Duties of Bailor and Bailee

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Duties of Bailor and Bailee

Who is a Bailor

A person who has the duty to deliver the good is called the ‘Bailor.’[1]

Who is a Bailee

The person to whom the Bailor has the duty to deliver the good, is called the ‘Bailee.’[2]

What is the procedure called?

‘Bailment.’

What is Bailment?

‘Bailment’ is the delivery of goods by a person (the Bailor) to another (the Bailee) for a certain purpose. The purpose is mentioned in a contract and upon the accomplishment, the ‘good’ is to be returned, or delivered or disposed as per the directions.[3]

Duties of a Bailor:

As Spiderman said, “With great power comes great responsibility;” the same goes for the bailor as well. He/she has a sense of responsibility and a duty to discharge certain things whilst the act of Bailment. Some of the duties which are discharged by the Bailor are:

  1. Disclosure of faults:

The Bailor is bound by the law to disclose the defects of the goods bailed, to the bailee. If, in case, any future damage arises, because of the non – disclosure, it becomes the liability of the Bailor to bear the expenses.[4] Even if the good in transit is for hire, it is the Bailor who is responsible for the damages. His awareness or non – awareness of the fault in the good is no excuse.[5]

Illustration 1: A lent his car to B. A knew that the brakes of the car are a bit loose. A did not disclose this fact to B. B rode the car and met with an accident. A is liable for the damages of B.

Illustration 2: A gives his carriage to B for hire. A is unaware of the fact that the carriage is unsafe. B rides the carriage. B meets with an accident. A is liable for the injury.

  1. Bearing the Extra-Ordinary Expenses:

The usual and the ordinary expenses of the good are to be borne by the Bailee. But, if the need arises, to meet with some expenses which are ‘Extra-ordinary’ then, it is the duty of the Bailor to pay for it.

Illustration: A lends his car to B. B pays for petrol and type punctures et al. but if there is a major problem like Brake failure arise, then A will bear the repair charges.

  1. Indemnification:

The Bailee will not suffer, under any circumstances, because of the dispute of title of the Bailor’s good. If the bailee suffers, then it is the duty of the Bailor to indemnify or compensate the Bailee.

Illustration: A found an antique piece of jewellery and bailed it to B for safe-keeping. C, the real owner, found out that B has the jewellery and filed a suit against B for recovery and compensation. Here, it is the duty of A, the Bailor to indemnify B, the Bailee.

  1. To Claim the Bailed Goods Back:

The Bailor has the duty to take back his goods after the expiry of the time or the fulfilment of the purpose for which the good was bailed. In case the Bailor fails to claim back the good, it is his responsibility to compensate the Bailee for the expenses incurred because of the Bailor’s delay.

Illustration: A gave his car to B for servicing. B told A to collect the car after a week. A did not come for a month. B has the right to claim for the compensation of the car’s safekeeping from A.

Duties of a Bailee:

The Bailee, same as the Bailor, has some duties as well. Some of the duties are:

  1. Reasonable Care:

The Bailee is supposed to take care of the goods as they were to be his own. He must take reasonable care of the goods as an ordinary and prudent man of sound mind.[6]

Illustration: A delivers his car to B for servicing after bumping it in a tree. B cannot bump the car in a tree because A did the same. He ought to take care of the car.

  1. Unauthorized Use of Goods

If there be any unauthorized usage of the bailed good and there be any damage arising out of the unauthorized usage then the Bailee is liable to compensate the Bailor for the same.[7]

Illustration: A lends his car to B for driving. B gives it to his son C for joy riding. C crashes the car. B is liable to compensate A for the damage as A had bailed the car to B, and not C.

  1. Duty of not Mixing the Goods

The Bailee has the responsibility keep his own goods and the Bailor’s good separate. He should not mix the two without any prior permission of the Bailor. But if any act of ignorance regarding the separation be done and the result of which be the in-separation of the Bailor’s good, then the Bailee must compensate the Bailor for the loss incurred.[8]

Illustration: A gives B a sack of Basmati rice. B mixes it with general rice. B is liable to compensate A for his loss as the cost of Basmati rice is more than the cost of normal rice.

4. Return the Goods

The Bailee must return or deliver the good upon the fulfilment of the purpose. If the Bailee retains the goods even after the lapse of the slated time period then the Bailee is liable for any damages done.[9]

Illustration: A gives his documents to B for safe-keeping for a month. A does not take it back even after 3 months and neither does B return it to A. The documents are burnt in a fire. B is responsible for the loss as it was his duty too.

5. Dispute as to ‘Who is the owner?’

If the Bailee has received the good from the Bailor then he must return the good to the Bailor only. It does not matter if there a third person who claims the good to be his. The Bailee has accepted the good to be Bailor’s during bailment. The Bailee has no right to not re-deliver the good to the Bailor on grounds that the Bailor is not the real owner.[10]

Illustration: A gives his car to B. C comes to B and claims the car to be his. But B is responsible towards A, and A only as for this particular bailment A is the Bailor and not C.

Therefore, these are the various duties of Bailor and Bailee as per the Indian Contracts Act of 1872.


[References]

[1]Indian Contracts Act, 1872. Section 148.

[2]Ibid.

[3]Ibid.

[4]Indian Contract Act, 1872. Section 150.

[5]Ibid.

[6]Indian Contracts Act, 1872. Sections 151 – 153.

[7]Indian Contracts Act, 1872. Sections 154.

[8]Indian Contract Act, 1872. Sections 155 – 157.

[9]Indian Contracts Act, 1872. Sections 160 – 164.

[10]Indian Contracts Act, 1872. Sections 166 – 167.

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