Sat, Oct. 29, 2005

Claim to Art and Artful Claims

CK - Washington.   On October 24, 2005, the highest German court for civil matters, the Bundesgerichtshof in Karlsruhe, decided on a claim by the owner of a Oskar Schlemmer painting against an heir of the painter. The heir had stated--in a confidential note to a third party that ended up being conveyed to the owner of the painting--his belief that the painting continued to belong to the painter's estate.

The court noted that the owner had purchased the painting at auction in the United States in 1959. There is an unresolved issue as to whether the painting made in 1931 had been improperly taken by the Nazi regime. In any case, both parties agreed that the owner had acquired ownership in the painting, at least through adverse possession under §937 of the civil code, Bürgerliches Gesetzbuch.

The issue for the court was whether the owner could properly claim that the heir cease and desist making a statement that casts a cloud on the title. The court sided with the owner in the matter II ZR 329/03.

A day later, another division of the same court turned down a claim for payment on debentures issued 80 years ago by the city of Dresden. The debenture certificates had become worthless as financial instruments but are generally appreciated as art-like historical artifacts. The court based its decision on the statute of limitations of 30 years and the fact that the East German government had validly reconstituted the political entities which incidentally absolved cities such as Dresden from liabilities such as the then-worthless debentures.

Such bonds cases remind the reader of similar claims discussed periodially in the United States for the redemption of railroad and other bonds issued by long-defunct entities. Filing lawsuits for bonds that expired 50, 100 or 150 years ago raises the issue of an abuse of the legal system and a waste of holders' recources.

That may apply particularly to the warning by counsel in the Dresden case to bring the same matter before an American court, as 123recht.net reports and Handakte mirrors. A similar case being marketed by the German Goldbond Redemption Group, LLC is currently before the United States District Court for the Middle District of Florida.


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