Kurtha v Marks, Court of Appeal - Queen's Bench Division, February 27, 2008,  EWHC 336 (QB)
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Neutral Citation Number:  EWHC 336 (QB)Case No: TLQ/07/0841IN THE HIGH COURT OF JUSTICEQUEEN'S BENCH DIVISION Royal Courts of JusticeStrand, London, WC2A 2LL Date: 27/02/2008 Before : MR JUSTICE TUGENDHAT- - - - - - - - - - - - - - - - - - - - -Between : - - - - - - - - - - - - - - - - - - - - -- - - - - - - - - - - - - - - - - - - - - Mr John McCaughran QC & Mr Laurence Emmett (instructed by Michael Reason LLP) for the ClaimantMr Mark Warwick & Mr Nicholas Trompeter (instructed by Streathers) for the Defendant Hearing dates: 4th, 5th 6th & 7th February 2008- - - - - - - - - - - - - - - - - - - - -JudgmentMr Justice Tugendhat : 1. The question I have to decide in this case is the ownership of two paintings (``the Paintings'') by Francis Newton Souza (``Souza''). Souza was born in 1924 in what was then the Portuguese colony of Goa. The first of the Paintings was painted in 1953 and is entitled ``Chalice with Host''. The second was painted in 1961 and is entitled ``Head of a Portuguese Navigator''. They are both oil paintings on board. The first is 24 inches x 39 inches and the second 30 inches x 24 inches. 2. The Claimant (``Dr Kurtha'') states that he purchased the Paintings from Souza in or before 1982, and that they were in his possession in 1984 in London. After that he kept them in London, either at his home, or in a warehouse (he is not sure which) together with a large number of other pictures by Souza and by other artists. In 2002 five paintings by Souza were included in a sale of Islamic and Indian art by Bonhams of London. Dr Kurtha claimed they were stolen from his collection. Four of the pictures were removed from the sale, and the fifth was sold. Dr Kurtha sued Bonhams, discovered the names of the consignors, a Mr Mario Demetriou and a Mr Baxter, and joined them as defendants in his action against Bonham's. They are dealers in second hand furniture who knew one another, but were not known to Dr Kurtha. A settlement was reached, by which Dr Kurtha paid the consignors some money and they returned to him the five unsold pictures. 3. By 2003 Dr Kurtha came to believe that there were further pictures stolen from his collection, including the Paintings. He became sure of this in 2005 when he was preparing a monograph on Souza which was published in 2006. For that purpose he listed and had photographed all his Souza collection. On 4 May 2005 Dr Kurtha registered the Paintings with the Art Loss Register (``ALR'') in London. During 2005 and on 9 January 2006 Dr Kurtha spoke to Mr Demetriou. On 10 January 2006 the Defendant (``Mr Marks'') telephoned the ALR to enquire about Souza paintings in general, and the Paintings in particular. As a result, Dr Kurtha learnt that Mr Marks had possession of the Paintings. These proceedings ensued, in which Dr Kurtha claims their return.4. Mr Marks's case is that he bought the pictures from Mr Demetriou personally on 10 or 11 January 2006 (his case on the date has varied), once he had received the assurance from ALR that there was no problem with title. He expected to sell them very soon to a client, Mr John Bairstow, for a profit. In an e-mail to the ALR dated 18 January 2006, Mr Marks said that he would have asked Mr Bairstow to pay a figure in the region of £300,000 for both of the Paintings. Mr Marks and Mr Demetriou say that Mr Marks agreed to pay £124,000, and did pay £12,500 in cash in the late evening of 10 January 2006, and that he took possession of the Paintings immediately. Mr Demetriou claimed that he had bought the Paintings on the early evening of the same day 10th January 2006 from another dealer in second hand furniture, Christopher Martin. He said that he bought them for £25,000, that he paid £10,000 deposit and that he agreed to pay two instalments of £7,500 in monthly instalments in February and March. Mr Martin claims that he bought the Paintings in November 1999 from Ms Jennifer Banarse for £200. Ms Banarse claims that she received the Paintings as a gift from her grandmother sometime before that date. Her grandmother died in 2005 and the evidence as to the earlier provenance of the Paintings stops there. Mr Marks, Mr Demetriou, Mr Martin and Ms Banarse all gave evidence for the defence.5. There are a number of notable features of this case which have been the subject of much evidence. First, Dr Kurtha is unable to say when, between 1984 and 2005, the Paintings were stolen (as he says they were), nor whether they were stolen from his home or from a warehouse. Dr Kurtha has been strongly challenged on his case that the Paintings were his, and that they were stolen. But at the end of the case, the main issue on Dr Kurtha's case was whether the Paintings had been stolen.6. On Mr Marks's side, all the sales he and his witnesses claim took place were sales for cash, and there is no independent or documentary evidence that any cash was paid by, or to, any of those in the chain of sales. There is no