Nemo dat quod non habet

Nemo dat quod non habet, literally meaning "no one gives what he doesn't have" is a legal rule, sometimes called the nemo dat rule, that states that the purchase of a possession from someone who has no ownership right to it also denies the purchaser any ownership title. It is equivalent to the civil (continental) "Nemo plus iuris ad alium transferre potest quam ipse habet" rule, which means "one cannot transfer more rights than he has". The rule usually stays valid even if the purchaser does not know that the seller has no right to claim ownership of the object of the transaction (a bona fide purchaser); however, in many cases, more than one innocent party is involved, making judgment difficult for courts and leading to numerous exceptions to the general rule that aim to give a degree of protection to bona fide purchasers and original owners. The possession of the good of title will be with the original owner.

United States

In American law, a bona fide purchaser who unknowingly purchases and subsequently sells stolen goods will, at common law, be held liable in trover for the full market value of those goods as of the date of conversion. Since the true owner retains legal title, the seller is liable even in a chain of successive bona fide purchasers (i.e., the true owner can successfully sue the fifth bona fide purchaser in trover). However, the problem of successive bona fide purchasers can be remedied: If the jurisdiction recognises an implied warranty that the seller has title to the property (Article 2 of the Uniform Commercial Code (UCC) in the United States), then the bona fide purchaser can sue the seller for breach of that implied warranty. Courts of equity traditionally also recognise various other exceptions, likely giving rise to the idea embodied in the modern UCC.

This rule is exemplified in circumstances like the Holocaust reconciliation movement, where property, such as works of art, stolen or confiscated by the Nazis was returned to the families of the original owners. Anyone who purchased the art or thought they had ownership was denied any rights over the litigious property due to the nemo dat rule.

As mentioned earlier, the nemo dat rule has numerous exceptions. Legal tender, for example, does not adhere to the rule in certain circumstances. For example, if a rogue buys goods from a bona fide merchant, then that merchant will not have to return the bills to the true owner because holding the rule to be otherwise would disrupt the economy and prevent the free flow of goods. The same may be true of other "negotiable" instruments like cheques. If Alice, a thief, steals a cheque from Bob and sells it to innocent Charlie, then Charlie is entitled to deal with the cheque, and Bob cannot claim it back from Charlie (though the name appearing on the cheque may affect the validity of such a transfer).

Another matter is the transfer of other legal rights normally granted by ownership. In 2011, a US District judge ruled that a woman who had purchased a stolen laptop could sue a device tracking company for invasion of privacy stemming from recording software installed on the laptop to facilitate its recovery after being stolen.[1] This ruling demonstrated that bona fide purchasers are entitled to some rights by virtue of possession alone, or that nemo dat is superseded by the bona fide purchaser's right to privacy.