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  • 8/3/2019 Bailment Ass



    Bailment", "ballot", and "bailee" defined. 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 of

    according to the directions of the person delivering them. The person delivering the goods is called the "ballot."

    The person to whom they are delivered is called the "ballet."

    Explanation.---If a person already in possession of the goods of another contracts to hold them as a bailee, he

    thereby becomes the bailee, and the owner becomes the bailor, of such goods although they may not have been

    delivered by way of bailment.

    Nature of the transaction.---"Bailment" is a technical term of the Common Law, though etymologically it mightmean any kind of handing over (Fr. bailler). It involves change of possession. One who has custody withoutpossession, like a servant, or a guest using his host's goods, is not a bailee. But constructive delivery will create therelation of bailor and bailee as well as actual, as stated in the Explanation.

    The bailee's duly to deal with the goods according to the bailor's orders is incidental to the contract of bailment, andarises on the delivery of the goods, although those orders may have already been given and accepted in such a

    manner as to constitute a prior special contract. As a matter of pleading this is no longer material in this country, butit might still be material with regard to the period of limitation.

    Bailment is necessarily dealt with by the Contract Act only so far as it is a kind of contract. It is not to be assumedthat without an enforceable contract there cannot in any case be a bailment.

    The words. "otherwise disposed of" in the present section express the common law as now understood. "It seemsclear that a bailee is not the less a bailee because he is clothed with authority to sell the thing which is bailed tohim," e.g., a factor for sale. On the whole a bailment may be described as a delivery on condition, to which the lawusually attaches an obligation to redeliver the goods, or otherwise deal with them as directed, when the condition issatisfied; but there may be, in particular cases, a bailment without anenforceable obligation.

    Where a chattel is delivered by mistake, the intention being to deliver another chattel either with or without

    conditions, the legal result, whatever it may be, is not a bailment; for there is no intention at all to deliver the chattelwhich is in fact delivered, and no contract with respect to it. In the converse case of a mistake on the part of thebailee, a bench of the Madras High Court has held that the sameprinciples apply.

    No bailment where whole property transferred.---Obviously no transaction can be a bailment within the Actwhich does not satisfy the terms of this section. Accordingly there is not a bailment if the thing delivered is not to bespecifically returned or accounted for: and so is the Common Law.

    A delivery of property on a contract for an equivalent in money or in other commodities (whether like the propertydelivered or not) is a sale or exchange and not a bailment, as where farmers deliver grain to a miller to be used byhim in his trade, and are entitled to claim an equal quantity of corn of like quality or its market price.

    An agent authorised to receive payment, and bound to hand over to his principal an equivalent sum, but notnecessarily the actual coin or instruments of credit received by him, is not abailee.

    Similarly the delivery of Government promissory notes to a treasury for cancellation and consolidation into a singlenote is not a bailment, for there is no contract in such a case that the notes shall be returned or otherwise disposed ofaccording to the directions of the owner.

    Again the relation between a indigenous banker and the person depositing money with him in the ordinary way ofbusiness is that of borrower and lender, and the money so lodged can be recovered only as "money lent" under art.59 of the Limitation Act, and not as "money deposited" under an agreement that it shall be "payable on demand"under art. 60. In the former case the period of limitation runs from the date of the loan, and in the latter from the date
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    of demand. "The mere use of the term 'deposit' cannot alter the substance of thetransaction".It is in each Case aquestion of fact whether a transaction amounts to a mere loan or a deposit under art. 60.

    Rights and duties of bailee---What are. The bailee has no right to dispose of or sell the property unless specificallyauthorised to do so. He has only a right to retain the goods bailed with him until he receives due remuneration forthe service rendered in respect of the goods. He is responsible for the safe delivery of the goods bailed with him andin default is responsible to the bailor for anyloss of the goods.

    Goods given to a person by bank on trust receipt---Person becomes a bailee---Liable for criminal breach oftrust in case of non-accounting of goods. The execution of a trust receipt is a recognised mode of making a personbailee of the goods and in such circumstances the Bank must be deemed to be in possession or control of the goods.The validity and efficacy of such instruments of trust are now generally acknowledged. If a person who has signedsuch a trust receipt, fails to hand over to the Bank the sale-proceeds of the goods sold, the former would be liable forcriminalbreach of trust.

    Intentional wrong delivery by carrier---Carrier liable for damages.---Where the carrier has made intentionalwrongful delivery of goods, he cannot escape liability to indemnify the plaintiff for the loss caused to him bywrongful deliveries of theconsignments.

    Delivery of goods---Goods delivered into custody of Port Trust---Delivery order issued to Clearing Agent for taking

    delivery of goods---Clearing Agent found goods lying in damaged condition---Goods found short per Surety Report---Such survey taking-place after 20 days of arrival of goods at port---Condition of goods at time of survey was notnecessarily condition of goods at time of discharge---Goods, held, were discharged and delivered to port trust insound condition.

    Entrustment of money for purchase of property---Plaintiffs alleging entrustment of Rs. 200,000 to defendant forinvestment in business and for purchase of property in dispute---Plaintiffs and main defendant having businessrelations for long time and having running business dealings---Held, mere allegations in plaint of having depositmoney in trust or mutual trust of parties does not create any trust---Party to show creation of trust must prove thatmoney paid in confidence on express condition for specific purpose in trust---Held further, if such payment mademoney vests in payee forbenefit of payer.

    149. Delivery to bailee how made.---The delivery to the bailee may be made by doing anything which has the

    effect of putting the goods in the possession of the intended bailee or of any person authorised to hold them on hisbehalf.


    The bailor's part need not be very active. Mere assent, for example, of a guest at a place of public entertainment to aservants officious assumption of custody may be sufficient evidence of delivery to make the proprietor of the housea bailees and responsible for loss. The railway authorities were held liable as bailees where cotton was stacked on astation platform, with the consent of the station-master, no wagon being available, and was set on fire three dayslater by a spark from apassing train. Having regard to the course of dealing of a railway company, the mere fact thatloading clerk in the employ of a railway company filled up a forwarding note and market a number on it has beenheld not to amount to delivery of goods to the company within the meaning of this section. It was further necessarythat a number corresponding to the number of the forwarding note should be marked on the goods by arailway

    official.A lady employed a goldsmith for the purpose of melting old jewellery and making new jewels. Everyevening she used to receive the half-made jewels from the goldsmith and put them into a box which was left in aroom in the goldsmiths house, of which she retained the key. It was held that there was a redelivery of the jewels tothe lady and that they were not in the possession of the goldsmith when during one night they werestolen.

    150. Bailor's duty to disclose faults in goods bailed.---The bailer is bound to disclose to the bailee faults in thegoods bailed, of which the bailer is aware, and which materially interfere with the use of them, or expose the baileeto extraordinary risks; and if he does not make such disclosure, he is responsible for damage arising to the baileedirectly from such faults.
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    If the goods are bailed for hire, the bailor is responsible for such damage, whether he was or was not aware of theexistence of such faults in the goods bailed.


    (a) A lends a horse, which he knows to be vicious, to B. He does not disclose the fact that the horse is vicious. Thehorse runs away. B is thrown and injured. A is responsible to B for damage sustained.

