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Contract Handout 3

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19 views24 pages

Contract Handout 3

Uploaded by

ganesh yadav
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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BAILMENT

Essentials of bailment
• S. 148 provides for the concept of bailment. The essentials are:
1. It is the delivery of goods
2. For some purpose
3. Upon a contract that upon the completion of the contract
4. The goods be returned or otherwise be disposed of according to the
instructions of the lesson delivering them.
5. The person delivering the goods is bailor
6. The person to whom delivered is bailee
7. S. 149 provides how delivery is to be done. Delivery can be both actual
and constructive.
Duties of bailor
• S. 150 provides:
1. It is the duty of bailor to disclose the faults in the goods bailed
2. Of which he is aware and which would materially interfere with the
use of them
3. If he does not disclose he would be liable for damages resultant
thereto
4. However, if the goods are for hire the above rule would not apply.
Duties of bailee

S. 153 Mixture of goods


S. 151 Duty to return
Use the goods S. 155, S. 156, S.
Reasonable care S. 160, S. 161
according to the 157
to be taken by
terms of
bailee
bailment

S. 154 effect of Duty to return


not using the increase
according to S. 163
term of bailment
Effect of mixture
Separable
S.156

S.155
Without consent
With consent

Not separable
S. 157
Rights of bailee

S. 164 S. 158
S. 170, S. 171 S. 180, S.181
Right to Right to expenses
Right to lien Right to sue
compensation or remuneration
Right to lien
• There are two types of lien provided under the Act.
1. Particular lien under S. 170. The constituents are
• Bailee in accordance with the purpose of bailment
• Rendered any service involving exercise of labour or skill
• He has the right to retain the goods
• Until he receives due remuneration for the services rendered
• S. 171 provides for general lien which is in respect of the following
1. Bankers
2. Factors
3. Wharfingers
4. Attorneys
5. Policy brokers

Such a lien only for general balance of account. In the case of R.D.
Saxena v. Balram Prasad Sharma the Court held that S. 171 does not
give the right to the attorney to retain the case files.
Miscellaneous

S. 162
S. 159 S. 165
Termination of
Restoration of Bailment by Finder of goods
gratuitous
goods lent several joint S. 168, S.169
bailment by
gratuitously owners
death
PLEDGE
Pledge defined
• S. 172 defines pledge, pawnor and Pawnee

• It says:
1. The bailment of goods
2. As security
3. For payment of debt or performance of promise
4. The bailor is pawnor and Bailee is pawnee
Rights of pawnee

S. 175 S. 176
S.173 Pawnee’s right as Pawnee’s right
pawnee’s right of to extraordinary where pawnor
retainer expenses makes default
incurred
Miscellaneous
• S. 174 Pawnee not to retain for debt other than that for which goods
pledged.

• S.177 defaulting pawnor’s right to redeem

• S. 178 Pledge by mercantile agent

• S. 178A pledge by person in possession under voidable contract

• S. 179 pledge where pawnor has limited interest


AGENCY
Appointment and authority of agents
Agent and principal
• S. 182 defines agent as as
1. A person employed to do any act for another
2. Or to represent another in dealings with third person
3. The person for who act done or who represented is principal
• The contract here is entered into between the third party and the
principal. Therefore, Competency is seen that of third party and the
principal
S.183, S. 184
• Who may be a principal? A person of majority and sound mind may
be a principal

• Who may be an agent?


As between p and tp any person can become agent
BUT
No person who is not of age if majority or sound mind can become
agent as to e responsible to his p according to the provisions contained
herein.
Also, no consideration is necessary in such a contract
Agent’s authority
• It may be express or implied

• Extent of agent’s authority (S. 188)

• Agent’s authority in emergency ( S. 189)


Sub agent
Sub agent defined
• S. 190 lays down the general rule of delegatus non potest delegare.
• The above provides that agent cannot further delegate it’s work to a
sub agent.
• The exception is :
1. When the same is required by ordinary custom or trade
2. Nature of agency is such that sub agent must be employed
• S. 191 provides that a sub agent is a person employed by and acting
under the control of the original agent in the business of agency.
Representation of principal by sub agent
S. 192
Sub agent properly
appointed
The principal is so far as
regards the third person S. 193
represented by sub agent Sub agent not appointed
1. The agent is properly
responsible to The agent will be
principal for acts of responsible both to the
sub agent. principal as well as the
2. The sub agent is third person for the acts
responsible to agent of the agent.
3. The sub agent is
responsible to
principal in case of
fraud or wilful wrong.
Sub agent and substituted agent
• Read S. 194 and S. 195 of contract act
Revocation of Effect of agency
Agent’s duty to Principal’s duty
Ratification authority on contract with
principal to agent
S. 196- S. 200 S. 201-S.210 third party
S. 211-S.221 S. 222-S.225
S. 226-S.238

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