Questions
1. Define conversion. State the defence available to the defendant in an action for conversion.
Definition of Conversion
- Conversion in the law of torts refers to an intentional act of dealing with goods in a manner seriously inconsistent with another's right to possession, whereby that other person is deprived of the use and possession of the property.
- It amounts to treating another's property as one's own, either by wrongfully taking, using, disposing of, or denying the owner's rights to the property.
- The essence of conversion lies in the defendant's wilful interference with the plaintiff's chattel without lawful justification, resulting in the unlawful deprivation of the plaintiff’s property.
- Conversion is a strict liability tort; thus, the plaintiff need not prove malice, negligence, or motive. It is enough that the defendant intentionally exercised control over the property in a manner inconsistent with the plaintiff's rights.
Examples of conversion include:
- Taking and using someone else’s car without permission.
- Refusing to return a borrowed item when lawfully demanded.
- Selling another person's property as if it were one’s own.
- Conversion applies only to tangible, movable property (chattels), and not to real property or purely intangible rights.
Ingredients of Conversion
- Plaintiff’s ownership or immediate right to possession of the property at the time of the alleged conversion.
- Defendant’s act of dealing with the property in a manner denying or inconsistent with the plaintiff’s rights.
- Absence of lawful justification for the defendant’s actions.
- Resultant deprivation of the property for the plaintiff.
Modes in Which Conversion May Be Committed
Conversion can occur in several ways, including:
- Wrongful taking or disposal of goods.
- Use or misapplication of goods by a person not entitled to do so.
- Denial or repudiation of the plaintiff’s title or rights, such as refusing to deliver the property on demand.
- Unauthorized transfer or sale of the property.
Defences Available to the Defendant in an Action for Conversion
Defences to an action for conversion are categorized as specific and general. Some defences are unique to conversion, while others (the general defences) apply broadly to all tort actions.
Specific Defences to Conversion
1. Jus Tertii (Right of a Third Party):
- The defendant may plead that a third person has a better right to the goods than the plaintiff. This plea is limited; if the plaintiff was in possession of the goods at the time of conversion, the defendant generally cannot raise the jus tertii defence.
- However, if the defendant acted under the authority of the person who is truly entitled, this can be a valid defence.
2. Consent of the Plaintiff:
- If the defendant proves that the plaintiff had consented to the act that amounted to conversion, this acts as a valid defence. Consent may be expressed or implied, and can be withdrawn unless associated with consideration.
3. Authorization or Lawful Justification:
- Where the defendant acted with legal authority, such as in execution of a court order (for example, a bailiff taking possession under a warrant), this is a complete defence.
- Action taken in obedience to statutory or contractual duty may also serve as defence.
4. Restoration Before Suit:
- If the alleged converter returns the property voluntarily before any legal proceedings, this may mitigate liability, although it does not always constitute a complete defence if damage has already been done.
5. Abandonment:
- If the plaintiff had abandoned the goods, the defendant cannot be held liable for conversion since there are no rights left to interfere with.
General Defences Applicable to Conversion and Other Torts
1. Act of Necessity:
- Action taken under circumstances of necessity (such as disposal of property to prevent greater harm) may be a sufficient defence.
2. Plaintiff Not Entitled to Possession:
- If at the time of the alleged conversion, the plaintiff had no right to possess the goods, the defendant cannot be held liable.
3. Inevitable Accident:
- If the interference with the plaintiff's goods was completely accidental and could not be foreseen or prevented by reasonable care, this may amount to a defence in rare circumstances.
4. Execution of Legal Process:
- If the defendant took possession of goods pursuant to a valid court order or in capacity of official duty, this serves as defence, provided the process was not abused.
Defences that Are Not Available
1. Mistake of Fact or Good Faith:
- Generally, bona fide belief or good faith mistaken identity is not a defence to conversion.
- This means that even if the defendant genuinely believed the property was their own or was acting innocently, they may still be liable.
- Similarly, the fact that the defendant was not negligent, or that the plaintiff was negligent, does not excuse conversion.
2. Ignorance of Ownership:
- Not knowing who owns the goods or acting at the request of a third party (unless that party is truly entitled) is not a valid defence.
5. Case Law Illustrations
1. Armory v. Delamirie (1722): It was held that a finder of goods has better title than anyone except the true owner. Hence, possession is generally deemed sufficient unless a third party's better right is proven.
2. Akola Electric Supply Co. Ltd. v. Gulabi: Denial of title to owner, and dealing in a manner inconsistent with his rights, amounted to conversion.
3. Baram v. Farugia: It reiterates that conversion requires intent to exercise dominion, but not necessarily wrongful motive or awareness of the true owner's rights.
6. Conclusion
- Conversion is a pervasive tort to protect possessory rights over movable property, deterring unlawful interferences.
- Its strict liability nature means that several intuitive defences, like mistake or good faith, generally do not succeed, though certain specific and general legal defences exist.
- The actual rights and remedies in a conversion suit usually depend on fact-intensive considerations, and courts tend to emphasize the protection of property rights against all forms of significant, unjustifiable interference.