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00:00Let's get started with special contracts from Indian Contract Act, law relating to
00:05bailment and pledge before that if you're watching my video without subscribing to my
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00:26What is bail meant?
00:27The word bailment has been derived from the French word baleur which means to deliver.
00:33Bailment etymologically means handing over or change of possession.
00:38As per section 148 of the Act, bailment is the delivery of goods by one person to another
00:43for some purpose, upon a contract, that the goods shall, when the purpose is accomplished,
00:50be returned or otherwise disposed of according to the directions of the person delivering
00:54them.
00:55Parties to Bailment
00:57Bailer, the person delivering the goods.
01:01Bailee, the person to whom the goods are delivered.
01:04The essential elements of a contract of bailment are
01:07Contract
01:09Bailment is based upon a contract.
01:13The contract may be express or implied.
01:16No consideration is necessary to create a valid contract of bailment.
01:21Delivery of goods
01:22It involves the delivery of goods from one person to another for some purposes.
01:28Bailment is only for movable goods and never for immovable goods or money.
01:32The delivery of the possession of goods is of the following kinds.
01:36Actual Delivery
01:37When goods are physically handed over to the bailee by the bailer.
01:41Example
01:43Delivery of a car for repair to workshop
01:46Constructive Delivery
01:48Where delivery is made by doing anything that has the effect of putting goods in the possession
01:53of the bailee or of any person authorized to hold them on his behalf.
01:57Example
01:58Delivery of the key of car to a workshop dealer for repair of the car.
02:04Purpose
02:04The goods are delivered for some purpose.
02:08The purpose may be express or implied.
02:11Possession
02:12In bailment, possession of goods changes.
02:16Change of possession can happen by physical delivery or by any action which has the effect of placing
02:21the goods in the possession of bailee.
02:24The change of
02:25Possession does not lead to change of ownership.
02:29In bailment, bailer continues to be the owner of goods.
02:33Where a person is in custody without possession he does not become a bailee.
02:38For example
02:39Servant of a master who is in custody of goods of the master does not become a bailee.
02:45Similarly, depositing ornaments in a bank locker is not bailment, because ornaments are
02:50kept in a locker whose key are still with the owner and not with the bank.
02:55The ornaments are in possession of the owner though kept in a locker at the bank.
03:00Return of goods
03:00Bailee is obliged to return the goods physically to the bailer.
03:05The goods should be returned in the same form as given or may be altered as per bailer's
03:10direction.
03:10It should be noted that exchange of goods should not be allowed.
03:15The bailee cannot deliver some other goods, even not those of higher value.
03:20Deposit of money in a bank is not bailment since the money returned by the bank would not be
03:25identical currency notes.
03:27Duties of a bailer
03:28Duties of bailer
03:30The duties of bailer are spelt out in a number of sections section 150, 100, and 58, 159,
03:39164.
03:41These are categorized under the following headings.
03:45First
03:45Bailer's duty to disclose faults in goods bailed section 150
03:50In case of gratuitous bailment
03:52The bailer is bound to disclose to the bailee faults in the goods bailed, of which the bailer
03:58is aware, and which materially interfere with the use of them, or expose the bailee to extraordinary
04:04risks, and if he does not make such disclosure, he is responsible for damage arising to the
04:10bailee directly from such faults.
04:11In case of non-gratuitous bailment
04:14If the goods are bailed for hire, the bailer is responsible for such damage, whether he
04:20was or was not aware of the existence of such faults in the goods bailed.
04:25Duty to pay necessary expenses
04:27Section 158
04:28In case of gratuitous bailment
04:31Where, by the conditions of the bailment, the goods are to be kept or to be carried,
04:37or to have work done upon them by the bailee for the bailer, and the bailee is to receive
04:41no remuneration, gratuitous bailment, the bailer shall repay to the bailee the necessary expenses
04:47incurred by him and any extraordinary expenses incurred by him for the purpose of the bailment.
04:53In case of non-gratuitous bailment the bailer is liable to pay the extraordinary expenses
04:58incurred by the bailee.
05:00Duty to indemnify the bailee for premature termination
05:03Section 159
05:05The bailer must compensate the bailee for the loss or damage suffered by the bailee that is
05:10in excess of the benefit received, where he had lent the goods gratuitously and decides
05:15to terminate the bailment before the expiry of the period of bailment.
05:19Bailer's Responsibility to Bailee
05:21Section 164
05:23The bailer is responsible to the bailee for the following.
05:27Indemnify for any loss which the bailee may sustain by reason that the bailer was not entitled
05:32to make the bailment, or to receive back the goods or to give directions, respecting them,
05:38defective title in goods.
