If you buy a stolen coin at auction ...

291fifth · January 16, 2012 9:09AM

... what is your liability/course of action when a request is made to return the coin to its original owner?

Is the auction house obligated to pay you back?

The theft of coins from the ANA Museum and the subsequent auctioning of the stolen coins prompts my question. (No, I didn't buy any of them.)

SanctionII · January 16, 2012 9:16AM

First thing I would do if you discover that a coin you purchased at an auction had been stolen would be to review the terms and conditions of the auction [better to even do this before you bid] to see what, if any, recourse for the seller against the auction house and/or consignor is spelled out in the auction terms.

Even if the auction terms are silent on this point, general principles of law are present which would give you, the buyer, recourse against the auction house and consignor to recoup your purchase price. If you force a refund from the auction house and/or consignor, they in turn (in theory) have recourse to seek restitution of the amounts they pay you from persons up the chain all the way back to the bad guy who wrongfully stole the coin from the true owner.

My $0.02.

Raybob15239 · January 16, 2012 9:28AM

If you buy something that is stolen, the owner gets it back and you are out your cash. Se, the seller of the stolen property never held title to it and therefore could not transfer title to you. You may have recourse against the auction house.

LindeDad · January 16, 2012 9:40AM

There is a reason the Auction Houses TOS are three pages of fine print.

291fifth · January 16, 2012 9:41AM

Since these coins were apparently auctioned in 2007 there is a good chance they have been resold one or more times since. The ownership trail may go cold if the sale was for cash on the bourse floor.

If the ownership trail becomes complex the legal fees relating to the recovery of the coins may exceed their value.

If that were the case, what should the ANA do?

Is there a statute of limitations that is applicable to a case like this?

notwilight · January 16, 2012 10:52AM

<< First thing I would do if you discover that a coin you purchased at an auction had been stolen would be to review the terms and conditions of the auction [better to even do this before you bid] to see what, if any, recourse for the seller against the auction house and/or consignor is spelled out in the auction terms.

Even if the auction terms are silent on this point, general principles of law are present which would give you, the buyer, recourse against the auction house and consignor to recoup your purchase price. If you force a refund from the auction house and/or consignor, they in turn (in theory) have recourse to seek restitution of the amounts they pay you from persons up the chain all the way back to the bad guy who wrongfully stole the coin from the true owner.

My $0.02. >>

I like your explanation better than others put forth. I know you are a law professional as well.

So in theory, if everything works as it should, you get a refund from the auction house, they get a refund from the consignor, they get a refund from whoever they bought it from all the way back until you either find a guy who knowingly/stupidly bought stolen property and has no recourse (rightfully left holding the bag (empty bag)) or the thief. But most thiefs won't show you their driver's license when they sell you stolen goods.

--Jerry

pennyannie · January 16, 2012 11:58AM

If i had bought a coin at auction that turned out to be stolen, i would wait until the auction house refunded my money before i shipped the coin back. If they would not do it that way i may or may not claim to still have possession of the said coin.

dollarsandcents · January 16, 2012 12:01PM

<< If i had bought a coin at auction that turned out to be stolen, i would wait until the auction house refunded my money before i shipped the coin back. If they would not do it that way i may or may not claim to still have possession of the said coin. >>

You would be wrong for doing so.

astrorat · January 16, 2012 12:12PM

<< If i had bought a coin at auction that turned out to be stolen, i would wait until the auction house refunded my money before i shipped the coin back. If they would not do it that way i may or may not claim to still have possession of the said coin. >>

Wow! I certainly hope you never have coins stolen from you and have to deal with a dishonest buyer. Geez!

PerryHall · January 16, 2012 7:02PM

<< 

<< If i had bought a coin at auction that turned out to be stolen, i would wait until the auction house refunded my money before i shipped the coin back. If they would not do it that way i may or may not claim to still have possession of the said coin. >>

Wow! I certainly hope you never have coins stolen from you and have to deal with a dishonest buyer. Geez! >>

How can you call the buyer dishonest if he bought it from an auction? The auction house should buy the coin back and the auction house should then go after the consignor of the stolen coin.

TwoSides2aCoin · January 16, 2012 8:00PM

If you buy a stolen coin , you are guilty of a crime. If you sell a stolen coin, you are guilty, too. That's the law. Maybe the auction houses should be shut down.
<2/3s serious, 1/3 sarcasm>

RYK · January 16, 2012 8:15PM

This seems pretty clear cut to me. Heritage or SB would refund the money and go after the next party up the chain. If not, this could be very damaging to future auction business.

