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Bailment
Sec 148 defines bailment as the delivery of goods by

one person to another for some purpose upon a contract that they shall, when the purpose is accomplished, be returned or otherwise disposed of according to the directions of the person delivering them. The person delivering the goods is called a bailer and the person to whom they are delivered is called a bailee.

examples
A gives a piece of cloth to be stitched into a suit. Here

there is a bailment contract between A and B. A lends a book to B to be returned after the examination. There is a contract between A and B. A sells certain goods to B who leaves them in the possession of A. There is a bailment contract between A and B. An insurance company places a damaged car of A in possession of repairer R. Here A is the bailer, insurance company is the bailee and the repairer is sub bailee.

Requisites of Bailment
Contract: It is created by agreement between bailer

and bailee. In certain cases it is implied for instance in case of finder and owner while in most cases it is expressed Delivery of possession For some purpose Return of specific goods

Bailment is concerned only with goods

Goods defined in Sec 2(7) of the Sale goods Act 1930

meaning every kind of movable property other than money and actionable claims. Only the possession is transferred and not the ownership and hence there is no bailment in case of sale of property or depositing money with the bank Other examples of bailment includes Hire purchase contract Seizure of goods by the customs authorities who after the seizure are in the position of bailee Acceptance of goods by transport company Acceptance of goods by post office as value payable parcels

Classification of bailments
For the exclusive benefit of the bailor
For the exclusive benefit of the bailee. For the mutual benefit of the bailer and bailee It can also be classified as gratuitous and non

gratuitous bailments depending upon the consideration which passes between the bailment and the bailee.

Duties of bailer
To disclose known faults
To bear extraordinary expenses of bailment To indemnify bailee for loss in case of premature

termination of gratuitous bailment To receive back the goods To indemnify the bailee

Duties of bailee
To take reasonable care of the goods bailed
Not to make any unauthorised use of goods Not to mix goods bailed with his own goods.

Not to set up any adverse title

To return any accretion to the goods To return the goods

Right of the bailer

Enforcement of rights
Avoidance of contract Return of goods lent gratuitously

Compensation from a wrong doer

Right of a bailee
Delivery of goods to one of several joint bailee of goods
Delivery of goods to bailer without a title Right to apply to court to stop delivery

Right of action against trespassers

Bailers Lien

Law relating to Lien

It means the right of a person to retain the possession

of some goods belonging to another until some debt or claim of the person in possession is satisfied. It appertains to the person who has possession of the goods which belong to another, entitling him to retain them until the debt due to them has been paid. Possession is essential for exercising the right of lien and in order to create a lien the possession should be - rightful - continuous - without any purpose

Types of lien
Particular lien it is one which is available to the bailee

against only those goods in respect of which he has rendered some service involving the exercise of labour or skill example A delivers a rough diamond to B to be cut and polished. B is entitled to keep the diamond with him until he get the amount for his services. this right cannot be exercised if the bailee voluntarily returns the goods or if he is not in the possession of the goods and have given back the goods to the bailer who in turn has promised him to pay the due after some time.

General lien
A general lien is a right to retain all goods or any other

property of another until all the claims of the holder are satisfied. This is the right to retain the property of another for general balance of account. For example if two securities are given to a banker but loan is taken only against one securities then the banker has the right to retain both the securities until his claim is satisfied. General lien is available to bankers, factors, wharfingers, attorneys of high courts and policy brokers

Rights of bailers and bailee against wrong doers

Suit against wrong doer
Apportionment of relief

Finder of goods
A person who comes by an article is not obliged to pick

it up or take charge of it but does pick it up he becomes a bailee. Sec 71 clearly lays down that a person who finds goods belonging to another and takes them into his custody is subject to the same responsibility as a bailee

Rights of finder of goods

Right of lien Right to sue for reward Right of sale

-if the owner with reasonable diligence be found. - if found he refuses to pay the lawful charges of the finder -if the goods found are in danger of perishing or losing greater part of their value If the lawful charges of finder to respect of the goods found amounts to two thirds of their value.

Obligation of finder of goods

He must take reasonable care of goods and if in spite

of this the goods are destroyed he is not responsible for any loss He must not use the goods for his own purpose He must not mix the goods with his own goods He must try to find out the owner of goods and if he does not do that he will be liable as a trespasser(one who interferes with anothers property)

Liability of hotel keepers, inn keepers, common carriers

The liability of hotel keeper in respect to the goods

belonging to a guest is that of a bailee of goods. He should take as much care of goods as a prudent man would take of his own goods under similar circumstances. The liability of a hotel keeper in India to his guests is regulated By the Contracts Act There are separate laws which deals with the liabilities of common carrier in India.

Termination of Bailment
On the expiry of the period
On the achievement of the object Inconsistent use of goods

Destruction of subject matter

Gratuitous bailment Death of bailer or bailee

pledge
The bailment of goods as security for payment of a

debt or performance of promise is called a pledge. The bailer in this case is called the pledger or pawn or and the bailee is called pledgee or pawnee example If A borrows 200 rupees from B and keeps his watch as a security for the payment of the debt, the bailment of watch is a pledge. Delivery is necessary to complete a pledge which needs to be either constructive or actual.

Difference between pledge and bailment

Pledge is the bailment of goods as a security for the

performance of a specific promise, that is the payment of a debt or performance of promise. Bailment on the other hand is for the purpose of any kind. In case of default by the pawnor to repay the debt, the pawnee may after giving notice to pawnor sell the goods pledged with him. The bailee may retain the goods or sue for his charges In case of pledge, the pawnee has no right to use the goods pledged with him. In case of bailment the bailee may do so if terms of bailment so provide.

Rights of pawnee
Rights of retainer
Right of retainer to subsequent advances Right to extraordinary expenses

Right against true owner, when the pawnors title is

defective Pawnees right where pawnor makes default.

Rights of pawnor
Right to get back goods
Right to redeem debt Preservation and maintenance of goods

Rights of ordinary debtors

Pledge by non owners

Pledge by mercantile agent
Pledge by seller or buyer in possession after the sale Pledge where pawnor has limited interest

Pledge by co owner in possession

Pledge by person to possession under the voidable

contract.