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SEC 148. SAYS A "bailment" is the delivery of goods by one person to another for some
purpose, upon a CONTRACT and they shall, when the purpose is accomplished, be
returned or otherwise disposed of according to the directions of the person delivering
them. The person delivering the goods is called the "bailor." The person to whom they
are delivered is called the " bailee."
On the whole a bailment may be described as a delivery on condition, to which the law
usually attaches an obligation to redeliver the goods, or otherwise deal with them as
directed, when the condition is satisfied ; but there may be, in particular cases, a bailment
without an enforceable obligation .
Where a chattel is delivered by mistake, the intention being to deliver another chattel
either with or without conditions, the legal result, whatever
2. An agent authorised to receive payment, and bound to hand over to his principal an
equivalent sum, but not necessarily the actual coin or instruments of credit received
by him, is not a bailee.
a case that the notes shall be returned or other-wise disposed of according to the
directions of the owner.
In the case of ULTZEN V. NICOLLS 1894 (QB) The plantiff went to a hotel and the
waiter took is coat without being asked and hung it on the hook and the plantiff rose the
coat was one, the hotel keeper was held to be liable, if the customer has directed him
where and how to hang the coat the judgment can be otherwise.
SEC 149. The delivery to the bailee may be made by doing Delivery to bailee anything
which has the effect of putting the goods in the possession of the intended bailee or of
any person authorised to hold them on his behalf.
CHARACTERISTICS OF BAILMENT
1. Delivery of Goods - it may be express or constructive (implied).
Like delivery of railway receipt amounts to delivery of goods (Morvi Mercantile bank v.
union of India 1965 sc)
2. Delivery upon Contract. and when thepurpose is accomplished the goods shall be
returned to the bailor and when there is a possession without any contract that is
not a bailment in thecase of RAM GULAM V. GOVERNMENT OF UP 1950 the
persons ornaments were stolen and was recovered and put in the police custody nad
were stolen again the plaintiff action state was dismissed
The English law recognizes bailment without contract
And so this view was changed in the former cases that the government falls under the
position of bailee and further said thatthere can be bailment without an enforceable
contract and consent is also not needed for such relationship a finder og goods is also a
bailee ( State of gujrat v. memon mohd.) it was held that moter vehicles were seized by
the state under sea customs act the goods in custody were ruined the state was held to
be responsible.
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KINDS OF BAILMENTS
• Bailment may be classified as follows: -
1. Deposit - Delivery of goods by one man to another to keep for the use of the bailor.
2. Commodatum - Goods lent to friend gratis (free of charge) to be used by him.
2. Hire - Goods lent to the bailee for hire, i.e., in return for payment of money.
4. Pawn or Pledge - Deposit of goods with another by way of security for money
borrowed.
5. Delivery of goods for being transported by the bailee - for reward.
DUTIES OF BAILOR
1. To disclose faults in the goods
SEC150. The bailor is bound to disclose to the bailee faults in the goods bailed, of which
there is a Bailor's duty to disclose faults, and which materially interfere with the goods
bailed, or expose the bailee to extra- ordinary risks ; and, if he does not make such
disclosure, he is responsible for damage arising to the bailee directly from such faults.
Bailee's liability for negligence of servants. A bailee's liability extends to damage caused
by the negligence of his servants acting in the course of their employment about the use or
custody of the thing bailed ; but it does not extend to damage caused by the acts or defaults
of third persons which he could not by ordinary diligence have foreseen and prevented, nor
to unauthorised acts of his servants outside the scope of their employment.
IN the case of involuntary bailee there is no duty casted upon the person who has receipt
of something he had not asked for.
Sec 154 goods must be used by the bailee only for the purpose they are bailed and not
otherwise, So if the bailee does this above act there can be termination of bailment under
sec 153.
NOT TO MIX BAILOR'S GOODS WITH HIS OWN sec 155 – 157
The bailee should maintain a separate identity of the bailers goods and should not mis his
own goods if the mixture is made without the consent of bailor the separation charges and
the damages arising will be bear by the bailee.
By the Trusts Act, s. 66, " where the trustee wrong- fully mingles the trust property with
his own, the beneficiary is entitled to a charge on the whole fund for the amount due to
him."
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Expl. Even if there is a person who has a better title to the goods then that of the bailor,
the bailee may safely return the goods to the bailor and he is not liable to the owner of the
goods.
In the case of JUGGILAL KAMLAPAT OIL MILLS V. UNION OF INDIA 1976
The oil was consigned with the railways it reached the destination the sender instruteed the
railway to bring it back but the food inspector found it to be adulterated and and destroyed
it under the order of the court,
The raiway was not held to be liable as the subject was taken by the authority of law
As Sec 165 Where The Goods Have Been Bailed By Several Joint Owners The Bailee
May Deliver Them To One Joint Owners Without The Consent Of All In Absence Of Any
Agreemnent To The Contrary
But in the case of shares and securities if they are pledged with the bank and they received
bonus shares or dividends the bank can not be compelled to handover such increment
unless the pledge securities are redeemed ( STANDARD CHARTERED BANK V.