05:40It is the duty of the bailer to receive back the goods when the bailee returns them after
05:44the time of bailment has expired or the purpose of bailment has been accomplished.
05:49If the bailer refuses to take delivery of goods, when it is offered at the proper time the bailee
05:55can claim compensation for all necessary expenses incurred for the safe custody.
06:01Duties of a bailee
06:02Take reasonable care of the goods, Section 151 and 152
06:08In all cases of bailment, the bailee is bound to take as much care of the goods bailed to
06:14him as a man of ordinary prudence would, under similar circumstances, take care of his own
06:19goods of the same bulk, quality, and value, as the goods bailed.
06:24Exception
06:25Bailee when not liable for loss, etc., of thing bailed
06:30Section 152
06:31The bailee, in the absence of any special contract, is not responsible for the loss,
06:38destruction, or deterioration of the thing bailed, if he has taken reasonable care as required
06:43under Section 151
06:45Not to make inconsistent use of goods, Section 153 and 154
06:51As per Section 154, if the bailee makes any use of the goods bailed, which is not according
06:58to the terms and conditions of the bailment, he is liable to compensate the bailer for any
07:03loss or destruction of goods.
07:06As per Section 153, a contract of bailment is voidable at the option of the bailer, if the
07:12bailee does not use the goods according to the terms and conditions of bailment.
07:17Not to mix the goods, Section 155, 100, and 56 and 157
07:23If the bailee, mixes the goods bailed with his own goods, with the consent of the bailer,
07:30both the parties shall have an interest in proportion to their respective shares in the
07:34mixture thus produced, Section 155
07:37If the bailee, without the consent of the bailer, mixes the goods bailed with his own goods
07:43and the goods can be separated or divided, the property in the goods remains in the parties
07:48respectively, but the bailee is
07:50bound to bear the expense of separation or division and any damage arising from the mixture,
07:56Section 156
07:57If the bailee, without the consent of the bailer mixes the goods of the bailer with his own
08:03goods in such a manner that it is impossible to separate the goods bailed from the other
08:07goods and to deliver them back, the
08:09bailer is entitled to be compensated by the bailee for loss of the goods, Section 157
08:16Return the goods, Section 160 and 161
08:21It is the duty of bailee to return, or deliver according to the bailer's directions, the
08:27goods bailed without
08:28demand, as soon as the time for which they were bailed has expired or the purpose for
08:34which they were bailed has been accomplished
08:36Section 160
08:38If, by the default of the bailee, the goods are not returned, delivered, or tendered at the
08:45proper time, he is responsible to the bailer for any loss, destruction, or deterioration of
08:51the goods from that time
08:52Section 161
08:54Return an accretion from the goods
08:57Section 163
08:58In the absence of any contract to the contrary, the bailee is bound to deliver to the bailer,
09:04or according to his directions, any increase or profit which may have accrued from the
09:09goods bailed
09:10Not to set up adverse title
09:12Bailee must not set up a title adverse to that of the bailer
09:16He must hold the goods on behalf of and for the bailer
09:19He cannot deny the title of the bailer
09:22Rights of Bailer
09:24Right to terminate the bailment Section 153
09:28The following are the rights of bailer
09:30Right to terminate the bailment
09:33Right to demand back the goods at any time
09:36Right to file a suit against any wrongdoer
09:39Right to file a suit for enforcement of duties imposed upon a bailee
09:44Right to claim compensation
09:46Right to terminate the bailment Section 153
09:50A contract of bailment is voidable at the option of the bailer, if the bailee does any
09:55act with regard to the goods bailed, inconsistent with the conditions of the bailment
10:00Right to demand back the goods
10:02Section 159
10:04When the goods are lent gratuitously, the bailer can demand back the goods at any time even
10:10before the expiry of the time fixed or the achievement of the object
10:14However, due to the premature return of the goods, if the bailee suffers any loss, which
10:20is more than the benefit actually obtained by him from the use of the goods bailed, the
10:25bailer has to compensate the bailee
10:27Right to file a suit against a wrongdoer Section 180 and Section 181 will see in detail later in the
10:33session Watch it without skipping the video Don't forget to subscribe my channel and like this video
10:39Right to sue the bailee
10:41The bailer has a right to sue the bailee for enforcing all the liabilities and duties of him
10:47Right to compensation
10:49If any damage is caused to the goods bailed because of the unauthorized use of the goods or unauthorized
10:54mixing of the goods, the bailer has a right to claim compensation for the same
11:00Rights of a bailee
11:01The following are the rights of the bailee
11:04Right to deliver the goods to any one of the joint bailers Section 165
11:09If several joint owners bailed the goods, the bailee has a right to deliver them to any one of the joint
11:15owners unless there was a contract to the contrary
11:18Right to indemnity Section 166
