diff --git a/substrate/Cargo.lock b/substrate/Cargo.lock
index 7caa98e8dc..535a77a056 100644
--- a/substrate/Cargo.lock
+++ b/substrate/Cargo.lock
@@ -2832,6 +2832,7 @@ dependencies = [
  "sr-version 0.1.0",
  "substrate-client 0.1.0",
  "substrate-primitives 0.1.0",
+ "substrate-state-machine 0.1.0",
  "substrate-test-client 0.1.0",
  "syn 0.15.26 (registry+https://github.com/rust-lang/crates.io-index)",
 ]
diff --git a/substrate/core/client/src/call_executor.rs b/substrate/core/client/src/call_executor.rs
index 4c274fc436..03cec8885a 100644
--- a/substrate/core/client/src/call_executor.rs
+++ b/substrate/core/client/src/call_executor.rs
@@ -14,7 +14,7 @@
 // You should have received a copy of the GNU General Public License
 // along with Substrate.  If not, see <http://www.gnu.org/licenses/>.
 
-use std::{sync::Arc, cmp::Ord, panic::UnwindSafe};
+use std::{sync::Arc, cmp::Ord, panic::UnwindSafe, result};
 use codec::{Encode, Decode};
 use runtime_primitives::generic::BlockId;
 use runtime_primitives::traits::Block as BlockT;
@@ -61,7 +61,7 @@ where
 			Result<NativeOrEncoded<R>, Self::Error>
 		) -> Result<NativeOrEncoded<R>, Self::Error>,
 		R: Encode + Decode + PartialEq,
-		NC: FnOnce() -> R + UnwindSafe,
+		NC: FnOnce() -> result::Result<R, &'static str> + UnwindSafe,
 	>(
 		&self,
 		at: &BlockId<B>,
@@ -89,7 +89,7 @@ where
 			Result<NativeOrEncoded<R>, Self::Error>
 		) -> Result<NativeOrEncoded<R>, Self::Error>,
 		R: Encode + Decode + PartialEq,
-		NC: FnOnce() -> R + UnwindSafe,
+		NC: FnOnce() -> result::Result<R, &'static str> + UnwindSafe,
 	>(&self,
 		state: &S,
 		overlay: &mut OverlayedChanges,
@@ -168,7 +168,7 @@ where
 		let mut changes = OverlayedChanges::default();
 		let state = self.backend.state_at(*id)?;
 		let return_data = state_machine::execute_using_consensus_failure_handler::<
-			_, _, _, _, _, _, fn() -> NeverNativeValue
+			_, _, _, _, _, NeverNativeValue, fn() -> _
 		>(
 			&state,
 			self.backend.changes_trie_storage(),
@@ -192,7 +192,7 @@ where
 			Result<NativeOrEncoded<R>, Self::Error>
 		) -> Result<NativeOrEncoded<R>, Self::Error>,
 		R: Encode + Decode + PartialEq,
-		NC: FnOnce() -> R + UnwindSafe,
+		NC: FnOnce() -> result::Result<R, &'static str> + UnwindSafe,
 	>(
 		&self,
 		at: &BlockId<Block>,
@@ -208,7 +208,7 @@ where
 		if method != "Core_initialise_block" && initialised_block.map(|id| id != *at).unwrap_or(true) {
 			let header = prepare_environment_block()?;
 			state_machine::execute_using_consensus_failure_handler::<
-				_, _, _, _, _, R, fn() -> R,
+				_, _, _, _, _, R, fn() -> _,
 			>(
 				&state,
 				self.backend.changes_trie_storage(),
@@ -254,7 +254,7 @@ where
 			Result<NativeOrEncoded<R>, Self::Error>
 		) -> Result<NativeOrEncoded<R>, Self::Error>,
 		R: Encode + Decode + PartialEq,
-		NC: FnOnce() -> R + UnwindSafe,
+		NC: FnOnce() -> result::Result<R, &'static str> + UnwindSafe,
 	>(&self,
 		state: &S,
 		changes: &mut OverlayedChanges,
diff --git a/substrate/core/client/src/client.rs b/substrate/core/client/src/client.rs
index e8c46156f7..2313c4733d 100644
--- a/substrate/core/client/src/client.rs
+++ b/substrate/core/client/src/client.rs
@@ -16,7 +16,7 @@
 
