NVL command with ' ' (space) as NULL

Hi,

In our DB we store character NULL values as a single character blank string ' '.  How does this work with the NVL command?

Example

select NVL (
(SELECT  ' ' from dual)
, 'TEST') from dual;

returns ' '

select NVL (
(SELECT  NULL from dual)
, 'TEST') from dual;

returns 'TEST'

So how can I get 'TEST' to come out when there is a NULL?

Thanks!

-Mike

Oracle Database 11g Enterprise Edition Release 11.2.0.2.0 - 64bit Production
PL/SQL Release 11.2.0.2.0 - Production