11:22Bailee is entitled to be indemnified by the bailer for any loss arising to him by reasons that the bailer was not
11:28Entitled to make the bailment or to receive back the goods or to give directions in respect to them
11:35If the bailer has no title to the goods, and the bailee in good faith, delivers them back to, or according to the directions of
11:43The bailer, the bailee shall not be responsible to the owner in respect of such delivery
11:48Bailee can also claim all the necessary expenses incurred by him for the purpose of gratuitous bailment
11:55Right to claim compensation in case of faulty goods
11:59Section 150
12:01A bailee is entitled to receive compensation from the bailer or any loss caused to him due to the failure of the bailer to disclose any faults in the goods known to him
12:11If the bailment is for hire, the bailer will be liable to
12:15Compensate even though he was not aware of the existence of such faults
12:20Right to claim necessary expenses
12:22Section 158
12:24In case of gratuitous bailment, the bailer shall repay to the bailee the necessary expenses incurred by him and any extraordinary expenses incurred by him for the purpose of the bailment
12:35Right to apply to court to decide the title to the goods
12:38Section 167
12:40If the goods bailed are claimed by the person other than the bailer, the bailee may apply to the court to stop its delivery and to decide the title to the goods
12:49Right of particular lien for payment of services
12:52Section 170
12:54Right of general lien, Sector 171
12:58Rights of bailer and bailee against any wrongdoer, third party
13:03Sued by bailer and bailee against wrongdoers
13:06Section 180
13:07If a third person wrongfully deprives the bailee of the use or possession of the goods bailed, or does them any injury, the bailee is entitled to use such remedies as the owner might have used in the like case
13:18If no bailment had been made, and either the bailer or the bailee may bring a suit against a third person for such deprivation or injury
13:26Apportionment of relief or compensation obtained by such suits
13:30Section 181
13:32Whatever is obtained by way of relief or compensation in any such suit shall, as between the bailer and the bailee, be dealt with according to their respective interests
13:42Termination of bailment
13:43Termination of bailment
13:44A contract of bailment shall terminate in the following circumstances
13:49On expiry of stipulated period, if the goods were given for a stipulated period, the contract of bailment shall terminate after the expiry of such period
14:00On fulfillment of the purpose, if the goods were delivered for a specific purpose, a bailment shall terminate on the fulfillment of that purpose
14:08By notice
14:10Where the bailee acts in a manner which is inconsistent with the terms of the bailment, the bailer can always terminate the contract of bailment by giving a notice to the bailee
14:20A gratuitous bailment can be terminated by the bailer at any time by giving a notice to the bailee
14:26However, the termination should not cause loss to the bailee in excess of the benefit derived by him
14:33In case the loss exceeds the benefit derived by the bailee, the bailer must compensate the bailee for such a loss
14:39Section 159
14:41By death
14:42A gratuitous bailment terminates upon the death of either the bailer or the bailee
14:47Destruction of the subject matter
14:50A bailment is terminated if the subject matter of the bailment is destroyed or there is a change is in the nature of goods which makes it impossible to be used for the purpose of bailment
15:00Finder of lost goods
15:02Right of finder of lost goods may sue for specific reward offered Section 168
15:09A person who finds some goods which do not belong to him is called the finder of the goods
15:15It is the duty of the finder of goods to find the true owner and surrender the goods to him
15:20However, the finder of goods has no right to sue the owner for compensation for trouble and expense
15:26voluntarily incurred by him in finding the owner and preserving the goods found
15:30But he has a right to retain the goods against the owner until he receives such compensation
15:36And, where the owner has offered a specific reward on the lost goods, the finder may sue the owner for such reward
15:42and may retain the goods until then
15:45The finder of lost goods can ask for reimbursement of expenditure incurred for preserving the goods and searching the true owner
15:53If the real owner refuses to pay compensation, the finder cannot sue but retain the goods so found
15:59Further where the real owner has announced any reward, the finder is entitled to receive the reward
16:05The right to collect the reward is a primary and a superior right even more than the right to seek reimbursement of expenditure
16:13When finder of thing commonly on sale may sell it
16:15Section 169
16:17When a thing which is commonly the subject of sale if lost, if the owner cannot with reasonable diligence be found, or if he refuses, upon demand, to pay the lawful charges of the finder, the finder may sell it
16:32When the thing is in danger of perishing or of losing the greater part of its value, or
16:37When the lawful charges of the finder in respect of the thing found amount to two-thirds of its value