 //! Substrate Client
 
-use std::{marker::PhantomData, collections::{HashSet, BTreeMap}, sync::Arc, panic::UnwindSafe};
+use std::{marker::PhantomData, collections::{HashSet, BTreeMap}, sync::Arc, panic::UnwindSafe, result};
 use crate::error::Error;
 use futures::sync::mpsc;
 use parking_lot::{Mutex, RwLock};
@@ -804,7 +804,7 @@ impl<B, E, Block, RA> Client<B, E, Block, RA> where
 		match transaction.state()? {
 			Some(transaction_state) => {
 				let mut overlay = Default::default();
-				let (_, storage_update, changes_update) = self.executor.call_at_state::<_, _, NeverNativeValue, fn() -> NeverNativeValue>(
+				let (_, storage_update, changes_update) = self.executor.call_at_state::<_, _, NeverNativeValue, fn() -> _>(
 					transaction_state,
 					&mut overlay,
 					"Core_execute_block",
@@ -1244,7 +1244,9 @@ impl<B, E, Block, RA> CallRuntimeAt<Block> for Client<B, E, Block, RA> where
 	E: CallExecutor<Block, Blake2Hasher> + Clone + Send + Sync,
 	Block: BlockT<Hash=H256>
 {
-	fn call_api_at<R: Encode + Decode + PartialEq, NC: FnOnce() -> R + UnwindSafe>(
+	fn call_api_at<
+		R: Encode + Decode + PartialEq, NC: FnOnce() -> result::Result<R, &'static str> + UnwindSafe
+	>(
 		&self,
 		at: &BlockId<Block>,
 		function: &'static str,
diff --git a/substrate/core/client/src/error.rs b/substrate/core/client/src/error.rs
index f8ac292c25..bfc073f634 100644
--- a/substrate/core/client/src/error.rs
+++ b/substrate/core/client/src/error.rs
@@ -116,6 +116,12 @@ error_chain! {
 			display("Error decoding call result of {}", method)
 		}
 
+		/// Error converting a parameter between runtime and node.
+		RuntimeParamConversion(param: &'static str) {
+			description("Error converting parameter between runtime and node")
+			display("Error converting `{}` between runtime and node", param)
+		}
+
 		/// Changes tries are not supported.
 		ChangesTriesNotSupported {
 			description("changes tries are not supported"),
diff --git a/substrate/core/client/src/light/call_executor.rs b/substrate/core/client/src/light/call_executor.rs
index 05fd9dffed..601cb0732f 100644
--- a/substrate/core/client/src/light/call_executor.rs
+++ b/substrate/core/client/src/light/call_executor.rs
@@ -17,7 +17,7 @@
 //! Light client call exector. Executes methods on remote full nodes, fetching
 //! execution proof and checking it locally.
 
-use std::{collections::HashSet, sync::Arc, panic::UnwindSafe};
+use std::{collections::HashSet, sync::Arc, panic::UnwindSafe, result, marker::PhantomData};
 use futures::{IntoFuture, Future};
 
 use codec::{Encode, Decode};
@@ -52,7 +52,7 @@ pub struct RemoteOrLocalCallExecutor<Block: BlockT<Hash=H256>, B, R, L> {
 	backend: Arc<B>,
 	remote: R,
 	local: L,
-	_block: ::std::marker::PhantomData<Block>,
+	_block: PhantomData<Block>,
 }
 
 impl<B, F> Clone for RemoteCallExecutor<B, F> {
@@ -133,7 +133,7 @@ where
 			Result<NativeOrEncoded<R>, Self::Error>
 		) -> Result<NativeOrEncoded<R>, Self::Error>,
 		R: Encode + Decode + PartialEq,
-		NC: FnOnce() -> R,
+		NC: FnOnce() -> result::Result<R, &'static str>,
 	>(&self,
 		_state: &S,
 		_changes: &mut OverlayedChanges,
@@ -214,7 +214,7 @@ impl<Block, B, Remote, Local> CallExecutor<Block, Blake2Hasher> for
 			Result<NativeOrEncoded<R>, Self::Error>
 		) -> Result<NativeOrEncoded<R>, Self::Error>,
 		R: Encode + Decode + PartialEq,
-		NC: FnOnce() -> R + UnwindSafe,
+		NC: FnOnce() -> result::Result<R, &'static str> + UnwindSafe,
 	>(
 		&self,
 		at: &BlockId<Block>,
@@ -285,7 +285,7 @@ impl<Block, B, Remote, Local> CallExecutor<Block, Blake2Hasher> for
 			Result<NativeOrEncoded<R>, Self::Error>
 		) -> Result<NativeOrEncoded<R>, Self::Error>,
 		R: Encode + Decode + PartialEq,
-		NC: FnOnce() -> R + UnwindSafe,
+		NC: FnOnce() -> result::Result<R, &'static str> + UnwindSafe,
 	>(&self,
 		state: &S,
 		changes: &mut OverlayedChanges,
diff --git a/substrate/core/client/src/runtime_api.rs b/substrate/core/client/src/runtime_api.rs
index fbe5d1378b..72371bc95f 100644
--- a/substrate/core/client/src/runtime_api.rs
+++ b/substrate/core/client/src/runtime_api.rs
@@ -77,7 +77,7 @@ pub trait ApiExt<Block: BlockT> {
 pub trait CallRuntimeAt<Block: BlockT> {
 	/// Calls the given api function with the given encoded arguments at the given block
 	/// and returns the encoded result.
-	fn call_api_at<R: Encode + Decode + PartialEq, NC: FnOnce() -> R + UnwindSafe>(
+	fn call_api_at<R: Encode + Decode + PartialEq, NC: FnOnce() -> result::Result<R, &'static str> + UnwindSafe>(
 		&self,
 		at: &BlockId<Block>,
 		function: &'static str,
diff --git a/substrate/core/executor/src/error.rs b/substrate/core/executor/src/error.rs
index c5a6160ac1..98993519f4 100644
--- a/substrate/core/executor/src/error.rs
+++ b/substrate/core/executor/src/error.rs
@@ -23,8 +23,10 @@
 use state_machine;
 use serializer;
 use wasmi;
-use error_chain::{error_chain, error_chain_processing, impl_error_chain_processed,
-	impl_extract_backtrace, impl_error_chain_kind};
+use error_chain::{
+	error_chain, error_chain_processing, impl_error_chain_processed,
+	impl_extract_backtrace, impl_error_chain_kind
+};
 
