Law of Tort Tutorial weeks 6 7 Question

Law of Tort Tutorial weeks 6 -7 Question One Presented by: Joseph (50342303) Sing(50295647)

Question One n n n Facts Issues Rules Applications Conclusion

Facts n B&C Co. Ltd ---- Car -- A (hire-purchase) n A --- $6000 monthly-- B&C Co. Ltd. (2 years) n A uses illegal method to make him become registered car owner n A -----car---- D, an auctioneer n D-----car-- X (public auction)

Issues n n n Can B&C Co. Ltd. sue A, if so, what is the remedies available? Can B&C Co. Ltd. sue D, if so, what is the remedies available? Does X get the title of the car?

Rules n n Trespass to Chattels Conversion Sale of Goods Ordinance s 24 Principle of Jus Tertii

Trespass to Chattels n n n unlawful interference with the possession of a chattel by P. direct and intentional act P have possession or a right to possession

Conversion n n intentional act Someone’s act which is the owner can do only, and seriously inconsistent the possession of goods D knows the goods do not belong to P or intention not to challenge P’s right is not relevant. Note that: The difference between trespass to chattels and conversion is: Trespass: not serious interference (liable) Conversion: ONLY Serious interference (liable)

Principle of Jus Tertii Definition: D claims that he has a better title or is acting for 3 rd party who has a better title. n P has possession of the chattel and D does not have a better title, D cannot plead jus tertii. n When P was not in possession of the chattel but relied on his right to possession, D can plead jus tertii. n

Cases n n n Penfolds Wine v Elliott (1947) 74 CLR 204 (supra) R. H. Willis and Son v British Car Auctions Ltd (1978) Leake v Loveday (1842) 4 Man & F 972

Penfolds Wine v Elliott (1947) n P sold wines bottle with words “This bottle is the property of Penfolds Wine Ltd” n The bottles could not be used for storing any other product n D brought two empty bottles for own wine and sold n n n Held: D had committed conversion. D used bottles for his own trade D Violated the P’s title to use the bottle

Applications: A’s Remedies - Trespass to chattel: intentionally and directly interference on the possession of the car n Conversion: A changed the ownership registration, gave the car to the D for disposal, A committed an act of conversion n A breached the HP contract n HP contract was void and B&C Co. had the right to immediate possession n In the law of conversion, A gave the Car to D without the consent of B&C Co, will liable in conversion n A was liable the unpaid purchase price to BC Ltd.

R. H. Willis and Son v British Car Auctions Ltd (1978) n P, a motor car dealers, sold a car on hire-purchase terms to C (Mr. Croucher) n In default of the agreement, C entered the car in car auction run by D (auctioneers) n In the auction, the car was sold to the highest bidder n On knowing that the car had been sold, P bought an action against the auctioneers for conversion n Held: the auctioneers were liable in conversion to the true owner since they had sold a chattel to which they did not have any good title

Applications: D’s remedies Conversion: n When A hands over the car D for sale in the public auction. In law, the receipt by D of B&C Co. ’s chattel amounts to conversion if D’s act is inconsistent with B&C Co. ’s title to the good. n On this basis, D receiving goods for sale to X may render him liable in conversion even if he innocently effects the sales because his act is inconsistent with B&C Co. ’s title.

Sale of Goods Ordinance s 24 n 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.

Leake v Loveday (1842) n It was held that where P was not in possession at the time of the conversion but relied on his right to possession, jus tertii could be pleaded by the defendant.

Applications: X’s Title n n If B&C Co. will take legal action against X for conversion. X can plead jus tertii as defence As a buyer in market overt, X may also claim that he has bought the car in good faith and without knowledge of the defeat in the seller’s title

Conclusion B&C Co. may sue A for Trespass to chattels n The remedies: Damage B&C Co. may sue both A and D for conversion n The remedies: Damages -Both A and D are liable to pay the outstanding balance due from B&C Co. ($6000*18=$108000) X’s title to the car n He may get the title as he may plead that he buys the car in the market overt, for bona fide value and without knowledge of defeat in title