(E) THE RELATIONSHIP BETWEEN RESTITUTION FOR WRONGS AND PROPRIETARY RESTITUTIONARY CLAIMS
Where the defendant has wrongly taken the claimant’s property the claimant may have two alternative restitutionary claims, one for a personal remedy founded on wrongdoing and the other founded on the vindication of property rights. For example, if the defendant takes the claimant’s car without permission and then sells it, the tort of conversion will have been committed. The claimant may seek a personal restitutionary remedy founded on the tort or, alternatively, may bring a proprietary restitutionary claim to recover the proceeds of the sale of the car, such a claim being founded on the claimant’s continuing title in the car and its traceable product.
This distinction between proprietary claims and claims founded on wrongs is not, however, as neat as first appears, because a number of forms of wrongdoing require proof that the defendant has interfered with the claimant’s proprietary rights, which in turn requires proof that the claimant has a continuing interest in the particular property. This is illustrated by the tort of conversion. But where the claimant sues for this tort, even though he or she must be shown to have an interest in the property converted, the cause of action is still founded on the tort and not on the vindication of property rights. Consequently, the award of restitutionary remedies following the commission of the tort of conversion are properly considered in this Part, rather than in Part IV where proprietary restitutionary claims are examined. It should be emphasized, however, that this is merely a matter of convenience for the exposition of the subject and because of the legacy of history as to how causes of action are characterized. It does not mean that the commission of the tort of conversion has nothing to do with proprietary restitutionary claims.
The overlap between restitution for wrongs and proprietary restitutionary claims may arise in another context. Sometimes, where the defendant commits an equitable wrong, the court may recognize that the defendant holds the benefit obtained from the wrong on constructive trust for the claimant. The consequence of this is that the claimant will have an equitable proprietary interest in the property held by the defendant, so the claimant will be able to bring a restitutionary proprietary claim to vindicate this property right.32