Could I Be Liable for Having or Receiving Stolen Property?

Could I Be Liable for Having or Receiving Stolen Property?

Last updated: June 2009

The following questions were submitted to John Roska, an attorney/writer whose weekly newspaper column, "Q&A: The Law," runs in the St. Louis Post-Dispatch (Illinois Edition) and the Champaign News Gazette. This article was published on September 16, 2008.

Q:    What happens to property that turns out to be stolen?  Like, if I buy something at a yard sale that was stolen, do I lose it?  Could I be liable for having or receiving stolen property?

A:    A thief can’t give good title.  No matter how far removed you may be from the thief, you can only have the same legal rights to stolen property as the thief had when they stole it—none.  The police can confiscate stolen property and return it to the true owner, who never lost their legal rights.

If stolen property didn’t have to be returned to its true owner, there’d be much less reason to track it down, or the thief who stole it.  Crime would also pay more, since thieves who could guarantee good title to what they sell could command better prices.

There seems to be one limited exception to the general rule that a thief can’t give good title.  Third parties who receive currency and negotiable paper “in good faith and for value” can apparently keep it.  That exception is designed to promote commerce, which would slow down a bit if people were reluctant to accept cash. 

Note you have to give “value” for the stolen currency, in addition to be acting in good faith, to be able to keep it.  You can’t just receive it.  In one old Illinois case, lawyers who’d received a lump of stolen cash from a train robber couldn’t keep it, because they hadn’t yet provided any services to the thief.

The “title” at stake here means the general legal right to own something.  Having legal title to something usually doesn’t require an official paper title, unless it’s a car, boat, or plane.

Legally speaking, a thief has “void title.”  That means no title at all.  A void title can never improve—once void, always void.  (Unless it’s currency.)  That’s why no one down the line can acquire good title from a thief.

There’s also something called “voidable title.”  Unlike a void title, it’s not completely worthless, but does have some flaws or imperfections.  When the right people point out and prove those flaws, voidable title becomes void.  Until then, however, voidable title is valid and enforceable.

Also unlike a void title, a voidable title can improve.  As lawyers say, it can “ripen” into good title.  As with the exception discussed above for stolen currency, a “good faith purchaser for value” from someone who only had voidable title gets good—not voidable—title. 

The Illinois Commercial Code expresses these principles this way:  “A purchaser of goods acquires all title which his transferor had or had power to transfer . . . .  A person with voidable title has power to transfer a good title to a good faith purchaser for value.”

Although this doesn’t say flat-out that you can’t get good title from a thief, that’s implicit in the initial idea that you only get whatever title your predecessor had.  If that title was void, yours is, too.

This sometimes leaves innocent third parties empty handed, like when stolen art gets returned to the true owner.  The third party’s “rights” are simply trumped by the original ownership rights of the innocent crime victim. 

Finally, Illinois law says it’s theft to obtain “control over stolen property knowing the property to have been stolen or under such circumstances as would reasonably induce him to believe that the property was stolen.”  The more you know or suspect about stolen goods when you receive them, the closer you are to theft.

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