MODULE

CONTRACT OF
BAILMENT
Points to be Covered
• Definition and Essentials
• Parties to a contract of Bailment
• Rights and Duties of Bailor and Bailee
• Finder of goods—as a Bailee
• Liability towards the true owner
• Obligation to keep the goods safe
• Rights to dispose of the goods
• Lien of a Bailee
• Particular lien
• General lien
General Meaning
• “The temporary control over articles/ goods for a purpose”
• “It is generally a contractual relationship either expressly or implied,
between two parties to act according to particular terms.”
• “Transfer of possession of the property not ownership interests.”
• “Once the purpose for which the property has been delivered is
accomplished, the property is returned to the owner or disposed as per
the contract.”
BAILMENT UNDER ICA
Sec 148: A "bailment" is the delivery of goods by one person to another for
some purpose, upon a contract that they shall, when the purpose is
accomplished, be returned or otherwise disposed of according to the directions
of the person delivering them.
The person delivering the goods is called the "bailor".
The person to whom they are delivered is called the "bailee".

Explanation: If a person already in possession of the goods of another contract to

hold them as a bailee, he thereby becomes the bailee, and the owner becomes the
bailor of such goods, although they may not have been delivered by way of
bailment.
Essentials of a Contract of Bailment
1. Delivery of Possession
• Putting the goods in possession of the bailee
• Different from a mere “custody”
• Goods must be handed over for whatever purpose the bailment is for
• An old customer went into a restaurant for dinner, when he entered the
room a waiter took his coat, without being asked and hung it on a hook
behind him. Later on the coat found to be missing: The restaurant
keeper liable as bailee
• Delivery needed to constitute bailment.
• Any bailment will come to an end once the bailor was put in possession of the
good
• Kaliaporumal Pillai vs. Visalakshmi (AIR 1938 Mad. 32)
Facts: Lady wanted to convert her old jewellery into new. Every evening, as soon
as the gold-smiths' work for the day was over, the she used to receive the half
made jewels from the goldsmiths, put them into a box and lock. One night, Goods
were stolen.
Held: No bailment. As she did not hand over hand over the possession.

S. 149. Delivery to bailee how made

The delivery to the bailee may be made by doing anything which has the effect
of putting the goods in the possession of the intended bailee or of any person
authorized to hold them on his behalf.
Types of Delivery
1. Actual/ Physical Delivery – Transfer of physical possession from one
person to another.
2. Constructive Delivery – Person already in possession of goods- holds
it for some other person.
No change in physical possession, but something is done which gives
effect of putting them in the possession of the other person.
Example: A sells his watch to B, B asks A to hold his watch for one
month and deliver at his home after one month. After this A becomes the
Bailee and B the Bailor.
• Where the bailor has done everything to put the goods in the hands of
the bailee, liability of bailee begins.
2. Presence of Contract – delivery must be made for some purpose
and upon a contract that when the purpose is accomplished the goods
must be returned
• contradicting opinion in India
• English Law accepts even no contractual obligations
• Ram Gulam vs Govt. of U.P., AIR 1950 All 106 –
• The plaintiff’s ornaments having been stolen, were recovered by
police and while in police custody they were stolen again
• Court held no contract as the police while keeping the goods in
possession was acting in discharge of obligations imposed by law.
Thus, No Bailment and no liability to indemnify
• L.M. Co-operative Bank v. Prabhudas Hathibai, AIR 1966 Bom. 134- In this case
the goods were seized by the Income Tax Officer. The godown was locked and keys
kept in possession. Due to heavy rains and leakage in the godown, goods were
damaged. Court held that it was the duty of the Government to take care as a
Bailee.
• View accepted by SC in State of Gujarat v Memon Hasan and further cases

