Rights of the True Owner

Conversion is defined as an intentional dealing with goods in such a way that inconsistent with the rights of the true owner. As in the case of Tay Kian Hock v Kewangan Bersatu Bhd [1], it was held that there must be an intention on the part of the defendant in so doing to deny the owner’s right or to assert a right which is inconsistent with the owner’s right. This principle was adopted from an English case, namely Lancashire and Yorkshire Railway Co v MacNicoll [2].

If there is no positive wrongful act on the part of the defendant then no tort has been committed as held in Lam Teik Kai v Hallam Nominees Ltd & Ors [3]. Under conversion the interest of the plaintiff to have dominion and control over his goods is protected. However, merely moving goods do not amount to a conversion and an action may only lie in the tort of trespass to goods.

There are 3 elements of conversion must be considered, namely the mental state of the defendant; interference or inconsistent dealing; and the interference or inconsistent dealing must amount to a denial or a deprivation of the owner’s right to have possession.

As for the first element, the defendant’s conduct must be voluntary and thus done intentionally. Mere unauthorized retention of goods would not necessarily constitute a conversion. As in Kuwait Airways Corp v Iraqi Airways Co (No 3) [4], the court held that detention must be adverse to the owner, excluding him from the goods. An example to this element was shown in Ashby v Tolhurst [5]. In this case, the plaintiff left his car at the defendant’s car-park. When he came to collect his car, the attendant told the plaintiff that someone who had claimed to be the plaintiff’s friend had driven the car out of the area. The House of Lords held the defendant not liable in conversion as there was no intentional act on their part.

Furthermore, Hollins v Fowler [6] laid down a principle that any person who obtains possession of goods of another, who in turn has been fraudulently deprived of them, and subsequently disposes of them, whether for his benefit or otherwise, is guilty of a conversion. For example, if the defendant himself was directly involved in the business negotiation, and he then disposes of the goods to a third party, as in the instant case, he will be liable. However, if someone else had been directly involved in the business transaction and the defendant is merely an agent or representative who delivers the goods in question, he has not committed any conversion. The plaintiff in Hollins v Fowler could not take any action against the purchaser as he was a bona fide purchaser. A contradict decision was made in Che Din Mohamed Hashim v Teoh Ong Thor and Chew Chan Seng [7], where the bona fide purchaser for value did not acquire a good title as he and the seller knew at the time of the sale that the seller had no right to sell the goods.

The above 2 cases demonstrate the nemo dat rule which means a person cannot give a better title than what he has to someone else. An exception is to a bona fide purchaser, who will acquire title from a person who does not have any title over the goods. If the goods were bought in good faith, the true owner will lose his right and title over the goods and cannot sue the bona fide purchaser for the tort of conversion.

Next, interference or dealing that is inconsistent with the owner’s right may arise in a number of ways. First, if a person takes possession of another’s property without lawful justification, this give rise to tort of trespass to good and tort of conversion. However, if the interference is merely temporary and trivial and is unaccompanied by any intention to exercise any rights over the goods or to assert rights which are inconsistent with the plaintiff’s, no conversion will arise.

For instance, in Fouldes v Willoughby [8] the court held that an act that involved moving an object from one place to another was no sufficient to amount to conversion. In this case, the defendant’s initial act of requesting the plaintiff to get off the ferry also did not amount to his asserting any right that was in any way inconsistent with the plaintiff’s right.

In JH Rayner (Mincing Lane) Ltd v Teck Hock & Co (Pte) Ltd & Ors [9], it laid down a principle that if a person receives goods voluntarily when in fact the goods belong to a third party who does not consent to the handling of the goods, the party who receives them may be liable in conversion. On the other hand, if a person receives goods involuntarily he does not commit conversion by virtue of that involuntary reception. The latter situation was established in Lethbridge v Phillips [10]. Moreover, a person who receives goods involuntarily and is subsequently negligent will also not be held liable for any damage to the goods as held in Howard v Harris [11]. A person would not be held liable also if he has takes reasonable steps to return the goods. If, however, a person deliberately destroys the goods, he may incur liability in conversion.

The following situation is abuse of possession where dealing with goods may be inconsistent with the owner’s right is where the defendant initially has lawful possession of the goods but he subsequently does an act that constitutes a conversion. For example in Moorgate Mercantile Co v Finch [12] , the defendant was held liable in conversion for using the car for unauthorized purposes.

The third element of conversion was established in The Jag Shakti [13] , which the rightful owner’s right to have possession was denied when goods were given to another party. The denial must be absolute in order for conversion to occur. ‘Denying’ or ‘depriving’ the owner of possession does not mean that the wrongdoer must himself actually take the goods from possession of the owner. As in Kuwait Airways Corp v Iraqi Airways Co (No 3) [14] , an owner is said to be denied or deprived of possession when he is excluded from possession, when possession is withheld from him.

Next issue that need to be considered is the element of defamation. Defamation arises when there is a publication which has a tendency to lower the person’s reputation or to cause him to be shunned or avoided by reasonable persons in society, and thereby adversely affecting his reputation. There are 2 types of defamation, namely libel and slander. Libel is when such words are expressed in a permanent form which is usually visible to the eye, like in a book, e-mail or picture. Slander is when such words are expressed in a temporary form, usually when spoken or made by body movements. For both libel and slander, there are 3 main elements which are necessary to prove defamation. First, the words are defamatory; second, the words refer to the plaintiff; and third, the words have been published.

