The opinion of the court was delivered by: MISHLER
Memorandum of Decision and Order
This action was commenced in 1969 by the Federal Republic of Germany, as the representative of the people of Germany, to recover possession from defendant Elicofon of two portraits painted by the renowned fifteenth century German artist Albrecht Duerer. The paintings disappeared from their place of safekeeping in Germany during the occupation of Germany by the Allied Forces in the summer of 1945. In 1966 the paintings were discovered in the possession of Elicofon, who had purchased them in Brooklyn, New York from an American serviceman in 1946.
By order dated March 25, 1969, this court granted the Grand Duchess of Saxony-Weimar leave to intervene as plaintiff. The Grand Duchess asserted ownership to the paintings by assignment from her husband, Grand Duke Carl August. And by order dated February 24, 1975, six years later, the Kunstsammlungen zu Weimar, a museum located in what is now the German Democratic Republic, the predecessor of which had possession of the paintings before their disappearance, and which claims to be entitled to recover them from Elicofon, was granted the right to intervene as plaintiff in this action.
Thereafter, on December 9, 1975, the original plaintiff, the Federal Republic of Germany, discontinued its claim with prejudice. And in a Memorandum of Decision and Order, dated August 24, 1978, -- - F. Supp. -- , this court dismissed the intervenor-complaint and cross-complaint of the Grand Duchess of Saxony-Weimar. Thus, the only parties remaining in the action are the plaintiff-intervenor Kunstsammlungen and the defendant Elicofon.
Presently before the court are the motions of plaintiff-intervenor Kunstsammlungen zu Weimar for summary judgment and the cross-motion of defendant Elicofon for summary judgment (Defendant's Memorandum of Law, p.2). Fed.R.Civ.P. 56.
HISTORICAL SETTING & FACTS
Until 1927, the Duerer portraits which are the subject of this suit formed part of the private art collection of the Grand Duke of Saxe-Weimar-Eisenach. Under the terms of a Settlement Agreement of 1927 between the Land of Thuringia and the widow of Wilhelm Ernst, the then owner of the private collection, title to the Grand Ducal Art Collection had been transferred to the Land of Thuringia. Thuringia was created by Federal German Law of April 20, 1920 and was the legal successor to the territory of Weimar, which included as one of its seven subdivisions Saxe-Weimar-Eisenach, the territory over which the Grand Dukes formerly had presided before being ousted from power.
In 1933, Hitler assumed power in Germany. Throughout much of the period of the Third Reich, until 1943, the Duerer paintings remained on exhibit in a museum in Weimar, Thuringia, known as the Staatliche Kunstsammlungen zu Weimar, the predecessor to the Kunstsammlungen zu Weimar. But in 1943, after the commencement of World War II, Dr. Walter Scheidig, the then Director of the Staatliche, according to his account, anticipated the bombardment of Weimar and had the Duerers and other valuable items of the museum transferred to a storeroom in a wing of a nearby castle, the Schloss Schwarzburg, located in the District of Rudolstadt in the Land of Thuringia, where they remained until their disappearance in the summer of 1945.
On May 8, 1945, the Hitler Government surrendered. On June 5, 1945, the Allied Powers-the United Kingdom, the United States, the U.S.S.R. and the French Republic-issued a Declaration stating that the Allied Governments assumed supreme authority with respect to Germany, including all the powers possessed by the German Government. For the purposes of occupation, Germany was divided into four zones with one of the Four Powers assuming military authority over each zone to effect its own policy in regard to local matters and the policy of the Allied Control Council in regard to matters affecting Germany as a whole.
Under the June 1945 Declaration the Land of Thuringia was designated to be part of the Soviet Zone of Occupation. However, the American Military Forces had occupied Thuringia, with a regiment stationed at Schwarzburg Castle, since the defeat of Germany or some time before the official surrender in April or May of 1945. In accordance with the Allied plan, on July 1, 1945, the United States turned over control of Thuringia to the Soviet Armed Forces. According to Dr. Scheidig's account, the disappearance of the Duerer portraits from Schwarzburg Castle coincided in time with the departure of the American troops from the Castle.
Political differences and disagreement over the future of Germany developed between the Western Allies and the Soviet Union. Irreconcilable divisions prompted the Soviet Union's Commander in Chief to resign from the Allied Control Council on March 7, 1948 and the Council thereafter ceased meeting as the combined governing body of occupied Germany. On September 21, 1949, the Federal Republic of Germany was established in the former French, British and United States Zones; and on October 7, 1949, the German Democratic Republic was established in the former Soviet Zone.