3. Delivery should be upon some Purpose

• A "bailment" is always made for a purpose
• Subject to the condition that when the purpose is accomplished these goods be
returned or otherwise disposed of according to the directions of the person delivering
them
• If the person to whom goods are delivered is not bound to restore them to the person
delivering them or deal with them according to his instructions, this relationship will
not be of bailment
Bank locker: whether Bailment?
• Disputes between banks and locker holders, pertaining to loss of articles placed inside the locker, have
been subject to judicial consideration in various jurisdiction
• There has also not been any authoritative pronouncement from the Supreme Court on the issue of
whether banks are responsible as bailees, or in any other capacity, for any loss or damage to the contents
of the lockers. 
• mere leasing out of the locker ipso facto would not establish a relationship of bailment between the bank
and the locker holder.
• In order to establish exclusive possession, the claimant must prove that the bank had knowledge of the
contents of the locker.
• Alternatively, where the locker holder alone has knowledge of the contents, they must lead independent
evidence to prove that their articles or valuables were actually inside the locker, and the valuation of the
same.
• Amitabha Dasgupta vs United Bank Of India
• In pursuance to the judgement circular passed effective from January 1, 2022
https://rbidocs.rbi.org.in/rdocs/notification/PDFs/NOT865BD846E789E5477889250E475AC2347A.PDF
 Cases from the course outline
• New India Assurance Co Ltd v DDA AIR 1991 Delhi 298
• FACTS: Plaintiff has filed a suit for recovery of Rs. 2,91,500/- for loss of truck parked at the
parking lot of the defendants which was stolen from there. Defendant is constituted under the
Delhi Development Act, 1957 and has various functions to perform under the Act. It was
maintaining a truck parking centre at Majnu-ka-tilla, Delhi by the name given to the parking
centre by the name Idle Truck Parking Centre
• The truck was brought to the Idle Truck Parking Centre on 8-6-1987 and parked there and receipt
was issued by the defendants. On the night of 8th June, 1987 the truck was stolen from the parking
site.
• ARGUMENTS: The plaintiffs contended that possession of the truck was handed over to the
defendants and when parked against receipt the custody, control and possession of the truck was
with the defendants.
• The defendants were responsible for the safety of the truck and were bound to deliver the same to
the plaintiffs in the same condition in which it was parked at the parking lot under the control of
the defendants.
• The truck, however, mischievously, unauthorisedly and illegally removed from the parking lot on
account of the negligence of the staff of the defendants at the site when the receipt still remained
with the plaintiffs
• It was argued by the defendant that possession of the truck always remained with the
second plaintiff as the driver of the truck was sleeping inside the truck
• It was only when he had left at about 3 a.m. on the night of 8th and 9th June 1987 for
ostensible purpose of drinking water that in the meanwhile the truck was stolen
• and further that there was no contract between the parties under which the defendants
were bound for the safety of the truck.
• HELD: Essence of bailment is possession. The possession of the truck was handed
over to the defendants when the truck was parked in the Parking Centre of the
defendants. The defendants had issued a receipt. Immediately at that time a contract of
bailment came into being.
• The defendants as bailee having failed to deliver the vehicle back to the second
plaintiff within the contracted period and not having shown to have exercised any
prudent care for the safety of the truck, are liable for its loss.
• It is immaterial if the driver of the truck was also sleeping in the vehicle. The vehicle
could not have been taken out of the Parking Centre without surrendering the receipt
Types of Bailment
• Gratuitous Bailment – Goods are delivered by the bailor to the bailee
without any reward .
Eg: Lending a book to a friend for reading. ( Exclusive benefit of either
of the party)

• Non – Gratuitous bailment – Where bailment of goods is done for a

reward. E.g. A car let out for hire, laptop given for repair
 RIGHTS & DUTIES OF BAILOR

Where there is a right there is a corresponding duty on another. Thus,

the rights of the bailor are the duties of the bailee and vice versa.

Duties –
• To disclose faults in the goods bailed (S. 150)
• Repayment, by bailor, of necessary expenses (S. 158)
• Restoration of the Goods lent Gratuitously and Indemnity (S. 159)
• Responsibility Towards Bailee (S. 164)
DUTIES OF THE BAILOR
To disclose faults in the goods bailed (S. 150)
1) The bailor is bound to disclose to the bailee faults in the goods bailed, of which the
bailor is aware, and which materially interfere with the use of them, or expose the
bailee to extraordinary risks; and if he does not make such disclosure, he is
responsible for damage arising to the bailee directly from such faults.

2) If the goods are bailed for hire, the bailor is responsible for such damage, whether
he was or was not aware of the existence of such faults in the goods bailed.

S. 150 is divided into – A gratuitous Bailor –

A bailor for reward – non-gratuitous
• Second part of S. 150 – imposes higher duty on the bailor since the
bailor is drawing a profit from such bailment such as giving costumes
on rent.
• Whether aware or not, the bailor is liable
• No defense of lack of knowledge
• Reed v Dean: implied undertaking that the motor launch was as fit for the
purpose for which it was hired as reasonable care and skill could make it

If you hire a zoom car and met with an accident due to faulty brakes, but the
bailor company was not aware of the defaults. Can you claim Damages?
- you can claim damages.
Illustrations
• A lends a horse, which he knows to be vicious, to B. He does not disclose the
fact that the horse is vicious. The horse runs away. B is thrown and injured. Is A
responsible to B for damage sustained?: Yes

• A hires a carriage of B. The carriage is unsafe, though B is not aware of it, and
A is injured. Is B responsible to A for the injury? : Yes
2) Repayment by bailor of necessary expenses- S. 158.
Where, by the conditions of the bailment, the goods are to be kept or to be carried, or
to have work done upon them by the bailee for the bailor, and the
bailee is to receive no remuneration,
the bailor shall repay to the bailee the necessary expenses incurred by him for the
purpose of the bailment.

