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    Contract of Bailment

    Uploaded by

    Radhika Reddy
    The document defines and discusses the concept of bailment under Indian contract law. It notes that bailment involves the delivery of goods by one person (the bailor) to another (the bailee) for a specific purpose, upon agreement that the goods will be returned after the purpose is accomplished. The key elements of a bailment are a contract, delivery of possession of goods, and return of the goods. Bailments can be gratuitous (without payment) or for reward, and for the exclusive benefit of one party or for mutual benefit. The duties of the bailor include disclosing known faults, bearing extraordinary expenses, indemnifying the bailee in certain situations, and receiving back the goods.

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    Attribution Non-Commercial (BY-NC)
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    Contract of Bailment

    Uploaded by

    Radhika Reddy
    278 views22 pages
    The document defines and discusses the concept of bailment under Indian contract law. It notes that bailment involves the delivery of goods by one person (the bailor) to another (the bailee) for a specific purpose, upon agreement that the goods will be returned after the purpose is accomplished. The key elements of a bailment are a contract, delivery of possession of goods, and return of the goods. Bailments can be gratuitous (without payment) or for reward, and for the exclusive benefit of one party or for mutual benefit. The duties of the bailor include disclosing known faults, bearing extraordinary expenses, indemnifying the bailee in certain situations, and receiving back the goods.

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    The document defines and discusses the concept of bailment under Indian contract law. It notes that bailment involves the delivery of goods by one person (the bailor) to another (the bailee) for a specific purpose, upon agreement that the goods will be returned after the purpose is accomplished. The key elements of a bailment are a contract, delivery of possession of goods, and return of the goods. Bailments can be gratuitous (without payment) or for reward, and for the exclusive benefit of one party or for mutual benefit. The duties of the bailor include disclosing known faults, bearing extraordinary expenses, indemnifying the bailee in certain situations, and receiving back the goods.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    278 views22 pages

    Contract of Bailment

    Uploaded by

    Radhika Reddy
    The document defines and discusses the concept of bailment under Indian contract law. It notes that bailment involves the delivery of goods by one person (the bailor) to another (the bailee) for a specific purpose, upon agreement that the goods will be returned after the purpose is accomplished. The key elements of a bailment are a contract, delivery of possession of goods, and return of the goods. Bailments can be gratuitous (without payment) or for reward, and for the exclusive benefit of one party or for mutual benefit. The duties of the bailor include disclosing known faults, bearing extraordinary expenses, indemnifying the bailee in certain situations, and receiving back the goods.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
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    Contract of Bailment

    Bailment
    Bailment means any kind of handing over

    In legal sense, it involves change of


    possession of goods from one person to another for some specific purpose

    Bailment
    Definition
    Section 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

    Bailment
    The person delivering the goods is called the bailor

    The person to whom they are delivered is called the


    bailee e.g.: A teacher lends a book to a student, which to be returned after the examination Here the teacher is a bailor and the student is bailee

    Requisites of Bailment
    1. Contract: the agreement between the bailor and

    the bailee may be express or implied


    2. Delivery of possession: bailment involves

    delivery of possession of goods by bailor to


    bailee
    The delivery may be actual or constructive (Sec. 149)

    Requisites of Bailment
    3. For some purpose: the delivery of goods from bailor to

    bailee must be for some purpose


    4. Return of specific goods: it is agreed between the bailor and bailee that when the purpose is accomplished, the goods to be returned or otherwise disposed of according to the directions of the bailor

    Bailment is concerned with Goods only


    Goods : Sec. 2(7) of the sale of goods Act, 1930
    Every kind of movable property other than money & actionable claims. In a contract of bailment only possession passes from bailor to the bailee and not ownership. Hence if the property in goods is transferred for money consideration, it is a sale and not a bailment. Ex. Of Bailment Seizure of goods by the custom authoriy, acceptance of goods by the transport company/ railway / post etc.

    Consideration in contract of Bailment


    In a contract of bailment the consideration
    is in the form of money payment either by
    the bailor or by the bailee

    TYPES OF BAILMENT
    Bailment can be categorised in two
    ways; they are
    Bailment for reward/ Gratuitous bailment

    Bailment only for benefit

    Bailment for Reward


    Gratuitous Bailment
    Where none of the parties get any
    remuneration the Bailment is gratuitous

    e.g.: lending of a book to a friend

    Bailment for Reward

    Non- Gratuitous Bailment


    Where either of the parties gets

    remuneration the Bailment is non-gratuitous

    e.g.: Giving a scooter for repair

    Gratuitous Vs. Non-Gratuitous Bailment


    Basis of distinction Gratuitous Bailment Non-Gratuitous Bailment Some consideration is passed between the Bailor and the Bailee It is for mutual benefit of Bailor and bailee

    Consideration No consideration is passed between the Bailor and the Bailee Benefit It is for the exclusive benefit of Bailor and Bailee

    Gratuitous Vs. Non-Gratuitous Bailment


    Liability of Bailor for unknown defects (Sec.151)
    The Bailor is not liable to the Bailee for loss due to defects in goods if the defects are unknown to him
    The Bailor must repay to the Bailee all the necessary expenses which, the Bailee has already incurred for the purposes of Bailment

    The Bailor is liable to the Bailee for the loss due to defects in the goods whether he is aware of the defects or not
    The Bailor must repay to the Bailee only the extraordinary expenses which, the Bailee has already incurred for the purpose of bailment

    Bailors duty to bear expenses (Sec. 158)

    Gratuitous Vs. Non-Gratuitous Bailment


    Bailment for a period of purpose
    It can be terminated at any time even though the Bailment was for a specific purpose It is terminated on the expiry of the specific period or on the fulfillment of the purpose

    Effect of death

    It is terminated with the death of Bailor or Bailee

    It is not terminated with the death of Bailor or Bailee

    Bailment only for Benefit


    Bailment for the exclusive benefit of the
    Bailor
    e.g.: delivery of some valuables to a neighbor

    for safe custody without charge

    Bailment only for Benefit


    Bailment for the exclusive benefit of the
    Bailee
    e.g.: lending of vehicle to a friend for his use,

    without charge

    Bailment only for Benefit


    Bailment for the mutual benefit of both
    Bailor and Bailee
    e.g.: giving a car for repair

    Duties of Bailor
    To disclose known faults
    According to section 150, it is the first and foremost
    duty of the bailor to disclose the known faults about the goods bailed to the bailee If the goods are bailed for hire the duty of the bailor is greater

    Duties of Bailor
    To bear extraordinary expenses of the bailment
    The bailee is bound to bear ordinary and reasonable
    expenses of the bailment but for any extraordinary expenses the bailor is responsible In case of gratuitous bailment the bailor must repay all the necessary expenses incurred by him for the

    purpose of bailment (Sec. 158)

    Duties of Bailor
    To indemnify bailee for loss in case of premature
    termination of gratuitous bailment
    According to section 159, if the contract of bailment is terminated before the time specified and because of which the bailee suffering losses more than the benefit he has derived from that, the bailor shall have

    to indemnify the bailee

    Duties of Bailor
    To receive back the goods
    If the bailor refuses to receive back the goods
    after the termination of time specified he is

    liable to pay the compensation to the bailee

    Duties of Bailor
    To indemnify the bailee
    According to section 164, if the bailee is suffering
    losses because of the title of the goods i.e. where the title of the bailor to the goods is defective, the bailor has to pay the compensation for the losses incurred by the bailee

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