    (b) A hires a carriage of B. The carriage is unsafe, though B is not aware of it, and A is injured. B is responsible to Afor the injury.


    There is no doubt that such is the Common Law, though there is not much positive authority. The rule of RomanLaw is that if a man knowingly lends his neighbour foul or leaky vessels, whereby the wine or oil put into themperishes or is lost, he is liable for the damage.

    A person who delivers to a carrier goods which he knows to be of a dangerous character, such as explosives, and to

    require extraordinary care in handling, and omits to give warning of it (the nature of the goods not being apparent),is liable for any resulting damage. There is an implied warranty that the goods are not dangerous, so that theconsignor is liable, whether or not he knows the goods are dangerous, for any resulting damage. If the goods of athird party are damaged through a breach of this warranty the carrier can recover from the consignor the amount ofthe damage whether or not the carrier is liable over to the third party.

    The language of the second paragraph of the present section is open to at least there constructions:

    (i) The bailer is under a duly to take reasonable care to make the goods reasonably safe for the purpose for which heknows they have been hired.

    (ii) The bailor is under a duty to supply goods that are reasonably safe, the only defence being that the defect is alatent one that could not be discovered by any care or skill.

    (iii) There is an absolute guarantee of fitness.

    In the common law, there is some authority for each of these views, but little to support view.

    With regard to illustration (b) there is some doubt whether the rule would apply to the case where A hires of B aspecific carriage, not a carriage to be provided by B at his discretion. But the decisions upon the hiring of particularkinds of property turn rather on questions of implied warranty, or unexpressed terms of the contract, and must beused with great caution for the establishment of any general rules.

    It does not seem, at all events, that the quite positive language of the second paragraph of the present section wouldbe qualified in India by any such exception.

    151. Care to be taken by bailee. In all cases of bailment the bailee is bound to take as much care of the goodsbailed to him as a man of ordinary prudence would, under similar circumstances, take of his own goods of the samebulk, quality and value as the goods bailed.


    This section abolishes the distinctions in the amount of care required of various kinds of bailees which wereestablished, or supposed to be established. The Privy Council has laid down the duty of a bailee for reward inEnglish law as being to exercise the same degree of care towards the preservation of the goods entrusted to him frominjury which might reasonably be expected from a skilled storekeeper, acquainted with the risk to be apprehended

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    either from the character of the storehouse itself or of its locality. It has, however, sometimes been held that there isliability only for gross negligence, or for failure to show such skill as the profession of the bailor implies. It isclearly not sufficient for a gratuitous bailee to show the same care as he bestowes upon his own goods. This is anobjective standard similar to that of reasonable care, and was applied in A.I.R. 1955 V.P. 30. When goods aredestroyed by a riotous mob, the bailee is notresponsible for the loss.

    A special and higher responsibility, not being part of the ordinary law of bailment at all, was imposed by the law ofEngland upon common carriers and innkeepers. How far this remains unaffected by the Contract Act must beseparately considered.

    Common carriers.---The provisions of Ss. 151 and 152 of the Contract Act embody in effect the Common Law ruleas to the liability of bailees other than common carriers and innkeepers. The measure of care required of thesebailees in respect of goods entrusted to them was the same as a man of ordinary prudence would take of his owngoods; in other. words, the liability was one for negligence only, in the absence of special contract Common carriersand innkeepers, on the other hand, were liable as insurers of goods; that is they were responsible for every injury tothe goods occasioned by any means whatever, except only the act of God and the enemies. Therefore the mere proofof delivery of goods and injury thereto, unless caused by the act of God or the enemies, was sufficient to entitle theplaintiff to compensation without proof of negligence on the part of the defendant. The question whether the liabilityof common carriers was still further reduced by the enactment of Ss. 151 and 152 of the Contract Act, so as torender them liable for negligence only as in the case of other bailees, came up before the High Court of Bombay in

    1878. The Court held that the definition of "bailment" in S. 148 was large enough to include bailment for carriage,and that the provisions of those sections, therefore, applied tocommon carriers. The High Court of Calcutta, on theother hand, held in a subsequent case that the liability of common carriers was hot affected by the Contract Act. Thesame point arose before the Privy Council in an appeal from the Court of the Recorder of Rangoon, where it washeld, approving the Calcutta decision, that the duties and liabilities of a common carrier are governed by theprinciples of the English Common Law in conjunction with the provisions of the Carriers Act, and that,notwithstanding some general expressions in the chapter on Bailments, the responsibility of a common carrier is notwithin theContract Act.

    Where the parties have expressly contracted to be bound by the provisions of the Carriage of Goods Act, 1925, therights of the parties are governed by theterms of that Act.It may well be that in the absence of any contraryintention, a shipowner carrying goods from one port to another can be presumed to contract with reference to theContract Act; but it by no means follows that the presumption is the same if the goods are to be carried to London or

    New York.

    Carriers by Railway.---The liability of carriers by railway is now governed by the Railways Act, 1890. S. 72 ofthat Act provides that the responsibility of a railway administration for injury to goods delivered to it to be carriedby railway is, subject to the other provisions of the Act, that of a bailee under Ss. 151, 152 and 161 of the ContractAct, and that it shall not be affected by the Carriers Act, but that it may be limited by a special agreement betweenthe parties, provided that it is in writing by or on behalf of the person sending the goods and is otherwise in a formapproved by the Governor-General in Council. Several railway companies accordingly issued what is called "therisk note" in a form approved by the Govt., which is used when the sender elects to despatch at a "special reduced"or "owner's risk" rate articles for which an alternative "ordinary" or "railway risk" rate is quoted in the tariff. The"risk note" provides that, in consideration of the railway company carrying the goods at a special reduced rate, theyshall be exempted by the sender from liability for loss or damage to the goods from any cause whatever before,during, or after transit over the railway or other railways working in connection therewith. Such a note signed by the

    sender constitutes a special contract within the meaning of S. 72, and a railway company cannot, therefore, berendered liable on such a note, whatever may be the cause of injury to the goods. Where, however, there was nocontract to the contrary, it was held that a passenger whose luggage deposited in the cloak-room was lost wasentitled to the entire value of the goods, but not to anyconsequential damages.

    Innkeeper.---It has been held by the High Court of Allahabad that the liability of a guest in respect of goodsbelonging to a hotel-keeper and used by the guest is that of a bailee under Ss. 151 and 152 of this Act, so that theguest is not responsible for the loss, destruction, or deterioration of the furniture in his use if he has taken as muchcare of it as a man of ordinary prudence would, under similar circumstances, take of similar furniture of his own.
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    Burden of Proof---In cases governed by the provisions of Ss. 151 and 152, the loss or damage of goods entrusted toa bailee is prima facie evidence of negligence, and the burden of proof, therefore, to disprove negligence lies on thebailee. The same rule applies, by reason of S. 72 of the Railways Act, to a railway administration, unless the goodsare consigned under a risk note under which the railway company are absolved from all liability for loss or damageexcept that due to willful negligence on the part of their servants, in which case the, burden lies in the first instanceupon the company to prove that the loss was such as was contemplated by the contract, and when this has been doneit shifts to the plaintiff to show that the loss was due to the willful neglect of the company or its servants. A railwaycompany receiving goods for carriage is not bound to inquire into the apparent owner's title or to see that the risk-note is read and understood by the person whodelivers the goods. As regard goods delivered to a common carrier,he is liable even if there be no negligence on his part except in certain cases mentioned above (see note "commoncarriers," above). Under S. 6, however, of the Carriers Act he may by special contract limit his liability, but eventhen the burden lies on him, by reason of S. 9 of the Act, to disprovenegligence.

