Principle of bailment

1.INTRODUCTION:

Hard cases make bad law.

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S. 148 defined- In the law of contract bailment means when a person is said to be in a bailment if

he receives the possession of an article or articles from someone else without there being a

transfer of ownership. The arrangement is not a sale and the person receiving the goods is not

intended to keep them.

Examples of bailment include:

1.Leaving a car with a parking lot attendant.

2.Checking a coat at a restaurant.

3.Placing property in a safe-deposit box.

The Contract Act, 1872 (ACT NO. IX OF 1872)

*In case of Bailment if there exist any contract than it my become a bailment but if there are no

contract forms than it will never been a bailment.

Bertig v. Norman case proofs that.

General Principles of bailment:

1. Contract must exist first.

2.Changing of possession without transferring ownership of any object. (Bohannon v. Springfield)

3. Not a sale of goods.

4.Bailee and Bailor must exist.

5.Duty of bailor and bailee. (S. 150)

Illustration of bailment:

'A' the went to somewhere in his personal car and now he wants to park his car into the parking

area and for that he paid 20 takas to the person 'B’ who is entitled to take care of the cars which

are in the parking area. Its and paid Bailment. 'A' delivers his cars possession but not the

ownership and 'B' takes the possession of the car for a period of time but not the ownership.

Here “A” is the Bailor and “B” is the Bailee.

2. MAIN BODY:

2.1: Legal Analysis-Law, Case, Judgement, principles:

Law:

Relevant Sections of the Contract Act, 1872 (Bailment Focus):

Section 148 - Definition of Bailment.

Section 149 - Delivery to Constitute Bailment.

Section 150 - Duty of the Bailor.

Section 151 - Duty of Bailee to Take Care.

Section 152 - Bailee Not Liable for Loss if Due Care is Taken.

Section 153 to 154 - Termination of Bailment and Liability.

Section 161 - Bailee's Responsibility in Non-return.

Section 171 - Bailee’s Right to Retain.2

Legal Analysis:

Contractual Basis: Bailment generally arises from mutual consent, although some forms, such as

finding lost property, may be involuntary.

Liabilities and Rights: The responsibilities of the bailee range from strict liability for

mis-delivery to a standard of reasonable care for safeguarding the goods.

Judicial Precedents: Courts have refined bailment principles to balance justice and commercial

practicality, highlighting the significance of circumstances in determining liability.

Judicial Interpretations and Case Laws:

Foulke v. New York Consolidated R.R.: The court confirmed that bailment results from the

lawful possession of, and obligation to account for, the property, irrespective of any contractual

basis.

Cowen v. Pressprich: The defendant was not held liable for mis-delivery since he had not

actively assumed control over the mistakenly delivered bond.

Siegel v. Spear & Co.: The court extended the bailee's liabilities to cover a promise to insure

stored goods, showing how much circumstances can extend beyond contract.

Principles of Bailment:

Delivery and Possession: There need not be actual delivery by the bailor. Lost goods found or

possession through natural forces could amount to a bailment in the absence of any act by the

owner.

Obligations of the Bailee: Responsibilities vary according to the facts, including whether he

knows of his possession and any benefits derived. A person finding lost goods is obliged to take

reasonable care but not the full contractual burdens.

Mis-delivery: Liability for mis-delivery arises when possession is voluntary or involves a

contractual obligation. Courts balance intent, actions, and the owner’s conduct in cases of

involuntary possession.

Laidlaw emphasizes aligning legal interpretations with practical realities, ensuring the relevance

of bailment in modern contexts like logistics and digital asset custody.

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2.2. Analytical Frame Work:

The legal concept of bailment is considered in light of its underlying principles, its scope, and the

applicability of such to various scenarios. The scheme thus examines the interrelationship

between possession, consent, and the correlating duties of a bailee.

Nature of Bailment: Bailment arises when one party (the bailor) delivers goods to another (the

bailee) for a specific purpose, under the expectation of return or proper care. It does not

necessarily require a contract but involves lawful possession and an obligation to return or

manage the property as agreed.

Core Elements:

Possession: The bailee must knowingly possess the goods. Unawareness of possession typically

exempts liability unless negligence is involved.

Duty of Care: The standard of care varies, considering whether the bailment was gratuitous or

for hire. A bailee could be found liable in case of negligence or mis-delivery, depending on the

amount of responsibility taken upon oneself.

Creation and Termination: The bailment may be created either voluntarily, by contract, or

involuntarily, by circumstance, such as finding lost goods. The relationship is terminated when

the agreed purpose is accomplished or the property is returned, although liability may survive in

cases of mis-delivery or damage.

Judicial Precedents: Case law, such as Foulke v. New York Consolidated R.R., highlights that

bailment focuses on possession and duty rather than contract. Misinterpretations, such as treating

all bailments as contractual, are rectified by emphasizing duties over rigid classifications.

This analytical framework underscores bailment's versatility in addressing property relationships,

ensuring justice while balancing expectations of care and liability.

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3.Conclusion:

The concept of bailment is dynamic, defined by the undulating boundaries of lawful possession

and the accompanying obligations, rather than by rigid contractual boundaries. As the legal

systems continue to adapt to evolving property relationships, the core principles of bailment will

remain essential to maintaining fairness and accountability.