If the item was purchased on eBay, it gets murkier.

As far as the ANA is concerned, would the organization really want the bad publicity (again!) of going after collectors who innocently and unknowingly purchased stolen coins that several owners ago belonged to the ANA?

PerryHall · January 16, 2012 8:51PM

<< This seems pretty clear cut to me. Heritage or SB would refund the money and go after the next party up the chain. If not, this could be very damaging to future auction business.

If the item was purchased on eBay, it gets murkier.

As far as the ANA is concerned, would the organization really want the bad publicity (again!) of going after collectors who innocently and unknowingly purchased stolen coins that several owners ago belonged to the ANA? >>

The ANA and anyone else who is a victum of theft should do what ever it legally takes to get their property back. As far as the auction house goes, it's just the cost of doing business.

astrorat · January 16, 2012 11:25PM

<< 

<< 

<< If i had bought a coin at auction that turned out to be stolen, i would wait until the auction house refunded my money before i shipped the coin back. If they would not do it that way i may or may not claim to still have possession of the said coin. >>

Wow! I certainly hope you never have coins stolen from you and have to deal with a dishonest buyer. Geez! >>

How can you call the buyer dishonest if he bought it from an auction? The auction house should buy the coin back and the auction house should then go after the consignor of the stolen coin. >>

Reread Mark's statement: If they would not do it that way i may or may not claim to still have possession of the said coin. May or may not claim to still have possession is not being honest. An auction buyer of a coin determined to be stolen should be compensated for the cost of the coin, shipping, etc, but to not claim you have it when you do is theft of the coin. And the buyer is just as guilty as the original thief.

BAJJERFAN · January 16, 2012 11:35PM

<< If you buy a stolen coin , you are guilty of a crime. If you sell a stolen coin, you are guilty, too. That's the law. Maybe the auction houses should be shut down.
<2/3s serious, 1/3 sarcasm> >>

Buying a stolen coin from someone in the alley behind your shop knowing full well that it was stolen is one thing. Buying a stolen item thru legitimate channels with no knowledge that it was stolen doesn't make one a criminal in my book.

BAJJERFAN · January 16, 2012 11:40PM

<< 

<< 

<< 

<< If i had bought a coin at auction that turned out to be stolen, i would wait until the auction house refunded my money before i shipped the coin back. If they would not do it that way i may or may not claim to still have possession of the said coin. >>

Wow! I certainly hope you never have coins stolen from you and have to deal with a dishonest buyer. Geez! >>

How can you call the buyer dishonest if he bought it from an auction? The auction house should buy the coin back and the auction house should then go after the consignor of the stolen coin. >>

Reread Mark's statement: If they would not do it that way i may or may not claim to still have possession of the said coin. May or may not claim to still have possession is not being honest. An auction buyer of a coin determined to be stolen should be compensated for the cost of the coin, shipping, etc, but to not claim you have it when you do is theft of the coin. And the buyer is just as guilty as the original thief. >>

I'd have no issue with someone using possession of an item as a means of leverage for getting his money back. When you consign to auction don't you have to certify that you are the lawful owner of the consigned items? Or if you are an agent consigning for a client, the client would affirm that he has lawful possession of said items.

NebuchadnezzarTheGreat · January 16, 2012 11:44PM

Does anyone recall what happened with Tom Reynolds complaint about Stack's-Bowers selling his stolen large cents a year or so ago?

BAJJERFAN · January 16, 2012 11:48PM

I assume the ANA coins are raw so if that is the case how readily identifiable are they?

Wingsrule · January 16, 2012 11:50PM

If you buy a stolen anything anywhere, you have no legal claims to it.

BAJJERFAN · January 16, 2012 11:58PM

<< If you buy a stolen anything anywhere, you have no legal claims to it. >>

That's true, but then again I wouldn't cede my leverage just like that, would you?

Wingsrule · January 17, 2012 12:04AM

When a cop comes knocking on my my door and I say I don't have it (if I really do), that makes me guilty as well. Sticky situation. If I had one of those listed coins in my possession, I would be talking to an attorney.

BAJJERFAN · January 17, 2012 12:12AM

From the HA terms.

