The nemo dat rule literally meaning "no one [can] give what one does not have" is a legal rule in property law that states where goods are sold by a person who is not the owner thereof and who does not sell them under the authority or with the approval of the owner, the purchaser requires no better title to the goods than the seller had. This law states that if a bona fide purchaser who unknowingly purchases and subsequently sells stolen goods will, at common law, be held liable in trover for the full market value of those goods as of the date of conversion. Since the proper owner retains legal title, this is true even in a chain of successive bona fide purchasers (ie, the true owner can successfully sue the fifth bona fide purchaser in trover). In laymans terms, it means that if you buy something that was potentially stolen, like a car, the legal owner of that car can take it back and sue you for possessing it and in addition to that you will not get the money you paid for the car back, unless you sue the person you bought it from. A very famous example can be seen in the Holocaust reconciliation movement where property, such as works of art, that was stolen or confiscated by the Nazis was returned to the families of the original owners. Anyone who purchased the art or thought they had ownership were denied any rights over the litigious property due to the nemo dat rule. There are exceptions to the nemo dat rule. These are.
special powers of sale
seller in possession
buyer in possession
Special powers of sale confers good title on the buyer which prevails over the claims of the original owner. For example, goods confiscated in breach of customs regulations, abandoned motor vehicles, goods left in a hotel room and on public transport can all be sold lawfully. Voidable title states that if a contract is merely voidable and not void, the right to sell cannot be exercised if the goods have been sold to a...
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