Difference between Bailment and Pledge ?

Difference between Bailment and Pledge ?

Category : Contract – II

Sr. No 

Bailment

 

Pledge

 

1

 

Sections 148 to 171 of the Indian Contract Act 1872 deals with bailment

 

Sections 172 to 181 of the Indian Contract Act deals with Pledge.

 

 

2

 

Meaning: The term bailment is derived from the French word ‘Bailor’, which means ‘to deliver. It means possession voluntarily from one person to another.

 

Meaning:  Pledge is a special kind of bailment. If the goods are bailed as a security for payment of a debt or performance of a promise, it is called Pledge.

 

 

3

 

Definition: Delivery of goods by Bailor to Bailee for a definite purpose on condition of their return or disposal, when purpose is accepted. (Section.148, I.C.A)

 

Definition: The Bailment of goods as security for payment of a debt or performance of a promise is called pledge. (Section.178, I.C.A)

 

 

4

 

Example:  Sam delivers a cloth to John, a tailor making a shirt . The contract between Sam and John is bailment

 

Example: If a Farmer delivers to bank 50 bags of wheat as security for obtaining a loan, it is called pledge.

5 

It is made for any purpose

 

It is made for specific purpose

6 

The Bailee can use the goods

 

Pledgee cannot use the goods 

 

7

 

The Bailee has no right to sell the goods bailed

 

The Pledgee / Pawnee has a right to sell the goods pledged if the pledger could not redeem them within the stipulated period.

 

8

 

 

Bailee can exercise lien on goods only for labour and service

 

Pledgee can exercise lien even for nonpayment of interest.


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