BAILMENT

-Dr.Shikha Dimri
 The word bailment comes from the
French word ‘bailler’ which means to
deliver or handling over.

 In legal sense it involves change of

possession of goods from one person to
another for some specific purpose.
 S ECTION 148 D EFINES B AILMENT , B AILOR
AND B AILEE

 Sec-148 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. The
person delivering the goods is called the “bailor”. The
person to whom they are delivered is called the
“bailee”.

 Explanation: If a person already in possession of the

goods of another contract to hold them as a bailee,
he thereby becomes the bailee, and the owner
becomes the bailor, of such goods, although they
may not have been delivered by way of bailment.
 E SSENTIAL F EATURES OF
B AILMENT

 Delivery of possession goods; Actual or

Constructive
 Contract between the parties;
 There should be a Purpose
 Return of goods or their disposal as per
directions of the bailor
D IFFERENCE BETWEEN B AILMENT
AND C USTODY

Kaliaperumal Pillai v Visalaxmi

 Visalaxmi ,where the lady was getting certain jewelry made by a

goldsmith and each evening the half made jewels were put into the
box in the goldsmith’s room and the lady kept the keys of the box in
her possession. The jewels were lost one night. But the lady’s
action against goldsmith failed. It was held there was no bailment.

 The basic fact which distinguishes a mere custody from

bailment is the delivery and the control to be exercised over
the goods
Ultzen v Nicolls,(1894)1 QB92,

- where a waiter at a restaurant took the coat of the customer and

hung it at a place of his desire a bailment was said to have
occurred and the owner of the restaurant was held liable for the
loss of the coat.

Jagdish Chandra Trikha v Punjab National Bank

- Plaintiff claimed gold ornaments and jewellery deposited with

the bank. It was held that the position of bank was that of bailee
 Bailment compared with :
 Sale – Possession + Ownership
 Exchange or Barter – Exchange of
Possession + Ownership
 Hire Purchase - Bailment + element
of Sale
Can there be bailment without a contract?
 Allahabad HC expressed that obligation of bailee can
arise only out of a contract of bailment and not
otherwise.
 Case – Ram Gulam v Govt of UP, the plaintiff ‘s
ornament having been sold were recovered by the police
and while in police custody were again stolen. The
plaintiffs action against state for the loss was dismissed.
 Decision given in this case has been described as
unjustifiable by Pollock and Mulla
 Non –contractual Bailments- English law
recognizes bailment without contract.
 In India bailment has been found in
subsequent cases apart from contract between
the parties.
 Cases –
 Lasalgaon Merchants Cooperative Bank Ltd v
Prabhudas Hathibhai, it was held Govt. stood
in the position of a bailee and it was liable for
having failed to take care of goods.
State of Gujarat v. Memon Mahomed [bailment in case
of goods seized]

-Certain motor vehicles and other goods belonging to the

plaintiff’s were seized by the state in exercise of its power
under Sea Customs Act. The goods were in custody of the
State remained uncared for. It was contended that state
were not bailee, there was no obligation to take care. But
this contention was not sustainable.
 Bailment in case of Parking Lots
 General Exchange Ins Corp. v Service
Parking Grounds
 Beetson v Hollywood A.C.
 Keenan Hotel Co v Funk
 KINDS OF BAILMENT

According to sec 150 duty of bailor are of two kinds:

1. gratuitous bailor

 A person who lends his articles or goods without any

charge is called a gratuitous bailor. His duty is less then
that of the bailor for hire or consideration.

2. bailor for reward

 Where the bailment is not gratuitous it is for reward, it

is called bailor for reward. Duties for bailor for reward
is much greater then that of gratuitous bailor
 D UTY OF B AILOR

Duty of Gratuitous bailor

 Duty to disclose defect

 Illustrations Section 150

Hyman & Wife v Nye & Sons, plaintiff hired a

carriage & horses from defendant for a
particular journey.The carriage being defective,
it was upset and plaintiff was injured. Defendant
was held liable.
 D UTIES OF B AILEE

