Newton v. Porter
New York Court of Appeals
69 N.Y. 133 (1877)
Newton (plaintiff) owned $13,000 in government bonds that were stolen by William and George Warner, who sold the bonds and invested the proceeds in a promissory note, a bond, and a mortgage. After the Warners were arrested and indicted for the theft, they paid their defense attorneys (defendants) by transferring the note and assigning the bond and mortgage to them. Newton sued the attorneys to recover those instruments as traceable proceeds of his stolen bonds, and the trial court found the attorneys had notice the securities derived from the stolen bonds, ruling for Newton; the attorneys appealed.
Whether the owner of stolen property may recover the traceable proceeds of the property's sale, including securities purchased with those proceeds, from an assignee who had notice that the property derived from the theft.