Erna Menzel (plaintiff) and her husband fled their home in 1940 when the Germans invaded Belgium. The Menzels left behind a painting by Marc Chagall, which was removed by German authorities. In 1955, the painting was sold by a Parisian art gallery to Klaus Perls and his wife (defendants), who did not inquire about the painting’s title. The Perlses sold the painting to Albert List (defendant) later in 1955 for $4,000. Menzel discovered the painting’s location in 1962 and demanded that List return the painting to Menzel. When List refused, Menzel brought a replevin action against him. List impleaded the Perlses, alleging that they were liable to him for a breach of implied warranty of title. The jury returned a verdict in Menzel’s favor, and the lower court ordered that the painting be returned to Menzel. The jury also returned a verdict for List against the Perlses in the amount of $22,500, which the jury determined to be the painting’s present value. The Perlses appealed, and the appellate division reduced the amount awarded to List to $4,000, the amount that List had paid the Perlses for the painting. List appealed.