This case from the English courts discussed important issues of the law concerning the art trade, especially in the area of the legality of transactions and the conflict of international laws. The key areas of legal discussion for the case centred on the bona fide purchase rule, and lex res situs. Other issues relating to these included the issue of the conflict of laws, the question of good title, and ending finally with the case conclusion of public policy. The dispute between the original owner and the good-faith purchaser of stolen art can be described as a question of title to moveable property.
The validity and effect of transfers of interests and rights in the property are governed by the rule lex res situs. As a consequence, the rule provides that if the situs where the transactions took place provide validity for the title, this is the law that will prevail. This title must be recognised, despite the fact that the law would not have validated this transfer, i. e. theft. The issue of bona fide purchaser is linked to this rule as some jurisdictions recognise the validity of items bought in good faith to claim good title to the objects.
Japanese art objects were stolen from the plaintiff, Winkworth, an English national within in England. These objects were then sold in Italy in good faith to the defendant. This purchaser subsequently returned them to England for their sale at Christie's auction house. Actions were brought against the defendants under conversion and detinue, in an attempt to recover the works and assert his title for them. The purchaser in Italy claimed to have acquired good title as he acted in good faith and had therefore become the bona fide purchaser, as Italian legislation allows.
English law upheld the plaintiffs claim, however as the court applied lex res situs rule, the Italian law had to be recognised and the title held would be determined by the Italian courts. Mr Mummary representing the plaintiff put forward the argument that the lex situs should be treated as English as he argues that at all material times the property rights belonged to the plaintiff. He claimed these as 'English connecting factors', which should allow for the case to be treated as English.
The arguments put forward include, that the objects were stolen from the owner in England and the owner domiciled in England also. The objects were removed to Italy without the owner's knowledge or consent, and their voluntary return was also made without his knowledge. As the objects were originally in England, and were now in England should mean that the case be treated as English. The other argument over this case advanced was that had the case been dealt with in Italy, the exceptional circumstances of the case should bring the issue outside the principle of lex situs as defined in Cammel v Sewell1.
However, these factors should make the case matters for the English law were rejected by the court as there was no authority to support this opinion. Instead the reasoning that the court relied on was that of Cammell v Sewell. This old case was yet to be disputed and therefore stood as the valid law regarding this subject. Cammell v Sewell discussed the trading of some timber, which was wrecked off the shore or Norway without the knowledge that they were then sold there to an innocent purchaser who has no knowledge of the former agreements of sale.
This case affirmed the idea of lex situs stating: 'If personal property is disposed of in a manner binding according to the law of the country where it is, that disposition is binding everywhere'. Pollock C. B. 2 The discussion of the matter of where the law of where the owners domiciled would be enforced, or the law of where the last relevant transaction took place, and the conclusion was that it would be that of the last legal transaction. No interruption was made to the property rights of the plaintiff until the sale within Italy. This sale removed their legal title.
It as held that this position was necessary in order to keep consistency within the law. Mr Gilman outlined the five possible exceptions to the general principle of international law of lex situs, and concluded that they were of no relevance. These included if the purchaser had not acted in a manner bona fide, and if the English court were to consider the law of Italy being against public policy of England. The public policy of England would be to apply the general principle of international law, and recognise the jurisdiction of Italy in this case.