UNIT 4: CONVERSION AND RECONVERSION

CONTENTS

1.0       Introduction

2.0       Objectives

3.0       Main content

3.1       Importance of the Doctrine of conversion

3.2       Types of Circumstances in which the doctrine is operative

3.3       Failure of Conversion

3.4       Reconversion

4.0       Conclusion

5.0       Summary

6.0       Tutor-Marked Assignments

7.0       References / Further Reading

1.0     INTRODUCTION

In the last unit, we examined assignment of choses in action. In this unit, we will consider the doctrine of conversion and reconversion. Bowen, L.J. once said: 'It is an established principle in equi- ty that when money is directed or agreed to be turned into land, or land agreed or directed to be turned into money, equity will treat that which is agreed to be or which ought to be done as done already, and impresses upon the property that species of character for the purpose of devolution and title into which it is bound ultimately to be converted.' Att. Gen. v. Hubbuck (1884) 13 Q.B.D. 275, 289.

The equitable doctrine of conversion rests on the maxim that equity regards as done what ought to be done. The doctrine becomes relevant wherever there is an obligation arising under a will, trust, contract or court order, to sell or purchase land. In equity, even though the obligation has not been carried out, the existence of such obligation is sufficient to fix the rights of the parties and to determine the nature and character of such rights as they would have been if the obligation had in fact been performed. This leads to the fictitious and artificial nature of the doctrine.

2.0     OBJECTIVES

By the end of this unit you should be able to:

(i)        Explain the importance of the doctrine of conversion;

(ii)       List the types of circumstances in which the doctrine is operative;

(iii)       Discuss Failure of Conversion; and

(iv)       Explain the doctrine of reconversion.

3.0     MAIN CONTENT

In the language of Langdell, ‘A direct equitable conversion differs from a direct actual conversion in this, namely, that while the latter is a fact, the former is a pure fiction. To say, indeed, that a direct equitable con- version is other than a pure fiction would be to claim for equity those miraculous powers which the ancient alchemists claimed for themselves .... The immediate object of the direct equitable conversion is to cause a thing to devolve, on the death of its owner, not according to its true  nature  and quality, but according to the nature and quality which equity, by a fiction, attributes to it, for example, to cause land to devolve as if it were money or money as if it were land.’ (Equitable Conversion (1904) 18, Harv.L.Rev.83 at 245). The no- tional or fictitious conversion usually become effective at the date of the instrument expressing the intention, if a deed or contract, and if a will, at the date of the testator's death.

In Fletcher v. Ashburer (1779) 1 Bro.C.C.497, 28 E.R. 1259, Sir Thomas Sewell M.R. attempted to jus- tify the development of the doctrine when he said that ‘nothing was better established than this principle, that money directed to be employed in the purchase of land, and land directed to be sold and turned into money are to be considered as that species of property into which they are directed to be converted; and this in what- ever manner the direction is given: whether by will, by way of contract, marriage articles, settlement or oth- erwise, and whether the money is actually conveyed or only agreed to be conveyed; the owner of the land, or the contracting parties, may make land money or money land. The cases establish this rule universally.’

The practical operation of the doctrine as conceived by Sewell,M.R., may be said to have conditioned the development of the doctrine of conversion. Maitland, in his book ‘Lectures on Equity (2nd Edn.) p.277, was of the view that the equitable doctrine of conversion is the outcome of the fact that England had two systems of intestate succession, the one for realty, the other for personalty; and that but for that unfortunate fact there would have been no need of the doctrine. He went further to say that the doc- trine has its root in the simple principle that when property has been given to a trustee it must not be in the power of that trustee to alter the devolution of the beneficial interests by committing a breach of trust. Keeton thought that the development of the doctrine at the beginning of the 18th century can be traced to the unfairness of allowing trustees prejudicially to affect the interests of beneficiaries by postponing sales or purchases of land. No doubt the doctrine is designed to promote justice and also to assist the owner of the subject-matter of conversion in the accomplishment of his objective as regard the ultimate devolution or distribution of his property in accordance with his presumed intention.

3.1    Importance of the Doctrine

Practically, the doctrine is of little significance in Nigeria, hardly can one find a single reported case in which the doctrine has been applied. Even, in England where the doctrine originated, the importance of the doctrine has declined since the property legislation of 1925. As Maitland rightly observed, the doctrine would not have been evolved, but for the fact that before 1926, England had two systems of intestate succession, the one for realty and the other for personalty. Furthermore, the law made and still makes a distinction between what is real property and what is personal property. Before 1926, on intestacy, real property devolved in one way and personal- ty in another; it was, therefore, important to ascertain by reference to the application of the doc- trine of conversion what property of the deceased intestate could be classified as realty and that which could be said to be personalty before the heir's interest and that of the next-of-kin could be accurately determined. By the then applicable law, the heir was entitled to realty while the personalty devolved on the next-of-kin.

The property legislation of 1925 has, however, robbed the doctrine of its importance in relation to intestacies. For example, sections 45 and 46 of the Administration of Estates Act, 1925 ab- olished descent of realty to the heir, instead, a new form of succession common to both real and personal property was introduced. Similarly, section 33 of the Act provides that, on intestacy, the personal representatives of the deceased hold on statutory trust from sale so that persons en- titled under the Act to the deceased intestate property, will primarily, be entitled to it as perso- nalty. There is a similar provision in Section 37 of the Administration of Estates Law (Western Nigeria), 1959.

Nevertheless, the doctrine has not become totally impotent; there are a number of circumstances in which the question of conversion can still arise and a fair and just settlement of such question can be achieved by reference to the equitable doctrine of conversion. For example, the question of conversion will still arise where a testator disposes of his realty and his personalty respective- ly to different persons. In that connection, it is necessary if the desired result as between the de- visees and the legatees is to be achieved and if the intention, of the testator is to be fully imple- mented, to determine that which is realty and that which is personalty under the testator's will. For it may be that the testator, in his life time, was under an obligation either to lay money for the purchase of land or to sell land and this obligation was not carried out before his death. Here the doctrine of conversation becomes relevant in the determination of the nature of the testator's rights as regards that obligation and a fortiori, the rights of those interested in the realty and per- sonalty under the testator's will. Whenever the doctrine applies, it applies for all purposes.

In Sweetapple v. Bindon (1705) 2 Vern. 536, 23 E.R. 947, T. bequeathed £300 to be laid out in the purchase of land and settled to the use of her daughter and her children and that if her daugh- ter should die without issue, the property should go over. The daughter died without issue and no purchase of the land had been made with the £300. The husband of the daughter claimed to be tenant by courtesy of the fund of £300; this was a kind of tenancy by which a widower was entitled to his deceased's wife' realty. The claim was upheld, though the purchase of land had not been made; by the doctrine of conversion, the money was regarded as realty.

