Question

1) How does a bailment differ from a gift? 2) How does a bailment differ from a lease? 3) Give an example of a bailment that is not a contract. Give an example of a bailment that is a contract.

Answer 1

Bailment meaning:

Transfer of personal property by one party (the bailor) in the possession, but not ownership, of another party (the bailee) for a particular purpose. Such transfer is made under an express or implied contract (called bailment contract or contract of bailment) that the property will be redelivered to the bailor on completion of that purpose, provided the bailee has no lien on the goods (such as for non-payment of its charges). The bailee is under an obligation to take reasonable care of the property placed under its possession. Bailment contracts are a common occurrence in everyday life: giving clothes to a launderer, leaving car with an auto mechanic, handing over cash or other valuable to a bank, etc.

1) In the case of gift, ownership will be transferred. But, no ownership will be transfrred in case of bailment

2) Unlike a lease, where ownership remains with the lessor but the lessee is allowed to use the property, the bailee is generally not entitled to the use of the property while it is in his possession. A common example of bailment is leaving your car with a valet.

3) Valet parking at owner's risk is the example of bailment that is not a contract. Bailor can't sue the bailee in this case.

4) In the case of giving clothes to laundrer, this bailment amounts to contract. In case of damage to clothes by bailee, he is responsible for pay damages.