 error_chain! {
 	foreign_links {
diff --git a/substrate/core/executor/src/native_executor.rs b/substrate/core/executor/src/native_executor.rs
index 753c2227f6..cd1ab3bca2 100644
--- a/substrate/core/executor/src/native_executor.rs
+++ b/substrate/core/executor/src/native_executor.rs
@@ -14,8 +14,7 @@
 // You should have received a copy of the GNU General Public License
 // along with Substrate.  If not, see <http://www.gnu.org/licenses/>.
 
-use std::borrow::BorrowMut;
-use std::cell::{RefMut, RefCell};
+use std::{borrow::BorrowMut, result, cell::{RefMut, RefCell}};
 use crate::error::{Error, ErrorKind, Result};
 use state_machine::{CodeExecutor, Externalities};
 use crate::wasm_executor::WasmExecutor;
@@ -109,7 +108,7 @@ fn safe_call<F, U>(f: F) -> Result<U>
 ///
 /// If the inner closure panics, it will be caught and return an error.
 pub fn with_native_environment<F, U>(ext: &mut Externalities<Blake2Hasher>, f: F) -> Result<U>
-where F: UnwindSafe + FnOnce() -> U
+	where F: UnwindSafe + FnOnce() -> U
 {
 	::runtime_io::with_externalities(ext, move || safe_call(f))
 }
@@ -186,7 +185,7 @@ impl<D: NativeExecutionDispatch> CodeExecutor<Blake2Hasher> for NativeExecutor<D
 	<
 		E: Externalities<Blake2Hasher>,
 		R:Decode + Encode + PartialEq,
-		NC: FnOnce() -> R + UnwindSafe
+		NC: FnOnce() -> result::Result<R, &'static str> + UnwindSafe
 	>(
 		&self,
 		ext: &mut E,
@@ -242,7 +241,8 @@ impl<D: NativeExecutionDispatch> CodeExecutor<Blake2Hasher> for NativeExecutor<D
 							.map_or_else(||"<None>".into(), |v| format!("{}", v))
 					);
 					(
-						with_native_environment(ext, move || (call)()).map(NativeOrEncoded::Native),
+						with_native_environment(ext, move || (call)())
+							.and_then(|r| r.map(NativeOrEncoded::Native).map_err(Into::into)),
 						true
 					)
 				}
diff --git a/substrate/core/sr-api-macros/Cargo.toml b/substrate/core/sr-api-macros/Cargo.toml
index 7cc414a732..1856d3702c 100644
--- a/substrate/core/sr-api-macros/Cargo.toml
+++ b/substrate/core/sr-api-macros/Cargo.toml
@@ -15,6 +15,7 @@ blake2-rfc = "0.2"
 [dev-dependencies]
 substrate-client = { path = "../client" }
 substrate-test-client = { path = "../test-client" }
+substrate-state-machine = { path = "../state-machine" }
 sr-primitives = { path = "../sr-primitives" }
 sr-version = { path = "../sr-version" }
 substrate-primitives = { path = "../primitives" }
diff --git a/substrate/core/sr-api-macros/benches/bench.rs b/substrate/core/sr-api-macros/benches/bench.rs
index 54f8c8a3d1..0b829052e6 100644
--- a/substrate/core/sr-api-macros/benches/bench.rs
+++ b/substrate/core/sr-api-macros/benches/bench.rs
@@ -1,4 +1,4 @@
-// Copyright 2018 Parity Technologies (UK) Ltd.
+// Copyright 2018 - 2019 Parity Technologies (UK) Ltd.
 // This file is part of Substrate.
 
 // Substrate is free software: you can redistribute it and/or modify
diff --git a/substrate/core/sr-api-macros/src/decl_runtime_apis.rs b/substrate/core/sr-api-macros/src/decl_runtime_apis.rs
index 54f8d81bef..13498003c2 100644
--- a/substrate/core/sr-api-macros/src/decl_runtime_apis.rs
+++ b/substrate/core/sr-api-macros/src/decl_runtime_apis.rs
@@ -17,7 +17,7 @@
 use utils::{
 	generate_crate_access, generate_hidden_includes, generate_runtime_mod_name_for_trait,
 	fold_fn_decl_for_client_side, unwrap_or_error, extract_parameter_names_types_and_borrows,
-	generate_native_call_generator_fn_name
+	generate_native_call_generator_fn_name, return_type_extract_type,
 };
 
 use proc_macro;
@@ -157,12 +157,15 @@ fn generate_native_call_generators(decl: &ItemTrait) -> Result<TokenStream> {
 	// Auxilariy function that is used to convert between types that use different block types.
 	// The function expects that both a convertable by encoding the one and decoding the other.
 	result.push(quote!(
+		#[cfg(any(feature = "std", test))]
 		fn convert_between_block_types
-			<I: #crate_::runtime_api::Encode, R: #crate_::runtime_api::Decode>(input: &I) -> R
+			<I: #crate_::runtime_api::Encode, R: #crate_::runtime_api::Decode>(
+				input: &I, error_desc: &'static str,
+			) -> ::std::result::Result<R, &'static str>
 		{
 			<R as #crate_::runtime_api::Decode>::decode(
 				&mut &#crate_::runtime_api::Encode::encode(input)[..]
-			).unwrap()
+			).ok_or_else(|| error_desc)
 		}
 	));
 
