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Bailment
Transfer of legal possession (delivery) of personal property to a bailee temporarily For a specific purpose Goods to be returned to the bailor (or a 3P if bailor so directs)
Types of Bailment
Coggs v Bernard (1703) 6 forms of bailment (borrowed from Roman law) Duty of care and levels of liability vary depending upon the type of bailment
Bailment - Remedies
Contract Damages for breach Limited by privity of contract Exclusion clauses may limit liability Tort Damages for injury Limited to those to whom a duty of care is owed Bailment Return of the good or damages Can pursue claim against sub-bailees Exclusion clauses may limit liability
The essential difference between bailment and sale is the locus of the title. Who is bearing the risk of loss?
Bailment? Or Licence?
In order for there to be a bailment, the care and control of the good must be transferred to the bailee If the control is not transferred, then there is no bailment --- only a licence A licence can be created by express words as in Ashby v Tolhurst
ASHBY v TOLHURST
[1937] (COURT OF APPEAL)
"Received 1s. The proprietors do not take any responsibility for the safe custody of any cars or articles therein nor for any damage to the cars or articles however caused. ... all cars being left in all respects entirely at their owners' risk. Owners are requested to show ticket when required."
Ashby v Tolhurst
Facts: Plaintiff parked his car in the lot where there was an attendant. Though he had locked the car before leaving it, access could be obtained by putting a hand through the windscreen and it could be driven away. [Later] The car was not there. the attendant said that he had just given the car to the plaintiff's friend .
Ashby v Tolhurst
Plaintiff argued: 1.handing over of the car by the defendants' servant to a stranger without production of the ticket was a conversion by misdelivery; 2. the proprietors could not divest themselves of the position of bailees with words alone; 3. in the circumstances the conditions of the receipt did not exempt the defendants from liability.
Ashby v Tolhurst
Defendants argued: 1. There was a contract & it was not bailment 2. Its terms were contained in the receipt given the plaintiff and posted on the lot 3. The relationship of the parties was licensor & licensee on the terms contained in the conditions 4. The car was left at plaintiff s own risk and the owners of the parking ground were exempt from liability.
Ashby v Tolhurst
At trial, the parking ground owner lost. The court held the car was bailed to the lot and the attendant s misdelivery was conversion. The defendant appealed that decision.
Ashby v Tolhurst
Defendant Appellant Argued: 1. The plaintiff must be taken to have left the car on the parking ground at his own risk and to have paid only for a licence to do so, so that no liability was imposed on the proprietors of the car park. 2. If it was a bailment, then the conditions on the ticket suffice to relieve the defendants from all liability
Ashby v Tolhurst
Plaintiff Respondent Argued: The fundamental question here is, what was the relation between the parties? 1. There was clearly a contract of bailment or, at any rate, that there was sufficient evidence to entitle the county court judge to draw the inference that this was so. 2. The defendants admitted the deposit of the car and the attendant's negligence. The admission of negligence connotes certain duties.
Ashby v Tolhurst
Plaintiff Respondent further argued: 3. About the conditions on the ticket: a) It is inconsistent with the relationship of licensor and licensee that the defendants should require the protection of the conditions, but entirely consistent with the relationship of bailor and bailee. b) The conditions are not enough to relieve the defendants from liability for the negligence of their servant: see London and North Western Ry. Co. v. Neilson [1922] 2 A. C. 263, 271
Ashby v Tolhurst
What did the plaintiff respondent say the words on the ticket meant if not a license? 1. the car is left at the owner's risk cannot mean anything but the risk of accidental loss. It should not cover such a risk as that the defendants' servant should give away the car to a stranger. That was not contemplated. 2. The words of the conditions in the ticket are general words and not sufficient to give protection from liability in all circumstances.
Ashby v Tolhurst
THE JUDGMENT: The first thing to do is to examine the nature of the relationship between the parties Was it a bailment of the car or merely a licence granted by the defendant for the plaintiff to leave the car in the defendant s place?
Ashby v Tolhurst
The court considered 1. If the giving of a ticket signified the possession of the car had passed to the parking ground and 2. The significance of the words on the ticket both as they apply to the creation of the relationship and to the limiting of liability
Ashby v Tolhurst
HELD: (on the question of whether possession passed) It would be rather a surprising result if, when a man left his car on land like this and paid 1s. for the privilege of doing so, possession passed in a way in which it certainly would not pass if he left it in a public park in a square in London and paid the attendant 6d. for the ticket. In such a case possession, it seems to me, clearly would not pass; I quite fail to see why possession should pass in a case such as this.
Ashby v Tolhurst
Romer, J.: The defendants made it as clear as writing can make it in the ticket which was delivered to the plaintiff that they would not take any responsibility for the safe custody of any car
Ashby v Tolhurst
Held: (looking at the ticket given the Plaintiff) Reading the document as a whole, including its own description of itself, namely "Car park ticket," it really means no more than this: the holder of this ticket is entitled to park his car in the Seaway Car Park, but this does not mean that the proprietors are going to be responsible for it.
Ashby v Tolhurst
Held further:
The relationship was a relationship of licensor and licensee alone That relationship carries no obligations on the part of the licensor towards the licensee in relation to the chattel left there
Ashby v Tolhurst
OBITER: (because the court decided it was a licensee-licensor relationship) Even if the true relationship of the parties was that of bailor and bailee, the obligations normally imposed upon a bailee may be cut down to the extent, and only to the extent, that the conditions on a ticket prescribe.
Ashby v Tolhurst
Interpreting the words on the ticket (if it were a bailment):
Those words would permit a negligent custody, they protect the bailee in a case where damage is negligently done to the car by himself or by his servant. . . . impose no obligation on the bailee to provide an attendant to look after the car . . . impose no obligation on the bailee or his attendant, if he provided one, to take any active step whatsoever to prevent somebody from removing the car who had no title to remove it, even if it was done under the eyes of the bailee or the eyes of his attendant.