Tutorial for Conversion
Question 2
Presented by:
Ruby Tong (50342087)
Paul Tsang (50339730)

Rundown
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Trespass to chattels v conversion
Facts of the question
6 main areas
Each discuss according to
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Fact
Issue
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Rule
Application conclusion

Trespass to chattels
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Unlawful interference with the possession of a chattel by P
D’s act must be direct
D’s act must be intentional
P must have possession or a right to possession

Conversion
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Any intentional act of dominion in relation to a chattel
Inconsistent with the plaintiff’s possession or his right to immediate possession
Seriously inconsistent

Difference
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P may sue even for a trivial interference in trespass in chattel
In conversion, D’s act must be a serious interference

Facts
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Lucky and Lucy
Holiday in Heaven Plaza Hotel
Hotel staff put their luggage in their car
Found a box not belonging to them
Contained several pieces of crystal
Called up to the hotel reception
The hotel had no idea of any missing box

Facts
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Friends, Causal, an avid antiques collector
Asked for the crystal to assess the worth
Lucky and Lucy allowed him to do whatever he wants
Causal sold to an antique shop for $100,000
The shop auctioned them for $500,000 to Mr.
Chan
Lucky and Lucy knew from Evening Post

First area
Fact:
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A box (not belong to Lucky and Lucy)
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 mistakenly been put in the boot of their car by the staff of the Heaven Plaza
Hotel.
They called up the hotel
 were told that the hotel had no idea of any missing box.

First area
Issue:
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Are Lucky and Lucy were involuntary bailees?
Have they discharged their duty by calling up the hotel?

First area
Rule:
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Involuntary bailee
 a person who receives another’s chattel without asking for it.
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 liable in conversion
 wrongful delivery or destruction of the chattel.
No duty of care for such chattels
 unless the involuntary bailee has assumed some duty by his own conduct.

First area
Application:
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Lucky and Lucy are involuntary bailees
 received another’s chattel without asking for it.
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 duty of care has been discharged ?
In Howard v Harris
 recipient was held not to have duty.
In Summer v Challenor
 recipient was held to have duty

First area
Application
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Duty has been discharged or not
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 decided by a reasonable bystander.
They can discharge the duty by taking the box to the police station or back to hotel.
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In Elvis Powell v Plummer
 if persons were involuntary bailees
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 had done everything reasonable not liable to pay damages if something which they did resulted in the loss of the property.

First area
Conclusion:
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Still have duty.
May be liable to conversion if the owner turns up.

Second area
Facts:
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Causal asked Lucky and Lucy to let him assess the worth of that.
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Lucy and Lucky said he could do whatever you like with them.
Causal took the box away.

Second area
Issue:
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Did Causal commit in trespass to chattel?
Rule:
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Trespass to chattels
 an unlawful interference with the possession of the chattel.

Second area
Application:
 interference is unlawful
 do it without the consent of the people who have possession or a right to possession.
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Any interference without dispossessing that plaintiff is trespass.
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Casual had asked for permission from Lucky and Lucy.

Second area
Conclusion:
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Lucky and Lucy gave the crystals to
Casual on their own accord
Causal had not constituted in trespass.

Third area
Facts:
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Casual sold the crystal pieces to an antique shop
The shop subsequently auctioned the crystal pieces.

Third area
Issue:
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Did the auctioneer commit conversion?
Did he interfere with anyone’s possession or the right to immediate possession?

Third area
Rule:
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 without lawful authority disposes of goods with the intention of transferring the title or some other right in the goods, and who delivers the goods commits a conversion

Third area
Application:
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From Consolidated Co v Curtis & Son
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 the auctioneer sold the good in good faith but, goods do not belong to his client
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 commits conversion
If Lucky and Lucy had discharged their duties and gave the box to Casual
Then at the time of the auction, Casual had the right of possession.
The auctioneer did not commit conversion.

Third area
Application:
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However, if the true owner turns up, the auctioneer will commit conversion he did not have the authority to dispose the good.