    As regards bailments for hire, the rule is that if the damage caused were such that in the ordinary course of events itwould not happen to goods of the kind in question if used with ordinary prudence. Thus where a person hires a horsefor riding in a sound condition and the horse dies the same day while it is in his custody, it is for the hirer to provethat he had taken such care of the horse as a man of ordinary prudence would, under similar circumstances, havetaken of his own. Similarly, where goods delivered for safe custody for reward are lost while in the possession of thebailee, the burden lies on the bailee to prove absence of negligence on his part. But where hotel furniture used by aguest while suffering from an infectious disease is destroyed by the hotel-keeper to prevent infection, it lies on the

    hotel-keeper, if he claims damages for the loss thereof, to prove that the guest did not take as such care of the goodsas a person of ordinary prudence would have taken of his own goods under similar circumstances.

    Contract by bailee exempting himself from liability for negligence.---The learned authors considered that acontract by a bailee purporting to exempt himself wholly from liability for negligence was not valid. This opinion isbased on the express provisions for contracting out in S. 152, and in fact throughout the Chapter on Bailmentswherever a rule of law is to operate only in the absence of a contract to the contrary, it is expressly so stated in thesection (see sections 163, 165, 170, 171, and 174).

    Carriage of Goods by Sea Act (XXVI of 1923), Sched., Art. 1 (c)---Carriage of goods by sea---Cargo carried ondeck and at consignors risk short landing at destination---Liability for loss---Liability of carriers not governed bySs. 151 & 152, Contract Act, 1872---Word "goods" in Art. 1 (e) of Sched. to Carriage of Goods by Sea Act---Connotation---Cargo not governed by provisions of said Act---Negligence alleged by substitute of consignor denied

    by carrier in written statement---Carrier bringing evidence to show that goods were damaged due to act of God---Contention that provisions of Ss. 151 & 152. Contract Act were applicable in instantcase not tenable.

    Care to be taken by bailee----Theft of goods pledged with Bank---Document of pledge containing condition thatduring the continuance of pledge agreement the borrowers shall be responsible for all loss, damage, or deteriorationof security caused by theft, fire, rain or any other cause whatsoever---There being. no discrepancy betweenprovisions of S. 151, Contract Act, 1872 and condition of document of pledge, if loss had been caused by theft, fire,rain or any other cause, it would be the duty of the bailee to explain that he had taken care of the goods as a man ofordinary prudence would under similar circumstances take of his own goods and if in spite of that the goods pledgedwere lost in manner as recorded in the condition of document of pledge, liability of borrower could not belegally orequitably denied.

    Goods carried at risk of carrier---Carrier not proving due diligence in carrying goods---Carrier liable for

    loss. Where jute was carried at the risk of the railway and it caught fire when a porter went to seal the door with alamp, which showed negligence of the Railway. Moreover the carrier failed to prove its diligence in dealing Withthe jute in question throughout the period it was in its care and custody. The Railway was held liable for the losssuffered by theconsignor.

    Injury to goods in transit by Railway---Onus of proof as to negligence by carrier---How burden is to bedischarged.---Where due to long delay in transit, goods carried by Railway were damaged. Held: Although theburden of establishing want of care on the pari of' the Railway lies on the consignor yet it is the duty of the railwayto supply the entire material from which the amount of care that is taken is ascertained. The Railway pleaded that thedelay was caused due to unavoidable circumstances but no material was supplied in support of this plea; Therefore
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    the presumption of want of due Care would ariseagainst the Railway.

    Loss to goods by negligence of ship-owner---Claim for damages against shipowner sustainable.---Held: Theshipowner committed a breach of the obligation contained in the bill of lading and as such the consignee wasentitled to recover damages.

    Damage to contents of parcel---Burden of proof is on consignor--Mere damage to containers does not provedamage to contents.---The burden of proof was on the plaintiff to show that the damage to the contents was causedby the negligence of the servants of the Carrier while the Crates were in its custody. No such evidence has beenproduced by the plaintiff and merely, because some of the wooden crates were externally broken and some card-board cases torn, as stated in the Survey Report, it cannot be inferred, nor is there any evidence to show, that theexternal damage must have resulted indamage to the contents.

    Loss of goods in possession of bailee---Onus of proof as to negligence of bailee.---Where goods are lost ordestroyed while in .possession of bailee the onus of placing all the materials in his possession or knowledge is on thebailee, while the onus of establishing negligence is on theplaintiff.

    Negligence of bailee---No evidence to show negligence---Bailee not required to prove precautionary measurestaken against loss by fire, etc.---Held: The plaintiff has not suggested what were the steps which the Karachi PortTrust ought to have taken which it had failed to take, before an adverse inference of negligence can be drawn against

    them. It is not disputed that the cause of the fire was not known. Therefore, it was not incumbent on the K.P.T. toshow that the fire originated from causes beyond its control. In the circumstances, it was enough for the Karachi PortTrust to place before the Court all the materials in its possession and to satisfy the Court that it had taken due caregenerally of the goods entrusted to its custody as statutory bailee and that it had taken all prompt and reasonablesteps in its power to put out the fire and save whatever was possible of the goods. I am not satisfied that the plaintiffhas discharged the burden of proving negligence on the part of theKarachi Port Trust.

    Carriage of goods by sea from foreign port to Pakistan---Damage to goods---Contract Act applies.---Theprovisions of the rules to the Carriage of Goods by Sea Act, 1925 do not apply in relation to carriage of goods by seain a ship carrying goods from a foreign port to a port in Pakistan, as is the present case. Therefore, the rights andliabilities of the parties have to be ascertained by reference to the proper law of the contract which in this case, is thePakistan law.

    Damaged goods not surveyed---Nothing to show quantum of damage---Vague estimate of damage---Damagesnot awarded. Held: The consignee did not apply for a survey of the damaged goods nor is there any evidence in thesurvey whether the dirt stains penetrated beyond the outer cover of the rolls and damaged the carpets inside. Thevalue of the alleged damage is also not indicated in the survey report. It would, therefore, appear that the estimate ofRs. 4,675 claimed by the plaintiff as representating 5% damage to the 55 rolls of carpets can but be only a vagueestimate. In this absence of material evidence as to value of damaged goods, the claim of the plaintiff cannot beaccepted.

    Damage to goods noticed by M.D. of plaintiff--Delay in making request for appointment of surveyor---Carrier not bound by Survey report in absence of notice and survey.--- Held: The Managing Director of theplaintiff, in his deposition in Court admitted that he noticed the alleged damage at the time of the discharge of thegoods on 6-8-1965, by which time the goods had been removed by the K.P.T. from Transit Shed to anotherwarehouse, some four or five furlongs away. The first intimation of the particulars of the alleged damage was

    conveyed to the Carrier's Agent on 7-6-1966 just before the suit was filed, by the plaintiff's legal notice claiming anestimated loss of Rs. 1,28,385/-. In the absence of notice of survey, the carrier is not bound by the Survey Report.Therefore the carrier is not liable topay damages.

