South Beverly Wilshire Jewelry & Loan v. Superior Court

Opinion

CROSKEY, J.

In this case (1) a person voluntarily relinquished possession of his property under a consignment, (2) such property was then wrongfully transferred by the consignee to the possession of a third party who took it for value and without notice, and (3) the consignor could have perfected a security interest in the property but did not. Under those circumstances, the applicable rule is set out in Civil Code section 3543, which states that “[wjhere one of two innocent persons must suffer by the act of a third, he, by whose negligence it happened, must be the sufferer.”

This case…