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This is a brief contribution to the discussion of Gotha City and FRG v Sothebys and Cobert. Like John Murphy, I find the case somewhat puzzling, although for different reasons.

First of all, I agree with Charles Mitchell that the case as it appears in The Times is not very clear - or perhaps just badly reported. It is not clear how the actions have been pled. A reasonable assumption would be that they are actions for wrongful interference, albeit that they seek the discretionary remedy of delivery up (which is clearly not a vindicatio, for the reasons given by Peter Birks). The full transcript will no doubt reveal all.

Second, as highlighted by Lionel, the case contains some interesting conflicts points. The second matter which was considered by Moses J - according to the report in The Times - was whether the limitation period under German law should apply. This is where my puzzlement increases. This is an action in tort; the choice of law rule in tort therefore applies. The new choice of law rule in the Private International Law (Miscellaneous Provisions) Act 1995 would not apply here (the acts or omissions were before commencement on 1 May 1996). The *double rule* would therefore apply - the lex fori (English law) and the lex loci delicti (also English law - the wrong by the second defendant, Cobert, took place in England). There would therefore be one lex causae - English law. In fact, in strict terms, this is not a conflicts case at all (at least in respect of the interference claim).

This is where it all gets very odd. Moses J appears to dismiss the submission of counsel for FRG that German law simply did not apply. It was argued by counsel that the case was based on the tort of wrongful interference, the elements of which occurred in England, in respect of property acquired in England. The judge appears to have taken a slightly different view and decided that the claim was a *restitutionary proprietary claim ... deriving from ownership* which necessitated the application of German law to determine the ownership. However, the judge appears to have gone further - deciding that there should be two leges causae, English law and German law, and that they both should govern the question of title and the rights which flowed from that title.

German law will be relevant in this action to a degree. I am not convinced, however, that the door marked *German law* should have been opened on the basis that the claim was a *restitutionary proprietary claim* (whatever that means in the context of an action for wrongful interference with moveables).

It is said in the report that FRG was *asserting* its title. Without wishing to be pedantic, would it not be correct to say that in an action for wrongful interference the title is passive and is not *asserted*? Nevertheless, the title of FRG would have to be established in the action as a precondition to a successful claim for wrongful interference.

FRG would have to establish title to the painting. It presumably acquired title in Germany at some point prior to the removal of the painting in 1946.

It would have to establish that its title was not lost by the removal from Germany nor lost by the subsequent transfers in Germany in 1988 (to Mina Breslav) and in England in 1989 (to Cobert). This can be described - in the language of conflicts lawyers - as an incidental question. The main question in the action is - *Did the Defendant wrongfully interfere with property X?*; the incidental question which is raised is - *Did the Plaintiff own or have some possessory right in property X at the time of the interference?* The legal systems which may be relevant to this part of the enquiry are German law (in its widest sense), English law and the law applicable in the Soviet Union (if there were any transfers in the Soviet Union - it is not clear from the report).

However, it would seem to me that these legal systems are relevant only to the question of title, not to the question of interference. Each system would be applied as the lex situs at the time a transfer was effected and would determine whether property passed to the transferee.

In Scots law stolen property is tainted with a vitium reale (or labes realis) which prevents a thief from passing a good title. With the addition of the rule nemo dat quod non habet (which has been quaintly rendered in Scots - or nearly in Scots - as: ye cannae gie whit ye dinnae hae) any transferee from a thief or a transferee later in the chain will not become owner. As an aside, it should be noted that there is authority in Scots law to the effect that an intermediate purchaser of stolen property who has later sold the property for profit will be liable to account to the owner for the profit made if the property is ultimately irrecoverable. There is also authority - somewhat thin - that an intermediate purchaser who sells the property on in bad faith will be liable to account to the owner for the full value should the property by irrecoverable (si dolo desiit possidere, dolus pro possessione habetur).

The real difficulty in all of these cases arises when a good title to stolen moveable property is acquired under a foreign law (qua lex situs) and the property is then brought back to the UK to be sold here (see Winkworth v Christie, Manson and Woods Ltd [1980] Ch 496). In Winkworth property was stolen in England but then removed to Italy. It was held that a purchaser in Italy obtained a good title which would be recognised in England.

Coming back to the limitation point, once FRG's title is established the enquiry reverts to the main question - *Did the Defendant wrongfully interfere with property X?*. Limitation in the context of this case concerns rights of action, not titles. Once the incidental question is disposed of, the single law which applies to the alleged interference (the cause of action) is English law. The question of foreign limitation simply does not arise in that context. The English limitation rule in tort would apply.

It would appear that the judge decided to consider the effect of the German limitation period to determine whether the title was still assertable. To me this seems a false enquiry for two reasons: (i) the title was not being *asserted* and (ii) limitation relates to the action before the court not the title.

The system of law which confers the title cannot, in my view, also regulate its extinction when the property has subsequently been transferred under other systems of law (in this case, English law and possibly Soviet law). It is to wield a blunt stick to conclude that since at least three putative transfers were made - two in Germany and one in England - that therefore the two leges causae must be German law and English law. It is similarly fuzzy reasoning to suggest that both systems must apply to all matters before the court - including the existence of the title and the interference therewith - with no room for depecage. If we are to believe the report, does it mean that the interference aspect (the main question and the cause of action) is also to be judged by German law? Has the claim suddenly become an eingriffskondiktion (the interference action in the Wilburg-von Caemmerer taxonomy in German law)? The suggestion may seem absurd; however, the terms of the report leave the door open.

The judge was put in a difficult position by his decision to allow German law into the court to regulate all the elements of the claim. To get round the offending limitation rule in German law the judge had to carry out what looks like a rather artificial manoeuvre. If German law had only been allowed to operate in a tight sphere there would have been little difficulty. As it was, the solution was either an artificial escape route or a finding that English public policy excluded the operation of the German limitation rule (always a dangerous finding to make).

I should qualify all of the above by saying that it is somewhat speculative.

It is simply not clear from the report how the judge has approached this claim. I look forward to reading the full transcript and hope that it discloses more focus than the report.

Scott Dickson

Intrant of the Faculty of Advocates
Tutor in International Private Law, The University of Edinburgh