    Buyer rejecting goods---If can sell them to recover ware-house charges for storing them.---The buyer rejectedthe goods and then disposed them of in order to recover the ware-house charges for having stored them. Hecontended that he as a bailee had the right to do so.

    Held: The buyer of the good. s having rejected them and thereafter selling them as the goods belonging to him,stands on a different footing than the bailee contemplated under sections 151 and 170 of the Contract Act. The
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    principle on Which a bailee is entitled to dispose of the goods or has lien on the goods bailed with him are entirelydifferent and are not applicable to the case of the sale of goods. As discussed above, the buyer of the goods afterrejecting them, has no lien on the goods in dispute and must place them at the disposal of the seller for dealing withthem in anymanner he likes.

    Due care---If onus lies on the bailee---How should the onus be discharged---Duty of the plaintiff in case of lossof goods.---Per Yakub Ali, J. Section 151 of the Contract Act subjects a bailee to the duty of taking as much care ofthe goods entrusted to him as a prudent man would take of his own goods of similar quality and bulk. That the baileedischarged his statutory duly in respect of the goods entrusted to him can obviously be proved the bailee and not bythe bailor. The onus therefore, to prove what steps had been taken by the bailee in discharge of the duty imposedupon him by law would initially lie on him and not on the bailor.

    The loss of goods entrusted to a bailee is prima facie evidence of his negligence, and the question still remains to beanswered whether inspite of such loss any onus remains on the plaintiff to prove negligence after the defendantbailee has failed to prove that he had discharged his duty as it bailee under section 151 of the Contract Act. It isobvious that if the defendant satisfies the Court that he took as much care of the goods entrusted to him as a man ofordinary prudence would take of his own goods of similar quality and bulk, there will be no scope for the plaintiff toprove any negligence on the part of the defendant to indemnify him for the loss of his goods. Vice versa, if theplaintiff succeeds in proving negligence on the part of the defendant bailee, it will not be open to the defendant tocontend or show that in the discharge of his duty he had acted according to what he was enjoined upon to do under

    section 151 of theContract Act.

    Per Akhlaq Hussain, J. In a suit against a railway company or administration the plaintiff has to prove that thedefendant failed to take the care which, under section 151 on the Contract Act, it is the duty of a bailee to take. Thatsection, be it noted, does not lay the onus on a ballet in a suit against him to prove that he took the care which it washis duty to take. It only defines the measures of his duty; and a plaintiff can succeed only by proving its absence.Therefore it would be entirely erroneous on the part of a Court to cost any burden on the defendant by framing anissue whether he took due care or ally care.

    Another point to note is that section 105 does not cast the burden of proving due care upon the defendant; it onlymakes it his duly to prove such facts relating to the care actually taken by him which are "especially within hisknowledge." The burden of the issue whether loss has been occasioned by the failure of the defendant to take duecare rests squarely upon the plaintiff throughout, under sections 101 and 102 of the Evidence Act; and while

    evidence is being led on that issue the plaintiff may be exonerated from proving certain relevant facts" but not theissue itself.

    Goods carried by railway by route other than the usual route---Goods damaged or deteriorated---Railwayliable---Risk note is no protection.---A contract for the carriage of goods does always mention the place where thegoods are booked, the place of destination, and impliedly also the route by which the goods are to be carried.Therefore, if without the knowledge and consent of the party concerned the railway choose to carry the goods by aroute other than the route agreed upon or the usual route, they do so at their own risk and cannot fall back upon theterms contained in the Risk Note contrary to the terms on which they carry the goods by a different route, nor canthey claim that they are absolved from the general statutory liability or a bailee.

    The Risk Note does not stand in the way of the claim of theplaintiff at all.

    Loss of goods during transit---Railway liable---Absence of brake---Negligence of railway.---Where goods werelost during transit and it was found that there was no vacuum or brake in the van of the guard so that the train couldnot be stopped in case of theft in the running train.

    Held: There ought to be a vacuum in a train in order that in case of theft while it is running it may be stopped. Thata vacuum should be there in the brake of the guard is not denied and the failure to keep a vacuum against the ruleswould be negligence. Therefore the failure to provide brake should be considered a negligent act on the part of theRailway.

    Held further: That there is no satisfactory evidence from which it could be inferred that they had taken proper care
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    of the consignment as bailer of the goods consigned. Therefore, the railway was liable for theloss of goods.

    Railway---Liability while carrying goods---Similar to that of a bailee.---Held; The railway carries goodsdelivered to it by a party as a bailee under a contract and is bound to take such care of the goods as that taken by aman of ordinary prudence. It is only when it wants to limits its liability that it can enter into special contracts withtheparties concerned.

    Short delivery of goods---Goods carried on shippers risk---Company liable for short delivery under thesections---Where the goods were carried on shipper's risk, and the shipping company made a short delivery ofgoods.

    Held: It cannot be said that the special contract between the shipping company and the plaintiff is of such acomprehensive nature as to absolve the shipping company from all liability so as to exclude sections 151, and 152,Contract Act, from coming into operation. The company was therefore liable for loss on account of theshortdelivery.

    Loss of pledged goods---Liability of pledgee not affected by agreement that pledgee would not be responsiblefor loss---Pledgee must prove that loss was in spite of due care by him.---The goods pledged to a Bank werestolen. The Bank took up the plea that it was not liable for the loss of goods in view of a term of agreement with theparty by which the Bank was not to be held responsible for loss or damage to the goods.

    Held: The defendant Bank when seeking to rely on the terms of the agreement from being excused from anyliability of the pledged goods lost by theft, must first prove satisfactorily that the theft was committed by a person orpersons other than the agent or employees of the Bank and that the theft was committed in spite of the pledgee Bankhaving taken proper protection with regard to the safety of the goods. This, the pledgee Bank must do, as even whena special agreement of this nature is entered into between the parties, failure of the party seeking cover under specialterm must attract the provisions of the sections 151 and 152 of theContract Act.

    Goods entrusted to bailee damage by act of his servant---Servant acting outside his authority---Bailee is liablefor the loss. A bailer is liable to the bailor in respect of the goods bailed when the goods suffered from thenegligence of the servant of the bailee even though the negligent act look place while the servant was dealing withthe articles for hisown purpose.

    Liability of common carrier by Sea---Not governed by Ss. 151, 152---Common carrier would be liable accordinglyto terms of contract embodied in Bill of Lading---Carrier (shipper) would be immune from liability for any loss in acase where under terms of Bill of Lading goods were shipped on Deck and atconsigner's risk.

    Carriage of Goods by Sea Act (XXVI of 1925), Sched., Art. 1 (c)---Carriage of goods by sea---Cargo carried ondeek and at consignor's risk short landing at destination---Liability for loss---Liability of carriers not governed bySs. 151 & 152, Contract Act, 1872---Word 'goods' in Art. 1 (e) of Sched. to Carriage of Goods by Sea Act---Connotation---Cargo not governed by provisions of said Act---Negligence alleged by substitute of consignor deniedby carrier in written statement---Carrier bringing evidence to show that goods were damaged due to act of God---Contention that provisions of Ss. 151 & 152, Contract Act were applicable in instantcase not tenable.