39. Auctioneer is selling only such right or title to the items being sold as Auctioneer may have by virtue of consignment agreements on the date of auction and disclaims any warranty of title to the Property. Auctioneer disclaims any warranty of merchantability or fitness for any particular purposes. All images, descriptions, sales data, and archival records are the exclusive property of Auctioneer, and may be used by Auctioneer for advertising, promotion, archival records, and any other uses deemed appropriate.

49. No claims of any kind can be considered after the settlements have been made with the consignors. Any dispute after the settlement date is strictly between the Bidder and consignor without involvement or responsibility of the Auctioneer.

I do not know if Heritage has a sample consignment form available for viewing.

From TeleTrade.............

2. With respect to each coin consigned, Seller warrants that: Seller has full title, free and clear of any liens, encumbrances, security interests or contract rights impairing the unconditional right to sell all right, title and interest in and to such coin; authenticity, identity, grading, certification and description is as set forth in the consignment submission form; Seller has full authority to sell without condition or restriction; and all information provided by Seller is accurate and complete. Seller shall review all information about each consigned coin as posted on Teletrade’s website, including but not limited to any coin or lot descriptions inserted by Teletrade, and shall
notify Teletrade of any errors or omissions since the accuracy thereof is the sole responsibility of the Seller. Seller shall indemnify, defend and hold Teletrade harmless from any and all claims, costs, expenses, causes of
action or liabilities (including attorneys’ fees) arising out of or related to the consignment, the sale, any coin or property submitted for auction, any warranty, any proceeds of the sale or any claims relating to title, liens, encumbrance, identity, authenticity or description.

dollarsandcents · January 17, 2012 12:21AM

<< 

<< If you buy a stolen anything anywhere, you have no legal claims to it. >>

That's true, but then again I wouldn't cede my leverage just like that, would you? >>

You have no leverage in a situation where you unknowingly buy stolen property. Title to stolen property belongs to the person from whom it was stolen. A goodfaith purchaser of stolen property cannot convert that property for their own use or "leverage" it, as you put it, to be made whole.

If your property were stolen, would you care about who or how many purchasers traded your stolen property, or would you want your property returned to you? As others have stated, the only recourse for a purchaser of stolen property is with the party from whom it was purchased.

BAJJERFAN · January 17, 2012 12:30AM

<< 

<< 

<< If you buy a stolen anything anywhere, you have no legal claims to it. >>

That's true, but then again I wouldn't cede my leverage just like that, would you? >>

You have no leverage in a situation where you unknowingly buy stolen property. Title to stolen property belongs to the person from whom it was stolen. A goodfaith purchaser of stolen property cannot convert that property for their own use or "leverage" it, as you put it, to be made whole.

If your property were stolen, would you care about who or how many purchasers traded your stolen property, or would you want your property returned to you? As others have stated, the only recourse for a purchaser of stolen property is with the party from whom it was purchased. >>

If you have possession, you have leverage in trying to get your money back.

I'm not advocating keeping it. If it was a $100 coin I'd just give it back. If it was a $5K coin my take would be "not so fast my friend".

TwoSides2aCoin · January 17, 2012 12:36AM

<< 

<< If you buy a stolen coin , you are guilty of a crime. If you sell a stolen coin, you are guilty, too. That's the law. Maybe the auction houses should be shut down.
<2/3s serious, 1/3 sarcasm> >>

Buying a stolen coin from someone in the alley behind your shop knowing full well that it was stolen is one thing. Buying a stolen item thru legitimate channels with no knowledge that it was stolen doesn't make one a criminal in my book. >>

How did you know there is an alley behind my shop ?

BAJJERFAN · January 17, 2012 12:57AM

<< 

<< 

<< If you buy a stolen coin , you are guilty of a crime. If you sell a stolen coin, you are guilty, too. That's the law. Maybe the auction houses should be shut down.
<2/3s serious, 1/3 sarcasm> >>

Buying a stolen coin from someone in the alley behind your shop knowing full well that it was stolen is one thing. Buying a stolen item thru legitimate channels with no knowledge that it was stolen doesn't make one a criminal in my book. >>

How did you know there is an alley behind my shop ?

>>

There is, isn't there?

I wasn't implying it was you doing the the buying. Just that it could be a general transaction say between two dishonest folks that just happened to take place there.