Firstly, it must be proven that the words expressed are defamatory. Words are defamatory when they tend to lower the reputation of the plaintiff in the minds of an average person in society, so that the plaintiff is avoided, shunned or ridiculed.

Whether words are defamatory depends on the manner they were spoken or published. The words are to be judged in their ordinary meaning, as well as any special meaning which is known to the person who hears or sees those words. That means the intention of the maker of the statement does not matter. Thus, words can be defamatory even when its maker expresses them accidentally or jokingly. This was illustrated in the case of Institute of Commercial Management United Kingdom v News Straits Times Press (Malaysia) Bhd [15] , where the court held that the words complained of are defamatory.

Sometimes a defamatory imputation does not arise from the literal meaning of the words but said to be defamatory by innuendo. Innuendo may be divided into 2 types, false innuendo and true or legal innuendo. False innuendo is where the words are defamatory of the plaintiff due to inferences or implications arising from them. It may arise from a combination of statements and pictures. A true or legal innuendo arises due to special facts which are known to the recipient of the publication. This special knowledge will cause the words to be defamatory of the plaintiff.

Secondly, it must be proven that the words expressed must refer to the person who claims to be defamed. The test to establish this was laid down in the case of David Syme v Canavan [16] , the test being- are the words such that it would be reasonable in the circumstances to lead persons acquainted with the plaintiff to believe that he was the person referred to? The general principle is that the defendant will not be liable unless there is a specific reference to the plaintiff or certain individuals in a particular group. Reference to him can either be direct or indirectly. Indirect reference means when there are other outside facts known to the reader or listener that makes him guess that the words refer to the person claiming to be defamed.

Thirdly, it must be proven that the words have been made to a third party, other than the person being defamed. Thus, if the person being defamed is the only person who hears or reads the words that defame him, there is no defamation. For instance, if someone insult you or defame you in a room which has no other person except you and the maker, then you may not sue him for defamation.

Also, a person who wishes to sue another for slander must pass another element; he has to prove that he has actually suffered financial loss as an effect from the defamatory words being expressed. In libel, there is no such element. The law automatically presumes that loss has been suffered.

The next issue that need to be discussed is the element of trespass to land. Trespass to land is the intentional wrongful entry and unreasonable interference with another’s ownership of his land. In order to establish a tort of trespass to land, 2 elements must be satisfied. First, the defendant must have an intention to trespass, or there must be a voluntary act in entering land that is in the possession of another. It does not matter whether the defendant knew that he was being a trespasser.

For instance, in Basely v Clarkson [17], the defendant accidentally mowed the plaintiff’s grass whilst he was mowing his own grass. The court held the defendant liable as the act of mowing grass was a voluntary act and therefore intentional. Besides, a deliberate entry onto the land is sufficient to constitute trespass as held in Conway v George Wimpey & Co Ltd [18]. However, if the defendant’s entry is without his consent and is involuntary, the element of intention is not fulfilled. As in Smith v Stone [19], the defendant entered the land involuntarily and thus not liable, but the person who brought him in was liable for trespass.

Moreover, the defendant will not be held liable if the act of trespass is foreseeable as held in League Against Cruel Sports Ltd v Scott [20].

To conclude, trespass arises when there is an intention to trespass, or the act of entry is done voluntarily, or the interference to the plaintiff’s land is a foreseeable consequence of the defendant’s act.

The second element of trespass to land called interference. The interference must be a direct and an immediate act. Interference may occur in several ways. For instances, in Tan Wee Choon v Ong Peck Seng & Anor [21], it was held that once a person wrongfully enters onto land in possession of another even though no damage has been done, that constitute trespass to land. In this case the defendants were held liable in trespass. In Chanan Singh v Thiyagaletchumi [22], the court held slightest crossing of the boundary is sufficient to constitute an unjustifiable intrusion upon the land in possession of another.

Interference to land includes remaining on land which commonly referred to as ‘continuing trespass’. Continuing trespass applies only to the failure to remove things that have been wrongfully left on the land. For example in Tay Tuan Kiat v Pritam Singh [23], the defendant built a wall that encroached onto the plaintiff’s land, the court held that there was continuing trespass as long s the wall was not demolished. In addition, by using another’s land as access road to one’s land constitutes continuing trespass as in Ooi York Choo v Lim Song Foundry [24]. This was then re-affirmed in MBf Property Services Sdn Bhd v Madihill Development Sdn Bhd (No 2) [25].

The cases of Tay Tuan Kiat and MBf Property Services Sdn Bhd, as mentioned above, illustrate the interference by entering or placing an object on the land of another. Others example to this kind of interference would be like placing a ladder against another’s wall, removing doors and windows belonging to another and dumping soil onto another’s land.

Trespass can also be committed by interference to the airspace above the land. For example, in Wandsworth Board of Works v United Telephone Co [26], where an unauthorised telephone wires above the plaintiff’s land constituted trespass to the airspace. In Kelsen v Imperial Tobacco Co Ltd [27], the defendant committed trespass by allowing an advertising board to project eight inches into the plaintiff’s property at ground level and another above the ground level.

It may be concluded that interference may occur in several circumstances such as entering land which is in the plaintiff’s possession; remaining on the plaintiff’s land; entering or placing an object on the plaintiff’s land; or interference to airspace.