    Bailee's liability for damages---Damage to one Case caused by negligence of servants and/or agents of StevedoreCompany engaged by Shipping Company---Shipping Company neither taking plea of having taken as much care as

    man of ordinary prudence would take of his own goods nor pleading special contract---Shipping Company, held,responsible to importer.

    Bailor and bailee, relationship of---Correspondence showing Bank from time to time informing plaintiff about stockof plaintiff in custody of Bank---F.I.R. about theft of goods also lodged by an officer of Bank---Chowkidar of Bankalso deputed to guard goods in question---Deliveries of goods made by Bank on delivery orders issued by plaintiff---Rent for godown and salary of Chowkidar also recovered by Bank from plaintiff---Bank, held, bailee for reward ofgoods of plaintiff.

    152. Bailee when not liable for loss, etc, of thing bailed.---The bailee, in the absence of any special contract, is not
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    responsible for the loss destruction or deterioration of the thing bailed, if he has taken the amount of care of itdescribed in Section 151.


    Care to be taken by bailee.---Since the standard of diligence required of a bailee is that of the average prudent

    man, a bailee of goods is not liable for loss of the goods by theft in this shop, if it is shown that he took as much careof the articles bailed as an ordinary prudent man would under similar circumstances, take of his own goods of thesamequality and value. For the same reason if A sends jewels to B for repairs, asking B to return them after repairas a value payable parcel, and B does so, B is not liable for the loss of the jewels merely because he failed to insurethe parcel. Failure to insure the jewels is not evidence of want of such care as a man of ordinary prudence would,under similar circumstances, take of his own goods, especially when the owner himself does not insure them whensending themout for repair.But it is negligence on the part of a carrier of goods to send jute in a boat with twenty orthirty leaks on its side, one or one and a half inches in length, and keep the goods in the hold of the boat forthirtyhours.

    The bailee's duty does not necessarily come to an end when the. goods are lost or stolen.

    Liability of common carrier by Sea---Not governed by Ss. 151, 152---Common carrier would be liable accordingly

    to terms of contract embodied in Bill of Lading---Carrier (Shipper) would be immune from liability for any loss in acase whereunder terms of Bill of Lading goods were shipped on Deck and atconsigner's risks.

    153. Termination of bailment by bailee's act inconsistent with, conditions. A contract of bailment is voidable atthe option of the bailor, if the bailee does any act with regard to the goods bailed, inconsistent with the conditions ofthe bailment.


    A lets to B, for hire, a horse for his own riding. B drives the horse in his carriage. This is, at the option to A, atermination of the bailment.


    It is well settled law that a wrongful use or disposal of the goods by the bailee determines to bailment and remits thebailor to the right and remedies of a person entitled to possession; a wrongful act means, for this purpose, a dealingwholly inconsistent with the terms of the bailment. The English authorities go into refinements as to the precise kindof wrong committed and the precise form of action available which are almost as subtle as anything in eitherEuropean or Hindu philosophy; but, as these are intimately connected with the old Common Law system ofpleading, we have no occasion to consider them here. Merely irregular exercise of a right, such as a sub-pledge to athird person by a pledgee, or a premature sale by a pledgee with power of sale, has not the same effect. The presentsection has the merit of simplicity, and does not appear to have given rise to any litigation.

    154. Liability of bailee making unauthorised use of goods bailed. If the bailee makes any use of the goods bailed,which is not according to the conditions of the bailment, he is liable to make compensation to the bailor for anydamage arising to the goods from or during such use of them.


    (a) A lends a horse to B for his own riding only. B allows C, a member of his family, to ride the horse. C rides withcare, but the horse accidentally falls and is injured. B is liable to make compensation to A for the injury done to thehorse.

    (b) A hires a horse in Karachi from B expressly to march to Hyderabad. A rides with due care, but marches toKhairpur instead. The horse accidentally falls and is injured. A is liable to make compensation to B for the injury to
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    the horse.

    Illustration (b) is apparently .suggested by the case put in old English books of a man borrowing a horse to ride toYork and riding to Carlisle. Discussion of the old forms of action being here superfluous, no comment is required.

    155. Effect of mixture, with bailor's consent, of his goods with bailee's. If the bailee, with the consent of thebailor, mixes the goods of the bailor with his own goods, the bailor and the bailee shall have an interest in proportionto their respective shares, in the mixture thus produced.


    Performance bond---Awarding of amount claimed by plaintiff by way of refund of amounts paid to defendant---Jurisdiction of umpire---Such question having been raised in statement of claim before arbitrator---Umpire, held,had Jurisdiction to deal with refund of amount forfeited by defendant in terms of bank guarantee and to allow ordisallow requisite claim---By such refund of amount umpire had impliedly found that defendant was not entitled toforfeit Performance Bond---Umpire is not required under law to give separate findings on each issue or pointraisedbefore him.

    156. Effect of mixture without bailors consent, when the goods can be separated. If the bailee, without the

    consent of the bailor, mixes the goods of the bailor with his own goods, and the goods can be separated or divided,the property in the goods remains in the parties respectively; but the bailee is bound to bear the expense ofseparation or division, and any damage arising from the mixture.


    A bails 100 bags of cotton marked with a particular mark to B. B without A's consent, mixes the 100 bales withother bales of his own bearing a different mark, A is entitled to have his 100 bales returned, and B is bound to bearall the expense incurred in the separation of the bales and any other incidental damage.

    The proposition is almost too obvious to need stating. Not only this, but any other difficulty caused by unauthorisedacts of the bailee which may attend the return of the bailor's goods according to the contract must be at the bailee'srisk and expense.

    157. Effect of mixture, without bailor's consent, when the goods can be separated.---If the bailee, without theconsent of the bailor, mixes the goods of the bailor with his own goods; in such a manner that it is impossible toseparate the goods, bailed from the other goods and deliver them back, the ballot is entitled to be compensated bythe bailee for the loss of the goods.


    A bails a barrel of Cape flour, worth Rs. 45, to B.B, without As consent, mixes the flour with country flour of his

    own, worth only Rs. 25 a barrel. B must compensate A for the loss of his flour.

    By the Trusts act, 1882, S. 66, "where the trustee wrongfully mingles the trust-property with his own, thebeneficiary is entitled to a charge on the whole fund for the amount due to him."

    158. Repayment by bailor of necessary expenses. Where, by the conditions of the bailment, the goods are to bekept or to be carried, or to have work done upon them by the bailee for the bailor, and the bailee is to receive noremuneration, the bailor shall repay to the bailee the necessary expenses incurred by him for the purpose of thebailment.

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    This and the next two sections represent Storys opinion partly of what the law is and partly of what it should be.

    One does not quite see why in our law the bailees promise may not be limited to returning the goods at a certain

    date or on demand after a certain date, if such is the agreement of the parties. The bailor may intend to accept apromise so qualified as the consideration for parting with the possession of the goods, and there is no known rule oflaw to prevent effect from being given to that intention. Why not let the parties make their own terms instead ofborrowing a fixed rule from a system which has no doctrine of consideration? But the truth is that gratuitousbailments, though very common in private life, are not matters of business and therefore do not come into court.