16:43The finder though has no right to sell the goods found in the normal course, however, he may sell the goods if the real owner cannot be found with reasonable efforts or if the owner refuses to pay the lawful charges subject to the following conditions
16:57When the article is in danger of perishing and losing the greater part of the value or
17:03When the lawful charges of the finder amounts to two-third or more of the value of the article found
17:09General lien and particular lien
17:10Bailee's particular lien
17:13Section 170
17:14Where the bailee has, in accordance with the purpose of the bailment, rendered any service involving the exercise of labor or skill in respect of the goods bailed, he has, in the absence of a contract
17:26To the contrary, a right to retain such goods until he receives due remuneration for the services he has rendered in respect of them
17:34In accordance with the purpose of bailment if the bailee by his skill or labor improves the goods bailed, he is entitled for remuneration for such services
17:43Towards such remuneration, the bailee can retain the goods bailed if the bailer refuses to pay the remuneration
17:51Such a right to retain the goods bailed is the right of particular lien
17:54He however does not have the right to sue
17:57Where the bailee delivers the goods without receiving his remuneration, he has a right to sue the bailer
18:03In such a case the particular lien may be waived
18:07The particular lien is also lost if the bailee does not complete the work within the time agreed
18:13General lien of bankers, factors, wharfingers, attorneys and policy brokers
18:19Section 171
18:20Bankers, factors, wharfingers, attorneys of a high court and policy brokers may, in the absence of a contract to the contrary, retain, as a security for a general balance of account any goods bailed to them, but no other persons have a right to retain, as a security for such balance, goods bailed to them, unless there is an account of the
18:43Express contract to the effect
18:45Bankers, factors, wharfingers, policy brokers and attorneys of law have a general lien in respect of goods which come into their possession during the course of their profession
18:56For instance, a banker enjoys the right of a general lien on cash, checks, bills of exchange and securities deposited with him for any amounts due to him
19:06Banker can retain the jeweller given as security to the second loan towards the first loan which is yet to be repaid
19:13Under the right of general lien the goods cannot be sold but can only be retained for dues
19:18The right of lien can be waived through a contract
19:21Pledge
19:22Pledge, pawner and pawnee define Section 172
19:27The bailment of goods as security for payment of a debt or performance of a promise is called pledge
19:33The bailer is in this case called the pawner
19:37The bailee is called the pawnee
19:39Pledge is a variety or species of bailment
19:42It is bailment of goods as a security for payment of debt or performance of a promise
19:48The person who pledges or bails is known as pledger or pawner
19:52The person to whom the goods are delivered is known as pledgee or pawnee
19:56In pledge, there is no change in
19:59Ownership of the property
20:01Under exceptional circumstances, the pledgee has a right to sell the property pledged
20:07Section 172-182 of the Indian Contract Act, deal with the Contract of Pledge
20:15Essentials of Contract of Pledge
20:17Since pledge is a special kind of bailment, therefore all the essentials of bailment are also the essentials of the pledge
20:25Apart from that, the other essentials of the pledge are
20:29There shall be a bailment for security against payment or performance of the promise
20:34The subject matter of pledge is goods
20:37Goods pledged for shall be in existence
20:40There shall be the delivery of goods from pledger to pledgee
20:44Rights of a pawnee or pledgee
20:46Rights of pawnee can be classified as under the following headings
20:50Right to retain the pledged goods
20:53Section 173
20:54The pawnee may retain the goods pledged, not only for payment of the debt or the performance of the promise, but for the interest, of the debt, and all necessary expenses incurred by him in respect of the possession or for the preservation of the goods pledged
21:09Right to retention of subsequent debts
21:12The pawnee can retain the goods pledged for any debt or promise other than the debt or promise for which they are pledged
21:21But he can exercise this right only when there is a contract to this effect
21:26That is a right to retain goods for subsequent
21:29Debts can be exercised only when it has been provided for in a contract to this effect
21:34Pawnee's right to extraordinary expenses incurred
21:38Section 175
21:39The pawnee is entitled to receive from the pawner extraordinary expenses incurred by him for the preservation of the goods pledged
21:47For such expenses, however, he does not have the right to retain the goods, but he can sue the pawner for such expenses
21:55Pawnee's right where pawner makes default
21:58Section 176
21:59If the pawner makes default in payment of the debt, or performance, at the stipulated time of the promise, in respect of which the goods were pledged, the pawnee has the following rights
22:12The pawnee may bring a suit against the pawner upon the debt or promise, and retain the goods pledged as a collateral security
22:19Or
