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.[1]
Who is a Bailor?
Bailor: A person who has the duty to deliver the good is called the ‘Bailor.’[2]
Who is a Bailee?
Bailee: The person to whom the Bailor has the duty to deliver the good, is called the ‘Bailee.’[3]
Duties of Bailor
Bailor have various duties like indemnification of Bailee’s suffering, bearing extra – ordinary expenses, disclosing all the faults of the bailed good to the Bailee[4], claiming the good back after the Bailment, etc.
Duties of Bailee
Bailees have various duties like to take reasonably good care of the bailed good. Not to use the good unauthorizedly, not mixing the bailed good with something else, to return the good to the Bailor, etc.
Bailment of Pledges
What is a Pledge?
Pledge can be defined as when the goods are bailed with the objective of payment of a debt it is called a ‘Pledge.’ It can be either against the payment of a debt or against the performance of a promise.[5]
Who is a Pawnor?
A Pawnor is the bailor in this case.[6]
Who is a Pawnee?
A Pawnee is the bailee in this case.[7]
What are the various rights and duties?
-
Right of Retention
It is Pawnee’s right to retain the good bailed to him till the payment of the last instalment of debt or interest or any other expenses incurred by him during the bailment period for the preservation of the good.[8]
-
Extraordinary expenses
If the Pawnee has suffered some extra expenses whilst the good was in his possession then it is the duty of the Pawnor to reimburse the expenses.[9]
-
Where the Pawnor is wrong
If during the bailment of a good the Pawnor is wrong then he or she is responsible for all the wrongs.The Pawnee must redeem the value of the pledge to the Pawnor after the completion of the bailment.[10]
-
Default in Payment
If the Pawnee makes a default while paying the debt or while performing the promise at the given time then the Pawnor has the right to redeem the Pledged goods from the Pawnee before the actual sale but if the case arises he must pay in addition the expenses which have arisen from his default.[11]
-
With regard to Section 19
If the Pawnee has obtained the goods that have been pledged by him under section 19 of the Indian Contracts Act,and the contract at the time of the pledge has not been refunded by the Pawnee; he has the right to acquire a good title to the good, given that his actions are in good faith and without a notice of the bonus defect of ownership title.[12]
-
Interest
If the case arises where a person while pledging a good has only the interest which is limited to a certain extent then the pledge is valid only till the extent of that interest and not further so here it is the pledge where the Pawnee has only a limited interest.[13]
What are the various suits that a Bailee or a Bailor can initiate against a wrong – doer?
If the case arises where a third person wrongfully deprives the position and the shape of the bailed goods or injuries, then the Bailey has the right to use any remedies as the owner might have used if the case has arisen and no bailment had been made. The Bailor has the right to bring a Suit against the wrong doing third party for any such action or injury which they have done.[14]
All the compensation or the relief which will be a result of any such suit as aforementioned will be dealt with according to their own personal and respective interests between the Bailor and the Bailee.[15]
[References]
[1]Indian Contracts Act, 1872. Section 148.
[2]Ibid.
[3]Ibid.
[4]Indian Contracts Act, 1872. Sections 150-168.
[5] Indian Contracts Act, 1872. Section 172.
[6]Ibid.
[7]Ibid.
[8]Indian Contracts Act, 1872. Section 174.
[9] Indian Contracts Act, 1872. Section 175.
[10] Indian Contracts Act, 1872. Section 176.
[11]Indian Contracts Act, 1872. Section 177.
[12]Indian Contracts Act, 1872. Section 178A.
[13]Indian Contracts Act, 1872. Section 189.
[14]Indian Contracts Act, 1872. Section 180.
[15]Indian Contracts Act, 1872. Section 181.
