Bailment arrangements are very common and involve an important property law conc
ID: 2744170 • Letter: B
Question
Bailment arrangements are very common and involve an important property law concept. Someone please define what a bailment is for the class. How about some examples of bailments? List some of the times you've placed your property in the control of someone else. What is necessary to create a bailment and what are the different types of bailment? Please give an example and describe what type of bailment relationship you have given. I want to spend a little time talking about property rights involved when a person mislays, loses, or abandons a piece of personal property. I think this is a really interesting segment of personal property law. Believe it or not, there is some basis in law for the schoolyard principle of "finders keepers, losers weepers"! Please describe the definition of each situation (lost, mislaid, abandoned) and who has the right to the property in each situation.
Explanation / Answer
Bailment
The temporary placement of control over, or possession of personalproperty by one person, thebailor, into the hands of another, the bailee, for a designated purpose upon which the parties haveagreed.The term bailment is derived from the French bailor, "to deliver." It is generally considered to be acontractual relationship since the bailor and bailee, either expressly or impliedly, bind themselves to actaccording to particular terms. The bailee receives only control or possession of the property while thebailor retains the ownership interests in it. During the specific period a bailment exists, the bailee'sinterest in the property is superior to that of all others, including the bailor, unless the bailee violatessome term of the agreement. Once the purpose for which the property has been delivered has beenaccomplished, the property will be returned to the bailor or otherwise disposed of pursuant to the bailor'sdirections..
A common example of bailment is leaving your car with a valet. Leaving your car in an unattended parking garage is typically a license rather than a bailment, as the car park's intent to possess your car cannot be shown. However, bailments arise in many other situations, including terminated leases of property, warehousing (including store-it-yourself) or in carriage of goods.
Categories
There are three types of bailments:
(1) for the benefit of the bailor and bailee;
(2) for the sole benefit of thebailor; and
(3) for the sole benefit of the bailee.
Bailments are of six kinds:
(1) depositum, where goods are delivered by one person to another to keep for the use of thebailor;
(2) commodatum, where goods are ‘lent’ gratis to be used by the bailee and returned to the bailorafter such use;
(3) locatio et conductio, where goods are hired by the bailee for use by him;
(4) vadium (pawn or pledge), where goods or chattels are delivered to another as security formoney borrowed by the bailor;
(5) locatio operis faciendi, where goods are delivered to another for transportation or for the baileeto carry out some work on them;
(6) mandatum, as in (5) but where the transportation or work is to be undertaken gratis andwithout any reward.
Three elements are generally necessary for the existence of a bailment: delivery, acceptance, andconsideration.
Actual possession of or control over property must be delivered to a bailee in order to create a bailment.The delivery of actual possession of an item allows the bailee to accomplish his or her duties toward theproperty without the interference of others. Control over property is not necessarily the same as physicalcustody of it but, rather, is a type of constructive delivery. The bailor gives the bailee the means ofaccess to taking custody of it, without its actual delivery. The law construes such action as theequivalent of the physical transfer of the item. The delivery of the keys to a safe deposit box isconstructive delivery of its contents.
Rights and Liabilities
The bailment contract embodying general principles of the law of bailments governs the rights and dutiesof the bailor and bailee. The duty of care that must be exercised by a bailee varies, depending on thetype of bailment.
In a bailment for mutual benefit, the bailee must take reasonable care of the bailed property. A bailee whofails to do so may be held liable for any damages incurred from his or her negligence. When a bailorreceives the sole benefit from the bailment, the bailee has a lesser duty to care for the property and isfinancially responsible only if he or she has been grossly negligent or has acted in bad faith in takingcare of the property. In contrast, a bailee for whose sole benefit property has been bailed must exerciseextraordinary care for the property. The bailee can use the property only in the manner authorized by theterms of the bailment. The bailee is liable for all injuries to the property from failure to properly care for oruse it.
Once the purpose of the bailment has been completed, the bailee usually must return the property to thebailor, or account for it, depending upon the terms of the contract. If, through no fault of his or her own,the return of the property is delayed or becomes impossible—for example, when it is lost during thecourse of the bailment or when a hurricane blows the property into the ocean—the bailee will not be heldliable for nondelivery on demand. In all other situations, however, the bailee will be responsible for thetort of conversion for unjustifiable failure to redeliver the property as well as its unauthorized use.
The provisions of the bailment contract may restrict the liability of a bailee for negligent care orunauthorized use of the property. Such terms may not, however, absolve the bailee from all liability forthe consequences of his or her own Fraud or negligence. The bailor must have notice of all suchlimitations on liability. The restrictions will be enforced in any action brought for damages as long as thecontract does not violate the law or public policy. Similarly, a bailee may extend his or her liability to thebailor by contract provision.
Lost property
Property is generally deemed to have been lost if it is found in a place where the true owner likely did not intend to set it down, and where it is not likely to be found by the true owner. At common law, the finder of a lost item could claim the right to possess the item against any person except the true owner or any previous possessors.
The underlying policy goals to these distinctions are to (hopefully) see that the property is returned to its true original owner, or "title owner." Most jurisdictions have now enacted statutes requiring that the finder of lost property turn it in to the proper authorities; if the true owner does not arrive to claim the property within a certain period of time, the property is returned to the finder as his own, or is disposed of.
Many exceptions may be applied at common law to the rule that the first finder of lost property has a superior claim of right over any other person except the previous owner. For example, a trespasser's claim to lost property which he finds while trespassing is generally inferior to the claim of the respective landowner. As a corollary to this exception, a landowner has superior claim over a find made within the non-public areas of his property, so if a customer finds lost property in the public area of a store, the customer has superior claim to the lost property over that of the store-owner, but if the customer finds the lost property in the non-public area of that store, such as an area marked "Employees Only," the store-owner will have superior claim, as the customer was trespassing when he found it.[5]
The status of finders as employees or tenants of the landowner complicates matters, because employees and tenants have legitimate access to non-public areas of a landowner's property that others would not, without trespassing. Employees and tenants, however, still usually lose superior claim over lost property to their employers or landlords if the property is found within the scope of their employment, or outside the actual leased area, respectively.[6]
For example, if the lost property is found by a tenant inside the walls of his leasehold, or by an employee embedded within the soil of an estate owned by his employer, the landowner (as employer or landlord) of the property where it was found usually has a superior claim of right over that of the finder. However, this is not always the case, as a long-term tenant who finds lost property within the leased area of his leasehold may have a superior claim over that of his landlord (especially if the landlord has never been to the property). While employers usually have a superior claim over lost property found by their employees, exceptions to this exist as well, as modern law sometimes grants the employee superior claim if turning over lost property to his employer is not part of his job description (such as if the employee is an interior decorator).
Mislaid property
Property is generally deemed to have been mislaid or misplaced if it is found in a place where the true owner likely did intend to set it, but then simply forgot to pick it up again. For example, a wallet found in a shop lying on a counter near a cash register will likely be deemed misplaced rather than lost. Under common law principles, the finder of a misplaced object has a duty to turn it over to the owner of the premises, on the theory that the true owner is likely to return to that location to search for his misplaced item. If the true owner does not return within a reasonable time (which varies considerably depending on the circumstances), the property becomes that of the owner of the premises.
Abandoned property
Property is generally deemed to have been abandoned if it is found in a place where the true owner likely intended to leave it, but is in such a condition that it is apparent that he or she has no intention of returning to claim it. Abandoned property generally becomes the property of whoever should find it and take possession of it first, although some states have enacted statutes under which certain kinds of abandoned property – usually cars, wrecked ships and wrecked aircraft ,that they become the property of the state
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