At the store I work at we buy used music gear. Every now and then one of those items turns out to be stolen. We check IDs and make the seller sign a page describing the gear with serial number, and stating they are the owner. We cooperate with the police when they are looking for stolen gear and have helped people recover their stuff.
Recently we got a call from a Country star of some notoriety saying he had found a guitar that was stolen from him some months back. The person who had it said they had bought it at our store. We checked our records and sure enough it was purchased from us and we turned over the sellers info to the police. It is my understanding that the thief has been charged and the paper trail makes a guilty verdict very likely.
The customer returned the guitar to Country Star guy and then approached us to reimburse him for the money he spent on the guitar. The owners response was to tell him he needed to collect the money from the thief.
I know the law varies from state to state. I talked to the customer recently and he says TN has some kind of state restitution program in which we can recover our money from the state and they in turn will include that amount in the fines the thief is responsible for. Never heard of it and neither have the owners. It occurred to me that if that is true why doesn’t the customer who bought it from us recover his money that way?
Since the police haven’t indicated we are responsible to reimburse the customer the owners have no intention of doing so.
My question is, do any dopers have any experience or knowledge about the law in these matters.
Do you think the owners are either legally or morally responsible to reimburse the customer who bought the stolen guitar?
We take the hit every time stolen merchandise is recovered in store. Whatever we paid for it is a loss. We can legally pursue the person who sold it to us but it’s usually not worth it.
In this case since we bought it and sold it in good faith they feel the responsibility of getting restitution lies with the customer.
My family used to run a pawn shop. In this situation you are almost always SOL and have to eat it Think carefully about who it is that is going to compensate you and why they would need to. There isn’t anyone except the thief and you already know that it isn’t worth it. It is basically the same thing accepting a counterfeit bill. You just have to accept the loss and beef up your procedures if you think it is worth it.
In this case we sold the merchandise for a profit. Now, months later the person who bought it from us has returned it to the rightful owner and wants the store to return his purchase price.
Thats what I have a question about.
Are we in any way legally bound to return the money to the purchaser?
Oh sorry, that’s a good question. People usually won’t give you specific legal advice on this board but I have always thought that stolen merchandise was like a game of hot potato and the last person that gets it is the one that is screwed like in the case of a phony $100 bill if it has already been accepted. However, retailers usually have a guarantee of some sort whether written or not to sell what they represent something as so that may apply to you.
In other words, I have no idea. However the odds are great that someone will tell you to retain a lawyer in a post or two and that doesn’t make much sense if you are talking about a few hundred dollars.
I don’t know about the law in your jurisdiction, but around here generally:
1/ you can’t acquire title to goods by theft, and someone who doesn’t have title can’t pass title. Therefore, your shop may have physically had the goods, but you never owned them.
2/ it’s a condition of pretty much all sales contracts that the seller has title to the goods. The contract is one by which the customer takes on an obligation to give you the sale price, and you take on an obligation to pass title.
Therefore, at least by the law around here, he kept his side of the bargain, and you didn’t.
Get your own legal advice before action/inaction but I suspect you’ll get told something like the above.
The other snag is that the original owner never filed a police report at the time it was stolen. Perhaps that doesn’t matter as long as he could provide proof of ownership after it was recovered. OTOH if he has no police report, no serial number , to prove ownership and the customer just voluntarily surrendered the item then things may be different.
Ultimately the owners will make the call but I am curious about the legalities. I couldn’t find anything through a google search.
I hope someone with more detailed knowledge can more thoroughly explain how the Bona Fide Purchaser doctrine applies to these facts. For a quick overview, in some cases it is possible to pass better title to a good-faith buyer (the “bona fide purchaser” or BFP) than the seller had to begin with. If the seller had voidable title he can pass true title to a BFP. (note that the BFP has to be innocent and in good faith – if the buyer had any reason to suspect the item was stolen he would not be a BFP).
Voidable title is more than nothing but less than true title – an example is where you send a watch to be repaired. The watchmaker sells your item to a BFP. The watch repair shop had a voidable title (they were given into possession for a limited purpose) but by selling to a BFP they transfer “true” title. The original owners has no recourse against the BFP, but does have recourse against the watchmaker.
It is true that a thief cannot have title, and a person who knowingly purchases from a thief also would not have title. However, if a store purchases an item because of a misrepresentation, it may have voidable title, which would allow it to pass “true” title to the BFP.
As I said, I am uncertain how this doctrine fits the facts as stated, and am, of course, utterly ignorant of the OP’s local laws on the matter.