BAILMENT

BAILMENT

The bailment is defined under section 148 of the Indian contract act. 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.

There are some essential ingredients for the bailment

• The goods deliver by one person to another person should be movable goods.
• The goods are delivered to another person for the some purpose.
• The goods are delivered for some conditions, when the purpose is accomplished the goods are to be returned backed or disposed of according to the direction of bailor, either in their original form or in altered form.

The bailment consists of two things that is first benefit and second reward to the parties.

From the benefit point of view, bailment is of three types-

1. Bailment for the exclusive benefit of the balior, example is that bailor leaves the goods in the custody of the bailee without any compensation to be paid.
2. Bailment for the exclusive benefit of the bailee, eg a loan of some product.
3. Bailment for the mutual benefit of the bailor and bailee – It is the common type of bailment. In which the bailor receives the benefit of service anfd the bailee get benefited from the receipt of agreed charges.

 

From the reward point of view, bailment is of two types-

1. Gratuitous bailment – It is that type of bailment in which neither bailor nor bailee is entitled for given remuneration.
2. Non- gratuitous – In this bailment, either bailor or bailee is entitled to give the remuneration.

 DUTIES OF BAILEE

1. Duty to take care of bailor’s goods
   The section 154 says that bailee is responsible to take care of goods bailed by bailor. The bailee should take care of goods of bailor as similar as their own goods. The bailee is bounded not to reduce the value of bailed goods.
2. Duty not to make unauthorised use of bailor’s goods
   The bailee could not make unauthorised use of bailor’s goods against the terms and conditions of bailment. If there is unauthorised use of goods by the bailee, the bailee is liable for giving compensation to bailor for the damages of bailor’s goods.
3. Duty not to mix bailed goods with bailee owns goods.
   It is duty of bailee not to mix the bailed goods with his own personal goods. If the bailee mixed the bailor’s goods with his own goods with the consent of the bailor, so there is no breach of duty by the bailee. Whereas if the bailee has mixed up the goods of bailor with his owns goods without the consent of bailor, whether intentionally or accidentally, the following rule apply; (a) where the goods can be separated or divided and goods remains to respectively to parties (b) the goods cannot be separated, the bailee is liable for mixing up the goods, and for giving compensation to bailor.
4. Duty to return goods
   The bailee’s duty to return the goods back to bailor, when the bailed time period is complete or the purpose of bailment is accomplished. When the bailee failed to return the goods to bailor at proper time limit or the bailor face any defamation of goods at the time, the bailee is liable for giving the compensation for the damage of bailor.

DUTIES OF BAILOR

1. Duty to disclose faults in the bailed goods
   Section 150 makes distinction between the gratuitous bailor and bailor for reward
   • A gratuitous bailor has the duty to disclose all faults for the bailed goods, of which he is aware of and which materially interfere with the use of good, or expose the bailee to extraordinary risks, and if he fails to do so, he will be liable for such damages to bailee as may directly from the faults. The gratuitous bailor is not liable for the damages of bailee ignorance.
   • A bailor for reward is responsible for all the defects in the goods bailed whether the bailor is aware about faults or not. If the bailed goods are dangerous in nature. It is duty of bailor to disclose the fact to the bailee otherwise bailor is liable for damages.
2. Duty to repay necessary expenses in case of gratuitous bailment

It is the duty of the bailor to give necessary expenses incurred by the bailee for the purpose of bailment. Where by the condition of bailment, the bailee kept the goods and has done work on the goods by the bailee, if he does not get any remuneration, the bailor must pay the necessary expenses incurred.

1. Duty to repay any extraordinary expenses in case of non gratuitous bailment.
2. Duty to indemnify bailee

The bailor is also bound to indemnify the bailee for the loss suffered by the bailee, by reason of fact that the bailor was not entitled to bail the goods.

1. Duty to receive back the goods

The bailor has duty to take back the bailed goods after the completion of bailment or purpose of bailment accomplished. If bailor does not take back bailed goods from the bailee, the bailee will claim for the compensation of expenses.

RIGHTS OF BAILEE

1. Enforcement of bailor’s duties.
   The duties of the bailor are rights of bailee, the bailee has following rights-
   • Right to claim damages for undisclosed faults of the bailed goods
   • Right to claim reimbursement for extraordinary expenses incurred on the bailed thing.
   • Right to claim for compensation for expenses incurred on the safe custody of the goods, if the bailor has refused to take back the goods after bailment is over.
2. Right to deliver goods to one of several joint bailors.
3. Where goods have been bailed by several joint owners, bailee has the right to deliver them to or according to direction of any one joint owner without the consent of other
4. Right to deliver goods, in good faith, to bailor without title.
   The bailee has right to deliver the goods in good faith to the bailor or without any title or without incurring any liability toward bailor.
5. Right to lien
   Right to retain possession of the property or goods of another person for some debt or claim until when he is not paid is called lien.

RIGHTS OF BAILOR

1. Enforcement of bailee’s duties.
   The bailee duties are the rights of the bailor. The bailor has following rights-
   • Right to claim the loss of bailed goods by the bailee negligence.
   • Right to claim compensation of damages by the bailee for unauthorised use for goods.
   • Right to demand the bailed goods after the bailment has expired or the purpose is accomplished.
   • Right to claim for natural accretion in the bailed good
2. Right to terminate the bailment, if bailee uses the goods wrongfully.
   The bailment is to be terminated when the bailee do not follows the terms of the bailment and misuse the bailed goods before the expired time or purpose accomplishment.
3. Right to take back the bailed goods at any time in case of gratuitous bailment.

 

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Author: Manish Kumar,
Delhi Metropolitan Education( Affiliated to GGSIPU) 2nd year (BALLB)