    159. Restoration of goods lent gratuitously. The lender of a thing for use may at any time require its return, if theloan was gratuitous, even though he lent it for a specified time or purpose. But, if on the faith of such loan made fora specified time or purpose, the borrower has acted in such a manner that the return of the thing lent before the timeagreed upon would cause him loss exceeding the benefit actually derived by him from the loan, the lender must, ifhe compels the return, indemnify the borrower for the amount in which the loss so occasioned exceeds the benefit soderived.


    No authority has been found for Storys view, which appears, as above stated, to be nedlessly complicated. Onprincipal the question is what the terms of the contract were. Quaere whether an express contract not to recall a thing

    gratuitously lent before the expiration of a certain time would not be good in India notwithstanding this section.There is no difficulty about the consideration.

    160. Return of goods bailed on expiration of time or accomplishment of purpose. It is the duly of the bailee toreturn, or deliver the goods bailed, without demand, as soon as the time for which they were bailed has expired, orthe purpose for which they were bailed has been accomplished.


    Nothing is said here about the extent of the bailors remedies if the goods are not forthcoming. He can have an

    action for damagesagainst the bailee,but also he has further equitable rights. "if the bailee sells the goods bailed,the bailor can in equity follow the proceeds, and can follow the proceeds wherever they can be distinguished eitherbeing actually kept separate, or being mixed up with other moneys".

    It has been established for a very long period.... that the principles relating to the following of trust property[compare the Trusts Act, Ss. 63-65] are equally applicable to the case of a trustee and to the case of factors, bailees,or other kinds of agents... wherever a specific chattel is entrusted by one man to another, either for the purpose ofsafe custody or for the purpose of being disposed of for the benefit of the person entrusting the chattel; then eitherthe chattel itself, or the proceeds of that chattel, whether the chattel has been rightfully or wrongfully disposed of,may be followed at any time, although either the chattel itself, or the money constituting the proceeds of the chattel,may have been mixed and confounded in a mass of the like material. The development of this doctrine in cases oftrust is not within our scope; it is connected with the special application and limitation of the rules as toappropriation of payments (S. 61, above).

    It is obvious that in a case where the goods are found unfit for the purpose for which they were hired the purpose forwhich they were bailed is not accomplished; but the consequences are not here declared. It seems that all the baileeis bound to do is to give notice to thebailor of the default.

    161. Bailee's responsibility when goods are not duly returned. If, by the default of the bailee, the goods are notreturned, delivered or tendered at the proper time, he is responsible to the bailor for any loss, destruction ordeterioration of the goods from that time.


    Unexplained failure to return the thing bailed is presumed to be by thebailee's default.A bailee who refuses to givedelivery except upon some unjust or unreasonablecondition is in default.
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    Conversely, if a bailor or consignee omits or refuses to take his goods at the proper time from a carrier (or, it wouldseem, any other kind of bailee) who is ready and willing to deliver them, he may be liable to compensate the baileefor any necessary expenses of and incidental to their safe custody. But the goods are not at the risk of the bailor, andthe bailee will be liable for any breach of dutyunder S. 151.

    Bailee wrongfully converting goods kept with him---Liable for loss of bailor.---A bailee who either refused togive delivery of the goods under his custody or fails to return the goods to the bailor, is responsible to the bailor forany loss, destruction or deterioration of thegoods from that time.

    Delivery of pledged property---How may be made---When constructive delivery is sufficient. Delivery, eitheractual or constructive, of the articles pledged in consideration of the debt or advance is essential to the contract.Constructive delivery is where it is practically impossible to give physical possession, or where the pledge remainsin the possession of the pledgor for a special purpose and the pledge is legally delivered though it does not actuallypass from the hands of the pledgor to those of the pledgee. Delivery of a key of a warehouse in which goods arestored, or of a delivery order directing a warehouseman to deliver goods to the pledgee, is sufficient in law to formconstructive delivery. It is not essential that the advance and the delivery should be contemporaneous. it is sufficientif possession be delivered within a reasonable time of the advance, in pursuance of thecontract to pledge

    Pledgor and pledgee---Relationship of the parties discussed.---The general property in goods pledged remains in

    the pledgor, but a special property in them passes to the pledgee in order that he may be able to sell the pledge if hisright to sell arises. This special property is such that if a bailee accepts, as security for goods brought, an object ofvalue; he fraudulent retaking of the object by the bailor is larceny. By the bailment of goods by a debtor to hiscreditor in pledge, or as a security for a debt, the pledgee impliedly undertakes to deliver back the property to thepledgor, when the sum for which it was pledged is paid, and the pledgor impliedly undertakes that the propertypledged is his own and may be safely returned to him. If the pledgor makes default in payment at the stipulated time,the pledgee may sell the pledge, even though there be not any express agreement to that effect, or he may sue thepledgor or his debt, retaining the pledge as a security. But if a time for payment has not been agreed upon, or if thetime agreed upon has been extended indefinitely, the pledgee cannot sell the pledge until afterdemand and notice.

    162. Termination of gratuitous bailment by death, A gratuitous bailment is terminated by the death either of thebailor or of the bailee.

    The executors of persons who have borrowed things, especially books, do not always remember this, as is shown bycommon experience. On the other hand, the executors of a lender may tacitly and discreetly, in many cases, treat theloan as a gift without fear of being Called to account for a davastavit. The problems hence arising, if any, seem to berather ethical than legal, save so far as the law of limitation cures this amongst other irregularities. The presentsection does not, of course, exempt the bailees estate from liability for any default in his lifetime.

    163. Bailor entitled to increase or profit from goods bailed.---In the absence of any contract to the contrary, thebailee is bound to deliver to the bailor, or according to his directions, any increase or profit which may have accruedfrom the goods bailed.


    A leaves a cow in the custody of B to be taken care of. The cow has a calf. B is bound to deliver the calf as well as

    the cow to A.


    Good sense, and therefore, good law, seemingly without any previous reported authority. New shares allotted inrespect of shares that have been pledged are an increaseclaimable by the pledger.

    164. Bailor's responsibility to bailee.---The bailer is responsible to the bailee for any loss which the bailee maysustain by reason that the bailor was not entitled to make the bailment, or to receive back the goods or to give
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    directions, respecting them.

    If the terms of the bailment are such that its natural determination as between the parties is delivery over to a thirdperson, and there is a paramount title elsewhere, the bailee may be in difficulties, which, however, are mitigated byS. 166.

    165. Bailment by several .joint owners.---If several joint owners of goods bail them, the bailee may deliver themback to, or according to the directions of, one joint owner without the consent of all, in the absence of any agreementto the contrary.

    "May," not "must". Even if there is an agreement to the contrary, one of several joint owners cannot, after havingaccepted redelivery from the bailee, sue him jointly with the other owners; for "one party to a contract cannotmaintain an action for a breach occasioned by his own act, and neither can three parties maintain an action unlesseach party separately could."

    166. Bailee not responsible on redelivery to bailer without title. If the bailer has no title to the goods, and thebailee, in good faith, delivers them back to, or according to the directions of, the bailer, the bailee is not responsibleto the owner in respect of such delivery.