1. Duty of reasonable care (sec-151-152)

2. Duty not to make unauthorized use (sec-153-154)
3. Duty not to mix with own goods (sec-155-157)
4. Duty to Return(sec-160-161)
5. Duty to return accretion(sec-163)
6. Duty not to set up title in third person (sec-166-
167)
1. Duty of reasonable care (sec-151-152)
Care to be taken by bailee.
Martin v london Country Council, plaintiff was
brought to a paid hospital as patient. On her entry the
hospital officials took charge of two pieces of jewellery and a
gold cigarette case. They were subsequently stolen by a thief
who broke into the room in which they were kept. It was
held that the defendants as bailee for reward were liable for
the loss as they failed to exercise a care which nature and
quality of the articles required.
 Bailee when not liable for loss, etc., of thing
bailed.
 The bailee, in the absence of any special
contract, is not responsible for the loss,
destruction or deterioration of the thing bailed,
if he has taken the amount of care of it
described in section 151.
Loss due to act of Bailee’s Servant - liability will
be there if act has been done during the course of
employment

Case- Sanderson v. Collins, the defendant sent his

carriage to the plaintiff for repairs who lent his own
carriage to the defendant while the repairs were going on.
The defendants coachmen without his knowledge took
away the carriage for his own purpose and damaged it.
The defendant was not held liable as the coachmen at the
relevant time was not acting within the course of
employment.
There are exceptional circumstances
where bailee cannot exercise reasonable
care-loss due to floods, damage due to
action of mob;roits
Burden of proof-is on the bailee that he
was exercising reasonable care
 R IGHTS AND L IABILITIES OF
F INDER OF G OODS [S.168-169]

Right of finder of goods;

 To retain the goods until he receives
compensation
 To sue for-specific reward offered by
the owner.
 FINDERS RIGHT OF
SALE
Finder of goods may sell the goods found if :
(1) the thing is commonly subject of sale.
(2) the owner cannot be found with reasonable
diligence, or is found ,he refuses to pay the lawful
charges of the finder.
(3) either the goods are in danger of perishing or
losing their value; or the lawful charges of the
finder amount to two third of their value.
 His Liabilities (Sec-71) A finder of
goods is subject to the same
responsibility as that of the Bailee
 R IGHTS OF B AILEE

1. Right to recover expense or remuneration

(sec158)
2. Right to be indemnified (sec164)
3. Bailment by several joint owners (Sec165)
4. Right of lien on goods (sec170-171)
5. Right to sue wrong doers (sec180)
 Lien is the right of the bailee under which
the bailee can retain the goods of the bailor
and refuse to deliver them to the bailor until
his due remuneration for services in respect
of the goods bailed or the amount due is
paid. Act recognises two kinds of lien:
 General lien
 Particular lien
Particular lien- implies the right to retain only that
particular property in respect of which the charge for
rendering any service involving the exercise of labour
or skill is due. The right can be exercised so long as the
remuneration in respect of the specific goods has not
been paid

General lien-is the right to retain the goods of another as a

security for a general balance of account. The right of
general lien is only conferred on certain special kinds
of bailees only and not on every one.
Bailee's particular lien.
Section170.
Where the bailee has, in accordance with the
purpose of the bailment, rendered any service
involving the exercise of labour or skill in respect
of the goods bailed, he has, in the absence of a
contract to the contrary, a right to retain such
goods until he receives due remuneration for the
services he has rendered in respect of them.
 General lien of bankers, factors, wharfingers,
attorneys and policy-brokers.

 171. Bankers, factors, wharfingers, attorneys of a

High Court and policy-brokers may, in the
absence of a contract to the contrary, retain, as a
security for a general balance of account any
goods bailed to them; but no other persons have a
right to retain, as a security for such balance,
goods bailed to them, unless there is an express
contract to the effect.
 GENERAL LIEN PARTICULAR LIEN

1. It is a privilege of only 1. It is available to all

five classes of persons bailees
mentioned in section171
2. It is available only as
2. It is available against regards the goods on
all goods which the bailee has
done any work
3. It can be exercised for a
general balance of 3. It is available only for
accounts remuneration due in
respect of these goods
Suit by bailor or bailee against wrong-doer.

180. If a third person wrongfully deprives the bailee of

the use or possession of the goods bailed, or does them
any injury, the bailee is entitled to use such remedies as
the owner might have used in the like case if no
bailment had been made; and either the bailor or the
bailee may bring a suit against a third person for such
deprivation or injury.