Unless stolen art is recovered quickly, the Statute of Limitations presents a legal barrier to its recovery. This is because the Statute extinguishes an owner’s legal title if they do not commence legal proceedings within six years of the date the art is stolen.

There may be good reasons why legal proceedings, for the tort of conversion or wrongful detention, cannot be commenced within the six year limitation period. For instance, an essential detail to prepare a legal claim is missing, such as the identity of the thief might not be known or the whereabouts of stolen art might be concealed or unknown because it had passed through many hands. 

The decision of the Supreme Court of Victoria, Court of Appeal, in Levy v Watt & Anor [2014] VSCA 60 explored issue of whether the Statute of Limitations prevented an owner’s representative from asserting a good legal title to a Rupert Bunny painting known as Girl in Sunlight, which was stolen nineteen years earlier.

The painting and its provenance

James Watt purchased the oil painting Girl in Sunlight (opposite) in 1953. He displayed it prominently in houses where he lived for many years. The painting depicts a girl, sitting on the ground in a Parisian garden, reading a book, with a white parasol. In 1970, it was catalogued in a book on Rupert Bunny as painted in c 1913 and Coll: A. J. Watt Esq. Rupert Bunny (b 1864 d 1947) was an Australian impressionist painter who achieved success and critical acclaim as an expatriate in fin-de-siècle Paris. His paintings have become increasingly valuable. In 1997, the painting was valued at $150,000.

In April 1991, thieves broke into James Watt’s home at Blairgowrie and stole the painting (and nothing else). The theft was reported to the police immediately and it was publicised in the press. James Watt died in 1993. In his will, he bequeathed the painting to Maxwell and James Watt, who were also his executors.

The Watts maintained their uncle’s efforts to locate the painting. They kept up contact with the police and offered a substantial private reward in circulars to art galleries and art dealers.

Click here to view the image.

 In 2010, the executors again publicised the theft after they became aware of a major Rupert Bunny retrospective to be held at the National Gallery of Victoria. An informant contacted them, and as a result, the police seized the Girl in Sunlight which was hanging in Mr Frank Levy’s dining room.

How did Frank Levy acquire the painting? He was a solicitor who had advised a client Peter Rand, who died in 1997. Peter Rand knew James Watt well. There was no evidence of how Peter Rand acquired the painting – no evidence of purchase for valuable consideration, nor any evidence that he was connected with the theft. The theft remains a mystery. He had not concealed the painting: he had it valued by a valuer and an art auctioneer for insurance purposes in 1994 and 1996. In his will, Peter Rand bequeathed Girl in Sunlight to Frank Levy.

Until 2007, the painting was tied up in estate litigation. In 2008, Levy and his wife had the painting valued and invited various people to inspect the painting. In 2008 they showed the painting to a person cataloguing Rupert Bunny’s work who scheduled it to go on display in the Rupert Bunny retrospective. Only when seized by the police, did they learn that it was stolen.

Was the limitation period postponed because of fraudulent concealment?

The courts of equity have always been ready to assist in recovery of property obtained dishonestly. As Pepys MR said in Trevelyan v Charter (1835) 4 LJ (NS) (Chancery) 209:

It is fitting that those who thus appropriate the property of others, should be assured, that in this court no time will secure to them the fruits of their dishonesty, but that their children’s children will be compelled to restore the property of which their ancestors have fraudulently possessed themselves.

Although the Statute of Limitations restricts the limitation period to six years, it defers to the courts of equity and contains an exception which allows recovery beyond that time, that is, the limitation period to recover stolen chattels such as artwork commences only when the owner discovers sufficient information to prepare a legal claim. This exception applies where: the right of action is concealed by the fraud of ... the defendant ... or of any person through whom he claims (s. 27(b) Limitation of Actions Act 1958 (Victoria)).

Santamaria JA (with whom Warren CJ and Tate JA agreed) had to determine whether s. 27(b) of the Limitation of Actions Act applied to postpone the commencement of the limitation period from 1991 until 2010 for the painting Girl in Sunlight.

He noted that:

when a thief converts property by stealing it, the very failure of the thief to disclose his or her identity to the true owner constitutes fraudulent concealment within 27(b).

He adopted the trial judge’s formulation that:

It seems to me to be incongruous that time can run against the owner of a chattel and that ownership rights can be lost when the owner does not know who he or she can sue to recover the chattel.

He noted that the executors had pursued their searches with reasonable diligence.

Therefore, he held that the commencement of the limitation period was postponed until 2010. 

Levy argued that he took a possessory title innocently, because he did not know of the theft. But Santamaria JA held that the taint of fraudulent concealment applied to subsequent ‘owners’ who claimed title to the painting through the thief. Therefore Levy’s possessory title was tainted by fraud.

The only way that Levy could have acquired a good legal title to the painting was if he had proved that his client, Peter Rand had purchased the painting as a bona fide purchaser for value and without notice. No evidence was given of a bona fide purchase or of any attempt to contact Mr Watt or his executors to verify title.

Therefore, the executors succeeded in asserting their good legal title to the Girl in Sunlight.

Concluding comments

This decision offers fresh hope for owners of stolen artwork, and their executors, to recover their artwork many years after it was stolen.

To do so they must be reasonably diligent in attempting to discover the whereabouts of the artwork. Reporting the theft to the police, following up the police, and notifying art galleries, art dealers and auction houses are all recommended. The theft should also be reported to an international art loss register.