a. Why did Hungary's argument, that the Herzogs' consent was induced by duress, fail?
b. Why was the Judge reluctant to conclude that the Herzog family's consent was induced by duress?
c. Given the facts of this case, what level of due care is owed?
Baron Mór Lipót Herzog was a passionate Hungarian-Jewish art collector who, in the first half of the twentieth century, assembled more than two thousand paintings, sculptures, and other artworks. Known as the "Herzog Collection," this body of artwork was one of Europe's great private collections, and included paintings by renowned artists such as El Greco, Velázquez, Renoir, and Monet.
Then, during World War II, Adolf Hitler sent German troops into Hungary. The country enacted anti-Semitic laws and deported Hungarian Jews to concentration camps. The government required all Hungarian Jews to register their artwork and valuables. It then confiscated the most prized pieces.
The Herzogs attempted to save the collection by hiding it in the cellar of one of the family's factories. But the Hungarian government and its Nazi collaborators discovered the hiding place. They took the artwork directly to SS Commander Adolf Eichmann, who personally selected the best pieces for transfer to Germany. The remainder was handed over to Hungarian museums for safekeeping. The Herzog family was forced to flee Hungary or face extermination.
At the end of World War II, the Herzog heirs were dispersed all over the world-from the United States to Argentina. They claim that, at the time, they arranged for the Hungarian government to retain possession of most of the collection so that the works could continue to be displayed in Hungary. But when the Herzogs requested the collection's return, Hungary refused and thus began a seven-decade struggle over the artwork.
Finally, in 2010, the Herzog family sued the Republic of Hungary over the art, asserting a claim for bailment. They alleged that the family's postwar arrangement with Hungary formed a bailment agreement, whereby Hungary assumed a duty of care to protect the property and to return it to the family on demand. Hungary moved to dismiss, arguing that no such bailment was created. The district court denied the motion and Hungary appealed.