Rights & Duties of Bailor

Introduction:
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, the property must be returned

back or otherwise disposed off according to the directions of the person delivering them. The

person who delivers the goods (movable property) is called the bailor. The person to whom

the goods are delivered is called the bailee. And the contract between the bailor and bailee is

called the contract of bailment. The contract of bailment is created only about movable

property.

Duties of a Bailor:

 Duty to disclose Faults: In case of gratuitous bailment, the bailor is expected to disclose

to the bailee all the defects known to him and which would get in the way with the use of

goods bailed. A non-gratuitous bailment or bailment for reward, however, carries a

greater responsibility on the part of bailor. He will be liable even if he was not in the know

of the defects. The following instances drive home the points.

Example 1

A lends his horse, which he knows to be frisky, to B. He does not disclose the fact that the

horse is frisky. When B tries to ride it, the horse throws him off its back, and B is injured.

A is responsible to B for injury sustained.

Example 2

A hires a carriage of B, The carriage is unsafe, though B is not aware of it, and A is

injured. B is still responsible to A for the injury.

 Duty to repay bailee’s expenses : A bailor is duty bound to repay to the bailee expenses

incurred by him for work done on the goods received under conditions of bailment, and

for which he is not receiving any remuneration or deriving any benefit. In this regard.

 Duty to indemnify the bailee : The bailor is bound to make good the loss suffered by the

bailee that is in excess of the benefit actually derived, where he had delivered the goods

gratuitously and compelled the bailee to return them before the expiry of the period of

bailment.

 Duty to compensate bailee for breach of warranty : Every contract of bailment warrants

the bailee about the bailor’s title being defect free. Thus, if bailee subsequently suffers any

loss by the reason of the bailor’s title being defective, it is the duty of the bailor to

compensate the bailee for breach of warranty.

 Duty to claim back the goods: The bailor is bound to accept the goods upon being

returned by the bailee in accordance with the terms of bailment. If he refuses or fails to

accept back the goods, if offered at a proper time and at a proper place, without any

reasonable ground, he shall be responsible for any loss or damage to the goods and not the

bailee.

Rights of the Bailor:

 Right to enforce bailee’s performance : Since the bailor delivers goods to the bailee for

some specific purpose, the former, especially in case of non-gratuitous bailment, has an

elemental right to achieve that purpose or obtain the benefit (i.e., performance) through the

latter. For example, if X delivers a suit length to Y, his tailor, to stitch a suit for him, X

(bailor) will see that the tailor does the needful in the desired manner.
 Right to claim damages: In all cases of bailment, the bailor has the right to claim for

damages against the loss, if any, caused to the goods bailed due to the bailee’s negligence

or misconduct.

 Right to claim compensation against unauthorized use of goods : A good example for

this is this situation, A lets B use his car but with a condition that only B shall drive. B

allows C, a member of his family, to drive the car. C rides with care, but the car meets

with some accident. Now B is liable to compensate for the damages caused.

 Right to demand return of goods along with accretion to, if any : The bailor enjoys the

exclusive right to have the goods bailed delivered back to him in safe and sound condition

after the time of bailment has expired or the purpose behind the bailment has been

achieved. Moreover, in the absence of any contrary term in the contract, the bailor is also

entitled to any accretion to the goods bailed if it occurred while the goods were in the

study of bailee. For example, A leaves his brooding hen in the custody of B to be taken

care of for a week. The hen has hatched the chicks. A is entitled not only to the hen but

also to the chicks.

Duties of Bailee

 Take proper care of goods: According to section 151, it is the duty of a bailee to take

care of goods bailed to him. Bailee should take care of these goods as an ordinary man

will take care of his goods of the same value, quality, and quantity. Thus, if the bailee

takes due care of goods then he will not be liable for any loss, deterioration of such goods.

Also, the bailee needs to take the same degree of care of goods whether the bailment is for

reward or gratuitous. However, the bailee is not liable for any loss due to the happening of

any act by God or public enemies though he agrees to take special care of the goods.
 Not to make unauthorized use: As per section 153, the Bailee shall not make any

unauthorized use of goods bailed. In case he makes any unauthorized use, then bailor can

terminate the bailment. Bailor can also claim for damages caused to goods bailed due to

unauthorized use as per Section 154.

 Keep goods separate: The bailee needs to keep the goods separately from his own goods.

He should not mix the goods under bailment with his own goods. In case bailee mixes the

goods with his own goods without the consent of the bailor, then:

i. Bailor also has an interest in the mixture.

ii. If the goods can be separated or divided, the property in the goods remains with

both the parties. But, the bailee bears the expenses of separation or any damages

arising from the mixture.

iii. If it is not possible to separate the goods, the bailee shall compensate the bailor for

the loss of goods.

 Not set adverse title: A bailee must not set an adverse title to the goods bailed.

 Return Goods: The duty of the bailee is to return the goods without demand on the

accomplishment of the purpose or the expiration of the time period. In case of his failure

to do so, he shall be liable for the loss, destruction, deterioration, damages or destruction

of goods even without negligence.

 Return increase or profits: A bailee shall return the goods along with any increase or

profit accruing to the goods to the bailor, in the absence of any contract to the contrary.

For example, A leaves a hen in the custody of B. The hen gets a chick. B shall deliver the

hen along with the chick to A.

Rights of Bailee

 Right to compensation: The bailor is responsible to the bailee for any loss which the

bailee may sustain and the bailor was not entitled to make the bailment, or to give

directions respecting them. If the bailor has no right to bail the goods or to give directions

respecting them and consequently the bailee is exposed to some loss, the bailor is

responsible for the same.

 Right to expenses or remuneration: The conditions of the bailment, the goods are to be
kept, or to have work done upon them by the bailee for the bailor, thus the bailee is to

receive no remuneration, the bailor will have to repay to the bailee the necessary expenses

incurred by him for the purpose of the bailment.

 Right of Lien: If the bailee lawful charges are not paid he may retain the goods. So the

right to retain any property until the charges due in respect of the property are paid is

called the right of lien. The Supreme Court cited the following passage from

HALSBURY’S LAWS OF ENGLAND as to the nature of this right.