@@ -172,20 +175,30 @@ fn generate_native_call_generators(decl: &ItemTrait) -> Result<TokenStream> {
 		let trait_fn_name = &fn_.ident;
 		let fn_name = generate_native_call_generator_fn_name(&fn_.ident);
 		let output = return_type_replace_block_with_node_block(fn_.decl.output.clone());
+		let output_ty = return_type_extract_type(&output);
+		let output = quote!( ::std::result::Result<#output_ty, &'static str> );
 
 		// Every type that is using the `Block` generic parameter, we need to encode/decode,
 		// to make it compatible between the runtime/node.
 		let conversions = params.iter().filter(|v| type_is_using_block(&v.1)).map(|(n, t, _)| {
+			let name_str = format!(
+				"Could not convert parameter `{}` between node and runtime!", quote!(#n)
+			);
 			quote!(
-				let #n: #t = convert_between_block_types(&#n);
+				let #n: #t = convert_between_block_types(&#n, #name_str)?;
 			)
 		});
 		// Same as for the input types, we need to check if we also need to convert the output,
 		// before returning it.
 		let output_conversion = if return_type_is_using_block(&fn_.decl.output) {
-			quote!( convert_between_block_types(&res) )
+			quote!(
+				convert_between_block_types(
+					&res,
+					"Could not convert return value from runtime to node!"
+				)
+			)
 		} else {
-			quote!( res )
+			quote!( Ok(res) )
 		};
 
 		let input_names = params.iter().map(|v| &v.0);
@@ -240,7 +253,7 @@ fn generate_native_call_generators(decl: &ItemTrait) -> Result<TokenStream> {
 				#(, #impl_generics_params)*
 			>(
 				#( #fn_inputs ),*
-			) -> impl FnOnce() #output + 'a #where_clause {
+			) -> impl FnOnce() -> #output + 'a #where_clause {
 				move || {
 					#( #conversions )*
 					let res = ApiImpl::#trait_fn_name(#( #input_borrows #input_names ),*);
diff --git a/substrate/core/sr-api-macros/src/impl_runtime_apis.rs b/substrate/core/sr-api-macros/src/impl_runtime_apis.rs
index 6663cae85f..2909b07413 100644
--- a/substrate/core/sr-api-macros/src/impl_runtime_apis.rs
+++ b/substrate/core/sr-api-macros/src/impl_runtime_apis.rs
@@ -330,7 +330,7 @@ fn generate_runtime_api_base_structures(impls: &[ItemImpl]) -> Result<TokenStrea
 		impl<C: #crate_::runtime_api::CallRuntimeAt<#block>> RuntimeApiImpl<C> {
 			fn call_api_at<
 				R: #crate_::runtime_api::Encode + #crate_::runtime_api::Decode + PartialEq,
-				NC: FnOnce() -> R + ::std::panic::UnwindSafe,
+				NC: FnOnce() -> ::std::result::Result<R, &'static str> + ::std::panic::UnwindSafe,
 			>(
 				&self,
 				at: &#block_id,
diff --git a/substrate/core/sr-api-macros/src/lib.rs b/substrate/core/sr-api-macros/src/lib.rs
index 3dfc26c442..52e96a57cc 100644
--- a/substrate/core/sr-api-macros/src/lib.rs
+++ b/substrate/core/sr-api-macros/src/lib.rs
@@ -16,7 +16,7 @@
 
 //! Macros for declaring and implementing runtime apis.
 
-#![recursion_limit = "256"]
+#![recursion_limit = "512"]
 extern crate proc_macro;
 extern crate proc_macro2;
 extern crate quote;
diff --git a/substrate/core/sr-api-macros/src/utils.rs b/substrate/core/sr-api-macros/src/utils.rs
index e35ed52084..9df59b30a7 100644
--- a/substrate/core/sr-api-macros/src/utils.rs
+++ b/substrate/core/sr-api-macros/src/utils.rs
@@ -58,6 +58,14 @@ pub fn generate_runtime_mod_name_for_trait(trait_: &Ident) -> Ident {
 	Ident::new(&format!("runtime_decl_for_{}", trait_.to_string()), Span::call_site())
 }
 
+/// Get the type of a `syn::ReturnType`.
+pub fn return_type_extract_type(rt: &syn::ReturnType) -> Type {
+	match rt {
+		syn::ReturnType::Default => parse_quote!( () ),
+		syn::ReturnType::Type(_, ref ty) => *ty.clone(),
+	}
+}
+
 /// Fold the given `FnDecl` to make it usable on the client side.
 pub fn fold_fn_decl_for_client_side(
 	mut input: FnDecl,
@@ -70,14 +78,8 @@ pub fn fold_fn_decl_for_client_side(
 