As will be seen below, the doctrine can only operate where someone is under an obligation to have carried out certain act and there is someone who is in a position to compel the performance of such obligation.

3.2     Types of Circumstances in which the doctrine is operative

1. Where there is a binding and specifically enforceable contract for the sale or pur- chase of land

In this case, the doctrine of conversion becomes effective at the date and time of the contract expressing the intention. The land, the subject-matter of the contract of sale is considered and treated as personalty and the purchase-money is considered and treated as land. Thus, where there is contract by A to sell land to B at a certain price, B becomes the owner in equity of the land, subject, however, to B's obligation to perform his part of the contract by paying the pur- chase-money; but subject to that, the land is the land of B, the purchaser. As regards the position of A, the vendor, he truly has the legal estate in the land, but for many purposes, from the mo- ment the contract is entered into he holds it as a trustee for B, the purchaser. Although A has certain rights in the land remaining all those rights as conditioned and limited by the circums- tances that they are all referable to his rights to recover and receive the purchase-money. His in- terest in the land when he has entered into a contract for sale is not an interest in land; but an in- terest in personal estate, in a sum of money due under the contract. See Vaisey, J., in Hillington Estates Co. v. Stonefield Estates Co. Ltd. (1952) Ch. 627 at 631-632.

The extent of the operation of the doctrine-had been stated by Lord Eldon in the early case of Se- ton v. Slade (1802) 7 Ves. Jr. 265, 32 E.R. 108 at 273, when he said: 'The effect of a contract for purchase is very different at Law and in Equity. At Law, the estate remains the estate of the ven- dor; and the money that of the vendee. It is not so here (in equity). The estate from the sealing of the contract is the real property of vendee. It descends to his heirs. It is devisable by his will; and the question, whose it is, is not to be discussed merely between the vendor and vendee; but may be to be discussed between the representatives of the vendee.' Thus, if a vendor dies before com- pletion of the contract, the question would be whether at the time of his death he was under such an agreement that could have been specifically enforced against him. If the answer is in the af- firmative, the land which the vendor had agreed to sell will be treated as personalty and would devolve to the person or persons entitled to personality under the vendor's will. See Curre v. Bowyer (1818) 5 Beav. 6; 49 E.R. 478.

Conversely, on the death of the purchaser before completion, the land will devolve on his devisee who is however bound to pay the purchase-money. But where a testator specifically devises land which is subject to an uncompleted contract of sale owing to his death, but refers to the proceeds, the devisee is entitled to such proceeds. This was the position in Re Carlow (1928) Ch. 710 at 714, where the contract preceded the will, the court held that the will having been made after the date of the contract for sale and with full knowledge of that contract on the part of the testator, indi- cated an intention as shown by the testator's reference to proceeds of sale, to pass whatever estate the testator had in the property to the specific devisees. But where the will precedes the contract, the specific devise will be adeemed by the contract, and the proceeds of sale will go to the person who is entitled to personalty under the testator's will. See Farrar v. Winterton (1842) 5 Beav. 1,49 E.R. 476.

It is a condition precedent to the application of the doctrine that there must be, in every case, a contract binding on the vendor and the purchaser, and capable of being specifically enforced as between the vendor and the purchaser. See Lysaght v. Edwards (1876) Ch.n. 499; and National Bank of Nigeria Ltd. v. Compagnie Frassinet (1948) 19 N.L.R. 4 at 6. As regards contract affect- ing real estate, it is a requirement that the vendor must be in a position to make a title according to the contract; unless he has done this or the purchaser has accepted the title however bad the title may be, the contract will not be valid and, therefore, not specifically enforceable. But where the contract is valid and binding, it has the effect of converting the real estate in equity, making the land a part of the real estate of the purchaser. Indeed, all the cases on the doctrine of construc- tive conversion are founded on the principle that a valid and specifically enforceable contract ac- tually changes the ownership of the estate in equity. See Lysaght v. Edwards (supra).

Thus, in Re Thomas  (1886) 34 Ch.n. 166; where title was not made out at the time the rights and obliga- tions of the parties ought to have been fixed under the contract and as laid down by Jessell, M.R. in Lysaght v. Edwards (supra), Kay, J. held that since specific performance was not possible, there could be no conversion. See further, Buckmaster v. Harrop (1802) 7 Yes. 341, 32 E.R. 139. Similarly, conver- sion does not take place where the vendor-purchaser relationship is absent; and such relationship does not exist where the contract of sale is subject to a condition precedent; conversion will only take place if and when the condition has been performed. See Renelagh v. Melton (1864) 2 Dr. SM. 278; 62 E.R. 627.

2. Where there is an Option to Purchase

The Rule in Lawes v. Bennett (1785) 1 Cox. Eq. Cas. 167; 29 E.R. 1111. The general rule is that if an owner of a real estate contracts to sell it and dies before the contract is executed, the estate is con- verted into personalty; and that when a party under an agreement is given unilateral power of making an election at a future date, as to whether or not the contract should be carried out, and that party has elected in favour of the contract there is conversion which is related back to the time the power was granted; although the contract which gives rise to the option is never in fact specifically enfor- ceable, there is conversion from the moment the power to elect is exercised and, therefore, becomes a binding contract in the life time of either party.

But a different situation arises where an option is granted and the option is not exerciseable until af- ter the grantor's death; in that case there ought to be no conversion since there cannot be a specifi- cally enforceable contract in existence as from the date and time of the grantor's death. This is the position in most, if not in all, of the American jurisdictions. See the following cases: Rockland- Rockport Lime Co. v. Leary 203 N.Y. 469 (1911), Inghram v. Chandler; 161 N.W. 434 (1917), Smith v. Loewenstein 34 N.E. 159 (1893).

But the rule in Lawes v. Bennett (supra) is to the contrary. In that case, W, in 1758 leased a farm to D for 7 years. The leasehold agreement contained an option to D to purchase the freehold for £3,000, if D should give notice in writing before the 29th September 1765, of his intention to purchase the freehold, W would sell at the stated price. W, the lessor died in 1763, having devised all his realty to B and all his personalty to B and M equally. D subsequently exercised the option and M now claimed from B, half of the purchase price. The success or otherwise of M's claim depends on the nature and character of the purchase price. If the purchase price were regarded as personalty, M would succeed, otherwise, the entire purchase price would go to B who was entitled to realty under W's will. Whether the purchase price was realty or personalty would have to be determined by the application or non-application of the equitable doctrine of conversion.

