Bailee Definition and Legal Meaning
On this page, you'll find the legal definition and meaning of Bailee, written in plain English, along with examples of how it is used.
What is Bailee?
(n) Baillie is the person who is holding a property as a security for due fulfillment of a contract or legal obligations for which such security is given or rendered. A bailee can act up on the property when the obligation is not fulfilled
History and Meaning of Bailee
Bailee is a legal term used to describe a person or entity that has been entrusted with personal property or assets belonging to another individual or entity. The bailee holds the property as a security until the original owner completes their contractual or legal obligations. As per the given definition, the bailee has the right to take action over the property if the said obligations are not met.
The concept of bailee originated from English law, which recognized the importance of securing assets in case an individual fails to fulfill their legal obligations. A bailee may be a bank holding the deed to a property that is securing a loan or a warehouse storing goods for a third party. The bailee owes a duty of care to the property owner and is liable for any loss or damages that may occur.
Examples of Bailee
- A dry cleaning business that stores and safeguards clothing owned by its customers is considered a bailee.
- A parking garage that is holding a car as security for an unpaid parking ticket is also a bailee.
- A jewelry repair shop holding a piece of jewelry in its safekeeping for repair or cleaning is another example of a bailee.
- A hotel that provides guests with a safe to store their personal belongings in is also acting as a bailee.
- A client holding stocks or securities with a financial institution for safekeeping is also considered a bailee.
Legal Terms Similar to Bailee
- Bailment - The legal relationship between the bailor (property owner) and bailee (property holder) is called a bailment.
- Lien - A legal right to hold property belonging to another person until a debt owed by that person is discharged.
- Trustee - An individual or entity appointed to hold and manage assets for the benefit of others.
- Custodian - An individual or entity appointed to take care of the property or assets belonging to another.
- Mortgage - A legal agreement where a bank holds the deed to a property securing a loan until the loan is repaid in full.