This is discussed in my evolving essay ‘Art Restitution Litigation in the English Court’ on the ‘Mediation of Art & Cultural Heritage Disputes’ page at www.carlislam.co.uk.
A novel legal theory occurred to me over the weekend when I started to write the essay, which runs as follows.
If P delivers the SA to a dealer [‘D‘] in London for sale, and under their contract D acquired a proprietary interest in the SA, then under the Limitation Act 1980 [‘LA’], could possession of the SA by D constitute a conversion ‘related to the theft’ of the SA which took place in England?
Under the LA, ‘Once … A bona fide purchaser acquired the chattel, and six years has run from the date of his acquisition, the owner cannot sue a person who acquires the chattel after the date of the bona fide purchaser’s acquisition, even if he is not himself a bona fide purchaser … Any conversion which follows the theft before the owner recovers possession is treated as “related to the theft” except a purchase in good faith or any acquisition subject to such a purchase; section 4(2).’ Arden J in De Preval v. Adrian Alan Ltd . ‘It does seem to be possible to identify, from that legislation, a public policy in England that time is not to run either in favour of the thief nor in favour of any transferee who is not a purchaser in good faith. The law favours the true owner of property which has been stolen, however long the period which has elapsed since the original theft.’ The City of Gotha .
It therefore appears, that unless D can rebut the presumption under s.4(2) of the Limitation Act 1980 that the purchase by P was related to the theft, i.e. by proving that under English Law P had purchased the SA in good faith (for which purpose the court may take into account the factors mentioned by the judge in De Preval) , then the carve-out provided for in s.4(2) (i.e. that ‘if anyone purchases the stolen chattel in good faith neither the purchase nor any conversion following it shall be regarded as related to the theft’) is not engaged.
In other words, unless D can prove that P acquired the stolen painting in good faith in the foreign country where he purchased it, which arguably is a question to be decided by applying English Law to determine ‘good faith’, that D will fail at trial to discharge the burden of proof under s.4(2) of the Limitation Act 1980.
In which case, the first good faith purchase following the theft of the SA in England, took place when the painting was delivered by P into D’s possession in London.
Therefore, if this occurred less than six years ago, time is running under the Limitation Act for the bringing of a claim in conversion against D (who is in possession of the SA in London).