 	// Wrap the output in a `Result`
 	input.output = {
-		let generate_result = |ty: &Type| {
-			parse_quote!( -> ::std::result::Result<#ty, #crate_::error::Error> )
-		};
-
-		match &input.output {
-			syn::ReturnType::Default => generate_result(&parse_quote!( () )),
-			syn::ReturnType::Type(_, ref ty) => generate_result(&ty),
-		}
+		let ty = return_type_extract_type(&input.output);
+		parse_quote!( -> ::std::result::Result<#ty, #crate_::error::Error> )
 	};
 
 	input
diff --git a/substrate/core/sr-api-macros/tests/runtime_calls.rs b/substrate/core/sr-api-macros/tests/runtime_calls.rs
new file mode 100644
index 0000000000..d1d05eb48a
--- /dev/null
+++ b/substrate/core/sr-api-macros/tests/runtime_calls.rs
@@ -0,0 +1,60 @@
+// Copyright 2019 Parity Technologies (UK) Ltd.
+// This file is part of Substrate.
+
+// Substrate is free software: you can redistribute it and/or modify
+// it under the terms of the GNU General Public License as published by
+// the Free Software Foundation, either version 3 of the License, or
+// (at your option) any later version.
+
+// Substrate is distributed in the hope that it will be useful,
+// but WITHOUT ANY WARRANTY; without even the implied warranty of
+// MERCHANTABILITY or FITNESS FOR A PARTICULAR PURPOSE.  See the
+// GNU General Public License for more details.
+
+// You should have received a copy of the GNU General Public License
+// along with Substrate.  If not, see <http://www.gnu.org/licenses/>.
+
+extern crate substrate_client;
+extern crate substrate_test_client as test_client;
+extern crate sr_primitives as runtime_primitives;
+extern crate substrate_state_machine as state_machine;
+
+use test_client::runtime::{TestAPI, DecodeFails};
+use runtime_primitives::{generic::BlockId, traits::ProvideRuntimeApi};
+use state_machine::ExecutionStrategy;
+
+fn calling_function_with_strat(strat: ExecutionStrategy) {
+	let client = test_client::new_with_api_execution_strat(strat);
+	let runtime_api = client.runtime_api();
+	let block_id = BlockId::Number(client.info().unwrap().chain.best_number);
+
+	assert_eq!(runtime_api.benchmark_add_one(&block_id, &1).unwrap(), 2);
+}
+
+#[test]
+fn calling_native_runtime_function() {
+	calling_function_with_strat(ExecutionStrategy::NativeWhenPossible);
+}
+
+#[test]
+fn calling_wasm_runtime_function() {
+	calling_function_with_strat(ExecutionStrategy::AlwaysWasm);
+}
+
+#[test]
+#[should_panic(expected = "Could not convert parameter `param` between node and runtime!")]
+fn calling_native_runtime_function_with_non_decodable_parameter() {
+	let client = test_client::new_with_api_execution_strat(ExecutionStrategy::NativeWhenPossible);
+	let runtime_api = client.runtime_api();
+	let block_id = BlockId::Number(client.info().unwrap().chain.best_number);
+	runtime_api.fail_convert_parameter(&block_id, DecodeFails::new()).unwrap();
+}
+
+#[test]
+#[should_panic(expected = "Could not convert return value from runtime to node!")]
+fn calling_native_runtime_function_with_non_decodable_return_value() {
+	let client = test_client::new_with_api_execution_strat(ExecutionStrategy::NativeWhenPossible);
+	let runtime_api = client.runtime_api();
+	let block_id = BlockId::Number(client.info().unwrap().chain.best_number);
+	runtime_api.fail_convert_return_value(&block_id).unwrap();
+}
diff --git a/substrate/core/state-machine/src/lib.rs b/substrate/core/state-machine/src/lib.rs
index 69d257c8a9..c2427fb0d3 100644
--- a/substrate/core/state-machine/src/lib.rs
+++ b/substrate/core/state-machine/src/lib.rs
@@ -18,7 +18,7 @@
 
 #![warn(missing_docs)]
 
-use std::{fmt, panic::UnwindSafe};
+use std::{fmt, panic::UnwindSafe, result};
 use log::warn;
 use hash_db::Hasher;
 use heapsize::HeapSizeOf;
@@ -45,7 +45,8 @@ pub use changes_trie::{
 	InMemoryStorage as InMemoryChangesTrieStorage,
 	key_changes, key_changes_proof, key_changes_proof_check,
 	prune as prune_changes_tries,
-	oldest_non_pruned_trie as oldest_non_pruned_changes_trie};
+	oldest_non_pruned_trie as oldest_non_pruned_changes_trie
+};
 pub use overlayed_changes::OverlayedChanges;
 pub use proving_backend::{create_proof_check_backend, create_proof_check_backend_storage};
 pub use trie_backend_essence::{TrieBackendStorage, Storage};
@@ -156,7 +157,9 @@ pub trait CodeExecutor<H: Hasher>: Sized + Send + Sync {
 
