By Michael Murphy, Senior Solicitor, Litigation Department
With the onset of the recession and the increase in fraud cases, the phrase ‘caveat emptore’ (buyer beware) applies more than ever when purchasing second hand items. This could be particularly relevant to aspiring antique hunters or those involved in the second hand motor trade. There are criminal law aspects to such fraudulent transactions but we will concentrate upon the civil position.
For some unfortunate purchasers, goods purchased in good faith may prove to have been stolen from the rightful owner at a much earlier point in time and sold on to an unsuspecting purchaser. When the rightful owner traces their goods to that purchaser, this leads to the vexed question as to whether the purchaser has an entitlement to retain those goods or whether the goods will instead have to be returned to the rightful owner.
The area is presently governed by an 1893 Act and a 2005 Irish High Court case involving the purchase of a valuable book-case and the position is worth noting for all parties involved in second-hand purchases.
Section 12(1) of the Sale of Goods Act 1893, as amended, provides that in any contract for sale there is an implied condition on the part of the seller that he has a right to sell the goods or will have a right to sell the goods at the time when the title to the property is to pass.
Section 12(2) of the Act of 1893, as amended, provides for certain warranties in a contract of sale, in the case of which there appears from the contract or is to be inferred from the circumstances of the contract, an intention that the seller should transfer only such title as he or a third person may have.
The case of Mallett and Son (Antiques) Limited v. Rory Rogers