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Bailment ppt @ bec doms

Nov 04, 2014



Bailment ppt @ bec doms

  • 1. Bailment
    • A bailment is the delivery of the 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 off according to the directions of the person delivering them.
  • Bailment meansto deliverorto hand over .
  • Custody of goods without possession does not constitute Bailment.


  • The person delivering the goods is called thebailor . The person to whom they are delivered is called thebailee . The transaction is calledbailment(Section 148).
  • Adelivers cloth piece toB , a tailor, to be stitched into a suit. This is bailment.
  • If a person already in possession of the goods of another contracts to hold them as a bailee, he thereby becomes the bailee and the owner becomes the bailor of such goods.

3. Essentials

  • Contract:Delivery of goods is upon a contract between the bailor and the bailee.
  • Delivery of goods and change of possession:Mere custody of goods w/o parting with its possession doesnt constitute a bailment.
  • Specific purpose:Delivery of goods must be for some specific purpose.
  • Only for Movable Goods:Money not included as a movable good.
  • Return of specific goods:Bailee must return the specific goods as soon as the specific purpose is accomplished.

4. Kinds of Bailment

  • Gratuitous bailment:Goods given to a friend or any one else, to be used by him without any (unnecessary) reward or remuneration or consideration.
  • Bailment for reward or remuneration:For example, goods given on hire, goods given for repair against charges, etc.
  • Pawn or Pledge:Goods delivered to another as a security for money borrowed.

5. Bailor: Rights, Duties & Liabilities

  • Termination of bailment (Section 153):For example,Alets toBfor hire a horse for his own riding.Bdrives the horse in his carriage.Acan terminate the bailment.
  • Return of goods (Sections 160 & 161):Bailor has the right to get back the goods from the bailee as soon as time for which they were bailed has expired.
  • Right to claim compensation (Section 154):For wrongful use of goods by bailee.


  • Claim in case of mixture of goods by the bailee (Section 155-157):
  • (i)With the consent of bailor.Bailor can claim proportionate share in mixed goods.
  • (ii)Without consent of bailor . But goodscan be separated . Bailor can claim expenses of separation & any damage arising from the mixture.
  • (iii)Without consent of bailor.But goodscannot be separated . Bailor is fully entitled to compensation for the loss of the goods.
  • Right to receive any increase or profit from goods bailed.


  • Put bailee into possession (Section 149).
  • Disclose faults in the goods bailed (Section 150). Not disclosing is a liability for bailor.
  • Repay necessary expenses (Section 158). To repay to bailee who receives no remuneration.
  • To indemnify gratuitous bailee (Section 159). Indemnifying for any loss due to earlier demand by bailor.
  • Responsible for any loss due to defect in title (Section 164).
  • To take back the goods.

8. Bailee: Rights, Duties & Liabilities

  • Particular Lien (Section 170): For example,Adelivers a rough diamond toB , a jeweller, to be cut and polished, which is accordingly done.Bis entitled to retain the stone till he is paid for the services rendered.
  • To know faults in the goods bailed (Section 150).
  • Claim proportionate share in goods mixed (Section 155).
  • Claim expenses of bailment (Section 158).
  • Claim losses for defect in title of bailor (Section 160).
  • Gratuitous bailee can claim indemnity (Section 159).


  • To take reasonable care of the goods bailed (Section 151).
  • No unauthorized use of goods bailed (Section 154).
  • Return of goods (Section 160 & 161).
  • To deliver any increase or profits accrued on the goods (Section 163).
  • To pay damages: if he fails to take care of the goods; damage due unauthorized use; mixing w/o consent of bailor; commits default in returning goods.
  • Effect of mixture of goods.

10. Pledge

  • The bailment of goods assecurityfor payment of a debt (or performance of a promise) is calledPledge .
  • The bailor in this case is calledPawnor . The bailee is calledPawnee .
  • The transaction is calledpledgeorpawn .
  • Bailor is also calledPledgorand the bailee is calledPledgee .
  • Pledge is therefore a kind of bailment.
  • Aborrows Rs.4000 against security of his jewellery. The bailment of jewellery is a pledge.

11. Rights of Pawnee

  • To retain the goods for payment of the debt or the performance of the promise (Sec.173 & 174).
  • To recover extraordinary expenses (Sec. 175).
  • Right on pawnors default by (Section 176):
  • Bringing a suit on the pawnor;
  • Retaining the goods pledged as collateral security;
  • Selling the goods pledged after reasonable notice.
  • Note: Liabilities of a pawnee for loss of goods are similar to that of a bailee.

12. Rights of Pawnor

  • Right of redemption (Section 177):This right cannot be taken away by the pawnee by any contract or otherwise.
  • Preservation and maintenance:Pawnor can enforce preservation and proper maintenance of the goods pledged.
  • To receive back the goods:On the payment of the debt or on performance of the promise.
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