BAJJERFAN · January 17, 2012 1:05AM

<< When a cop comes knocking on my my door and I say I don't have it (if I really do), that makes me guilty as well. Sticky situation. If I had one of those listed coins in my possession, I would be talking to an attorney. >>

There is a gun shop a few miles from here where the owner was selling a gun that turned out to be stolen. I was told that he refused to return the gun and told the guy that if he wanted it back, he'd have to buy it.

jom · January 17, 2012 1:14AM

<< 

<< When a cop comes knocking on my my door and I say I don't have it (if I really do), that makes me guilty as well. Sticky situation. If I had one of those listed coins in my possession, I would be talking to an attorney. >>

There is a gun shop a few miles from here where the owner was selling a gun that turned out to be stolen. I was told that he refused to return the gun and told the guy that if he wanted it back, he'd have to buy it. >>

Of course he refused! He had a gun!

jom

rhedden · January 17, 2012 2:16AM

In the late 1990s, a dealer friend of mine in upstate NY bought some coins that turned out to be stolen. A few thousand dollars were involved. He did the right thing and called the police when the righteous owner contacted him by phone looking for the coins. The police subsequently took them and returned them to the owner. The dealer was reimbursed for nothing. The crook who stole them was, of course, not worth suing, because he had no assets.

pennyannie · January 17, 2012 2:55AM

I may not have worded it clear enough but i did not mean to suggest i would lie. I have bought many a coin at Heritage that i no longer own and I COULD NOT tell them who i sold it to or when, since i do not keep records of sales or trades. If i bought in good faith at auction, paid promptly and was later notified the coin was stolen i would not be johnny on the spot to send the coin back before i found out when and how i was going to be repaid. A form letter from Heritage would not fly on a 1k to 5k coin. A $100 dollar coin would most likey not be an issue but i have never bought a 100 dollar coin from a auction house yet.

I have been around long enough that form letters do not spook me and the process server does not ruin my day. I get ripped about 10k a year in my business and generally just forget it as it is not worth the time and effort and expense to chase it down.

I have had employees pawn my tools and it is easier to just pay to pick them up, than to go thru the hassle of police and the court system.

My house got ripped while in Hawaii a few years back and the insurance company made me whole, being ripped did not bother me but people in my house did.

All that said i would not want or keep a known stolen coin in my collection but i would expect to be made whole at my convience and not the auction companies convience.

BAJJERFAN · January 17, 2012 6:50AM

<< I may not have worded it clear enough but i did not mean to suggest i would lie. I have bought many a coin at Heritage that i no longer own and I COULD NOT tell them who i sold it to or when, since i do not keep records of sales or trades. If i bought in good faith at auction, paid promptly and was later notified the coin was stolen i would not be johnny on the spot to send the coin back before i found out when and how i was going to be repaid. A form letter from Heritage would not fly on a 1k to 5k coin. A $100 dollar coin would most likey not be an issue but i have never bought a 100 dollar coin from a auction house yet.

I have been around long enough that form letters do not spook me and the process server does not ruin my day. I get ripped about 10k a year in my business and generally just forget it as it is not worth the time and effort and expense to chase it down.

I have had employees pawn my tools and it is easier to just pay to pick them up, than to go thru the hassle of police and the court system.

My house got ripped while in Hawaii a few years back and the insurance company made me whole, being ripped did not bother me but people in my house did.

All that said i would not want or keep a known stolen coin in my collection but i would expect to be made whole at my convience and not the auction companies convience. >>

No doubt you would probably have to take Heritage to court to recover your funds or get assistance in dealing with the consignor.

SanctionII · January 17, 2012 7:50AM

These provisions from the HA consignment agreement and/or auction terms

:39. Auctioneer is selling only such right or title to the items being sold as Auctioneer may have by virtue of consignment agreements on the date of auction and disclaims any warranty of title to the Property. Auctioneer disclaims any warranty of merchantability or fitness for any particular purposes. All images, descriptions, sales data, and archival records are the exclusive property of Auctioneer, and may be used by Auctioneer for advertising, promotion, archival records, and any other uses deemed appropriate.

49. No claims of any kind can be considered after the settlements have been made with the consignors. Any dispute after the settlement date is strictly between the Bidder and consignor without involvement or responsibility of the Auctioneer."

are boilerplate, fine print, provisions which have made there way into the standard form agreement/auction terms as a result of years of experience and after lawyers draft, review, revise and expand the current version of same.

These types of business contracts/auction terms keep getting updated and become more and more one sided in favor of the business and against the customer. Sometimes the wording is so one sided in favor of the business that it can be summarized as: "The business gets everything that it wants out of the deal and if things go wrong, the customer has no right to anything from the business."

