Bailment Definition and Legal Meaning
On this page, you'll find the legal definition and meaning of Bailment, written in plain English, along with examples of how it is used.
What is Bailment?
(n) Bailment is the process by which the custody of a property is transferred to another person or legal entity for safe keeping of such property. Normally bailment is a paid service and imparts a responsibility and obligation on the custodian to protect the goods
History and Meaning of Bailment
Bailment is an ancient legal concept that has its roots in English common law. It involves the transfer of a property's custody from one person to another for safekeeping or further processing. The bailor (owner of the property) surrenders control of the property to the bailee (custodian), who is bound to take good care of the property and return it to the bailor when called upon to do so. This agreement creates a legal relationship between the two parties that imposes certain rights and responsibilities.
Bailments can be classified as either "gratuitous" or "non-gratuitous." A gratuitous bailment is one where there is no consideration or fee involved, such as when someone lends their lawnmower to a neighbor. A non-gratuitous bailment is one where the bailee receives compensation or another benefit, such as when a storage company charges a fee to keep a car in a garage.
Examples of Bailment
John asks his friend, Tom, to keep his watch for a few days while he is out of town. This is a gratuitous bailment.
Mary hires a moving company to transport all her belongings to her new apartment. This is a non-gratuitous bailment.
Jill leaves her laptop in a repair shop to fix the keyboard. This is a non-gratuitous bailment.
Legal Terms Similar to Bailment
Lien - A legal right to keep someone's property until they pay a debt.
Trust - A legal arrangement where property or assets are held in the name of one person for the benefit of another.
Deposit - Giving money or other property to someone else for safekeeping or as a down payment.