CUSTODIAN)
Ss. 168. The finder of goods has no right to sue the owner for trouble and expense
voluntarily incurred by him to preserve the goods and to find out the owner ; but he may
retain the goods against the owner until he receives such compensation ; and, where the
owner has offered a specific reward for the return of goods lost, the finder may sue
for such reward, and may retain the goods until he receives it.
By the Common Law a person who finds lost goods and holds them with the intention of
saving them for the true owner is certainly not a trespasser, and has no higher duties than a
bailee ; but, the service being rendered without request from the owner, he does not seem
entitled to any remuneration unless a specific reward has been offered for the return of the
goods, and the offer has come to his knowledge; and if he cannot claim compensation
there is no ground on which he can retain the goods.
The rule of the present section appears to be intended to satisfy natural justice. Presumably
the compensation, if no specific reward has been offered and the parties cannot agree, is to
be what the Court considers reasonable.
Sec 169
When the thing is in danger of perishing or of losing the greater part of its value,
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(2) When the lawful charges of the finder, in respect of the thing found, amount to two-
thirds of its value.
This section is taken from the New York Draft Civil Code, s. 943, where it is stated to be a
new provision. It does not appear to have come before the Indian Courts. At common law
sale by the finder would be a conversion.
RIGHTS OF BAILEE
1. The bailee can sue bailor for
(a) claiming compensation for damage resulting from non-disdosure of faults in the
goods;
(b) for breach of warranty as to title and the damage resulting therefrom; and
(c) for extraordinary expenses.
2. Lien
2. Rights against wrongful deprivation of injury to goods
RIGHTS OF THE BAILOR
1. The bailor can enforce by suit all duties or liabilities of the bailee.
2. In case of gratuitous bailment (i.e., bailment without reward), the bailor can demand
their return whenever he pleases, even though he lent it for a specified time or purpose.
TERMINATION OF BAILMENT
1. On the expiry of the stipulated period.
2. On the accomplishment of the specified purpose.
2. By bailee's act inconsistent with conditions.
CHAPTEK IX.
OF BAILMENT.
DUTY OF BAILEE. 487
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(1)
170. Where the bailee has, in accordance with the
Bailee's par- purpose of the bailment, rendered any service
ticuiariien. involving the exercise of labour or skill in
Illustrations.
" Where a bailee has expended his labour and skill in the improvement
of a chattel delivered to him, he has a lien for his charge in that respect.
Thus the artificer to whom the goods are delivered for the purpose of being
worked up into form, or the farrier by whose skill the animal is cured of a
disease, or the horse-breaker by whose skill he is rendered manageable, have
liens on the chattels in respect of their charges " (c). An agister, who merely
takes in an animal to feed it, is not entitled to a lien, as not coming within
(b) Best, C.J., in Bevan v. Waters (1838) 4 M. & W. 270, 283, 51 B. R. 568,
(1828) 3 Car. & P. 520, 33 R. R. 692. 678.
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g s this principle, for he does not confer any additional value on the thing
General lien of
wharfingers, - - . ,
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(d) Jackson v. Cummins (1839) 5 M. & (e) Chase v. Westmore (1816) 15 M. &
Gonda Singh (1885) Punj. Rec. no. 60. (/) Miller v. Nasmijth's Patent Press
goods brought into the inn by a guest ; (y) Skinner v. Jager (1883) 6 All. 139.
this is on the distinct ground that he is (#) "A general lien is the right to
bound by law to accept them. See 1 Sm. retain the property of another for a
a distrainor at common law, who does not particular lien is a right to retain it only
acquire possession at all, see Turner v. for a charge on account of labour employed
624 ; Pollock and Wright on Possession, property detained " : Kent, Comm, ii,
82 ? 202, 634,
proved usage of trade; but, once being so established, it became part of S. 171.
part of the law (i). The right does not extend to securities or other
valuable property deposited with a banker merely for safe custody or for a
special purpose, and this on the ground that the limited and special
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to account for the absence from the text of any words expressly making
to secure a particular advance to the firm, it was held that the banker had
no lien for the general balance due from the firm(&). Nor does the lien of
him to advance money on them (I) ; and where a deed, dealing with two
of the properties with a specified sum and also the general balance due to
the banker, it was held that he had no lien on the other property comprised
But, in order that the general lien may be excluded by a special agree-
ment, whether express or implied from the circumstances, the agreement
must be clearly inconsistent with the existence of such a lien (n). Accord-
ingly a deposit of valuables with a banker to secure debts of a customer
due to him as banker is subject to the banker's lien for the customer's
general debts to him unless the customer can prove an agreement to give
up his general lien (o). Such an agreement maybe evidenced, for example,
by a memorandum of charge declaring that the deposit is to secure over-
drafts not exceeding a named amount. This excludes the banker's lien for
any greater amount (p). As to boxes or sealed parcels deposited with a
banker for custody without informing him of their contents or making them
accessible to him, he has no lien on them even if the customer is in the
habit of leaving other securities with the banker against advances (q).