It was contended on M's behalf that at the time of W's death, the freehold land, the subject-matter of the option must be considered as personalty since the exercise of the option related back to the date of the original agreement granting the option and that from that date conversion would operate. This contention was upheld by Sir Lloyd Kenyon M.R., thus the rule in Lawes v.  Bennett was evolved. That where there is a contract giving an option to purchase real estate, and the option is not exercised till after the death of the person who created the option, nevertheless, the purchase price, if and when the option is exercised, goes as part of the grantor's personal estate and not as part of his real estate. That the exercise of an option to purchase given in a lease has a retroactive effect, in that it relates back to the time the option was granted and, therefore, conversion operates, as between the persons interested in the realty and personalty respectively of the lessor, as from the date the option was granted.

Scope of the rule: The rule applies, as between the real and personal representatives of the person who granted the option, even where the terms of the option stipulate that the option is not exercises- able until after the death of the grantor. In Re Isaacs (1894) 3 Ch.D. 506, there was a lease which con- tained an option to purchase in favour of the lessee. The option was exercisable within 6 months of the lessor's death. The lessor died intestate and the lessee exercised the option; Chitty, J., held that the purchase money devolved not on the person entitled to realty but to the person entitled to perso- nalty under the deceased's intestacy.

Whenever the rule applies, conversion takes place at the time the option is exercised and not that of the creation of the option, thus, it is the time the option is exercised that must be looked at for the purpose of ascertaining the rights of the parties. See Re Adams & Kensington Vestry (1884) 27 Ch.D. 394 C.A. The right of the grantor and that of grantee in the subject-matter of the option are contingent upon the exercise of the option, therefore, their respective rights and obligations can only become fixed when the option is exercised. In Re Marlay (1915) 2 Ch.D. 264 at 275, it was held that where an agreement confers an option to purchase, the exercise of the option converts the agreement into an agreement for sale and that the land itself is treated as converted from the date of the original agreement, though the title to the intermediate rents and profits not changed.

This is consistent with the earlier decision of Lord Eldon in Townley v. Bedwell (1808) 14 Vts. 591; 33 E.R. 648, that where there is an option to a tenant to purchase the reversion, the rents and profits accruing within the interval, between the date of the lessor's death and the time the option is exer- cised, would go to the person entitled to realty under the lessor's testacy or intestacy and such per- sons would not be required to account for these. Suppose, for example, in 1968, D made a will de- vising his 'Agege Estate' to X and bequeathing all his personalty to Y; and in 1970, D granted a lease of 'Agege Estate' to Z for 8 years with an option to purchase the reversion for N5,000 before the expiration of the lease; D died in 1971, and in 1973 Z exercised the option.

Under the rule in Lawes v. Bennett, conversion takes place at the date Z exercised the option and the purchase money would be paid to Y who is entitled to personalty under D's will; however, since it is the exercise of the option that converts the agreement that created the option into an enforceable contract of sale, a fortiori, conversion of the realty to personalty, the rents from 'Agege Estate' be- tween the date of D's death and the time the option was exercised would be paid to X who is entitled to realty under D's will. See Collingwood v. Raw (1857) 26 L.J. Ch, 649. It is the exercise of the op- tion that adeems the devise of 'Agege Estate.'

The giving of notice to exercise an option is in itself sufficient to make conversion operative once and for all and, the mere fact that the exercise of an option is not followed by completion of the pur- chase would not prevent conversion, (which had notionally taken place, by the exercise of the op- tion) from continuing to subsist. See Re Blake (1917) 1 Ch. 18.

3. Where there is a Binding Trust to Sell or Purchase Land

Whenever there is a direction, contained in a will or settlement, that trustees shall sell or purchase land, there is a trust for conversion which becomes operative from the moment the instrument creating the trust becomes effective. In the case of conversion directed by will, con- version takes place from the time of the testator's death. Thus, in Beauclerk v. Mead (1741) 2 Atk. 168 at 170; 26 E.R. 505, the Lord Chancellor stated that while it is a correct rule that a direction under a will that money be invested in the purchase of land must be complete before conversion takes place; since a will is ambulatory in the testator's life time, conversion cannot take place until his death. In the case of conversion directed by deed; a deed differs from a will in the ma- terial respect that a will speaks from the death of the testator while a deed speaks from the date of its delivery or execution. See Wigram, V.C. in Griffith v. Ricketts (1849) 7 Hare 299. 311; 68 E.R 122.

There can only be a trust for conversion where the direction to convert is imperative and defini- tive. As Parker, J. observed in Re Walker (1908) 2 Ch. 705 at 712, it is possible for the legisla- ture by a simple enactment, to make personalty devolve and pass to a series of persons succes- sively for the same interests as if it had been realty; but the only manner in which an individual can achieve similar objective is by the creation of an imperative trust for its conversion into real- ty. Where the words in the settlement are sufficient to create an imperative and definitive trust to sell or purchase, there will be conversion; a counsel's submission to this effect was upheld by Pollock, M.R in Re Twopeny’s Settlement (1924) 1 Ch. 522 at 529. The counsel had relied on a doc- trine established by authorities that - 'where the quality of real estate is imperatively and definitively fixed upon personalty or vice versa, equity will treat the personalty or realty as the case may be as having acquired the quality indicated even though it is not found to have been actually turned into realty or personalty; this being that equity treat is what ought to have been done as done and will not allow the rights of the beneficiaries to be altered by a failure on the part of trustees to carry out their trusts.'

A mere declaration that personalty shall devolve or pass to persons successively as realty is in itself inoperative since the whole doctrine of conversion turns on the maxim that equity considers to have been done what ought to have been done pursuant to the trust. See Re Walker (supra). Considering the principle upon which the doctrine of conversion is founded, it is obvious that there must be a paramount obligation contained in the trust instrument, and binding the trustees to invest in the purchase of land; but if such investment is optional only so that the trustees may completely perform their duty by investing in some form of personal security, there would be no conversion and the rights of the parties would depend on the actual nature or state of the property at the material time. See Warrington, L.J. in Re Twopeny’s Settlement (1924) 1 Ch. 522 at 533. Thus, nothing short of an absolute and effective trust for sale or purchase can in equity create a conversion of realty into personalty or vice versa. See Stirling, J. in Goodier v. Edmunds (1893) 3 Ch. 455, 462.