On April 14, 1969, retroactive to January 1, 1969, the Minister of Culture of the German Democratic Republic, issued an order conferring juridical personality upon the former Staatliche Kunstsammlungen, which thereafter became known as the Kunstsammlungen zu Weimar, a status which under East German Law entitled the Kunstsammlungen to maintain suit for return of the Duerers. The Kunstsammlungen moved to intervene as a plaintiff in this action for return of the Duerer portraits in April 1969. In a Memorandum of Decision and Order dated September 25, 1972, we denied the motion to intervene on the ground that the Kunstsammlungen was an arm and instrumentality of the German Democratic Republic, a country not recognized by the United States at the time. 358 F. Supp. 747 (E.D.N.Y.1972), aff'd 478 F.2d 231 (2d Cir. 1973), cert. denied, 415 U.S. 931, 94 S. Ct. 1443, 39 L. Ed. 2d 489, reh. denied, 416 U.S. 952, 94 S. Ct. 1962, 40 L. Ed. 2d 302 (1974). On September 4, 1974, the United States extended formal recognition to the German Democratic Republic. Accordingly, by order of February 24, 1975, upon motion, we vacated our prior order and permitted the Kunstsammlungen to file its complaint. In its complaint, the Kunstsammlungen alleges that the Duerer paintings were stolen in 1945 from the Staatliche Kunstsammlungen zu Weimar and that Elicofon acquired them from the thief or his transferee and, therefore, has no right to them; and that as successor to the rights of the former Territory of Weimar and Land of Thuringia, the Kunstsammlungen is entitled to immediate possession. In his answer Elicofon denies that he holds the paintings wrongfully and on the basis of certain affirmative defenses, which are asserted in support of its motion for summary judgment, denies that the Kunstsammlungen is entitled to recover the paintings.
A. In support of its motion for summary judgment, Kunstsammlungen argues:
There exists no genuine issue of material fact as to whether Elicofon could have acquired good title. The uncontradicted account of Dr. Scheidig, Director of the Kunstsammlungen at the time the paintings disappeared, creates the irrefutable inference that the paintings were stolen in 1945 from Schwarzburg Castle. Thus, Elicofon could not have acquired good title to the Duerers even if he purchased them without knowledge of their source.
B. In support of its motion for summary judgment dismissing the complaint Elicofon argues:
1. Assuming that Elicofon did not acquire good title upon his purchase of the paintings, he later acquired title under the German law doctrine of ERSITZUNG.
2. (a) The Kunstsammlungen's claim is barred by the statute of limitations.
(b) Even if the Kunstsammlungen's claim is not barred by the statute of limitations, the Kunstsammlungen is estopped because of inordinate delay in prosecuting its claim.
3. (a) The Kunstsammlungen lacks standing.
(b) Under German law the Kunstsammlungen lacks the capacity to prosecute the claim.
Each of the grounds advanced by the parties is discussed separately below.
A. The Kunstsammlungen's Motion for Summary Judgment
In moving for summary judgment the movant bears the burden of showing the absence of a genuine issue as to any material fact. Adickes v. S. H. Kress & Co., 398 U.S. 144, 90 S. Ct. 1598, 26 L. Ed. 2d 142 (1970). The Kunstsammlungen argues that the irrefutable facts in this case indicate that Elicofon could not have acquired good title to the Duerers.
According to Elicofon, he acquired the Duerer portraits in 1946 when he bought them for $ 450 from a young American ex-serviceman, about 25 to 30 years old, who appeared at Elicofon's Brooklyn home with about eight paintings and who told Elicofon that he had purchased the paintings in Germany. Although Elicofon learned the name of the person he has since forgotten it. Elicofon had the paintings framed and hung them on a wall in his home with others. They remained there until 1966 when a friend, Stern, having seen a pamphlet containing lists of stolen artworks, informed Elicofon of their identity. At that time Elicofon made public his possession of the Duerers which precipitated a demand by the Kunstsammlungen for their return. Elicofon maintains that he purchased the paintings in good faith, without knowledge of their source or identity.
For the purpose of its motion for summary judgment, the Kunstsammlungen accepts the truth of Elicofon's version of the manner in which he acquired the Duerers. The Kunstsammlungen argues that good faith is irrelevant.
It is a fundamental rule of law in New York that a thief or someone who acquires possession of stolen property after a theft "cannot transfer a good title even to a bona fide purchaser for value (because) (o)nly the true owner's own conduct, or the operation of law ... can act to divest that true owner of title in his property ...." 3 Williston, Sales § 23-12.
