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Key Differences Between Bailment and Pledge

Bailment and pledge are both types of contracts where personal property is transferred temporarily, but they differ in their purpose and terms. Bailment involves transferring goods for a specific purpose like safekeeping or repairs, while pledge transfers goods as security against a debt. Additionally, in a pledge the consideration is the debt owed, the pledgee can sell the goods if not redeemed, and the pledgee cannot use the goods, unlike in a bailment.

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20 views1 page

Key Differences Between Bailment and Pledge

Bailment and pledge are both types of contracts where personal property is transferred temporarily, but they differ in their purpose and terms. Bailment involves transferring goods for a specific purpose like safekeeping or repairs, while pledge transfers goods as security against a debt. Additionally, in a pledge the consideration is the debt owed, the pledgee can sell the goods if not redeemed, and the pledgee cannot use the goods, unlike in a bailment.

Uploaded by

annette
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Meanin When the goods are temporarily When the goods are delivered

g handed over from one person to to act as security against the


another person for a specific debt owed by one person to
purpose, it is known as bailment. another person, it is known as
the pledge.

Parties The person who delivers the The person who delivers the
goods is known as the Bailor goods is known as Pawnor
while the person to whom the while the person to whom the
goods are delivered is known as goods are delivered is known as
Bailee. Pawnee.

Purpose Safe keeping or repairs, etc. As security against payment of


debt.

BASIS FOR COMPARISON BAILMENT PLEDGE

Key Differences Between Bailment and Pledge


The following are the major differences between Bailment and Pledge

1. A Bailment is a contract in which goods are transferred from one


party to another party for a short period for a specific objective. The
Pledge is a kind of Bailment in which goods are pledged as security
against payment of debt.
2. A Bailment is defined under section 148 while Pledge is defined
under section 172 of the Indian Contract Act, 1872.
3. In bailment, the consideration may or may not be present, but in the
case of a pledge, the consideration is always present.
4. The objective of bailment is safe custody or repairing of goods
delivered. On the other hand, the sole purpose of delivering the goods
is to act as security against the debt.
5. The receiver has no right to sell the goods in case of bailment whereas
if Pawnor does not redeem the goods within the reasonable time, the
Pawnee can sell the goods after giving notice to him.
6. In bailment, the goods are used by the bailee only for the said
purpose. Conversely, in pledge, Pawnee has no right to use the goods.

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