Bailment

Question 1

What is “bailment”?

Answer 1

Bailment is the delivery of goods to the bailee, where implicitly or expressly, at the end of the term, the goods will be returned to the bailor

Question 2

Who is the Bailor?

Answer 2

The bailor is the legal owner of the goods being bailed

Question 3

Who is the Bailee?

Answer 3

The Bailee is the party taking delivery of the goods, and who returns the goods to the bailor at a later stage

Question 4

What are three examples of bailment?

Answer 4

1) Leaving a car at the dealer to be serviced
2) Depositing goods at a bank for safe keeping
3) Hiring goods

Question 5

What are the two types of bailment?

Answer 5

Bailment can be classified into two categories, gratuitous and for reward.

Question 6

What are the duties of a gratuitous baliee?

Answer 6

Care of goods was reasonable in the situation

A breach is dependent on the particular circumstances of the bailment

Question 7

What are the duties of a bailee for reward?

Answer 7

A bailee for reward has a duty equal to the circumstances of the reward, therefore a larger reward would return a larger responsibility for the care of the goods

Question 8

How is a bailee for reward liable for negligence?

Answer 8

A bailee in these circumstances is liable fo their own liability on top of the liability of their employees/ agents. As demonstrated by Makower, McBeth and Co Pty Ltd v Dalgety and Co Ltd

Question 9

What is a sub-bailment?

Answer 9

When the original bailee transfers possession of the goods to a third party

Question 10

What duties does the third party of a sub-bailment have?

Answer 10

The third party carries the same duties as a normal bailee.

Question 11

What case allows for an exclusion of liability towards the bailee?

Answer 11

Thomas National Transport (Melbourne) Pty Ltd v May and Baker (Aust) Pty Ltd

Question 12

What are two guarantees provided to consumers which protect customers?

Answer 12

1) services must rendered be with due care and skill S60 ACL

2) services must be reasonably fit for any particular purpose made known by the consumer S61 ACL

Question 13

What are the main duties of a bailor?

Answer 13

The bailor will not interfere with the goods while in the possession of the bailee
The bailor must inform the bailee of dangerous goods

Question 14

Does bailment require the consent and knowledge of the bailee?

Answer 14

Yes. WD & HO Wills (Aust) v State Rail Authority of NSW (1998) 43 NSWLR 338

Question 15

How are bailed goods returned?

Answer 15

Based on agreement between parties goods are returned in their original state or an altered state.

Question 16

Is bailment created if the essence of the contract is to destroy the immediate identity of the goods?

Answer 16

No, that is a contract of sale.

Question 17

Is hire of goods a Bailment?

Answer 17

Yes, at common law, hiring of goods is a bailment if being used by the hirer

Question 18

How can a bailment expire?

Answer 18

• By expiry of the term
• By demand of a gratuitous bailor
• By wrongful act of the bailee
• By destruction of the bailed goods

Question 19

What is a common Carrier?

Answer 19

A person who

• Carries on normal business as a carrier
• takes goods no matter the type, only rejects if they’re full

Question 20

What are the duties of a common carrier?

Answer 20

To carry the class of goods they profess to handle
To carry the goods by the usual route and not deviate
To deliver goods without any unreasonable delay
To carry out the instructions of the consignor for delivery to the consignee

Question 21

Rights of a common carrier?

Answer 21

To paid their charges in advance
To claim a lien on the goods until charges are paid
To refuse to carry goods which are:
– not the class normally carried
– improperly packed
– no space
– destination is outside the normal route or area