The Kunstsammlungen contends that the circumstances surrounding the disappearance of the Duerers leave no question that the paintings were stolen from Schwarzburg Castle where they had been stored, and that consequently Elicofon could not have acquired title to the paintings. Elicofon claims that there does exist a question as to those facts on which the Kunstsammlungen relies to establish a theft; alternatively, he claims, such a theft does not preclude a finding that Elicofon's transferor acquired good title to the paintings in Germany. Thus, the question on this motion is whether the facts about which there is no genuine dispute indicate that Elicofon bought the paintings from one who was incapable of conveying title.
1. The Occurrence of a Theft
On a motion for summary judgment, the moving party has the initial burden of presenting "evidence on which, taken by itself, it would be entitled to a directed verdict." Donnelly v. Guion, 467 F.2d 290, 293 (2d Cir. 1972). The facts about which the Kunstsammlungen contends there is no dispute were related by Dr. Walter Scheidig. Until 1940 Dr. Scheidig was the Deputy Director of the Kunstsammlungen zu Weimar, and from 1940 to 1967 was the Director of the museum. The facts were told by Dr. Scheidig at a deposition conducted by counsel for all parties to this action in May, 1971;
in addition, various documents and letters are submitted as exhibits in support thereof. Dr. Scheidig died in 1974. The facts as told by Dr. Scheidig are as follows:
In 1943, anticipating the bombardment of Weimar, where the Kunstsammlungen is located, Dr. Scheidig had the Duerers and other works of art in the Staatliche collection transferred to a nearby castle, the Schloss Schwarzburg, in a section of which they were stored for safekeeping. Shortly after the American Forces assumed occupation of Thuringia in the spring of 1945, Dr. Scheidig wrote a letter to the U. S. Military Government in Weimar advising it of the artwork stored at Schwarzburg and other places in and around Weimar, and urged that all such depositories be secured by the Military Government (Scheidig dep. exh. 8).
On May 9, 1945, Dr. Scheidig, by letter (Id. Exh. 9), requested that the Thuringia Land Ministry of Education
secure Military Government permission for him to visit the various depositories. Permission having been granted (Id. Exhs. 10, 11), Dr. Scheidig drove to the Schwarzburg and other depositories on June 12, 1945 with a Ministry official. During a stop in Rudolstadt, a neighboring town about 10 miles from Schwarzburg, Dr. Scheidig learned that an American Military unit had been stationed at Schwarzburg. Upon arriving in Schwarzburg, Dr. Scheidig had a discussion with the commanding officer who handed the keys to the storeroom to a soldier who accompanied Dr. Scheidig there. Other soldiers entered the storeroom while Dr. Scheidig was present, apparently out of curiosity. On this visit Dr. Scheidig also met one Fassbender who had been living on the castle grounds. Fassbender had been employed by the Reich Government to refurbish Schwarzburg Castle for use as a summer retreat for Hitler. Dr. Scheidig noted at the deposition that Fassbender had nothing to do with the art depository.
Having found all in order and all the paintings and other items in their place on June 12, 1945, he recorded his findings in a memorandum to his files dated June 13, 1945 (Id. Exh. 12). In addition to writing that all was in order, Dr. Scheidig wrote that the soldier who accompanied him to the storeroom was a Princeton student who was extremely interested in the collection of art. He also wrote that during his visit, Fassbender had told him that nothing had been removed from the storeroom. Similarly, Dr. Scheidig reported that the works of art in the storeroom had been examined by the American soldiers but no disorder or destruction was caused.
On June 27, 1945, Dr. Scheidig again visited Schwarzburg Castle. This trip was a brief visit made at the behest of the U. S. Military Government for the purpose of recovering from the Castle certain personal items of a Dr. Messter before he left for the West with the American Forces. Dr. Scheidig took the opportunity to make a quick survey of the status of the art objects in the depository. Again a serviceman accompanied him. This time it appeared that an inside door had been forced open; paintings had been removed from the racks on which they rested and were lying about the room; cabinets had been forced open. The conditions, Dr. Scheidig reported, were frightening.
After this June 27 visit, Dr. Scheidig made two records of his findings. In a memorandum to his files dated July 3, 1945 (Id. Exh. 15), he described the disarray in the depot and reported that he complained to the commanding officer about the condition of the storeroom and was told that the guards at the Castle were not responsible for the artworks but were guarding submarine parts. The officer recommended that the artwork be removed from the Castle.
