Trust me, 21st century American property law is just freakin' weird enough and retains just enough old school feudalisms (like enfeoffment) to make it not entirely inapplicable to a candyland ruled by a princess.

Well, actually, the situation is a little gray and would depend a lot on two things:  first, whether Maja, the Sky Witch, acted in good faith (i.e. whether Ash gave her any indication that he had stolen or otherwise didn't hold valid title for Hambo) and, secondly, jurisdiction and relevant case law.