Third area
Conclusion:
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If the true owner does not turn up the auctioneer will not commit in conversion

Forth area
Fact:
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Casual said, ‘Do you mind if I take these pieces to assess if they are worth anything’? And Lucky said, ‘ I am not interested, you do whatever you like with them.’

Forth area
Issue:
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Did Casual commit tort as she took the box of crystal pieces away??

Forth area
Rule:
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Possession connotes both the power
(factum) and intention (animus) to exercise physical control.

Forth area
Application:
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As Lucy and Lucky did not want to retain the power and intention to exercise the crystals, and thankfully gave the right of possession to Casual.
The title of the crystal is then belonging to Casual when she received it as a gift.

Forth area
Conclusion:
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And so, definitely Casual has her own right to take the box of crystal away.

Fifth area
Facts:
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The buyer, Mr. Chan bought the crystals from an auction, after Casual got the crystals and sold it to a antique shop, which the antique shop sold the crystal in an auction.

Fifth area
Issue:
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Did the Buyer Mr. Chan acquire both the crystals and its possession right?

Fifth area
Rule:
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Where a chattel has been sold without possession being transferred, the buyer has a sufficient right to immediate possession to bring an action in conversion against the seller or a third party who interferes with the chattels.

Fifth area
1. Sales of Good Ordinance (Chp26) s 24
 Where goods are openly sold in a shop or market in Hong Kong, in the ordinary course of the business of such shop or market, the buyer acquires a good title to the goods, provided he buys them in good faith and without notice of any defect or want of title on the part of the seller.

Fifth area
2.Sales of Good Ordinance (Chp26) s 25
 When the seller of goods has a voidable title thereto, but his title has not been avoided at the time of the sale, the buyer acquires a good title to the goods, provided he buys them in good faith and without notice of the seller's defect of title.

Fifth area
Application:
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Mr. Chan acquires a good title, as he bought the crystals through the auction in good faith, and without notice the seller’s defect in title.
Conclusion:
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Suppose the above conclusion made from 1 to 4 is true. Mr. Chan did get the right to possess the crystals, as he had paid for it lawfully through an auction.

Overall
A.
B.
C.
Issue:
If Lucky and Lucy are involuntary bailees and have made an immediate gift to Casual, would
Lucky and Lucy commits conversion when the true owner turns up?
Does the word of Lucky sufficient to constitute a gift to Casual??
How ‘s the position of the auctioneer would be affected if Lucky commited conversion, at the same time, the true owner turns up??

Overall
Rule:
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Involuntary reception of any chattel is not conversion. But, an involuntary bailee is liable under an unauthorized and negligent act deprives the owner of the chattel.
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Possession connotes both the power (factum) and intention (animus) to exercise physical control
In the absent of true owner, a mere finder of a chattel has all the right in respect of the chattel.
(Watt Ltd v York Products Pty Ltd [1970])

Overall
Application:
A. Though involuntary reception is not conversion, however, Lucky and Lucy should take good care to the crystals in order not to commit conversion. So
Lucky and Lucy has assumed some duty of care by his own conduct, and they maybe liable for any loss or damage occasioned through his negligence.
Definitely, treating the crystals as a gift to any third party seems not to be a good conduct in keeping the crystals in reasonable care. So Lucky and Lucy maybe liable in conversion for loss of chattels according to their own negligence.

Overall
B. Since Lucky and Lucy did not have any intention in possessing the crystals according to their words, probably they have treated the crystals as a gift to Casual.
C. When the true owner turns up, the title of the crystals will be returned to the true owner. And as a buyer, Mr. Chan have bought the crystals without the true possession of the crystals being transferred. Mr. Chan can bring an action in conversion against the seller, the antique shop or the auctioneer.

Overall
Conclusion:
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Once the true owner turns up, the title of crystals will return to the true own. The true owner can sue Lucky and Lucy in conversion, as they had not maintained the crystals properly. And the buyer Mr. Chan can sue either the antique shop or the auctioneer in conversion, as they had let him bought the crystals without possession.