As to the Duerer paintings, Dr. Scheidig wrote in the memo: "The two Duerer pictures were not anymore in their old place and could, for the time being, not be found." The meaning of this statement as described at his deposition was that the Duerer paintings were not in their place on the racks in the depot; yet, there was insufficient time to make a thorough investigative search of the premises. Thus, "for the time being" meant "until the next thorough checking."
Dr. Scheidig's June 27, 1945 visit to Schwarzburg Castle was also recorded in a letter to the Thuringian Ministry of Education dated July 5, 1945 (Id. Exh. 16). In the letter he reported that the doors of the depot had been forced open and cabinets and boxes opened. In support of a request for authority to remove the Kunstsammlungen's collection from the castle he wrote: "In the depot in Schwarzburg are the most important pieces of art of the Land of Thuringia from the Weimar Castle Museum (paintings of Duerer, Cranach (and) Friedrich).... Losses from this depot will be irreplaceable."
The Russian Army replaced the U. S. Military in Thuringia on July 2, 1945.
Dr. Scheidig was able to visit Schwarzburg again on July 19, 1945, accompanied by his assistant, Dr. Marchand and another Rudolstadt official. The custodian of the Castle grounds, Ehle, was still there and reported that the depository door had been forced open and he had nailed it shut after the Americans left. The storeroom was, as before, in a shambles, now with empty frames lying about. Dr. Scheidig and his assistant inventoried the missing paintings and finally established that the Duerers were among them.
In a letter dated July 21, 1945 (Id. Exh. 19), Dr. Scheidig reported to the Land Ministry that certain paintings had been stolen from the art depot and attached a list of the missing paintings with exact descriptions and photographs. The Duerer portraits and another painting by Friedrich were described in the letter as "the most valuable possessions of the Land of Thuringia." Dr. Scheidig also stated that the thefts "were obviously committed by American soldiers before their departure," specifically, by the troops stationed there under Captain R.R. "Ewarr" (changed in ink to "Estesl' (sic)). He also suggested that the architect Fassbender, who had fled to south Germany shortly before the Americans left, also could have been involved in the theft.
The theft of the Duerers and the commencement of efforts to secure their recovery prompted further correspondence in regard to them. Dr. Scheidig had much correspondence with a Dr. Zimmerman, Director of the Kaiser Freidrich Museum in Berlin. Dr. Scheidig informed Dr. Zimmerman of the theft in a memorandum dated September 30, 1945, and stated that the discovery that the depot had been looted was made "immediately after the American troops had left on July 1, 1945." In response to two letters from Dr. Zimmerman dated September 28, 1945 (Id. Exh. 21) and October 10, 1945 (Id. Exh. 23), in which Dr. Zimmerman requested more specific information about the thefts to relay to the authorities, Dr. Scheidig wrote two letters to Dr. Zimmerman, dated October 3, 1945 (Id. Exh. 22) and October 12, 1945 (Id. Exh. 24). In the letter of October 3, 1945 Dr. Scheidig wrote that the thefts probably occurred "in the last hours before the departure of the American troops on July 1, 1945." And on October 12 he identified the troops stationed at Schwarzburg as "of the 15 American Inf. Division under the command of Capt. Paul Estes ... (who) had the key to the depository in his possession...."
In a letter dated March 22, 1946 to Dr. Carl Mueller of the Bavarian National Museum in Munich, (Id. Exh. 28) Dr. Scheidig wrote that the paintings had been stolen "at the time of the departure of the American troops."
In a memorandum dated September 6, 1948 for transmittal to the Soviet Military Administration, (Id. Exh. 30), Dr. Scheidig charged that the Americans under the command of Captain Paul Estes were responsible for the theft, noting that footprints and cigarette butts of Americans were left behind in the storeroom. Dr. Scheidig stated that the paintings were determined to be missing "on July 19, 1945, after the departure of the American troops."
In January 1961, Dr. Scheidig recounted the circumstances surrounding the disappearance of the Duerers in a memorandum and letter written to Ms. Ardelia Hall, a United States State Department official in charge of the program to locate the missing artworks. The account is substantially the same as prior accounts except that in the 1961 letter Dr. Scheidig wrote that on June 27, 1945 when he visited the castle the paintings were "no longer in the repository," as opposed to "no longer in their old place," as he had stated in the memorandum of July 3, 1945. In addition, Dr. Scheidig added to the account that the soldier who accompanied him to the storeroom on June 27 specifically asked him about the Duerer portraits and that Dr. Scheidig and the officer reported to the commanding officer that the paintings were missing, not only that the room was in a shambles, for which the commander is said to have disclaimed responsibility. Similarly, at the deposition in 1971, Dr. Scheidig stated that it was his belief that the paintings had already been stolen on June 27, and that the commanding officer was told that the paintings were missing.
