Q. Define Bailment and explain its essentials.

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The term bailment is derived from French word 'bailor' which means to deliver. Section 148 of ICA defines bailment 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 of according to the directions of the person delivering them.

Here, the person so delivering the goods is called bailer and to whom the delivery is made, can be called as bailee.”


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Essential elements of bailment:

1.      Delivery of possession of goods:

Delivery of possession of goods from one person to another, for a specific purpose, is deemed as essence of the concept of bailment.

According to Section 149 of the Indian Contract Act, 1872 the delivery of possession can either be actual or constructive.

I.                     Actual Delivery: When the bailor hands over to bailee the physical possession of goods, it is called actual delivery.

II.                   Constructive Delivery: When there is no change of physical possession, goods remain where they are, but something is done which has the effect of putting them in bailee’s possession, it is called constructive delivery.

It is important to note that mere custody of goods is not equivalent to the possession of goods. In Reaves v. Capper, it was held that a servant can be in the custody of the goods because of the nature of his job but that does not mean he is in possession of the goods.


2.      Only Movable goods can be bailed

It is necessary that the property concern must be movable in nature. The important thing to note here is that the money cannot be bailed to the other party, as the same money cannot be returned back.


3.      There must be a contract regarding the same:

There can be no bailment without a contract. all conditions for valid contract are to be satisfied, such as Competent parties, existence of a valid consideration, lawful object etc. The contract can either be expressed or implied.


Finder of goods is also considered as bailee, even though this condition cannot be satisfied in this particular case.


4.      Condition for return or dispose of goods according to the direction:

In bailment the goods are delivered for specific purpose. after the purpose is accomplished the goods may be returned to the bailor in the same or altered direction, condition or maybe disposed of as directed by bailor. If the person to whom the goods are delivered is not bound to restore them to the person delivering them or to deal with them according to the mandate, their relationship will not be that of bailor and bailee.

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