Contract of Bailment

Contract of Bailment

Chapter IX, Section 148 to 181 of the Indian Contract Act talk about bailment. Contract of bailment is defined under section 148 of the Act.

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, the property must be returned back or otherwise disposed off according to the directions of the person delivering them.

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1. The person who delivers the goods (movable property) is called the bailor.
2. The person to whom the goods are delivered is called the bailee.
3. And the contract between the bailor and bailee is called the contract of bailment.

The contract of bailment is created only about movable property.

Rights and Duties of Bailee

Bailee has some rights that he can enjoy as well as some duties to follow.

Rights of Bailee

1. Right to get compensation.

2. Right to terminate the contract of bailment.
If the terms and conditions are decided by the parties while making a contract and the goods are not according to terms and conditions of the contract, then the bailee has right to terminate the contract.

3. Right to get expenses.
If the expenses are incurred by the bailee regarding the goods bailed, then afterwards the bailee is entitled to get the expenses.

Duties of Bailee

1. Duty to take care of the goods.

2. Duty to return goods.
After the accomplishment of purpose, it is the duty of the bailee to return the goods to the bailor.

3. To make proper use of goods bailed.
The use of the goods which are mentioned under the contract, the use must be according to the contract.

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4. Duty not to mix his own goods with the goods of bailor.

5. Duty not to question the title of the bailor.

6. Duty of bailee to pay increase or profit from goods bailed.
For Example, A gives a cow to B on bailment and after the bailment cow gives birth to a calf. It is the duty of the bailee to return cow as well as the calf to the bailor.

Rights and Duties of Bailor

Bailor has certain rights and also some duties that he has to follow. They are:-

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Rights of Bailor

1. Right to get his goods back.

2. Right to get the increase or profit from the goods bailed.

3. Right to get compensation.

4. Right to terminate the contract.

Duties of Bailor

1. It is the duty of bailor to disclose faults in goods bailed: It is the paramount duty of the bailor to express the fault of the goods to the bailee.

2. Duty of the bailor to give compensation to the bailee.

3. Duty to give expenses.

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