In the earlier case of Curling v. May (1734) 3 Atk. 255n, T by his will gave £500 to his trustees with a direction that the money be laid out for the purchase of land or put the same out on good securities for the separate use of his daughter D. D survived T but the money was not invested in any purchase until after D's death. The question was, as between D's administrator and her heir, who was entitled to the purchase. If the trust under which D was a beneficiary was imperative, then there would be conversion as from the moment of T's death, and the purchase would de- volve on the person entitled to realty under T's intestacy otherwise it would devolve as personal- ty. It was argued that when it is doubtful whether a bequest ought to be considered as money or land the court of chancery will not interfere because of the element of doubt involved. This sub- mission was upheld by Lord Talbot who stated that there could be no conversion on the ground that the direction in the trust instrument was discretionary; there was no sufficient indication in the will as to what was the testator’s principal intention since the direction was one of investing in land or securities.

Where settlor or testator directs trustees to sell or purchase land and such direction is to take place with the consent or at the request of some named persons, such qualification is not suffi- cient to prevent the direction from being imperative. See Re Ffennell’s Settlement (1918) 1 Ch.91. In Attorney-General v. Dodd (1894) 2 Q.B. 150 at 154,  where the direction to sell was subject to the qualification that the sale should take place at the request of certain specified per- sons, Matthew, J., rejected the contention that the qualification necessarily prevented the direc- tion from being imperative; such clauses; he stated, are only intended to give directions as to the time and circumstances under which the sale is to take place and do not necessarily indicate that the sale must not take place ultimately.

Sometimes, however, it may be a question of construction whether the qualification is such that it imports an element of discretion enabling the specified person to prevent conversion, in which case there will be no conversion. For example, where the direction to sell is to be 'with the con- sent of A and not without' there is no conversion for, here the discretion is not imperative. But as Morton, L.J. put it in Duke of Marlborough v. Attorney-General (1945) Ch. 145 at 154, it is well set- tled that if real property is vested in trustees upon trust for sale with the consent of a named per- son, the consent is treated as intended to regulate the exercise of the trust for sale but not to pre- vent the trust for sale from being an immediate trust for sale, whether subject to consent or not, the trust operates at once to effect a conversion. This is consistent with the earlier opinion of

Grant, M.R in Thornton v. Hawley (1804) 10 Ves. 129 at 137; 32 E.R 793, where he said that 'nothing is more common than to direct money to be laid out upon request. The object of that is only to ensure that the act shall be done when the request is made-not prevent it until· request.'

4. Under a Statutory Trust for Sale - Applicable only in the Former West and Mid-West States Under the Property & Conveyancing Law, 1959 and the Administration of Estates Law, 1959

The following provisions statutorily create trusts for sale a fortiori, the consequences are automatic con- version. Section 61(2) of the law provides that where, after the commencement of the law, land is ex- pressed to be conveyed to any persons in undivided shares and those persons are of full age, the con- veyance shall (notwithstanding anything to the contrary in the law) operate as if the land had been ex- pressed to be conveyed to the grantees ... as joint tenants upon the statutory trusts hereinafter mentioned and so as to give effect to the rights of the persons who would have been entitled to the shares had con- veyance operated to create those shares.

Section 61(3) provides that a devise, bequest or testamentary appointment, coming into operation after the commencement of the law, of land to two or more persons in undivided shares shall operate as a de- vise, bequest or appointment of the land to the personal representatives of the testator, and (but without prejudice to the rights and powers of the personal representatives for the purposes of administration) upon the statutory trusts hereinafter mentioned.

Section 64(1) provides that any disposition purporting to make a settlement of an undivided share in land shall only operate as a settlement of a corresponding share of the net proceeds of sale and of the rents and profits until sale of the entirety of the land. Section 62, which defines 'statutory trusts' provides that, for the purposes of the law, land held upon the 'statutory trusts', shall be held upon trusts for sale. Sec- tion 63(1) provides that where a legal estate is beneficially limited to or held in trust for any persons as joint tenants, the same shall be held on trust for sale, in like manner as if the persons beneficially entitled were tenants in common, but not so as to sever their joint tenancy in equity.

Section 37(1) of the Administration of Estates Law, 1959 also provides that on the death of a person in- testate as to any real or personal estate, such estate shall be held by his personal representatives:

(a) as to the real estate upon trust to sell the same; and

(b) as to the personal estate upon trust to call in, sell, and convert into money such part thereof as may not consist of money.

The general effect of the foregoing provisions which create automatic trust for sale and conversion in cir- cumstances falling within any of the provisions is best illustrated by English decisions on similar provi- sions in the English Law of Property Act, 1925. Generally, where there is statutory imposition of a trust for sale, the effect is, as far as beneficiaries are concerned, to convert land into money.

Thus, in Re Kempthrime (1930) 1 Ch. 268 at 290, it was held that the statutory imposition of a trust for sale operated to convert an undivided share of real estate into a corresponding share of the proceeds of sale of the entirety; and that as from the passing of the Law of Property Act, 1925, the interest of the owner of an undivided share in real estate became personal estate and passed as such. In that case, a testator was, in his life time, entitled to an undivided share in freehold property. By his will made before 1925, he gave all his freehold property to A and all his person- al estate to B. The testator died in 1928, and the question was, as between A and B, who was en- titled to the undivided share under the testator's will. It was held that as from the 1st January 1926, the Act of 1925 operated to convert the undivided share into personalty which accordingly passed to B. The decision would not have been different if the will had been made after the commencement of the Act. (See further Re Price (1928) Ch. 579).

The full effect of the Act where it operates seems to be that a devise of undivided share in realty will be adeemed since the devise would be of land which the imposition of trust for sale notional- ly converts into personalty and as such there will be nothing upon which the devise will operate. Thus, in Re Newman (1930) 2 Ch. 409 at 413, a devise of an undivided share in land was held adeemed by the imposition of statutory trust for sale and conversion because there was nothing left for the devise to operate on; the undivided freehold moiety having been impressed with statu- tory trust for sale, had become a moiety of the proceeds of sale.

However, the court would give effect to the substance of the devise of an undivided share in land and preclude ademption where the testator sufficiently indicated a contrary intention. For exam- ple, ademption would be precluded where the testator had used such words as to demonstrate his intention to benefit the devisee in whatever form his interest in the property might take. The use, by a testator, of the words 'all my share of interest' in devising his interest in an undivided land, has been held sufficient' to preclude ademption. See Re Mellish (1929) 2 K.B. 82. Similarly, a contrary intention, precluding ademption, would be shown if the testator either confirmed (Re Warren (1932) 1 Ch. 42) or merely republished (Re Harvey (1947) Ch. 285) his will by codicil.