 	/// Call a given method in the runtime. Returns a tuple of the result (either the output data
 	/// or an execution error) together with a `bool`, which is true if native execution was used.
-	fn call<E: Externalities<H>, R: Encode + Decode + PartialEq, NC: FnOnce() -> R + UnwindSafe>(
+	fn call<
+		E: Externalities<H>, R: Encode + Decode + PartialEq, NC: FnOnce() -> result::Result<R, &'static str> + UnwindSafe
+	>(
 		&self,
 		ext: &mut E,
 		method: &str,
@@ -248,7 +251,7 @@ where
 {
 	// We are not giving a native call and thus we are sure that the result can never be a native
 	// value.
-	execute_using_consensus_failure_handler::<_, _, _, _, _, NeverNativeValue, fn() -> NeverNativeValue>(
+	execute_using_consensus_failure_handler::<_, _, _, _, _, NeverNativeValue, fn() -> _>(
 		backend,
 		changes_trie_storage,
 		overlay,
@@ -286,7 +289,7 @@ where
 /// Note: changes to code will be in place if this call is made again. For running partial
 /// blocks (e.g. a transaction at a time), ensure a different method is used.
 pub fn execute_using_consensus_failure_handler<
-	H, B, T, Exec, Handler, R: Decode + Encode + PartialEq, NC: FnOnce() -> R + UnwindSafe
+	H, B, T, Exec, Handler, R: Decode + Encode + PartialEq, NC: FnOnce() -> result::Result<R, &'static str> + UnwindSafe
 >(
 	backend: &B,
 	changes_trie_storage: Option<&T>,
@@ -443,7 +446,7 @@ where
 {
 	let proving_backend = proving_backend::ProvingBackend::new(trie_backend);
 	let (result, _, _) = execute_using_consensus_failure_handler::
-		<H, _, changes_trie::InMemoryStorage<H>, _, _, NeverNativeValue, fn() -> NeverNativeValue>
+		<H, _, changes_trie::InMemoryStorage<H>, _, _, NeverNativeValue, fn() -> _>
 	(
 		&proving_backend,
 		None,
@@ -491,7 +494,7 @@ where
 	H::Out: Ord + HeapSizeOf,
 {
 	execute_using_consensus_failure_handler::
-		<H, _, changes_trie::InMemoryStorage<H>, _, _, NeverNativeValue, fn() -> NeverNativeValue>
+		<H, _, changes_trie::InMemoryStorage<H>, _, _, NeverNativeValue, fn() -> _>
 	(
 		trie_backend,
 		None,
@@ -621,7 +624,7 @@ mod tests {
 	impl<H: Hasher> CodeExecutor<H> for DummyCodeExecutor {
 		type Error = u8;
 
-		fn call<E: Externalities<H>, R: Encode + Decode + PartialEq, NC: FnOnce() -> R>(
+		fn call<E: Externalities<H>, R: Encode + Decode + PartialEq, NC: FnOnce() -> result::Result<R, &'static str>>(
 			&self,
 			ext: &mut E,
 			_method: &str,
@@ -684,7 +687,7 @@ mod tests {
 	#[test]
 	fn dual_execution_strategy_detects_consensus_failure() {
 		let mut consensus_failed = false;
-		assert!(execute_using_consensus_failure_handler::<_, _, _, _, _, NeverNativeValue, fn() -> NeverNativeValue>(
+		assert!(execute_using_consensus_failure_handler::<_, _, _, _, _, NeverNativeValue, fn() -> _>(
 			&trie_backend::tests::test_trie(),
 			Some(&InMemoryChangesTrieStorage::new()),
 			&mut Default::default(),
diff --git a/substrate/core/test-client/src/lib.rs b/substrate/core/test-client/src/lib.rs
index af22cb2be7..eec5770fc1 100644
--- a/substrate/core/test-client/src/lib.rs
+++ b/substrate/core/test-client/src/lib.rs
@@ -38,6 +38,8 @@ use runtime_primitives::StorageMap;
 use runtime_primitives::traits::{Block as BlockT, Header as HeaderT, Hash as HashT};
 use runtime::genesismap::{GenesisConfig, additional_storage_with_genesis};
 use keyring::Keyring;
+use state_machine::ExecutionStrategy;
+use client::LocalCallExecutor;
 
 mod local_executor {
 	#![allow(missing_docs)]
@@ -69,6 +71,23 @@ pub fn new() -> client::Client<Backend, Executor, runtime::Block, runtime::Runti
 	new_with_backend(Arc::new(Backend::new()), false)
 }
 
