Last year, we wrote a mini-series on the five most common causes of action we were seeing in the evolving world of cannabis litigation. Given that we’re seeing some other trends (I last wrote about defamation back in January), we’re going to continue on with another often-included cause of action: conversion.
Conversion is defined by California case law as “the wrongful exercise of dominion over the personal property of another.” Essentially, if someone is substantially interfering with your possession or right to possession, you are entitled to recover the property or the full value of the property as a consequence. We typically see this cause of action in breach of contract actions, especially in the cannabis business purchase and sale context. For example, if a seller sells product to a buyer on terms, and the buyer ultimately ends up failing to pay the full contract price and fails to negotiate a return of the product, that seller typically has a conversion claim in addition to its breach of contract claim.
Statute of Limitations
The statute of limitations for conversion is three years under Code of Civil Procedure § 338(c). But, there are nuances here. That clock generally starts ticking