Chapter 15 - § 15.4 • ELEMENTS DEFINED

• Jurisdiction: Colorado

§ 15.4 • ELEMENTS DEFINED

§ 15.4.1—Elements 1 and 3: Unauthorized Exercise of Dominion or Control Over Property

To commit conversion, a defendant must have claimed or taken a right of ownership or possession of the personal property of the plaintiff.¹¹ A temporary deprivation of an individual's property does not constitute conversion.¹²

Nor will a cause of action for conversion exist where the defendant had authority to possess the property in question. For instance, in Byron v. York Investment Company,¹³ the court held that a defendant lessor did not commit conversion where the lease allowed the lessor to take ownership of the plaintiff lessee's machinery and equipment if not removed from the premises within 60 days after the termination of the lease. Once the plaintiff left its property on the premises after 60 days, the lease no longer provided the plaintiff a right of ownership in its machinery and equipment. Similarly, in Stauffer v. Stegemann,¹⁴ the court held that the plaintiffs failed to allege that the defendant attorneys exercised a distinct, unauthorized act of ownership over the plaintiffs' property where, during a pending arbitration, the defendants viewed allegedly proprietary information that was within the scope of a discovery order entitling them to view the information.

§ 15.4.2—Element 2: Personal Property of the Plaintiff

A plaintiff must have, at the time of conversion, both an interest in the personal property and a right to immediate possession of it.¹⁵ As the court explained in Byron,¹⁶ the plaintiff in a conversion case must have "had, at the time of the alleged conversion, either actual possession[,] or title and constructive possession[,] or a right to possession of the land from which the property was taken."¹⁷ In Herbertson,¹⁸ for example, the court held that the plaintiff, as chattel mortgage holder for but not owner of a vehicle, had a right under the mortgage to possession of the automobile and could bring a claim for conversion against the defendant.

Property subject to conversion includes any item of personal property, such as apples,¹⁹ tractors,²⁰ automobiles,²¹ flatware and jewelry.²² In Lawry v. Palm,²³ a dispute regarding a fly-fishing business, the court found a government-issued permit to allow guide trips on the Colorado River was converted by the defendant.²⁴ However, in Culpepper v. Pearl Street Building, Inc.,²⁵ where the plaintiffs alleged wrongful cremation of their son, the Colorado Supreme Court held that there is no property right in a body that would support a claim for conversion.²⁶

A claim for conversion will lie even where the property at issue is only money. In Rhino Fund, LLLP v. Hutchins,²⁷ the defendant took proceeds on the plaintiff's collateral to pay the defendant's own debts and obligations. The court rejected the defendant's argument that the plaintiff could not have a claim for conversion against money only, holding that the defendant took "specifically identifiable funds" that were required to be used for another purpose, namely to secure the plaintiff's loan.²⁸ In Scott, the plaintiff stated a claim for conversion against her ex-husband's second wife where the plaintiff had a vested interest in the proceeds of her ex-husband's life insurance policy by virtue of a court-approved separation agreement, and the ex-husband changed the beneficiary of the policy such that the proceeds ultimately went to his second wife.²⁹

Courts have held that less tangible property is...