In Re Harvey (supra) at 293-295, a testator, by his will made in 1912, devised his undivided shares to his trustees for his daughter for life. The Law of Property Act, 1925 converted the shares into personal property. In 1927, the testator made a codicil which merely recorded the destruction of the earlier codicils but without any confirmation or reference to the contents of any preceding testamentary document. It was argued, among other things, that the quality and whole nature of the property had fundamentally changed by the imposition of the statutory trust for sale so that that which the testator purported to dispose of, had previously to the death of the testator been taken away from him and that there was nothing left upon which the disposition would operate. But Vaisey J. held that since the fifth codicil, that is, that of 1927, referred expressly to the will, the codicil had sufficiently republished the testator's will constructively so as to preclude ademp- tion of the gift in question and that absence of express confirmation of the will was immaterial.

It would appear that the court has taken this flexible approach so as to ensure that statutory impo- sition of trust for sale which is designed principally to make conveyancing easy, does not defeat testators' intentions or, destroy or alter substantive rights in the process. See Re Warren (supra). It should, however, be noted that the foregoing cases were decided in the context of the English Law of Property Act, 1925, but the relevant provisions of the Act, Section 34-36, have been sub- stantially re-enacied by the Property and Conveyancing Law (Western Nigeria), 1959, Sections 61-63 respectively.

5. 5. Where Land is Partnership Property

Where land is partnership property, such land has always been treated in equity as personality. As Bowen, L.J. explained in Attorney-General v. Hubbuck (1884) 13 Q.B.D. 275 at 289, the doctrine of conversion necessarily ·affects partnerships- 'partnership property is that which is held by the part- ners as such for the purposes of the partnership; it is held for the purpose of carrying on the adven- ture of the partnership, and may be wanted for that purpose, and moreover, at the time of winding up of the partnership the debts of the partnership will have to be paid, the question of their amount settled between the partners and then the unexhausted assets divided between them'.

To achieve the various purposes of a partnership and upon dissolution to ensure equitable division of partnership property among the partners, partnership property must be treated in the end as sub- ject to a trust for sale and conversion. This is the basis of the rule which has now been made statu- tory: Section 22 of the Partnership Act 1890, a statute of general application and section 23 of the Partnership Law Cap. 86, Laws of the Western Region of Nigeria, 1959, provides that where land or any interest therein has become partnership property, in the absence of any contrary expression or a contrary intention, it is to be treated as personalty, not only as between the partners (including the representatives of a deceased partner) but also as between the beneficiaries who are entitled in the real and personal estate of a deceased partner.

6. 6. Where Court Directs a Sale

Where a court of competent jurisdiction directs a sale of realty, conversion becomes operative from the date of the order. In Fauntleroy v. Beebe (1911) 2 Ch. 257 at 263, an absolute order for sale made by a court of competent jurisdiction in an administration action was held to operate as a conversion from the date of the order and, the interest of the joint-owners were no longer in the land but in the proceeds to be derived from the sale. Where conversion is rightfully directed, it is for all purposes and all the consequences of conversion must follow, thus there is no equity in favour of any beneficiary, either under a will, settlement or intestacy to take the property, the subject-matter of conversion, in any other form than in its converted form.

The mere fact that the order was  made for a purpose which does not exhaust the proceeds of sale does not prevent conversion. In Burgees v. Booth (1908) 2 Ch. 648 at 651, the question was whether the surplus of proceeds of sale of an infant's real estate which had been directed by an order of the court to be sold for payment of costs, descended on the infant's heir-at-law or went as personalty to his next-of- kin. Cozens-Hardy, M.R. held that 'there are no trusts for reconversion into real estate, and there is no equity between heir-at-law and next-of-kin, and there is no ground for holding that this is anything else than what it professes to be and is in fact, namely cash.'

The court may, however, order that there should be no conversion, which may mean that the property would retain its original nature and character either for all purposes or for purposes of devolution only. Such order is, perhaps, usually made where the property ordered to be sold or to be purchased is owned by someone suffering under certain incapacity. In Attorney-General v. Marquis of Ailesbury (1887) 12 App. Cas. 672 at 687-688, Lord Fitzgerald said that 'it seems that for a great length of time a theory has existed in equity, which has been carried into effect in practice, that an investment of the money of a lunatic in the purchase of land under such conditions as are now before us does not change its character or its destination... it remains 'money' for all intents and purposes'.

As Lord Macnaghten pointed out in this case, in the ordinary course of managing a lunatic's estate, the court pays no regard to the interests or expectations of those who may succeed him, but that it is equally well settled that in matters outside the ordinary course of management, such as an order for sale and con- version of a lunatic's property, the court has a duty so far as may be possible not to alter the character of the lunatic's property or to interfere with any rights of succession. See also Re Searle (1912) 2 Ch. 365.

Whenever it becomes necessary for the court to order the nature and consequent devolution of the estate of a lunatic, the paramount consideration, the controlling factor, is always what in the circumstance, is in the best interest of the lunatic. See Re Silva (1929) 2 Ch. 198. The court may also direct that there should be no conversion where conversion has been effected by parties who have no lawful authority to effect such conversion; it is immaterial that the result of conversion may have been beneficial. See Taylor v. Taylor (1853) 10 Hare 475; 68 E.R. 1014.

SELF ASSESSMENT EXERCISE 1

List the circumstances in which the doctrine is of conversion operates

3.3     Failure of Conversion

Failure of conversion may be either total or partial.

Total failure

Whether a conversion is directed by a Deed or by a Will, if the objects for which the conversion has been directed totally fail before the will or the deed becomes operative there is no conversion. A num- ber of reasons may be responsible for total failure of conversion; for example where all the benefi- ciaries under a trust for sale die before the trust instrument comes into operation for example, death of legatees or devisees in the life time of the testator in the case of conversion directed by will, or death of all the beneficiaries before a deed, directing conversion in their favour, becomes inoperative. Similarly there will be total failure of conversion where the beneficiaries failed to ob- tain vested interest because the instrument directing conversion offends the role against perpetuity or that the disposition is otherwise illegal. See Goodier v. Edmunds (1893) 3 Ch.D. 455; and Re Appleby (1903) 1 Ch. 565.

Effect

Whatever reason that brings about a total failure of objects for which conversion was directed and whether the direction was by Will or by Deed, the effect is the same and that is there is no conver- sion, the reason being that the equitable doctrine of conversion can only operate where there is a human being who is able to insist that the nature and character of the subject matter for conversion shall be altered. See  Smith v. Claxton (1820) 4 Madd. 484; 56 E.R 784.  As Cozens-Hardy, M.R. stated in Re Lord Grimthrope (1908) 2 Ch. 675 at 679, 'when once you get to this fact, that there was no human being who, from the first moment when the trust came into operation ... could have enforced the trust for sale' there is no conversion.