The problem is that many such terms are invalid for one legal reason or another. The term that the auctioneer disclaims any warranty of title to the items it is selling may be invalid and illegal. In real property transactions a seller that signs a "Grant Deed" to convey title to real property makes certain warranties to the buyer of the property, including a Warranty Of Title, through which the seller represents and guarantees the buyer that the seller actually owns the property being sold. A seller can not put a provision in a sales contract that disclaims the Warranty Of Title present in a Grant Deed. The same rule may apply to sales of personal property, including coins.

Though not quoted, I suspect that the HA consignment contract has a provision in it similar to the quoted Teletrade language (Para. 2) through which the consignor represents and warrants to HA that the consignor owns the consigned coins and that the consignor agrees to indemnify and hold HA harmless from any claims made against HA that the coins were not owned by the consignor.

If anyone has the desire to read the fine print in consignment contracts and/or auction terms, you will be surprised how one sided they are. You can also object to same, cross out provisions and/or modify provisions before you sign and I expect that the auction house rep you are dealing with will probably grumble but cave in and agree to the changes [since they want your coins to be consigned to them for sale, particularly if the coins will bring large sale prices].

As a matter of practical advice to anyone who finds themselves in a position where they are advised that coins they possess (of significant value) are stolen, I would never simply surrender possession of the coins immediately. I would defer doing anything with the coins unless and until I first investigated the situation to (1) determine if the coins really are stolen; and (2) determine if there is anyone that I can seek a refund from so that I am not stuck with a loss.

BAJJERFAN · January 17, 2012 7:59AM

<< These provisions from the HA consignment agreement and/or auction terms

:39. Auctioneer is selling only such right or title to the items being sold as Auctioneer may have by virtue of consignment agreements on the date of auction and disclaims any warranty of title to the Property. Auctioneer disclaims any warranty of merchantability or fitness for any particular purposes. All images, descriptions, sales data, and archival records are the exclusive property of Auctioneer, and may be used by Auctioneer for advertising, promotion, archival records, and any other uses deemed appropriate.

49. No claims of any kind can be considered after the settlements have been made with the consignors. Any dispute after the settlement date is strictly between the Bidder and consignor without involvement or responsibility of the Auctioneer."

are boilerplate, fine print, provisions which have made there way into the standard form agreement/auction terms as a result of years of experience and after lawyers draft, review, revise and expand the current version of same.

These types of business contracts/auction terms keep getting updated and become more and more one sided in favor of the business and against the customer. Sometimes the wording is so one sided in favor of the business that it can be summarized as: "The business gets everything that it wants out of the deal and if things go wrong, the customer has no right to anything from the business."

The problem is that many such terms are invalid for one legal reason or another. The term that the auctioneer disclaims any warranty of title to the items it is selling may be invalid and illegal. In real property transactions a seller that signs a "Grant Deed" to convey title to real property makes certain warranties to the buyer of the property, including a Warranty Of Title, through which the seller represents and guarantees the buyer that the seller actually owns the property being sold. A seller can not put a provision in a sales contract that disclaims the Warranty Of Title present in a Grant Deed. The same rule may apply to sales of personal property, including coins.

Though not quoted, I suspect that the HA consignment contract has a provision in it similar to the quoted Teletrade language (Para. 2) through which the consignor represents and warrants to HA that the consignor owns the consigned coins and that the consignor agrees to indemnify and hold HA harmless from any claims made against HA that the coins were not owned by the consignor.

If anyone has the desire to read the fine print in consignment contracts and/or auction terms, you will be surprised how one sided they are. You can also object to same, cross out provisions and/or modify provisions before you sign and I expect that the auction house rep you are dealing with will probably grumble but cave in and agree to the changes [since they want your coins to be consigned to them for sale, particularly if the coins will bring large sale prices].

As a matter of practical advice to anyone who finds themselves in a position where they are advised that coins they possess (of significant value) are stolen, I would never simply surrender possession of the coins immediately. I would defer doing anything with the coins unless and until I first investigated the situation to (1) determine if the coins really are stolen; and (2) determine if there is anyone that I can seek a refund from so that I am not stuck with a loss. >>

It's important to keep in mind that those terms and conditions AREN"T the law and are likely there only to discourage you from seeking redress in the event something goes wrong.

If you buy a stolen coin at auction ...

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