    Return of goods to or to the order of the bailor.---A bailee who in good faith returns the goods bailed to the bailoror his order is not liable to the true owner of goods. N. entrusted certain bales of cotton to L., a muccadam(warehouseman). L pledged the cotton with B (with whom he had dealings for several years) to secure advancesmade by B to L. Subsequently L redeemed the pledge, and the cotton was returned by B to or to the order of L.Nsued B and L claiming delivery of the goods or their value. The Privy Council held that whether the pledge by L toB was or was not valid under S. 178, the return of the goods by B in good faith to L was a completedefence to thesuit.The section really applicable was the present section, but the case was wrongly argued as under S. 178, which itwas held unnecessary to consider.

    Estoppel of bailee.---Cp. the Evidence Act, 1872, S. 117.---"...Nor shall any bailee or licensee be permitted to denythat his bailor or licensor had, at the time when the bailment or license commenced, authority to make such bailmentor grant such license...Expl. (2).---If a bailee delivers the goods bailed to a person other than the bailer, he rallyprove that such person had a right to them as against the bailer."

    The rule of the Common Law is that generally a bailee is estopped from denying his bailor's title. He is not onlyjustified in delivering to the bailer or according to his directions, but he is not justified in refusing to deliver to thebailer unless he is under the effective pressure of an adverse claim, and defends upon the right and title and by theauthority of the third person so claiming. There must be something equivalent to an eviction by a paramount title,which if it actually took place would of course determine the bailment. But if the bailer has by his own act, as bymortgaging the thing bailed, made it impossible for the bailee to redeliver to him without being exposed to an actionat the suit of a third person, then the bailee is excused.

    But if a man accepts a bailment with notice at the lime of an adverse claim, he must stand by the election he hasmade, and cannot afterwards rely on the adverse title against his bailer.

    A common carrier's position is not quito the same, as he must in any case accept goods offered him for carriage andcannot make inquiries as to the ownership. He may safely deliver in pursuance of his employment until he has noticeof an adverse claim, but after notice he would so deliver at his peril, and therefore is justified in delivering to the realowner.

    If a warehouseman, or other such like person having the custody of goods, acknowledges that he holds them at theorder of a certain person, he thereby makes himself that person's bailee, and is estopped from denying his title to thesame extent as if he had actually accepted delivery from him.
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    167. Right of third person claiming goods bailed.---If a person, other than the bailor, claims goods bailed, he mayapply to the Court to stop the delivery of the goods to the bailor, and to decide the title to the goods.

    The bailee's protection against conflicting claims appears to be left to the general directions of the Code of CivilProcedure.

    168. Right of finder of goods; may sue for specific reward offered. The finder of goods has no right to sue theowner for compensation for trouble and expense voluntarily incurred by him to preserve the goods and to find outthe owner; but he may retain the goods against the owner until he receives such compensation; and, where the ownerhas offered a specific reward for the return of goods lost, the finder may sue for such reward, and may retain thegoods until he receives it.


    By the Common Law a person who finds lost goods and holds them with the intention of saving them for the trueowner is certainly not a trespasser, and has no higher duties than a bailee; but, the service being rendered withoutrequest from the owner, he does not seem entitled to any remuneration, unless a specific reward has been offered forthe return of the goods, and the offer has come to his knowledge (see on S. 8, "General Offers", above); and if hecannot claim compensation there is no ground on which he can retain the goods. But it seems the Court would be

    astute to lay hold of any evidence which might constitute a cause of action for a meritorious finder who had been atsubstantial pains, and it is possible that in some cases he might have rights analogous to a salvor's. It appears to havebeen a current opinion as late as the seventeenth century that a finder could abandon the goods with impunity.

    The rule of the present section appears to be intended to satisfy natural justice. Presumably the compensation, if nospecific reward has been offered and the parties cannot agree, is to be what the Court considers reasonable. If theparties do agree, the owner's promise of reward may be binding under S. 25, sub- S. 2 (ante).

    169. When finder of firing commonly on sale may sell it.---When a thing which is commonly the subject of sale islost, if the owner cannot with reasonable diligence be found, or if he refuses, upon demand, to pay the lawfulcharges of the finder, the finder may sell it---

    (1) When the thing is in danger of perishing or of losing the greater part of its value, or,

    (2) When the lawful charges of the finder, in respect of the thing found, amount to two thirds of its value.

    170. Bailee's particular lien. Where the bailee has, in accordance with the purpose of the bailment, rendered anyservice involving the exercise of labour or skill in respect of the goods bailed, he has, in the absence of a contract tothe contrary, a right to retain such goods until he receives due remuneration for the services he has rendered inrespect of them.


    (a) A deliver a rough diamond to B, a jeweller, to be cut and polished, which is accordingly done. B is entitled toretain the stone till he is paid for the services he has rendered.

    (b) A gives cloth to B, a tailor, to make into a coat. B promises A to deliver the coat as soon as it is finished, and togive A three months credit for the price. B is not entitled to retain the coat until he is paid.


    Principle of bailees lien.---This section expresses the "Common Law principle that if a man has an articledelivered to him, on the improvement of which he has to bestow trouble and expense, he has a right to detain it untilhisdemand is paid.

    Where a bailee has expended his labour and skill in the improvement of a chattel delivered to him, he has a lien for
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    his charge in that respect. Thus the artificer to whom the goods are delivered for the purpose of being worked upinto form, or the farrier by whose skill the animal is cured of a disease, or the horse-breaker by whose skill he isrendered manageable, have liens on the chattels in respect of their charges. An agister, who merely takes in ananimal to feed it, is not entitled to a lien, as not coming within this principle, for he does not confer any additionalvalue on the thing entrusted to him. A garage owner is not entitled to a lien merely for maintaining a motor car.

    A bailee's lien is lost if he surrenders possession of the goods, even though he subsequently regainspossession.Theline never arises unless the bailee has a right to continuing possession of the goods, so that if the bailor has the rightto remove the goods from time to time, there is no lien, in the absence of an express agreement that the goods shallremain "in pawn" despite temporary removal by the bailor.

    Further, where a person does work on goods delivered to him under an entire contract, the fact that the deliveries arcat different times does not affect his right to a lien on all goods dealt with under that contract. Accordingly, wherejute was delivered to a pressing company from time to time to be baled, but all under one contract, the lien was heldto attach to all such goods.

    A bailee for reward cannot transfer his lien to a sub-contractor without the bailor's authority. But such authority maybe implied. If H, who has hired a car from a car owner O, under a hire-purchase agreement, by the terms of which Hhas undertaken to keep the car in repair, delivers the car to a garage proprietor G for repair, G has a lien not onlyagainst H, but also against O: the express duty to repair leads to an implied authority to create a lien for repair. This

    implied authority is not removed by the fact that H is in arrear with the payments of the hire-purchase installments atthe time the vehicle is delivered to G for repair, unless O has already terminated the agreement for such defaultbefore the car is left with G.

    Contract to the contrary.---A lien, good against the owner, arises in favour of a repairer, employed by a hirer, eventhough the contract of hire-purchase expressly forbids the creation of a lien, if this prohibition is unknown to therepairer.

    Where there is an express contract to do certain work for a specified sum of money, there is no room for a quantummeruit claim. A person, therefore, to whom an organ is delivered for repairs for a certain sum is not entitled to retainit as security for a sum of money claimed not under the contract, but for worked done. While the special contract isin force there is no other "due remuneration" than the sum expressly contracted for.

