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Bailment and pledge

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Bailment and pledge

  1. 1. Bailment & pledge Section 148 Delivery of goods by 1 person to another for some purpose …contract: to return after use or to dispose as asked by the person who delivered the goods Bailor: who gives Bailee : who takes Bailment: transaction
  2. 2. Examples: Hiring a bicycle Giving cloth to a tailor Delivering watch for repair
  3. 3. Kinds of bailment Based on benefit: Bailment for the exclusive benefit of : 1] bailor: leaving goods in safe custody without paying 2] bailee :a loan of some article like a pen 3] mutual benefit: contracts for hiring, repair ,etc
  4. 4. Kinds of bailment: Based on reward: 1] gratuitous bailment: neither bailor nor bailee is entitled for remuneration, example: lending a book to a friend 2] non-gratuitous bailment: bailment of reward: either bailee or bailor is entitled to a remuneration , example: hire, tailor, etc
  5. 5. Difference between sale & bailment Ownership transferred? Buyer under no obligation to return goods? Ownership not transferred?
  6. 6. Difference between bailment &licence Permission to use place? No delivery of goods? Responsible for safety of goods? Goods delivered?
  7. 7. Duties of bailee: Take reasonable care of goods[S.151] Not to make unauthorized use of goods[S.154] Not to mix goods with his own goods Duty to return goods {A hires a horse for 4 days, fails to return, horse dies, has to pay price of horse} Duty to return any accretion to goods {cow + calf}
  8. 8. Duties of bailor: Disclose faults in goods Repay necessary expenses in case of gratuitous bailment.. feeding expenses for the horse kept in safe custody Repay extraordinary expenses in case of non-gratuitous bailment.. If horse falls ill during bailment period then giving expenses Duty to indemnify bailee.. If A gives his neighbors scooter to B Duty to receive back the goods
  9. 9. PLEDGE OR PAWN Bailment of goods as security for payment of debt or performance of a promise :PLEDGE Bailor: PAWNER Bailee: PAWNEE Example: A borrows Rs.100 from B & keeps his watch as security : pledge
  10. 10. Difference between bailment &pledge: PURPOSE: security? ; repairs? RIGHT OF SALE: sale on default? ; no right to sale? RIGHT OF USING THE GOODS: no right?
  11. 11. Rights of Pawnee: Right of retainer{S.173}: right to retain goods until dues paid Right of transfer for subsequent advances: {S.174}: on lending money to same debtor without further security ;right to retain earlier goods extends Right to extraordinary expenses {S.175} Right to sue the pawner or sell the goods on default.
  12. 12. Rights of Pawnor: Enforcement of pawnee’s duties Defaulting pawnor’s right to redeem

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