Bailment

Bailment

Definition 

Bailment is defined in the Section 148 of the Indian Contract Act, as "A bailment is the delivery of goods by one person to another for some purpose, upon a contract that they shall, when the purpose is accomplished, be returned or otherwise disposed off according to the directions of the person delivering then."

Bailor: The person delivering the goods.

Bailee: The person to whom they are delivered.

Examples: Hiring of goods, delivering a watch for repair, keeping important documents or expensive ornaments in a bank locker. 

Essential Features

1. It is a delivery of movable goods by one person to another: The goods that are being delivered need to be movable, the delivery can be both actual or constructive. When the bailor hands over to the bailor physical possession of the goods, this is called actual delivery. Constructive delivery is when the goods are not physical handed over, rather something is done which puts the goods in the possession of the bailee, for example, handing over the bill of the goods in transit, or handing over the key of the scooter. 

2. The goods are delivered for some purpose. The goods are delivered either for keeping them safe, use by the bailee, as security against credit. If the goods are delivered by mistake without any purpose, it is not bailment.

3. The goods are delivered with conditions that after the completion of the purpose of bailment, they are to returned in species i.e. actual form or disposed off according to the directions of the bailor.


Kinds of Bailment 

Benefit point of view:
1. Bailment for the exclusive benefit of the bailor.
2. Bailment for the exclusive benefit of the bailee
3. Bailment for the mutual benefit of the bailor and the bailee.

Reward points of view 
1. Gratuitous bailment 
2. Non-Gratuitous bailment

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