Guide to Understanding The Term
A constructive possession is a legal fiction to describe a situation where an individual has actual control over chattels or real property without actually having physical control of the same assets. At law, a person with constructive possession stands in the same legal position as a person with actual possession.
For example, if your car is sitting in your driveway, you have physical possession of the car. However, any person with the key has constructive possession, as they may take physical possession at any time without further consent from you.
Constructive possession is an important concept in both the criminal law regarding theft and embezzlement, and the civil law regarding possession of land and chattels. For example, if someone steals your credit card number, the actual credit card never leaves your actual possession, but the person who has stolen the number does have constructive possession, and could most likely be charged with theft of your credit card information.
Constructive possession is also an important concept in cases of seizure of goods by private or government authorities. Take, for example, a large piece of equipment. Should money be loaned against the value of the equipment, and the loan goes into default, the creditor may find it difficult to actually remove the equipment in a timely manner. However, it may by notice to the borrower take constructive possession, which effectively prevents the borrower from further using the equipment pending its removal. Similarly, when a landlord exercises a contractual remedy of distress of goods for unpaid rent, the landlord need not remove the goods from the premises, but may take constructive possession of the goods through a simple declaration. At that point, if the tenant attempted to remove them, the tenant would be guilty of theft.
However, a person who makes it impossible to take possession of another's property has taken actual possession, not constructive possession. For example, if someone chains someone else's car to an immovable object, they have taken possession of it even though they have not moved it.