+/// Creates new client instance used for tests with the given api execution strategy.
+pub fn new_with_api_execution_strat(
+	api_execution_strategy: ExecutionStrategy
+) -> client::Client<Backend, Executor, runtime::Block, runtime::RuntimeApi> {
+	let backend = Arc::new(Backend::new());
+	let executor = NativeExecutor::new();
+	let executor = LocalCallExecutor::new(backend.clone(), executor);
+
+	client::Client::new(
+		backend,
+		executor,
+		genesis_storage(false),
+		ExecutionStrategy::NativeWhenPossible,
+		api_execution_strategy
+	).expect("Creates new client")
+}
+
 /// Creates new test client instance that suports changes trie creation.
 pub fn new_with_changes_trie()
 	-> client::Client<Backend, Executor, runtime::Block, runtime::RuntimeApi>
diff --git a/substrate/core/test-runtime/src/lib.rs b/substrate/core/test-runtime/src/lib.rs
index a19c966969..d804468a64 100644
--- a/substrate/core/test-runtime/src/lib.rs
+++ b/substrate/core/test-runtime/src/lib.rs
@@ -24,12 +24,13 @@ extern crate srml_support as runtime_support;
 #[cfg(feature = "std")] pub mod genesismap;
 pub mod system;
 
-use rstd::prelude::*;
-use parity_codec::{Encode, Decode};
+use rstd::{prelude::*, marker::PhantomData};
+use parity_codec::{Encode, Decode, Input};
 use parity_codec_derive::{Encode, Decode};
 
-use substrate_client::{runtime_api as client_api, block_builder::api as block_builder_api,
-	decl_runtime_apis, impl_runtime_apis,
+use substrate_client::{
+	runtime_api as client_api, block_builder::api as block_builder_api, decl_runtime_apis,
+	impl_runtime_apis,
 };
 use runtime_primitives::{
 	ApplyResult, Ed25519Signature, transaction_validity::TransactionValidity,
@@ -164,14 +165,47 @@ pub fn changes_trie_config() -> primitives::ChangesTrieConfiguration {
 	}
 }
 
+/// A type that can not be decoded.
+#[derive(PartialEq)]
+pub struct DecodeFails<B: BlockT> {
+	_phantom: PhantomData<B>,
+}
+
+impl<B: BlockT> Encode for DecodeFails<B> {
+	fn encode(&self) -> Vec<u8> {
+		Vec::new()
+	}
+}
+
+impl<B: BlockT> DecodeFails<B> {
+	/// Create a new instance.
+	pub fn new() -> DecodeFails<B> {
+		DecodeFails {
+			_phantom: Default::default(),
+		}
+	}
+}
+
+impl<B: BlockT> Decode for DecodeFails<B> {
+	fn decode<I: Input>(_: &mut I) -> Option<Self> {
+		// decoding always fails
+		None
+	}
+}
+
 decl_runtime_apis! {
 	pub trait TestAPI {
+		/// Return the balance of the given account id.
 		fn balance_of(id: AccountId) -> u64;
 		/// A benchmkark function that adds one to the given value and returns the result.
 		fn benchmark_add_one(val: &u64) -> u64;
 		/// A benchmark function that adds one to each value in the given vector and returns the
 		/// result.
 		fn benchmark_vector_add_one(vec: &Vec<u64>) -> Vec<u64>;
+		/// A function that always fails to convert a parameter between runtime and node.
+		fn fail_convert_parameter(param: DecodeFails<Block>);
+		/// A function that always fails to convert its return value between runtime and node.
+		fn fail_convert_return_value() -> DecodeFails<Block>;
 	}
 }
 
@@ -252,6 +286,12 @@ impl_runtime_apis! {
 			vec.iter_mut().for_each(|v| *v += 1);
 			vec
 		}
+
+		fn fail_convert_parameter(_: DecodeFails<Block>) {}
+
+		fn fail_convert_return_value() -> DecodeFails<Block> {
+			DecodeFails::new()
+		}
 	}
 
 	impl consensus_aura::AuraApi<Block> for Runtime {
diff --git a/substrate/core/test-runtime/wasm/target/wasm32-unknown-unknown/release/substrate_test_runtime.compact.wasm b/substrate/core/test-runtime/wasm/target/wasm32-unknown-unknown/release/substrate_test_runtime.compact.wasm
index 24b6ef4ef6..ec7eee0ddd 100644
Binary files a/substrate/core/test-runtime/wasm/target/wasm32-unknown-unknown/release/substrate_test_runtime.compact.wasm and b/substrate/core/test-runtime/wasm/target/wasm32-unknown-unknown/release/substrate_test_runtime.compact.wasm differ
diff --git a/substrate/node/executor/src/lib.rs b/substrate/node/executor/src/lib.rs
index f769b284e2..d98a8f32cc 100644
--- a/substrate/node/executor/src/lib.rs
+++ b/substrate/node/executor/src/lib.rs
@@ -118,7 +118,7 @@ mod tests {
 			twox_128(&<system::BlockHash<Runtime>>::key_for(0)).to_vec() => vec![0u8; 32]
 		]);
 
-		let r = executor().call::<_, NeverNativeValue, fn() -> NeverNativeValue>(
+		let r = executor().call::<_, NeverNativeValue, fn() -> _>(
 			&mut t,
 			"Core_initialise_block",
 			&vec![].and(&from_block_number(1u64)),
@@ -126,7 +126,7 @@ mod tests {
 			None,
 		).0;
 		assert!(r.is_ok());
-		let v = executor().call::<_, NeverNativeValue, fn() -> NeverNativeValue>(
+		let v = executor().call::<_, NeverNativeValue, fn() -> _>(
 			&mut t,
 			"BlockBuilder_apply_extrinsic",
 			&vec![].and(&xt()),
@@ -151,7 +151,7 @@ mod tests {
 			twox_128(&<system::BlockHash<Runtime>>::key_for(0)).to_vec() => vec![0u8; 32]
 		]);
 