Although Dr. Scheidig, in 1961 and 1971 was convinced that the Duerers had already been stolen on June 27, 1945 when the storeroom was in a shambles and the paintings were not in their places on the racks, the Kunstsammlungen does not adopt the version since a thorough examination of the storeroom could not be made on that day. The Kunstsammlungen only asserts that it is clear from Dr. Scheidig's testimony and the supporting documents that the Duerers were stolen sometime between June 12, 1945, when Dr. Scheidig last saw them in the storeroom, and July 19, 1945, when the theft was finally established.
Elicofon claims that the Kunstsammlungen has failed to carry its initial burden of presenting a prima facie case because internal inconsistencies in Dr. Scheidig's various accounts raise a question of his credibility. We disagree. We find no significance in the inconsistencies in Dr. Scheidig's various accounts. And, unlike Elicofon, we find that Dr. Scheidig's explanations at the deposition of any ambiguities in his past correspondence were consistent with what is already apparent to a reasonable person from the Kunstsammlungen's records and Dr. Scheidig's deposition testimony.
Elicofon is primarily concerned with inconsistencies in Dr. Scheidig's accounts as to when the theft occurred. Thus, in the documents of July 3 and July 5, Dr. Scheidig made no mention of a theft and, in fact, included the Duerers in a list of paintings located at Schwarzburg, but on July 21, 1945 and thereafter, up to 1961, Dr. Scheidig wrote that the theft was carried out by the Americans upon their departure from Schwarzburg on July 1, 1945; and in the letter of 1961 and at the deposition in 1971, Dr. Scheidig stated that the paintings were no longer in the repository on June 27, 1945, which fact was reported to the commanding officer.
Not having had the opportunity to check the depot thoroughly on June 27, 1945 it is reasonable that Dr. Scheidig did not officially report to the Thuringian Ministry in the letter of July 5 that the theft had occurred. As to why, in his request for permission to move the collection from Schwarzburg he listed the Duerers as among the paintings located at Schwarzburg, Dr. Scheidig explained: "In order to point out the urgency of the shipping, I just mentioned a few painters, in order to point to the fact how precious the collection is, without wanting to say or to express that at that point of time the pictures were still there." On the other hand, it is also reasonable for Dr. Scheidig to have complained to the commanding officer of the theft on June 27 without being certain that a theft had in fact occurred, since the officer ostensibly had the power to secure their return. Thus, the documents of July 3 and July 5 are not inconsistent with Dr. Scheidig's belief in 1961 and 1971 that the theft had already occurred by June 27.
Nor are the statements in the documents of July 21, 1945 up to 1961 inconsistent with the 1961 letter and 1971 deposition. The descriptions in the correspondence of the date by which the theft occurred by no means exclude June 27 since it was soon "before the Americans departed from Schwarzburg on July 1," and may be described figuratively as "the last hours" before their departure.
It is apparent from the frequent correspondence concerning the theft of the Duerers that Dr. Scheidig gave much thought to the circumstances surrounding the theft. Thus, it is quite understandable for Dr. Scheidig to have finally concluded sometime after 1945 that the Duerers, missing from their racks on June 27, had probably already been stolen at that time. Indeed, Dr. Scheidig noted at his deposition the use of the phrase "in the last hours" before the departure of the Americans to describe the time of the theft was based on the impression gained on the July 19 inspection when empty frames were lying about, whereas on June 27 no empty frames were lying about.
Having rejected as a matter of law Elicofon's assertions of the existence of internal inconsistencies in Dr. Scheidig's account which create a credibility issue, we find as a matter of law that the Kunstsammlungen has presented a prima facie case establishing that the Duerers were stolen from Schwarzburg sometime between June 12 and July 19, 1945.
Once the party moving for summary judgment has presented evidence which would sustain a directed verdict, the burden shifts to the party opposing the motion to offer competent evidence which "raises a substantial question of the veracity or completeness of the movant's showing or presents countervailing facts." Beal v. Lindsay, 468 F.2d 287, 291 (2d Cir. 1972). First National Bank of Cincinnati v. Pepper, 454 F.2d 626 (2d Cir. 1972).
The evidence presented by Elicofon which he purports raises a substantial question of the veracity of plaintiff's case consists of the affidavits of former officers of Company F, 2d Battalion, 406th Infantry Regiment, 102nd Division, which was stationed in the town of Schwarzburg above which stood the promontory on which the Castle was situated. The affidavits submitted are ...