Stolen paintings surfaced in Dutch gallery to be returned to Norway

Facts

A Dutch gallery on 26 May 2010 bought vijf paintings by the American artist Sam Francis (1923-1994). The paintings had been offered to the Dutch gallery by an English-speaking individual. The paintings all had a unique reference number and - prior to acquiring the paintings - the Dutch gallery had been informed by the Sam Francis Foundation that the foundation had no record of these paintings having been stolen.

On 27 May 2010, the Dutch gallery received a phone call from Hong Kong, from a different individual who also offered a work by Sam Francis for sale. The Dutch gallery thought it peculiar that two individuals within a relatively short time period happened to offer works by Sam Francis for sale. After further inquiry, it turned out that the paintings had been stolen in Norway.

Subsequently, the Dutch prosecution service seized the paintings bought by the Dutch gallery. Following the seizure, the Norwegian prosecuting authority requested its Dutch counterparts to release the paintings to Norway.

When there no longer is a need to uphold the seizure, a decision can be made to release the seized items to the person who on reasonable grounds may be considered to be the rightful owner. As a rule this is the person from whom the items were seized, unless someone else can be considered to be the rightful owner. This is what happened in the present case: the district attorney informed the Dutch gallery of its intention to return the paintings to the Norwegian gallery from whom the paintings had been stolen.

The Dutch gallery subsequently filed an objection on the grounds that the district attorney should have considered the Dutch gallery to be the rightful owner. The Dutch gallery demanded that the paintings be released to him, rather than to the Norwegian authorities.

Legal framework

The (Dutch) prosecution authorities may seize stolen items i.a. with a view to (eventually) returning them to the rightful owner (art. 94 of the Dutch Code of Criminal Procedure - Wetboek van Strafvordering). At the moment the prosecutor no longer has an interest to continue the seizure, the seized items may be released. As a rule the item is released to the person with whom the items were seized, unless someone else may be considered to be the real rightful owner (art. 116 Dutch Code of Criminal Procedure).

Say, the prosecution service decides to release a seized item to the victim of the theft (the original owner), rather than from the party from whom the item was seized, then the latter may file a formal objection. The judge will then render a decision as to whom may be considered the rightful owner. To be clear: this is only a preliminary finding, and not a definitive ruling on ownership. That decision as to ownership in the end is a matter to be finally settled in civil (rather than criminal) court proceedings. The person who is to be considered to be the rightful owner at the stage of release of a seizure by the prosecutor service, is based on a mere "marginal" evaluation as to who is the owner of the item.

Under Dutch law, the good faith buyer of a stolen item becomes the owner of that item, unless the original owner (from whom the item was stolen) files a replevin (revindicatie) claim within three years of the theft (article 3:86 sub 3 of the Dutch Civil Code). The original owner, provided he satisfies the three-year time period, can claim ownership of a stolen item even with an innocent buyer. Note: certain exceptions to the rule exist, which will not be discussed here. If the original owner timely files a valid replevin claim, then the innocent buyer will have to seek recourse from its seller.

The three year time period from the date of the theft is short. Perhaps too short, given that not all stolen items surface within that period. There is some movement to extend the relevant expiry period in cases of theft, but this concerns matters where stolen property surfaces with bad faith purchasers. This is not relevant for present purposes.

Norwegian gallery vs Dutch gallery: preliminarily decided in favor of the victim of the heist

In determining to whom the five works by Sam Francis ought to be released, the Dutch district court (in first instance) made a determination as to who on reasonable grounds could be considered the rightful owner. The district court held that the Norwegian gallery (the victim of the theft) was to be considered the rightful owner on the grounds that the Norwegian gallery had filed a replevin claim with the Norwegian prosecution authority within three years of the theft. In fact, there was no evidence of the claim actually having been filed. The district court took this as an assumption, reasoning that it would have been unlikely for the Norwegian prosecution authority to demand that the item be released to Norway for the benefit of the rightful owner if the victim of the heist had not filed an earlier claim with the Norwegian authorities.

Perhaps the district court considered the Norwegian authorities to have acted as representative of the original owner, and that the request for release qualified as a formal replevin claim on behalf of the victim of the theft.

The Dutch gallery subsequently filed cassation proceedings, and asserted that there was no adequate evidence to support the finding that the Norwegian gallery had timely filed a replevin claim.

The Dutch Supreme Court rejected the Dutch gallery's assertions. The Dutch Supreme Court held that when the Dutch prosecution service releases a seized item, it is not a prerequisite that the ownership situation of the item is conclusively established at that time. It is sufficient that the item is released to the person who on reasonable grounds may be considered to be the rightful owner.

The Dutch Supreme Court, further, held that the court may take into account considerations ensuing from property law (like the issue of whether the victim of the theft has satisfied the three-year term to file a replevin claim), but the court does not necessarily have to go into great depth in that respect. Who is to be considered the rightful owner is a matter to be established in civil court proceedings between the interested parties, i.c. between the Norwegian gallery on the one hand and the Dutch gallery on the other.

Commentary Oostwaard 

The decision is understandable. It shows that the Dutch prosecution service does not have await the final determination on the ownership situation when it wishes to release a seized item.

That being said, whether or not the victim of theft has satisfed the requirement that it filed a formal replevin claim within three years of the theft, should be easy to establish. The Dutch gallery could have expected that the court would have made a determination based on the evidentiary material, even in a marginal evaluation of the case. It will be interesting to track how the Dutch judiciary will handle the Dutch Supreme Court's finding of what constitutes a formal replevin claim.

Whatever the case: the Dutch gallery's position has not improved as a result of the Supreme Court's decision. Arguably it is more cumbersome for the Dutch gallery who argues to be an innocent buyer to attempt to recover the goods that just left the Dutch gallery's home jurisdiction from Norway through the Norwegian court system.

LINK TO THE JUDGMENT OF THE DUTCH SUPREME COURT (ECLI:NL:HR:2013:1575)