contemporaneous document recording the sale by Ms Banarse to Mr Martin. The only document purporting to record the sale by Mr Martin to Mr Demetriou is a single hand written document on plain paper signed by each of them and dated 10 January 2006. The only document purporting to record the sale by Mr Demetriou to Mr Marks is a single document printed by Mr Demetriou on plain paper, dated 11th January 2006, and signed only by himself. There is no photograph or other document relating to the Paintings produced by Mr Marks, Mr Demetriou, Mr Martin or Ms Banarse evidencing that the Paintings were in their possession at any time before Mr Marks contacted the ALR. The period during which Mr Martin states that he was in possession of the Painting is just over six years, between November 1999 and January 2006. During that time he states that they were for a short initial period in his shop, although not on display or for sale, and from then on in his home, in an attic or a cupboard, or under his bed. It was only by co-incidence, he says, that they happened to be downstairs and visible to Mr Demetriou when Mr Demetriou came to his house to see some chairs in May 2005.7. The facts in relation to the five paintings consigned to Bonhams in 2002 are similar. Mr Demetriou and Mr Baxter both claimed to have bought those paintings from a Mr Dobkins, and he claimed to have acquired them in a clearance sale which was not identified. There was no other evidence of provenance.8. Six years, as is well known, is the normal period within which an action for the recovery of property, or for damages, must be brought in England. Save in cases of theft, if the claim is not brought within that time, a claimant's title to the property of which he has lost possession is extinguished. But in cases of theft there are special provisions. A claim by a person from whom a chattel is stolen is not subject to the six year time limit from the date of the theft. In a case of theft the six year period never starts to run in favour of a thief, nor does it run against anyone whose possession of the property is related to the theft. The six year period does not begin to run unless and until someone purchases the chattel in good faith. Any conversion subsequent to the theft is presumed to be related to the theft: so the burden lies on the purchaser to show that the purchase of the goods was in good faith. This is a very brief summary of the effect of the Limitation Act 1980 ss.2-4. These complicated provisions were more fully explained by Arden J in Nicole de Préval v Adrian Alan Ltd (unreported 6 February 1997).9. Therefore, if Dr Kurtha can prove that he was the owner of the Paintings, and that they were stolen from him, then his claim must succeed unless Mr Marks can prove that someone purchased the Paintings in good faith not less than six years before this action was commenced. The action was commenced on 26 February 2007. So the good faith purchase, if any, must have been before 26 February 2001, if Mr Marks is to succeed in his defence.10. The only purchase of the Paintings before 26 February 2001, of which there is any evidence, is the purchase which Mr Martin and Ms Banarse say Mr Martin made from her in November 1999. The purchases in January 2006 were about a year before the action was commenced, so if they, or either of them, were made in good faith, that would not provide a defence to Mr Marks.11. So the main issues in the case are: (1) was Dr Kurtha the owner of the Paintings, and if so, (2) were they stolen from him (the burden of proving these two facts resting on him), and if so, (3) did Mr Martin buy them in good faith from Ms Banarse before 26 February 2001 (the burden of proving this fact resting on Mr Marks)?12. As to the first and second issues, it is not Mr Marks's case that Dr Kurtha brings this case dishonestly. His case is that Dr Kurtha cannot show that the Paintings were ever in his collection, although he accepts that Dr Kurtha believes they were. And Mr Marks's case is that if the Paintings were once in Dr Kurtha's possession, they were lost or disposed of in circumstances which Dr Kurtha did not know about, or has forgotten, and that, in any event, Dr Kurtha cannot show that the Paintings were stolen from him.13. As to the third issue, which is the only one on which Mr Marks or his witnesses have any direct knowledge, Mr Warwick makes a number of submissions of behalf of Mr Marks. At this stage I emphasise one point. What the law requires is that Mr Martin should have purchased the Paintings in good faith. If he did that, but if after that he did anything else which was not in good faith (for example, if the sale to Mr Demetriou was not in good faith) then that would not deprive Mr Marks of his defence. I accept that submission, so far as it goes. But Mr McCaughran QC for Dr Kurtha submits that what happened after Mr Martin says he bought the Paintings is not irrelevant. Since the issue whether and when Mr Martin bought the Paintings from Ms Banarse depends entirely...
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