Conversion (law)
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For other uses of the word "conversion", see Conversion.
Conversion is a common law tort. A conversion is a voluntary act by one person inconsistent with the ownership rights of another.[1] It is a tort of strict liability.[2] Its criminal counterpart is theft. Examples are seen in cases where trees are cut down and the lumber hauled from the land by someone not having clear ownership; or removing furniture belonging to another from a cohabited dwelling, placing it in storage and not telling the owner of the whereabouts. In medieval times, a conversion would occur when bolts of cloth were bailed for safe keeping, and the bailee or a third party took them and made clothes for their own use or for sale. (See infra.) Many questions concerning joint ownership in enterprises such as a partnership belong in equity, and do not rise to the level of a conversion. Traditionally, a conversion occurs when some chattel is lost, then found by another who appropriates it to his own use without legal authority to do so. It has also applied in cases where chattels were bailed for safe keeping, then misused or misappropriated by the bailee or a third party.
Conversion, as a purely civil wrong, is distinguishable from both theft and unjust enrichment. Theft is obviously an act inconsistent with another's rights, and theft will also be conversion. But not all conversions are thefts because conversion requires no element of dishonesty. Conversion is also different from unjust enrichment. If one claims an unjust enrichment, the person who has another's property may always raise a change of position defence, to say they have unwittingly used up the assets they were transferred. For conversion, there always must be an element of voluntarily dealing with another's property, inconsistently with their rights. |