In that case, the direction was to sell at a future date, but the purposes having totally failed before that date, there was no conversion. In the case of total failure of conversion directed by deed, the property results back to the settlor if he is alive; if not it would pass under his will or intestacy as the case may be. See Re Lord Grimthrope (supra). But where the direction is by will, the property would pass into the testator's residue: and would devolve on the residuary devisee or legatee depending on the nature of the property. For example a testator devised 'Agege Estate' upon trust to sell and the proceeds of sale to be divided between A and B. A and B died in the lifetime of T and T did not change his will. On the death of T the gift of 'Agege Estate' would lapse. Suppose P is the testator's residuary legatee and R is the testator's residuary devisee; 'Agege Es- tate' being realty, would devolve on R because the objects for which conversion was directed having totally failed, there is no conversion.

However, where there is no residuary bequest or devise under the testator's will, the property would devolve on intestacy. See Smith v. Claxton (1820) (supra) at 494; and Re Walpole (1933) Ch. 431, 437. Thus, in Re Hopkinson (1922) 1 Ch.D. 65, 69, the ultimate gift of property, the subject-matter of conver- sion, having totally failed, Sargant J., held that an intestacy resulted as to the property.

Partial Failure

There is partial failure of conversion where, for example, if A devises 'Ikeja Estate', upon trust to sell and the proceeds to be divided between X and Y, and X pre-deceased A; there is a lapse of the gift to X while that of Y is good. However it is necessary to distinguish between conversion di- rected by deed and that directed by will since the consequences of partial failure of objects of con- version differ from one to the other. The basis for this distinction as explained by Wigram V.C. in Griffith v. Ricketts (1849) 7 Hare 299, 311, is that a will speaks from the death of the testator while a deed takes effect from the date of its execution.

Furthermore, a deed converts the property in the lifetime of the author or settlor, whereas, in the case of a will, the conversion does not take place until the death of the testator. More importantly however, is the marked distinction between the effect of partial failure of conversion directed by a deed and will respectively; the basis of this distinction is that where a conversion is directed by deed, the effect is an out and out conversion, a conversion for all purposes, whereas a conversion directed by will is a conversion for the purposes of the will only. See Ackroyd v. Smithson (1780) 1 Bro. C.C. 503; 28 E.R 1262. The validity of this statement is to be seen in the discussion following.

Deeds: Effect of Partial Failure

Where there is a partial failure of the purposes of a conversion directed by deed, the proper- ty not required for the objects stated in the deed reverts to the settlor; if he is dead, it reverts to those claiming under him-in both cases, the property reverts in its converted form. Thus, where the direction is to turn land into money, the lapsed part of the land reverts to the set- tlor or those claiming under him as personalty. Similarly, money directed to be laid out in land reverts, on a partial failure of the direction, to the settlor or those claiming under him, as land.

For example, if A conveyed 'Home Estate' to trustee upon trust to sell and divide the pur- chase-price between his two friends C and D; but D died before the conveyance was ex- ecuted, here the purposes for which conversion was directed fail in part, the lapsed share of D in 'Home Estate' reverts to A, the settlor as personalty. Suppose the trust had been settled upon A for life and on his death upon trust to sell and divide the purchase price between C and D contingently on surviving A. A by his will gives his residuary personalty to P and his residuary realty to R. D pre-deceased A but C survived him, hence, there is partial failure of objects of conversion, in which case conversion is operative, but the lapsed share of D is treated as personalty and goes to P, who is entitled to residuary personalty under A's will.

Will: Effect of Partial Failure

(a) Land into Money: Where land is the subject matter of a conversion directed by will, and there is a partial failure of the purposes for which conversion has been directed, the trust for conversion has been directed, the trust for conversion becomes operative, and though, so far as the purposes have failed, land directed to be sold and converted into money would go to the person entitled to realty under his intestacy, but that person would take it as personalty.

This would seem to be the decision reached in the celebrated case of Ackroyd v. Smithson (supra) at 506, where it was stated that 'it is admitted, and cannot be denied that where a tes- tator directs real estate to be sold for special purposes, if any of those purposes became in- capable of taking effect, the heir-at-Iaw shall take; because there is an end of the disposition, when there is an end of the purposes for which it was made.' In Re Richerson (1892) 1 Ch.D. 379 at 381, Chitty J. held that where real estate is devised upon trust for conversion into personalty and the objects for conversion partially fail, the lapsed share of the proceeds of land sold or of the land (if any) unsold results to the heir (or the person entitled to realty under the testator's residuary gift if none or intestacy) but he takes it as personalty.

Thus, where there is a partial undisposed interest of real estate directed to be sold, that inter- est results to the residuary devisee (or person entitled to realty) of the testator and it becomes personal estate in his hands. But where the testator's residuary devisee, (or the person entitled to realty if there is no residuary devisee) survived the testator, but died before he received the ineffectually disposed of share in the purchase price, though the share had devolved on him as land, he would receive it as personalty and it would be treated as part of his personalty for purposes of devolution.

It is immaterial whether or not the trustees of the will for conversion had sold the realty in his life time. Thus, in Re Walpole (1933) Ch. 431, Farwell J. stated that if there is a partial in- testacy and the trust for conversion is a valid trust, this undoubtedly affects the position of the heir (the person entitled to realty) to the extent that although it does not defeat his right as the heir-at-law to whatever is real estate undisposed of, for the purpose of the devolution of his estate, it is treated as personalty and passes as such, the reason being that, under the rule in Ackroyd v. Smithson (supra), the lapsed share of the object that fails (that is, land di- rected to be converted into money) passes to the testator's residuary devisee (if none, the person entitled to realty) who, of course, must have survived the testator; however, since the failure of objects is partial only, and therefore, to satisfy the part that has not failed, the trus- tees are under an enforceable duty to sell; in this regard, the conversion is effective and al- though the lapsed share, devolves as land on the residuary devisee who takes it in its con- verted form. If he dies before receipt of the proceeds of sale, the proceeds of sale would go to his residuary legatee since his residuary devisee has no equity to reconversion. See Re Walpole (supra) at 437.

The position is the same where the purpose of a trust for sale of land and conversion cannot ex- haust the proceeds of sale. In Dixon v. Dawson (1825) 2 Sim & S. 327; 57 E.R. 371, by her will, the testatrix directed her trustees to sell land to satisfy certain specified charges; the property hav- ing been sold and the charges met, there was a surplus. It was held that the surplus belonged to the heir-at-law but that since the property was sold in the lifetime of the heir-at-law, he would take it in its converted form and it would devolve as such on his personal representative.

