Request By:
Honorable John E. Swain
Assistant County Attorney
1112 Kentucky Home Life Building
Louisville, Kentucky 40202
Opinion
Opinion By: Steven L. Beshear, Attorney General; John H. Gray, Assistant Attorney General
Thank you for your letter of August 13, 1981, which poses the following questions regarding pawnbrokers and stolen property:
1. Do the police have the authority to seize property from pawn shops when probable cause that it is stolen exists?
It is well established that one who purchases or acquires property from a thief in good faith has a right to the possession of that property against everyone except the rightful owner. 46 American Jurisprudence 623, Section 459;
Bainett v. London Assurance Corp., 138 Wash. 673, 245 P. 3, 46 A.I.R. 526. Therefore, even though pawnbrokers are subject to strict regulations, they may not be deprived of their property rights of possession against all but the true owner without due process of law.
Since both the Fourth Amendment of the United States Constitution, and Section 10 of Kentucky's Constitution protect persons from unreasonable seizures of the possessions, it is the opinion of this office that the police may seize property from pawn shops, absent exigent circumstances, only upon lawfully issued warrants.
2. If the police seize stolen property and place it in the police property room, what process of law is required to return the property to the lawful owner?
Under KRS 67.592(4), the property need only be returned to the lawful owner and that fact noted in the property clerk's book. As a practical matter, although not required by law, it would seem advisable for the property clerk to obtain a receipt for the property from the lawful owner. KRS 67.592(4) also requires the property clerk to advertise the property as to the amount and disposition of the property.
3. How should property seized be disposed of if the lawful owner cannot be located?
Since a pawnbroker has a right to possession against all but the lawful owner, the property should be returned to the pawnbroker if the lawful owner cannot be found.
4. What criminal charge is appropriate should a pawnbroker refuse to turn over the stolen property to the police or try to conceal it?
If a pawnbroker, in the face of a lawful search warrant, were to refuse to turn stolen property over to the police, a charge of contempt would certainly seem in order. Also, tampering with physical evidence would seem to be an appropriate charge under KRS 524.100.
As towards the true owner, the law is well settled that the pawnbroker acquires no reight to retain possession, as security for a loan, of an article pawned without the knowledge, consent, or authority of the owner.
Tappin's Jewelry Stores, Inc. v. Rosner, 111 N.J.L. 301, 168 A. 676 (1933);
Brown v. S. & G. Gross & Co., Sup., 13 N.Y.S. 2d 1020 (1939);
Gordetsky v. Cohen, 20 N.J. Super. 11, 89 A.2d 84 (1952);
City of Seattle v. Shepard, 613 P.2d 1158 (1980); 70 C.J.S. Pawnbrokers 18 (1951) at 192.F.
Therefore, in a situation where a pawnbroker is in possession of property acquired without the knowledge, consent, or authority of the true owner and the pawnbroker refuses to return the property to the true owner upon demand, the pawnbroker may be properly charged with theft by unlawful taking or disposition under KRS 514.030.
5. What obligation does the legal owner have to reimburse the pawnbroker for pawn fees?
None. It is also settled that the true owner is entitled to possession of the chattel pawned by an unauthorized pawner without repaying the pawnbroker the amount advanced by him to the pawner.
Swesnik Loan Co. v. Courtney, 291 Ill. App. 549, 10 N.E.2d 512 (1937).
Tappin's Jewelry Stores, Inc. v. Rosner, supra;
City of Seattle v. Shepard, supra; 70 C.J.S. Pawnbrokers 18.
It is hoped that this has adequately answered your questions. If it has not, please feel free to ask for further explanation.