1. What Are Damages?
2. What Is Conversion of Property?
3. Types of Property in Wrongful Conversion

Damages for conversion are the awards someone seeks in a conversion case. They are compensation for actual losses of personal property. Conversion is depriving an individual's rights to use or possess his or her personal property. It's often defined as interference in someone's right to property without that person's permission and without lawful justification.

What Are Damages?

Damages are intended to compensate the aggrieved party for its loss of personal property. This is property that was wrongfully taken by another.

The owner of the property may be able to recover its value at the time it was taken, along with interest up to the date of the trial. Damages should be full compensation for actual losses. Damages must be proven in court by displaying sufficient evidence that would enable a jury to figure a fair and reasonable value of damages.

The amount of damages may differ when conversion is tainted with fraud or other types of serious acts. In a case of conversion with fraud, gross negligence, or willful wrongdoing, the plaintiff has an option to determine the highest rate of the property's fair market value. This allows the plaintiff to maximize damages to punish particularly outrageous acts of conversion.

When a defendant doesn't convert property using fraud or willful wrongdoing, damages shouldn't be subject to a plaintiff's whims. Courts will not grant exorbitant damages as a way to unjustly enrich the plaintiff or unjustly punish the wrongdoer.

The fair market value is considered to be a price the property would bring in the open market between two willing parties. If there isn't enough market information available to determine the value, damages are calculated based on a reasonable value for the property when it was taken.

What Is Conversion of Property?

Conversion of property happens when an individual deprives another person of using or possessing his or her personal property. Conversion may also be called “trespass to chattel,” and it typically involves personal property, not real property.

Most conversion claims state that the defendant hindered the plaintiff's ability to use his or her own property. Damages are usually calculated based on the loss of use instead of the loss of possession. As a result, figuring out damages can be complicated.

Consider this example: your neighbor takes your bicycle without your permission and bends the frame. Your bike isn't rideable in this condition, and your neighbor refuses to replace the bike. While you can file a criminal complaint against your neighbor, that doesn't fix your bike. To reclaim the value of your damaged personal property, you have the option of filing a lawsuit for conversion.

Conversion may occur when a person, acting without your permission, engages in the following with your property:

  • Takes it
  • Fails to return it
  • Sells it
  • Substantially alters it, like cutting down your trees to use the wood
  • Severely misuses or damages it

Conversion occurs when someone intentionally takes an individual's personal property without the consent of that individual. The injured party may seek legal relief.

Types of Property in Wrongful Conversion

Wrongful conversion doesn't apply to all of the personal property you can own. It only applies to physical property, such as the following:

  • Bicycle
  • Computer
  • Cell phone

Basically, anything you own that can be moved is subject to conversion. Because real estate isn't property that you can move, it isn't covered under conversion.

Most types of property that don't have a physical substance — such as intellectual property rights or trade secrets — aren't subject to conversion. However, they may be covered if they've been merged into a physical form, such as insurance policies or stocks. Some state courts are moving toward recognizing certain kinds of intangible property as personal property.

Property that can be converted isn't "real property,” which is generally defined as land and any attached improvements on the land. Outside of real estate, all other property is usually considered personal property.

When someone takes another's personal property without permission, the law gives the aggrieved party some avenues for compensation. It's not always easy to place a value on that property, but courts try to provide some guidelines.

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