RIGHTS OF BAILEE ?
Category : Contract – II
- Right to return goods to one of the joint owners without consent of all:
Where several joint owners of goods bail them, the bailee may deliver them back to, or dispose them of according to the directions of one joint owner without the consent of all, in the absence of any agreement to the contrary (Sec. 165).
- Rights of immunity against delivery of goods to the bailor if he has no title to the goods:
If the bailor has no title to the goods, and the bailee, in good faith, delivers them back to, or according to the direction of the bailor, the bailee is not responsible to the owner in respect of such delivery (Sec. 166).
- Right to seek directions of the Court where a third person claims the goods bailed:
If a person other than the bailor, claims the goods bailed, the bailee may apply to the Court to stop the delivery of the goods to the bailor and to decide the title of the goods.
- Right of lien:
Where the bailee expends labour and skill in respect of the goods bailed, he has, in the absence of a contract to the contrary, a right to retain such goods until he receives the remuneration for the services rendered in respect of such goods (Sec. 170).
- Right of action against third parties:
If a third person wrongfully deprives the use or possession of the goods, or injures them, the bailee is entitled to such remedies as the owner might have used in the like if no bailment had been made. (Sec. 180).
- Right to share compensation obtained by such suits:
Any compensation received from such suit shall be shared by the bailor and bailee in accordance with their interests.
Right of Lien (Section 170-171)
In general, Lien means the right to keep the possession of the property of a person until that person clear the debts. In case of bailment, the bailee has the right to keep the possession of the property of the bailor until the bailor pays lawful charges to the bailee. Thus, right of Lien is probably the most important of rights of a bailee because it gives the bailee the power to get paid for his services.
Lien is of two kinds – Particular and General.
This means that the lien holder has a right to keep possession of only that particular property for which the charges are owed. For example, A gives a horse and a bicycle to B. A agrees to pay B charges for training the horse and no charges for keeping the bicycle. Now, if A fails to pay charges for the horse, B is entitled to keep possession only of the horse and not of the bicycle. He must return the bicycle.
Section 170 gives this right to the bailee. It says that where the bailee has, in accordance with the purpose of the bailment, rendered any service involving the exercise of labor or skill in respect of the goods bailed, he has, in absense of a contract to the contrary, a right to retain such goods until he receives due remuneration for the services he has rendered in respect of them.
Illustrations – A delivers a rough diamond to B to be cut and polished, which is accordingly done. B is entitled to keep the diamond until charges for his services are paid.
A gives cloth to B, a tailor, to make into a cloth. B promises to deliver the coat as soon as it is done and also to give 3 months credit for the price. B is not entitled to keep the coat until he is paid.
Conditions for Particular Lien –
- Exercise of labor or skill – This right is subject to the condition that the bailee has exercised labor or skill in respect of the goods. Further, it has been frequently pointed out that the labor or skill must be such as improves the goods. This, in Hutton vs Car Maintenance Co 1915, it was held that a job master has no lien for feeding and keeping the horse in his stable but a horse trainer does get a lien upon the horse.
- Labor or skill exercised must be for the purpose of the bailment – Any services rendered that are beyond the purpose of the bailment do not give a right of lien. For example, A bails his car to B to repair Engine. But B repairs tires instead. B will not get the right of lien.
- Labor or skill exercised must be in respect of the goods – As mentioned before, the bailee gets a right of lien only upon the goods upon which the service was performed.
General Lien –
As opposed to Particular Lien, General Lien gives a right to the bailee to keep the possession of any goods for any amount due in respect of any goods. Section 171 says that, bankers, factors, wharfingers, attorneys of a High Court, and policy brokers may, in the absence of a contract to the contrary, retain as a security for a general balance of account, any goods bailed to them; but no other persons have a right to retain, as a security for such balance, goods bailed to them, unless there is an express contract to that effect.
Thus, this right is only available to bankers, factors, wharfingers, attorneys of high court, and policy brokers. However, this right can be given to the bailee by making an express contract between the bailor and the bailee.