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Principles of Business Law Bailment
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Page 1: 02 contracts of bailment

Principles of Business Law

Bailment

Page 2: 02 contracts of bailment

Topics Covered

Principles of Business Law

• Definition

• Essential Features

• Kinds of Bailment

• Duties and Rights of Bailee

• Duties and Rights of Bailor

• Termination of Bailment

Page 3: 02 contracts of bailment

Principles of Business Law

Bailment

“ A Bailment is 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.”

Section 148 of the Contract Act

BailorBailee

Hiring of Goods

Hiring of Furniture

Delivering a scooter for repair

Page 4: 02 contracts of bailment

Principles of Business Law

Essentials features

Delivery of Movable goods

The Goods are delivered for some purpose

The goods are to be returned in specie or disposed of

Deposit of money with a banker is Bailment?

Page 5: 02 contracts of bailment

Principles of Business Law

Kinds of Bailment

Kinds from ‘benefit’ point of view:- Bailment for the exclusive benefit of the bailor Bailment for the exclusive benefit of the bailee Bailment for the mutual benefit of the bailor and the bailee

Kinds from ‘reward’ point of view:- Gratuitous bailment Non-gratuitous bailment

Benefit

Reward

Benefit and Reward

Page 6: 02 contracts of bailment

Principles of Business Law

Consideration in Relation to Gratuitous Bailments

Difference between ‘Sale’ and ‘Bailment’

Difference between ‘Bailment’ and ‘License’

Page 7: 02 contracts of bailment

Principles of Business Law

Duties of Bailee

Duty to take reasonable care of goods delivered to him

Duty not to make authorised use of goods entrusted to him

Duty not to mix goods bailed with his own goods

Duty to return the goods

Duty to deliver any accretion to the goods

Page 8: 02 contracts of bailment

Principles of Business Law

Duties of Bailor

Duty to disclose faults in goods bailed

Duty to repay necessary expenses in case of gratuitous bailment

Duty to repay any ‘extraordinary’ expenses in case of non-gratuitous bailment

Duty to indemnify bailee

Duty to receive back the goods

Page 9: 02 contracts of bailment

Principles of Business Law

Rights of Bailee

Enforcement of Bailor’s duties

Right to deliver goods to one of several joint bailors

Right to deliver goods, in good faith, to bailor without title

Right of lien

Page 10: 02 contracts of bailment

Principles of Business Law

Rights of Bailor

Enforcement of bailee’s duties

Right to terminate bailment if the bailee uses the goods wrongly

Right to demand return of goods at any time in case of gratuitous bailment

Page 11: 02 contracts of bailment

Principles of Business Law

Rights of Bailor and Bailees against Wrong-doers

Termination of Bailment-Specific period

- Specific purpose- Inconsistent in terms of bailment

- Gratuitous Contract can be terminated anytime/death

Page 12: 02 contracts of bailment

Principles of Business Law

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