(b) Money into Land: Where money is laid out for the purchase of land and there is a partial failure, the same rule and reasoning apply as in Ackroyd v. Smithson (supra). Thus in Cogan v. Stephens (1835) 5 L.J. Ch. 17 at 20, Lord Langdale MR. stated that if a testator devises land for purposes which are in part illegal, or which partially fail or which require part only of the land devised, the person entitled to realty in that circumstance takes the part which fails; or which is not required for the purposes of the will; and that conversely in the case of money laid out for the purchase of land, the Person entitled to personalty in the circumstances would take.

Where, for example, before 1959 in the Western and Mid-Western States, and Presently in some other states in the Federation where the Pre-1900 English law applies, T, by his will, gave N500 to trustees to purchase land for the benefit of X and Y in equal share, and Y died before the testator, there is partial fail- ure of the purposes for which conversion was directed; consequently there is a lapse of X's share which would pass to T's next-of-kin (the person entitled to T's personalty on intestacy) and not to the heir at law. But if testator had made residuary gifts, the lapsed share passed to the residuary legatee; though the lapsed share results in its unconverted form, the residuary legatee or the next-of-kin takes it as real estate.

In Curteis v. Wormald (1878) 10 Ch.D. 172, Jessel M.R. stated that if Personal estate is bequeathed upon trusts for conversion into land to be held on trusts the purpose of which partially fail, the lapsed part of land purchased before or after the failure goes to the next-of-kin as real estate. If, then the question of sub- sequent devolution arises, the same Principle and reasoning apply as in Re Richerson (supra) at 381. In that case, Chitty J. observed that whatever the trusts of the will are, whether it is an absolute conversion or not, 'all you have to do to ascertain the rights of the real and personal representatives of the heir is merely to look to the actual state in which the Property is, and there is an end to the question. Although the lapsed share of the trust of money for the purchase of land devolves, in unconverted form, on the person (next-of-kin) entitled to personalty under the testator's will, he takes it as land, which is the actual state the Property is, and it would devolve as such that is, in its converted form, under the will or intestacy of the next-of-kin.

3.4     Reconversion

Whenever the equitable doctrine of conversion operates, though the subject-matter for conversion has not in fact been converted, in the eye of equity there is notional conversion of that subject-matter, because eq- uity looks on that as done which ought to be done. Again in certain circumstances, the notional or fictitious and artificial character, which equity has imposed on the subject-matter, is annulled yielding place to the actual state of the property; the state in which it was, before being impressed by the equitable stamp of conversion. At this state there is reconversion.

3.4.1  Definition of reconversion

Reconversion has been defined as that imaginary process by which a prior notional conversion is reversed or discharged, and the notionally converted property restored in contemplation of equity to its original actual quality. (See Snell's Principles of Equity (27th Ed.) 1960 p.480). There are two ways by which reconversion may be effected. These are: by act of the Parties or by operation of law. The former depends on the manifestation of intention by the party or parties entitled to re- convert; while the latter reconversion is automatic.

3.4.2  Reconversion by act of parties

It frequently happens that the beneficial ownership of subject-matter for conversion is vested in one person who is sui juris, not being under any disability and absolutely entitled in that case, he is entitled to take the property in its actual state. Thus, if money is laid out for the purchase of land, the party who would have the sole and absolute interest in the land when bought, may elect to have the money paid to him and that the money, the subject-matter for conversion, shall not be used for the purchase of land; in that case, a court of equity will not order a contrary decree which might be annulled or rendered vain by the act of the absolute owner. See Benson v. Benson (1710) 1 P. Wms. 130 at 131; 24 E.R. 324. For if the purchase were to be enforced, he might at the same moment sell the land and convert it into money, thereby stultifying the court order, and 'equity like nature does nothing in vain.' See Seeley v. Jago (1717) l.p. Wms. 389; 24 E.R. 438; and Saunders v. Vautier (1841) 10 L.J. Ch. 354.

In Harcourt.v. Seymour (1851) 2 Sim (NS) 12 at 46; 61 E.R.244, Lord Cranworth V.C. observed that where by a settlement land has been directed to be converted into money, or money to be converted into land, a character is thereby imposed upon it until somebody entitled to take it in either form chooses to elect that, instead of its being converted into money, or instead of its being converted into land, it shall remain in the form in which it is actually found. The only question in each particular case is whether the person entitled to reconvert has manifested acts sufficient to enable the court to say that he has so elected.

Where more than one person are interested in the subject-matter of conversion, the same prin- ciple applies as in the case of an absolute beneficial owner. For example where land is held on trust for sale for the benefit of A and B in undivided shares and they are both of full age and absolutely entitled, provided they agree they can effect a reconversion. See  Re Daveron (1893) 3 Ch. 421, 425. However, the case is different where one of the several beneficiaries is not willing to reconvert. In Holloway v. Radcliffe (1857) 23 Beav. 163 at 172; 53 E.R. 64, Lord Romilly M.R states that where the undivided shares relate to money to be laid out in land, a co-beneficial own- er who wishes to elect to reconvert his share may do so without the concurrence of the other co- owners; the reason being that such course of action will not in any way be detrimental to the interest of the other co-owners who are not willing to reconvert.

Where, however, the undivided shares relate to land directed to be laid out into personalty, if there is to be any reconversion, at all, it must be total, which means all the beneficiaries must concur; a co-owner cannot effect a partial reconversion. As Lord Romilly observed, it would be repugnant to the principles on which the doctrine of conversion and reconversion rest to hold that one of the legatees of an undivided share in the proceeds of real estate directed to be converted into personalty could without the assent of the others, elect to take his share as unconverted and in the shape of real estate.

A more potent reason against partial reconversion in this case seems to be that it is more profita- ble to all the beneficiaries to have the land sold in its entirety than to have one part sold and the other part retained which would be the effect if one co-owner is permitted to reconvert his undi- vided share. However, the validity of this observation may depend on the size of the land laid out for conversion. If it is of such a size that the part sought to be reconverted would not pro tanto, make the remaining part less marketable than the entirety, on principle a co-owner, wishing to reconvert, ought to be allowed to do so.

