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Kunstsammlungen zu Weimar v. Elicofon

United States District Court, E. D. New York
536 F. Supp 829 (1981)
ELI5:

Rule of Law:

Under New York law, a thief cannot pass good title to stolen property, even to a bona fide purchaser, and the statute of limitations for a conversion claim against such a purchaser does not begin to run until the true owner makes a demand for the property's return and the purchaser refuses.


Facts:

  • Two portraits by Albrecht Duerer were part of an art collection owned by the Land of Thuringia, Germany.
  • In 1943, during World War II, the museum's director, Dr. Scheidig, moved the paintings for safekeeping to Schwarzburg Castle.
  • In the spring of 1945, American military forces occupied Schwarzburg Castle.
  • The paintings were last seen by Dr. Scheidig at the castle on June 12, 1945.
  • Between June 12 and July 19, 1945, coinciding with the withdrawal of American troops and the arrival of Soviet forces, the paintings disappeared from the castle.
  • In 1946, Edward Elicofon purchased the two paintings for $450 in Brooklyn, New York, from an American ex-serviceman.
  • Elicofon was unaware of the paintings' true origin or value and hung them in his home for twenty years.
  • In 1966, after a friend identified the paintings from a publication of stolen art, Elicofon publicly disclosed his possession of them.

Procedural Posture:

  • The Federal Republic of Germany (West Germany) initiated the action against Elicofon in the U.S. District Court for the Eastern District of New York in 1969.
  • The Grand Duchess of Saxony-Weimar was granted leave to intervene as a plaintiff.
  • The Kunstsammlungen zu Weimar's initial motion to intervene was denied by the district court in 1972 because the United States did not recognize the German Democratic Republic (East Germany).
  • The United States Court of Appeals for the Second Circuit affirmed the denial of the motion to intervene.
  • After the U.S. formally recognized the German Democratic Republic in 1974, the district court vacated its prior order and permitted the Kunstsammlungen to intervene in 1975.
  • The Federal Republic of Germany subsequently discontinued its claim.
  • The district court dismissed the complaint of the Grand Duchess of Saxony-Weimar.
  • The remaining parties, plaintiff-intervenor Kunstsammlungen and defendant Elicofon, filed cross-motions for summary judgment, which the district court is now deciding.

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Issue:

Does a good faith purchaser of stolen artwork acquire valid title under New York law, thereby barring the original owner's claim for recovery when the owner makes a demand decades after the theft?


Opinions:

Majority - Mishler, J.

No. A good faith purchaser cannot acquire valid title to stolen property because a thief cannot convey what they do not own. The original owner's claim is not barred, as the statute of limitations for conversion against a bona fide purchaser only begins to run upon the owner's demand for the property's return and the purchaser's refusal. The court found as a matter of law that the paintings were stolen from Schwarzburg Castle. Under the controlling New York law, a thief cannot pass title, making Elicofon's good faith irrelevant. The court rejected Elicofon's defenses based on German law, finding that New York choice-of-law principles dictate that the law of the situs (New York) governs the transfer of chattels, not the law of the place of the theft. The court held that the cause of action for conversion against a bona fide purchaser accrues only upon demand and refusal, a substantive requirement of the claim. Because the Kunstsammlungen made a demand in 1966 and filed suit in 1969, the action was timely under the three-year statute of limitations. The court also found that the delay in making the demand was reasonable, as the Kunstsammlungen and its predecessors had exercised due diligence in searching for the paintings in the difficult post-war period.



Analysis:

This decision solidifies the New York 'demand and refusal' rule for conversion claims against good faith purchasers, clarifying that the statute of limitations does not begin to run until this substantive prerequisite is met. It sets a high bar for a laches or unreasonable delay defense by requiring the defendant to show a lack of due diligence on the part of the original owner in searching for the stolen property. The case also provides a clear application of choice-of-law principles for chattels, favoring the law of the situs, which protects the state's interest in not becoming a marketplace for stolen goods. This precedent strongly reinforces the legal principle that title to stolen property cannot be laundered, even through a good faith purchase and the passage of many decades.

G

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