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In: Operations Management

Parvanh Backmirzie left two valuable Persian rugs with La Moquette Fine Rugs and Furnishings to be...

Parvanh Backmirzie left two valuable Persian rugs with La Moquette Fine Rugs and Furnishings to be sold on consignment. But they were not sold and while waiting to be picked up by Backmirzie they were stolen during a break-in at the store. This action is brought by Backmirzie against the company owner of the store demanding compensation for the loss.

Explain the basis of this action, the arguments that could be advanced by both parties and the likely outcome. Would your answer be affected by the additional information that several days before the break-in the proprietor of the store phoned Backmirzie saying she should pick up the rugs as she had observed two men in the store looking at them and they appeared to be “casing” the store and she feared a break-in? But she delayed picking them up and the rugs were stolen.

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Answer:

Ms. PB left her two precious rugs to be sold at a store owned by LM Rugs and Furnishing. But the rugs did not sell and before PB could pick them up they got stolen in a break-in by robbers. Over this PB brought a case against LM and demanded compensation for the loss.

Bailment stands for the action in which the goods owned by one person are in the possession of another wherein the owner of the good is called as bailor while the possessor of the good is called as bailee.

In the above-mentioned case, Ms. PB could file a case against LM for the violation of bailment actions in a showing of irresponsibility in taking care of the rugs that were given under the custody of LM. The argument in this case from Ms. PB's side could be that it was LM's responsibility to take care of the rugs as they were in the bailment of it and being the bailee it was LM's responsibility to take of them and return them back to PB when not sold Thus the court should hold LM liable for the irresponsible attitude and orders it to pay for the damages to PB. While the argument from LM's side, in this case, could be that it was not aware of the break-in and theft of the rugs and thus this event was accidental and thereby it should not be held liable for the same. The likely outcome, in this case, would favor Ms. PB because it was LM's responsibility to take care of the rugs as they were in the bailment of it and being the bailee it was LM's responsibility to take of them and return them back to PB when not sold.

But this answer would change by stating the additional information that several days before this break-in, LM informed PB about the incident wherein it has observed two men looking at the rugs and were casing on them. He also informed PB that it fears for a break-in and thus PB collect her rugs from the store but PB delayed the collection of rugs from the store and break-in took place. Owing to this additional information, the decision will likely favor now LM because it had prior informed PB about the contingencies and casing of rugs by two people but still she delayed her collection of rugs and thus the court might held PB liable for her damages instead of LM.


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