District Judge Christopher Tromans paints a warning of legal perils occurring in the auction room

Is an auctioneer who accepts instructions to sell a painting which is in fact stolen liable to the true owner if the painting does not sell and is returned to the person who gave the instructions?

This was the question before the Court of Appeal in Marcq v Christie Manson & Woods Ltd (t/a Christie's) (2003) The Times 30 May; [2003] EWCA Civ 731.

Mr Marcq was the lawful owner of a painting by Jan Steen known as The Backgammon Players.

It had been stolen in 1979 and the theft had been recorded in the Art Loss Register.

In July 1997, a Mr Schunemann instructed Christie's to sell the painting by auction and Christie's accepted the painting for sale on its standard terms and conditions.

These were described as creating penetrative, invasive and retentive rights over the painting and included the grant of a lien and the creation of an express power of sale.

In the event, the painting did not sell and was returned by Christie's to Mr Schunemann.

Mr Marcq commenced proceedings against Christie's which were struck out as disclosing no reasonable ground.

He appealed and in giving judgment, Lord Justice Tuckey gave a useful update of the law relating to conversion and bailment.

The main submissions made on Mr Marcq's behalf were that, with only minor exceptions, any unauthorised possession of goods is a conversion; by virtue of the terms and conditions, the retention and return of the painting amounted to conversion or alternatively a pledge under section 11(2) of the Torts (Interference with Goods) Act 1977; and that Christie's owed Mr Marcq a duty of care.

They did not impress the Court of Appeal, which dismissed the appeal.

As to conversion, the essential requirements are that the deliberate conduct of the defendant must be so extensive an encroachment on the owner's rights as to exclude him from use and possession (Kuwait Airways Corp v Iraqi Airways (Nos 4 &5) [2002] 2 WLR 1353 HL).

Merely ministerial acts such as storage or carriage do not amount to conversion (Hollins v Fowler [1874] QB 757).

If an auctioneer returns unsold goods to the apparent owner in good faith and without knowledge of adverse claims, there is no conversion.

An intention to sell is not in itself sufficient to establish liability.

Christie's had not acted in detriment to Mr Marcq's title, and there was no evidence of an intention to pledge.

The only circumstance in which auctioneers might owe a duty of care to return to the rightful owner was in bailment.

While a bailor-bailee relationship existed between Christie's and Mr Schunemann, Christie's was wholly unaware of Mr Marcq's interest.

A bailee has to have some knowledge of the existence of his bailor (The Pioneer Container [1994] 2 AC 324).

The most that could be said is that auctioneers should not simply rely on the word of a client and should be able to explain why they did not discover that the painting was stolen.

District Judge Tromans sits at Plymouth Combined Court Centre