(i) Brandao v. Barnett (1846) 12 01. & & F. 787, 69 R. R. 204; Agra Bank's
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(T) Lucas v. Dorrein (1817) 7 Taunt. (q~) Lease v. Martin (187H) L. R.17 Eq.
(m) Wylde v. Radford (1864) 33 L. J. (r) Misa v. Currie (1876) 1 App. Cas.
S. 171. In the case of money and negotiable securities, the lien is not prejudiced
by any defect in the title of the customer, nor by equities of third persons,
provided the banker acts honestly and without notice of any defect of
title (). But there is no lien for advances made after notice of a defect in
the customer's title (<), or after notice of an assignment of the moneys or
securities in the banker's hands (u). And in the case of securities which
are not negotiable, the lien is confined to the rights of the customer therein,
and is subject to all equities affecting them at the time when the lien
attaches (v).
543 ; Misa v. Currie, supra; Brandao v. 137, 20 R. R. 383, per Abbott, C.J., 2 B.
Burnett (1846) 12 01. & F. 787, 69 R. R. & Aid. at p. 143, Holroyd, J., at p. 148.
204. (jO Stevens v. Bitter (1883) 25 Ch. Div.
13 East, 135, 12 R. R. 341 ; Locke v. (z) In re Bombay Saw Mills Co. (1889)
(u) Jeffreys v. Agra Bank (1866) L. R. (a) Peacock v. Baijnath (1891) 18 Cal.
it does not extend to " debts which arise prior to the time at which his S. 171.
character of factor commences " (c). But it extends to all his lawful claims
against the principal as a factor, whether for advances, or remuneration,
or for losses or liabilities incurred in the course of his employment in
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In order that the lien may attach, the goods must come into the
possession, actual or constructive (e\ of the factor. If, for instance, a
factor accepts bills on the faith of a consignment of goods which, by reason
of the bankruptcy of the principal, are never received by him, he has no
lien on the goods as against the principal's trustee in bankruptcy (/). Nor
does the lien extend to goods acquired otherwise than in his character of a
factor (g), or entrusted to him with express directions or for a special
purpose inconsistent with the existence of a general lien (h). Instructions
to provide, out of the proceeds of a consignment, for a bill of exchange
drawn by the principal on the factor in favour of a third person will
exclude the factor's general lien unless he pays the bill of exchange (i).
(c) Houghton v. Matthews (1803) 3 B. held that his general lien did not extend
East, 227, where the principal died during 376, 63 R. R. 120 (bill of lading pledged
the currency of certain bills accepted by to factor for specific amount) ; Burn v.
the factor on the faith of a consignment Brown (1817) 2 Stark. 272, 19 R. R. 719
Cowp. 251 (liability incurred by the factor factor for the purpose of paying duties at
775, 51 R. R. 829. And see Lutscher v. & J. 409 ; Calvin v. Hartwell (1837) 5 Cl.
398, 84 R. R. 631 (where a factor insured (m) Richardson v. Goss (1802) 3 B.& P.
(not only deeds and law papers) (n) entrusted to him as solicitor (o) " for all
taxable costs, charges, and expenses incurred by him as solicitor for his
client ; but he has no lien for ordinary advances or loans. His taxable
costs, charges, and expenses would include money payments which he
makes for his client in the course of his business, such as counsel's fees " (p).
Taking a special security from the client is not necessarily an abandon-
ment of the general lien, but it will be so if the circumstances are
inconsistent with the continuance of the lien, and if the solicitor does
not expressly reserve his lien an intention to waive it will generally
be inferred, having regard to the solicitor's duty to give his client full
information (q).
and customs of trade not inconsistent with the provisions of this Act, and
the usage of trade of attorneys sanctioned by English law is not inconsistent
with this section. Applying this reasoning, it was held by the Calcutta
High Court chat a dissolution of a firm of solicitors operates as a discharge
of the client who employs them, and the attorneys are not entitled to retain
the papers until their costs are paid (t).
(n) E.g., cheques : General Share Trust (ff) 2b. at pp. 597, 601 ; Re Douglas
Co. v. Cliapman (1876) 1 C. P. D. 771. Norman % Co. [1898] 1 Ch. 199. The
(0) Sheffield v. Eden (1878) 10 Ch. leading earlier authorities are Cowell v.
Div. 291 (solicitor mortgagee has no lien Simpson (1809) 16 Ves. 275, 10 R. R. 181,
on mortgage deed for costs of mortgage ; and Stevenson v. Blakelock (1813) 1 M. &
Engl. 2d ed. 494, s.i: Solicitor, which see (s) An attorney who declines to act
for details of English practice on the further for a client unless costs already
(p) Lindley, L.J., Re Taylor, Stileman, Basanta Kuinar v. Kusum Kumar (1902)
and Underwood [1891J 1 Ch. 590, 596 ; 4 C. W. N. 767 ; Atool Chandra Mukerjee
" all such claims against the client as the v. Shoshee Bhusan (1904) 6 C. W. N, 215.
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