-		let r = executor().call::<_, NeverNativeValue, fn() -> NeverNativeValue>(
+		let r = executor().call::<_, NeverNativeValue, fn() -> _>(
 			&mut t,
 			"Core_initialise_block",
 			&vec![].and(&from_block_number(1u64)),
@@ -159,7 +159,7 @@ mod tests {
 			None,
 		).0;
 		assert!(r.is_ok());
-		let v = executor().call::<_, NeverNativeValue, fn() -> NeverNativeValue>(
+		let v = executor().call::<_, NeverNativeValue, fn() -> _>(
 			&mut t,
 			"BlockBuilder_apply_extrinsic",
 			&vec![].and(&xt()),
@@ -184,7 +184,7 @@ mod tests {
 			twox_128(&<system::BlockHash<Runtime>>::key_for(0)).to_vec() => vec![0u8; 32]
 		]);
 
-		let r = executor().call::<_, NeverNativeValue, fn() -> NeverNativeValue>(
+		let r = executor().call::<_, NeverNativeValue, fn() -> _>(
 			&mut t,
 			"Core_initialise_block",
 			&vec![].and(&from_block_number(1u64)),
@@ -192,7 +192,7 @@ mod tests {
 			None,
 		).0;
 		assert!(r.is_ok());
-		let r = executor().call::<_, NeverNativeValue, fn() -> NeverNativeValue>(
+		let r = executor().call::<_, NeverNativeValue, fn() -> _>(
 			&mut t,
 			"BlockBuilder_apply_extrinsic",
 			&vec![].and(&xt()),
@@ -221,7 +221,7 @@ mod tests {
 			twox_128(&<system::BlockHash<Runtime>>::key_for(0)).to_vec() => vec![0u8; 32]
 		]);
 
-		let r = executor().call::<_, NeverNativeValue, fn() -> NeverNativeValue>(
+		let r = executor().call::<_, NeverNativeValue, fn() -> _>(
 			&mut t,
 			"Core_initialise_block",
 			&vec![].and(&from_block_number(1u64)),
@@ -229,7 +229,7 @@ mod tests {
 			None,
 		).0;
 		assert!(r.is_ok());
-		let r = executor().call::<_, NeverNativeValue, fn() -> NeverNativeValue>(
+		let r = executor().call::<_, NeverNativeValue, fn() -> _>(
 			&mut t,
 			"BlockBuilder_apply_extrinsic",
 			&vec![].and(&xt()),
@@ -422,7 +422,7 @@ mod tests {
 	fn full_native_block_import_works() {
 		let mut t = new_test_ext(COMPACT_CODE, false);
 
-		executor().call::<_, NeverNativeValue, fn() -> NeverNativeValue>(
+		executor().call::<_, NeverNativeValue, fn() -> _>(
 			&mut t,
 			"Core_execute_block",
 			&block1(false).0,
@@ -477,7 +477,7 @@ mod tests {
 			]);
 		});
 
-		executor().call::<_, NeverNativeValue, fn() -> NeverNativeValue>(
+		executor().call::<_, NeverNativeValue, fn() -> _>(
 			&mut t,
 			"Core_execute_block",
 			&block2().0,
@@ -729,7 +729,7 @@ mod tests {
 	fn native_big_block_import_succeeds() {
 		let mut t = new_test_ext(COMPACT_CODE, false);
 
-		Executor::new().call::<_, NeverNativeValue, fn() -> NeverNativeValue>(
+		Executor::new().call::<_, NeverNativeValue, fn() -> _>(
 			&mut t,
 			"Core_execute_block",
 			&block1big().0,
@@ -743,7 +743,7 @@ mod tests {
 		let mut t = new_test_ext(COMPACT_CODE, false);
 
 		assert!(
-			Executor::new().call::<_, NeverNativeValue, fn() -> NeverNativeValue>(
+			Executor::new().call::<_, NeverNativeValue, fn() -> _>(
 				&mut t,
 				"Core_execute_block",
 				&block1big().0,
@@ -805,7 +805,7 @@ mod tests {
 	#[test]
 	fn full_native_block_import_works_with_changes_trie() {
 		let mut t = new_test_ext(COMPACT_CODE, true);
-		Executor::new().call::<_, NeverNativeValue, fn() -> NeverNativeValue>(
+		Executor::new().call::<_, NeverNativeValue, fn() -> _>(
 			&mut t,
 			"Core_execute_block",
 			&block1(true).0,
diff --git a/substrate/node/runtime/wasm/target/wasm32-unknown-unknown/release/node_runtime.compact.wasm b/substrate/node/runtime/wasm/target/wasm32-unknown-unknown/release/node_runtime.compact.wasm
index 2d410ff28c..151d49c6a3 100644
Binary files a/substrate/node/runtime/wasm/target/wasm32-unknown-unknown/release/node_runtime.compact.wasm and b/substrate/node/runtime/wasm/target/wasm32-unknown-unknown/release/node_runtime.compact.wasm differ