    Exaggerated claim made---Right to lien till payment of actual amount due is not lost.

    Goods under one contract delivered at different times---Lien is created on all goods.----Where a person doeswork on goods delivered to him under an entire contract, with reference to goods delivered at different times, suchas to establish a lien, he is entitled to that lien on all goods dealt with under thatcontract.

    Lien created---Value of goods being disproportionate to actual amount due does not affect lien.

    Lien---Exists only Where there is right to continuous possession. The established practice is that without theright of continuing possession there can be no right of a lien. If the owner, therefore, has a right to assert thepossession and to interrupt the possession of the party claiming the lien such a right of the owner would beinconsistent with a lien.

    Contract for packing jute---Advance payment of Rs. 30,000 made---Goods packed and found hypothecated tothird party---Packer cannot have prior charge on goods to recover balance of packing charges. Where theplaintiff entered into a contract with defendant No. 1 for packing 30,000 pucca bales of jute and for this he receivedRs. 30,000/- in advance. Defendant No. 1 left for India leaving behind 4,000 bales of jute when the outstandingcharge still due to the plaintiff stood at Rs. 60,000/- So the plaintiff filed this stilt under the ordinary law of contractand equity for declaring a prior lein over the existing 4,000 bales of jute and also for a decree of Rs. 60,000. The suitwas contested only by defendant No. 6 who claimed that by a written instrument dated 2-8-54 defendant No. 1 hadhypothecated and created a first charge on all. its stock of jute and as such defendant No. 6 was entitled to takepossession of the same jute.
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    Held: Equity can only come into play as and when it is found that the party is subject to some hardship for no faultof his. Since the plaintiff did not put any restriction, it cannot be said that the plaintiff is entitled to invoke principleof equity in the matter of realisation of any charge that may be due from defendant No. 1 for the jute stocked in hisgodown.

    Jute delivered to pressing company for pressing---Bales placed in godown of company with freedom to owner

    of bales to deal with them as he liked---Pressing company has no lien on goods in godown in case ofnon-

    payment of bill.

    Bailment :-

    A bailment is a delivery of goods one person to another for some purpose upon a contract that they shall be

    returned or otherwise disposed of according to the directions of the person delivering. The person delivering

    the goods is called the "Bailor". The person to whom they are delivered is called "Bailee".

    Example :- Mr. Jhon enters into agreement with Miss. Sony to deliver her laptop to him on this condition that it

    shall be returned to her after one month. In this example Mr. Jhon is a Bailee and Miss. Sony is a Bailor.

    Laptop is good bailed. It is a contract of Bailment.

    Essentials or Features of Bailment :-

    Following are the important essential of bailment :

    1. Contract :-

    It is the basic essential for the bailment. For the delivery of goods contract between the two parties is

    necessary. Contract may be oral or written, implied or expressed.

    2. Moveable Property :-

    It is the main feature of bailment that it is only for the moveable property and not for the immoveable property.

    3. Delivery of Goods :-

    It is also necessary that goods should be delivered by one person to another.

    4. Change of Possession :-

    Bailment contract also brings change in the possessions of the goods. Only b without possession is not

    sufficient for this contract.

    5. Purpose of Bailment :-

    The object of bailment may be for the safety of goods or for hire or for the use.

    6. Temporary Delivery :-

    The delivery of the goods may not be for the permanent purpose. it is essential that delivery must be made for

    the temporary purpose.

    7. Ownership :-right of ownership remains with bailor and it does not change by the delivery of goods to other person.

    8. Change In Shape :-

    If bailed goods shape changes in the mean time even then it remains a contract of bailment.

    9. Parties of the Contract :-

    In the contract of bailment there are two parties, the bailor and the bailee.
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    10. Returnable :-

    It is very important feature of the bailment. The bailee should return the goods to the bailor or disposed

    according the directions of the bailor

    . The main types of bailment are given below:

    1. Gratuitous Bailment:

    Where the bailee does not charge nay thing for the bailment it is called gratuitousbailment.

    2. Bailment for Reward:

    When the bailor charges any thing for his services it is called bailment for rewards.

    3. Bailment for Use:

    When the bailor delivers an article to the bailee for use by the later in any general or

    specific way, this is called a bailment for use.


    X delivers his watch to Y for the latter to use it for one month. Here bailment is bailmentfor used.

    4. Bailment of safe custody:

    If valueable goods or even coins or notes in box are deposited for protection, it is calledbailment for safe custody

    5. Bailment for Mutual Benefit:When the bailor delivers his articles to another for repair or gives his goods to carrier forcarriage, it is known as bailment for mutual benefit.

    6. Bailment for Pledge:

    It is a contract whereby an article is deposited with a lender as security for the paymentof a loan or performance of a promise.

    7. Bailment for Finding of lost Goods:

    If a person already in possession of the lost goods of another, he thereby becomes the bailee and

    the owner becomes the bailor.

    Types or Kinds of Bailment :-

    Bailment has the following important kinds :

    1. Bailment For Safe Custody :-

    Sometimes an owner of the precious goods like ornaments delivers them to the bailee for the safe custody.

    2. Bailment For Reward :-

    If the bailor charges some reward for the services it is called bailment for reward.

  • 8/3/2019 Bailment Ass


    Example :- Mr. Sean delivers the car on rent to Mr. Burg Rs. 25,00 per day.

    3. Gratuitous Bailment :-

    It is gratuitous bailment when bailor does not charge any reward for the bailment.

    4. Bailment For Use :-If any person delivers any article for the use to bailee it is called bailment for use.

    Example :- Mr. Carlos delivers a pen in the examination room to Miss. Rehana for three hours, it is a bailment

    for use.

    5. Bailment For Lost Goods :-

    If any person finds the goods of the other person, he will also be considered bailee. It will be called a bailment

    of lost goods. Real owner will be called bailor.

    6. Bailment For Pledge :-

    Sometimes an article isdeposited with a lender as a security for the performance of a promise or the

    repayment of debt.

    7. Bailment For Repair :-

    Sometimes a bailor delivers an article like Car, T.V, Laptop for the repair to another person. It is known as

    bailment for repair.

    8. Bailment For Carrier :-

    Sometimes we deliver the goods to the transport companies for carriage. It is known as bailment of carrier.

    9. Termination :-

    A contract of bailment is being dissolved with the completion of purpose, expiry of time, death of the party or at

    the option of the bailor.

    Termination of bailment:

    A contract of bailment is avoidable at the option of the bailor, if the bailee does any ad with regard to

    the goods bailed, inconsistent with the conditions of the bailment.


    A lets to B, for hire, a horse for his own riding. B drives the horse in his carriage. This is, at the 'optionof A, a termination of the bailment.

    The bailor is bound to disclose to the bailee faults in the goods bailed, of which the bailor is aware,and which materially interfere with the use of them, or expose the bailee to extraordinary risks; and ifhe does not make such disclosure, he is responsible for damage arising to the bailee directly from

    such faults.

    If the goods are bailed for hire, the bailor is responsible for such damage, whether he was or was notaware of the existence of such faults in the goods bailed.


    (a) A lends a horse, which he knows to be vicio