Remainder man

The question has arisen as to whether a remainder man can reconvert. In Meek v. Devenish (1877) 6 Ch.n. 566, Malins V.C. held that a person contingently entitled absolutely to the proceeds of real estate directed to be sold, may, pending the contingency, elect to take the estate as realty and such election will become operative upon the contingency happening before his death. Prima fa- cie a remainder man may reconvert, but his election to reconvert is only operative when his inter- est falls into possession and if before then, the property is in fact uncoverted. See  Re Duke  of Cleveland's Estates (1893) 3 Ch.n. 244 at 248.

A person who is absolutely entitled under a settlement of land upon trust for sale may by his will elect to take the property in its uncoverted state, which election would operate as a reconversion of the personalty into realty; he cannot however do so if he is a remainder man whose interest is still contingent at his death. See Re Sturt (122) 1 Ch. 416. Furthermore, the interests of prior owners are not bound or affected in any manner whatsoever, by any election made by a remaind- er man.

Infants and Persons of Unsound Mind

Ordinarily, it would appear that an infant cannot elect to reconvert. Robinson v. Robinson (1854) 19 Beav. 494; 52 E.R. 442. In certain circumstances, the court may elect for him (See Burgess v. Booth (1908) 2 Ch. 648) or sanction his election where he has already elected. The court will on- ly exercise this power after an enquiry has been directed as to what is most beneficial to the in- fant in the circumstance. In the case of persons of unsound minds, the same principle applies as in the case of infants. See Re Douglas and Powell's Contract (1902) 2 Ch. 296.

Evidence of Election to Reconvert

Election presupposes a clear intention to take the property 'in specie' free from a trust or direction to convert. In order to establish an election, there must be sufficient evidence of the election; such evidence may be by express declarations or inferred from acts or conduct of the party or parties entitled to elect. See Re Douglas and Powell's Contract (supra) at 312. Where a party's right to elect is subject to the right of another person to prevent reconversion, it is not enough for the party entitled to elect to show evidence of his intention to elect; in addition, it must also be shown that the person who can prevent reconversion has assented to an election.

In Re Douglas and Powells Contract (supra), Byrne J., could not find that there ever was a valid and effectual election to take in 'specie' because one of the persons interested in the matter had not been competent to give assent to an election. In the case of a direction to convert land into mon- ey, it is easier to infer intention to reconvert; circumstantial evidence such as the retention of the land for a reasonable length of time and expending money on its improvement may be sufficient. (Mutlow v. Bigg (1875) 1 Ch.D.385).

Thus in Re Gordon (1877) 6 Ch.D. 531 at 534, evidence of election to take land as real estate was inferred where the person entitled to elect received the rents of the land for a long time though he did not exercise any other act of ownership. It was the view of Jessel M.R. that the fact that the person had received rents from the land and also the fact that after his death his agent continued to receive rents from the land were sufficient evidence of election to retain the land in 'specie'.

However, where the direction is to layout money for the purchase of land a stronger and more direct evidence of an intention to reconvert is required. Thus a receipt of the income from the money for a long period of time may not be enough; there must be, in addition, a more positive manifestation of intention to reconvert. See Re Pedder's Settlement (1854) 5 De G.M. & G. 890; 24 L.J. Ch. 313; 43 E.R. 1116.

SELF ASSESSMENT EXERCISE 2

When does reconversion arise?

3.4.3  Reconversion by Operation of Law

In certain circumstances property which has been notionally converted in equity becomes recon- verted without any declaration or act of the party entitled to reconvert. This usually occurs either where the duty to convert and the right to call for the subject-matter in 'specie' are vested in the same person; or where both the legal interest and the equitable interest are vested in the same person; in both cases the obligation to convert is extinguished, and the property is said to be 'at home'.

Thus where money directed to be laid out for the purchase of land actually comes into the hands of the person who would be entitled to dispose of the land if purchased, the money is his absolute property and will pass under a general bequest of his personal estate. As Thurlow L.C. observed in Pulteney v. Earl of Darlington (1783) 1 Bro. C.C. 223 at 238; 28 E.R. 1095, If AB  has  in his possession £20,000 to be laid out in land  for his use, he has nobody to sue; the right and the thing centering in one person, the action is extinguished... Where a sum of money is in the hands of one without any other use but for himself, it will be money and the heir cannot claim'. See also Wheldale v. partridge (1803) 8 Ves. Jun 228 at 235; 32 E.R. 341.

In Chichester v. Bickerstaff (1693) 2 Vern 296; 23 E.R. 791, H convenanted under a marriage set- tlement to advance 1500 pounds within a specified period, to be laid out in land to be held on trusts for H for life and for his wife for life, remainder to H's heirs. The wife died without issue. By his will H be- queathed his residuary personal estate to Y. The 1500 pounds was never invested in land. On the death of H., his heir-at-law claimed the £1500 contending that the marriage settlement had, in equity, converted the money into land. In the opinion of Lord Chancellor Somers, 'This money, though once bound by the articles, yet when the wife died Without issue, became free again, and was under the power and disposal of the testator, as the land would likewise have been, in case a purchase had been made pursuant to the articles.'

In Re Cook (1948) Ch. 212, a freehold land was conveyed to H and W as joint tenants. H pre-deceased W. By her will, W gave all her personal estate to A and B. W died possessed of the freehold land. The question was whether there had been a reconversion of the land so as to make it real estate at the death of W since the land was subject to a statutory trust for sale and had devolved on W absolutely at the death of H or whether it passed under W's will as personal estate. Harman J. held that after the death of H, .the en- tire interest in the land both legal and equitable devolved on W and that no trust for sale could subsist the- reafter; W's beneficial interest became automatically reconverted, by operation of law, from money into land which accordingly was vested in W at her death as real estate. Therefore, the bequest of personal es- tate under W's will could not and did not give any interest in the land to A and B.

4.0     CONCLUSION

Whenever the equitable doctrine of conversion operates, though the subject-matter for conversion has not in fact been converted, in the eye of equity there is notional conversion of that subject-matter, because eq- uity looks on that as done which ought to be done. Practically, the doctrine is of little significance in Nigeria, hardly can one find a single reported case in which the doctrine has been applied. Even, in England where the doctrine originated, the importance of the doctrine has declined since the property legislation of 1925.

5.0 SUMMARY

In this unit, we have considered the doctrine of conversion and reconversion. You should now be able to: explain the importance of the doctrine of conversion and reconversion; list the types of circumstances in which the doctrine is operative; and discuss failure of Conversion.

6.0     TUTOR-MARKED ASSIGNMENT

How important is the doctrine of conversion?

7.0     REFERENCES / FURTHER READING

Hackney J., (1987) Understanding Equity and Trusts; London: Fontana press

Jegede M. I. (2007rep.) Principles of Equity; Ibadan: Unique Design/Prints