BAILMENT It means to hand over - it is the delivery of goods from one person to another for some purpose upon

a contract to be returned or otherwise disposed of. The ownership of the goods is with one person and possession is with another person eg: Delivering a cycle for repair / depositing luggage in a clock room, delivering gold to a gold

smith for making ornaments etc.. create relationship of bailment.

Sect. 148 of contract act defines 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 person delivering them.
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Delivery is not accompanied by transfer of ownership- delivery

is for some purpose-when purpose is achieved, the goods are to be returned.

The person who delivered the goods is called bailer the person
to whom they are delivered is the bailee. The transaction is called bailment. CHARACTERISTICS:1. There must be a delivery of goods. 2. Actual or constrictive delivery. 3. Delivery for some purpose upon a contract. 4. Return of goods.

5. Ownership is not transferred.

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DUTIES OF A BAILEE:
1. To take reasonable care for the goods bailed. 2. Not to mix the goods bailed with his own goods.

3. Not to make any un authorised use.

4. Not to setup adverse title. 5. To return the goods. 6. Retain additions or profit RIGHTS OF A BAILEE. 1. Right to enforce payment due to him. 2. Right to reimbursement. 3. Right to remuneration.

4. Right to compensation.
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5. Right of lien.
6. Right to deliver goods to one of the owners. DUTIES OF A BAILER :

1. To disclose known defects.

2. Duty to bear expenses. 3. Duty to indemnify bailee. 4. Duty to receive back the goods. 5. Duty to bear the risk. RIGHT OF A BAILER. 1. Entitled to get back the goods. 2. To claim any increase in value or profit. ( If the bailee has derived

any gain it must be disclosed to the bailer eg. Cow & Calf).
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4. Right of termination.
5. Right to recall goods at any time in a gratuitous bailment. 6. To claim damages.

INDEMNITY AND GUARANTEE:

A contract by which one party promises to save the other from loss caused to him by the conduct of the promisor is called a contract of indemnity. Suppose A enters the shop of B and says if you will supply the goods to C ,I will see you paid. Here A is giving a contract of indemnity to B. A is the indemnifier and B is the indemnified(indemnity holder). A contract of guarantee is a contract to perform the promise or

discharge the liability of a third person incase of his default.

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The person who is giving the guarantee is called the surety- the person for whom the guarantee is given is called the principal debtor and the person to whom the guarantee is given is the creditor. A guarantee may be either oral or written(sec-126) .

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