business law ii bailments chapter 20 mr. kretschmer

Business Law IIBusiness Law IIBailmentsBailments

Chapter 20Chapter 20

Mr. KretschmerMr. Kretschmer

Bailment RelationsBailment Relations

Did you ever lend your friend something? If Did you ever lend your friend something? If so, you participated in a bailment. so, you participated in a bailment. A bailment is the transfer of possession A bailment is the transfer of possession without the transfer of ownership. without the transfer of ownership. Who is the party who gives up possession of Who is the party who gives up possession of the property? the property?

Bailor Bailor

Who is the party who accepts possession and Who is the party who accepts possession and control?control?

Bailee Bailee


Four characteristics of a bailment: Four characteristics of a bailment: 1.1. Subject is personal propertySubject is personal property2.2. Transfer is temporary possessionTransfer is temporary possession3.3. Transfer is temporary controlTransfer is temporary control4.4. Both parties intend to return the Both parties intend to return the

goodsgoodsA bailment must be personal property. A bailment must be personal property. Real property such as land and Real property such as land and

buildings, cannot be bailed. buildings, cannot be bailed.


Can property be bailed by the person who Can property be bailed by the person who has title to the goods? Give examples of has title to the goods? Give examples of persons who may have possession.persons who may have possession.

Agent, Employee, Finder, ThiefAgent, Employee, Finder, Thief

There are two ways to transfer possession There are two ways to transfer possession and control of goods. Examples of each and control of goods. Examples of each one are below: one are below:

Actual Bailments Actual Bailments Constructive Constructive BailmentsBailments


In order for a bailment to arise, both In order for a bailment to arise, both possession and control of the goods must possession and control of the goods must shift from the bailor to the bailee. shift from the bailor to the bailee.

Give an example of someone who would Give an example of someone who would have custody of an item or items. have custody of an item or items. A guard hired to protect the paintings at a A guard hired to protect the paintings at a

museummuseum

Can goods be modified when returned to the Can goods be modified when returned to the bailor? If so, explain. bailor? If so, explain.

What are fungible goods? What are fungible goods?


When does a bailment end? When does a bailment end?

If there is a bailment for a fixed period and If there is a bailment for a fixed period and someone dies, does the bailment end? someone dies, does the bailment end? Who does it go to? Explain. Who does it go to? Explain. It does not endIt does not end

Duties in BailmentsDuties in Bailments

What are the cause of most of the legal What are the cause of most of the legal problems that are associated with problems that are associated with bailments?bailments?

When something happens to the goods while When something happens to the goods while they are in possession of the bailee. they are in possession of the bailee.

There are three levels of care when it comes There are three levels of care when it comes to the care of bailed goods: Give to the care of bailed goods: Give examples of each type of care. examples of each type of care.

1.1. Extraordinary CareExtraordinary Care2.2. Ordinary CareOrdinary Care3.3. Minimal Care Minimal Care


When one party benefits from a bailment, When one party benefits from a bailment, what type of bailment occurs? what type of bailment occurs? Gratuitous BailmentGratuitous Bailment

Give an example of a gratuitous bailment. Give an example of a gratuitous bailment. Lending a calculator to another student in Lending a calculator to another student in

class. class.

Give an example of a involuntary bailment. Give an example of a involuntary bailment. Your neighbors trash can blows into your yard. Your neighbors trash can blows into your yard.


There are three ways in which you can There are three ways in which you can modify the nature of the bailee’s duty of modify the nature of the bailee’s duty of care. They are the following: Give care. They are the following: Give examples of each. examples of each.

1.1. Legislation – Example = AirlinesLegislation – Example = Airlines

2.2. Contract – Example = GM transportation Contract – Example = GM transportation company company

3.3. Disclaimer – Example = RestaurantDisclaimer – Example = Restaurant


What are mutual-benefit bailments?What are mutual-benefit bailments? Bailor’s duty to provide goods fit for the Bailor’s duty to provide goods fit for the

intended purpose. intended purpose.

What are bailments for the sole-benefit of a What are bailments for the sole-benefit of a bailor?bailor? Your friend goes on vacation and leaves their Your friend goes on vacation and leaves their

pets and house in your care. pets and house in your care.

What are bailments for sole-benefit of a What are bailments for sole-benefit of a bailee? bailee? Borrowing equipment from a friend without Borrowing equipment from a friend without

charge. charge.

Common BailmentsCommon Bailments

Common carrier agrees, for a fee, to Common carrier agrees, for a fee, to transport goods for anyone who applies, transport goods for anyone who applies, provided the goods are lawful and fit for provided the goods are lawful and fit for shipment. shipment.


There are four rights of a common carrier. There are four rights of a common carrier. They are the following: They are the following:

1.1. Enforce reasonable rules/regulations for Enforce reasonable rules/regulations for the conduct of the business.the conduct of the business.

2.2. Charge an amount negotiated with the Charge an amount negotiated with the bailor.bailor.

3.3. Charge demurrage, a fee for the use of Charge demurrage, a fee for the use of the transportation vehicle. the transportation vehicle.

4.4. Enforce a carrier’s lien – retain the goods Enforce a carrier’s lien – retain the goods until charges for transportation and until charges for transportation and incidental services are paid. incidental services are paid.


What are some items that a bailment for What are some items that a bailment for hire may be negotiated for a fee?hire may be negotiated for a fee? Cars, Trucks, Machines, Other EquipmentCars, Trucks, Machines, Other Equipment

List some examples of bailment’s for List some examples of bailment’s for services below: services below: Fix a bike, repair a baseball glove Fix a bike, repair a baseball glove

What does consignment mean?What does consignment mean?-Ownership remains with the manufacturer or -Ownership remains with the manufacturer or

wholesaler until they are sold = Car dealership, wholesaler until they are sold = Car dealership, Lumber yard, Books, ClothingLumber yard, Books, Clothing

Any Questions? Any Questions?

business law ii bailments chapter 20 mr. kretschmer

Documents

bailment relations

bailment end

type of bailment

involuntary bailment

care of bailed goods

control of goods

bailee slide

transfer of possession