If the owner of goods entrusts proof of ownership to someone in possession of the goods, the goods cannot be recovered by the true owner from an innocent purchaser.

Question

Quizplus · Accepted Answer

This statement is referring to the legal concept of entrustment. If the owner of goods entrusts proof of ownership to someone in possession of the goods, such as lending a vehicle to a friend or leaving merchandise with a consignment shop, and that person then sells the goods to an innocent purchaser, the true owner cannot recover the goods from the innocent purchaser. This is because the innocent purchaser acquired the goods in good faith and without knowledge that the seller did not have the right to sell them. However, the true owner may have legal recourse against the person who the goods were entrusted to.

If the Owner of Goods Entrusts Proof of Ownership to Someone