THE CONCEPT OF BAILMENT IN CONTRACT LAW

Bailment as defined under section 148 of the Indian Contracts Act, 1872, which states “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 bailor. The person to whom they are delivered is called the bailee.” For example, Robert gave his shirt to the tailor for sewing on a button is a contract of bailment.

Essential of Contract of Bailment:

1. The existence of the valid contract: the existence of the valid contract is the most important thing in the bailment which implies that the good should return after its use. The person who found the lost good is considered as bailee, though there may or may not be any existing contract between that person and the real owner of that good.
2. Temporary delivery of goods: the concept of bailment is solely about the temporary delivery of goods. The person to whom the goods are bailed, he cannot have possession over them. Goods can be delivered either through actual delivery or constructive delivery. Constructive delivery means delivering of goods in a way that it has the impact of placing the goods in Bailee’s ownership or any other individual authorized by him.
3. Return of Specific Goods: The bailee has to return the goods to the bailor after the specific purpose or the period or any other condition stated while bailing the goods get fulfilled. If the person is not returning the goods then it’s not the bailment.

Duties and Liabilities of Bailor: There are several duties and liabilities of the bailor as mentioned in the statute (Indian Contract Act).

1. Duty to disclose defects: Bailor is bound to disclose defects present in the goods bailed. If bailee suffered any loss due to non-disclosure of defects, then bailor will be bound to pay damages.
2. Duty to indemnify: The bailor must indemnify the bailee for the losses he may bear due to the goods bailed.
3. Duty to claim back the goods: The bailor has to take his goods back as per provisions laid down in the contract. If bailor fails or refuses to take the goods at decided date and time, without any specific reason he will be liable for the loss happened to the goods afterwards.

Bailee’s Liabilities:

1. Duty to take care of the bailed goods: The bailee must keep the due care of the goods bailed to him. If any harm caused to the goods due to his mistake or negligence, then he will be liable for the same.
2. The duty to return the Goods: Bailee is bound to return the goods on the decided date, time and place. If he fails to do so, without any specific reason, then he will be bound to pay damages to the bailor.
3. Duty to return profit earned by the goods: Bailee is bound to return the profit which he may have earned from the goods bailed. 

Bailee’s Rights: Bailee also possesses certain rights like the right to a particular lien, a general lien under which he can retain the goods unless the balance gets cleared. He also has the right to take remedies if he suffered an injury or loss due to goods bailed or by the third-party intervention.