Porter v. Wertz
68 A.D.2d 141, 416 N.Y.S.2d 254 (1979)
Porter owned a valuable painting worth $30k. He lent it
to a man named Wertz, who was considering buying the painting from Porter.
Wertz had already bought one valuable painting from
Turns out, Wertz wasn't Wertz at all, his real name was
Maker was using his friend's identity.
After a few months, Porter went to check on the painting,
but was unable to locate Wertz or the painting.
The check from the first painting bounced as well, and
Porter learned that Wertz was a career criminal.
Porter reported Wertz to the FBI, with relation to the
bounced check, but didn't mention the 'borrowed' painting.
Porter contacted Wertz' attorney, found Wertz, and got a
signed agreement that Wertz would return the paintings or pay for them
within 90 days.
If he didn't, then Wertz's attorney would give Porter one
of Wertz's valuable paintings he was holding in escrow.
By this point, Wertz (by using the real Wertz as an intermediary)
had already sold the painting to Feigen for $20k. Feigen then sold the
painting to Brenner, who sold it to someone in Venezuela.
The real Wertz worked in a deli and was fascinated by the
art world, so he was willing to go along with the fraud.
Porter sued Wertz, Feigen, and Brenner.
By this point, Wertz had no money so if Porter was going
to recover for the value of his painting, he needed to sue someone other
The Trial Court found for Porter, and ordered the painting
returned or its value paid to Porter. Feigen appealed.
The Appellate Court affirmed.
Feigen argued that he was a bona fide purchaser,
and that Porter was barred from recovery due to statutory estoppel
based on UCC §2-403(2).
UCC §2-403(2) states that "any entrusting of
possession of goods to a merchant who deals in goods of that kind gives
him power to transfer all rights of the entruster to a buyer of the
ordinary course of business."
Basically, under the UCC, a good faith purchaser
acquires title to goods, even if the seller did not have the right to
The Appellate Court found that since Wertz was not a real
merchant, and was not acting in good faith, the deal for the painting was
not done in the "ordinary course of business" as required under
See UCC §1-201(9)
Feigen made no attempt to verify who Wertz was or
whether he was a legitimate art dealer as he claimed. Therefore he was
not a good faith purchaser, and was not protected by UCC §2-403(1).
It would have been pretty easy to find out who the true
owner of the painting was.
In order to be a good faith purchaser, you have to
believe that the seller has proper title to the item, and you have to
buy it at a cost that is reasonable.
Porter had only dealt with Maker, not the real Wertz, so
it could not be said that the Porter even entrusted the real Wertz with
Of course, the real Wertz was just acting as the fake
Wertz's agent, and the fake Wertz, despite being a scoundrel was an art
merchant, so does this argument hold?
Basically, if you are a merchant and you buy something in
good faith, then it's yours to keep or sell. But, you have to actually do
due diligence to verify the seller is the true owner of the goods. If you
don't, then you can still be liable for the return of the goods.