22:20He may sell the thing pledged on giving the pawner reasonable notice of the sale
22:25If the proceeds of such sale are less than the amount due in respect of the debt or promise, the pawner is still liable to pay the balance
22:33If the proceeds of the sale are greater than the amount so due, the pawnee shall pay over the surplus to the pawner
22:40Rights of a pawner
22:42As the bailer of goods, pawner has all the rights of the bailer
22:46Along with that he also has the right of redemption to the pledged goods which is enumerated under Section 177 of the Act
22:54Right to redeem Section 177
22:57If a time is stipulated for the payment of the debt, or performance of the promise, for which the pledge is made, and the pawner makes default in payment of the debt or performance of the promise at the stipulated time, he may redeem the goods pledged at any subsequent time before the actual sale of them, but he must, in that case, pay, in addition, any expenses which have arisen from his default
23:22Duties of the pawnee
23:25Pawnee has the following duties
23:27Duty to take reasonable care of the pledged goods
23:30Duty not to make unauthorized use of pledged goods
23:34Duty to return the goods when the debt has been repaid or the promise has been performed
23:39Duty not to mix his own goods with goods pledged
23:42Duty not to do any act which is inconsistent with the terms of the pledge
23:47Duty to return accretion to the goods, if any
23:51Duties of a pawner
23:53Pawner has the following duties
23:55The pawner is liable to pay the debt or perform the promise as the case may be
24:00It is the duty of the pawner to compensate the pawnee for any extraordinary expenses incurred by him for preserving the goods pawned
24:08It is the duty of the pawner to disclose all the faults which may put the pawnee under extraordinary risks
24:14If loss occurs to the pawnee due to defect in pawners title to the goods, the pawner must indemnify the pawnee
24:21If the pawnee sells the good due to default by the pawner, the pawner must pay the deficit
24:27Pledge by non-owners
24:30Ordinarily, it is the owner of the goods, or any person authorized by him in that behalf, who can pledge the goods
24:38But in order to facilitate mercantile transactions, the law has recognized certain exceptions
24:44These exceptions are for bona fide pledges made by those persons who are not the actual owners of the goods, but in whose possession the goods have been left
24:53Pledge by Mercantile Agent Section 178
24:57Where a mercantile agent is, with the consent of the owner, in possession of goods or the documents of title to goods, any pledge made by him, when acting in the ordinary course of business of a mercantile agent, shall be as valid as if he were expressly authorized by the owner of the goods to make the same, provided that the pawnee acts in good faith
25:18And has not at the time of the pledge notice that the pawner has no authority to pledge
25:23In this section, the expressions Mercantile Agent and documents of title shall have the meanings assigned to them in the Sale of Goods Act
25:31The necessary conditions of validity under the Section 178 are as follows
25:36The person pledging the goods must be a mercantile agent
25:40Mercantile agent must be in possession either of the goods or the documents of title to goods
25:46Such possession must be with the consent of the owner
25:49If possession has been obtained dishonestly or by a trick, a valid pledge cannot be effected
25:55Pledge must have been made by the mercantile agent, when acting in the ordinary course of business of a mercantile agent
26:02The pledgee must act in good faith
26:06The pledgee should have no notice of the pledger's defect of title
26:10If the pledgee knows that the pledger has a defective title, the pledge will not be valid
26:15Pledge by person in possession under voidable contract § 178a
26:21When the pawner has obtained possession of the goods pledged by him under a contract voidable under § 19 or § 19a, contracts where consent has been obtained by fraud,
26:31coercion, misrepresentation, undue influence, but the contract has not been rescinded at the time of the pledge, the pawnee acquires a good title to the goods, provided he acts in good faith and without notice of the pawner's defect of title
26:47Pledge where pawner has only a limited interest § 179
26:51Where a person pledges goods in which he has only a limited interest that is pawner is not the absolute owner of goods, the pledge is valid to the extent of that interest
27:02Pledge by a co-owner in possession
27:04Where the goods are owned by many person and with the consent of other owners, the goods are left in the possession of one of the co-owners
27:12Such a co-owner may make a valid pledge of the goods in his possession
27:16Pledge by seller or buyer in possession
27:20A seller, in whose possession, the goods have been left after sale or a buyer who with the consent of the seller, obtains possession of the goods, before sale, can make a valid pledge, provided the pawnee acts in good faith and he has no knowledge of the defect in title of the pawner
27:37A seller with the car with the one Duel도ι
27:41But this isn't it even more as a financial annoying.
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27:47P cercha
27:50P cercha
27:51P cercha
27:53P cercha
27:58P cercha
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