Eg. A wants to supply rice to a company. B, his friend, volunteers to keep the rice in
his godown for a month before sale. After storing the rice, A gives the keys to B to
keep it safely.
B undertakes measures to keep godown rodent free. He is further asked by A after a
month to deliver the rice to his shop in the other village as he is travelling.
Repayment?
- B can recover both the costs of maintenance as well as delivering the rice.
Where Bailment is for the benefit of Bailee, in reference to the
expenses : If in using the thing the borrower is put to any expense this
must be borne by himself, bailee compellable to bear ordinary expenses

Discussion: A lends his car to B for a trip to Goa. Can B recover the
expenses incurred by him in getting the cleaning and servicing of the car
done?
3) Indemnity in cases of Restoration of goods lent gratuitously S. 159.
The lender of a thing for use may at any time require its return, if the loan
was gratuitous, even though he lent it for a specified time or purpose.
But, if, on the faith of such loan made for a specified time or purpose,
the borrower has acted in such a manner that the return would cause him
loss exceeding the benefit actually derived by him from the loan,
the lender must, if he compels the return, indemnify the borrower for the
amount in which the loss so occasioned exceeds the benefit so derived.

Eg: You and your friends have planned a road trip to Goa during the Diwali
holiday. Your car breaks down and so you borrow your friend’s spare car for the
road trip. You make all your bookings and travel arrangements. 20 th October
your friend calls for the car back. You inform him about your trip but he
compels you to return the car. Can you seek indemnification?
He has a duty under S. 159 to indemnify you.
4) Bailor' s responsibility to bailee – S. 164 -
The bailor is responsible to the bailee for any loss which the bailee may sustain by
reason that the bailor was not entitled to make the bailment, or to receive back the
goods or to give directions, respecting them.

Eg. A is not the owner of the good and the original owner sues the bailee, the bailee is
entitled to recover costs from A.

• Bailee has to be acting in good faith

• Overlap with S. 158 – necessary expenses but there the expenses are to fulfil the
valid bailment.
• Under S. 164 are losses which bailee suffers due to unauthorized bailment.
Rights of Bailor
1. To avoid the contract (S. 153) -

S. 153 - Termination of bailment by bailee' s act inconsistent with

conditions-

A contract of bailment is voidable at the option of the bailor, if the

bailee does any act with regard to the goods bailed, inconsistent with the
conditions of the bailment.

Illustration : A lets to B, for hire, a car for his own driving. B runs the car
as a taxi. Can bailment be terminated? Yes

Read with Sec 154

2) S. 154 - Liability of bailee making unauthorized use of goods bailee –
If the bailee makes any use of the goods bailed, which is not according to
the conditions of the bailment, he is liable to make compensation to the
bailor for any damage arising to the goods from or during such use of
them.
Discussion:
(a) A lends a car to B for his own riding only. B allows C, a member of his
family, to drive the car. C drives with care, but the car by chance
meets with an accident and damages the car.
B is liable.
(b) A hires a horse in Calcutta from B expressly to march to Benares. A
rides with due care, but marches to Cuttack instead. The horse
accidentally falls and is injured.
A is liable to make compensation to B for the injury to the horse.
c) You lend a watch to your friend to be worn for the party. She wears it
to class and loses it.
You can claim damages from your friend.

Section 154 Read with S. 153 – If bailee does not conform to the terms
of the contract – the contract is voidable at the option of the bailor.
Duty of Bailee and Right of the Bailor
2. Right to claim increase in profit
S. 163 - Bailor entitled to increase or profit from goods bailed-
In the absence of any contract to the contrary, the bailee is bound
to deliver to the bailor, or according to his directions, any increase
or profit which may have accrued from the goods bailed.
3. Right to Subrogation and sue–
S. 180 - Suit by bailor or bailee against wrong-doer-
If a third person wrongfully deprives the bailee of the use or possession of
the goods bailed, or does them any injury, the bailee is entitled to use such
remedies as the owner might have used in the like case if no bailment had
been made; and either the bailor or the bailee may bring a suit against a
third person for such deprivation or injury.

Discussion: If A gives a watch to B and C steals it from B, who has the right to
sue?
- Both. The right to sue is of the bailee and he can file for all such actions
which the bailor has under the law and similarly, the bailor can without the
bailee suing, sue C for theft.
 RIGHTS & DUTIES OF THE BAILEE

Duties –
1. To take care of the goods (S. 151)
2. To act in conformity with the terms and conditions of the contract
(S. 153)
3. Not to make unauthorized use of the goods (S. 154)
4. Not to mix the goods which bailed with his own goods (S. 155,
156, 157)
5. To return the goods bailed, after the purpose is accomplished (S.
160)
6. Responsibility when the goods are not duly returned (161)
7. Duty to return increased profits on the goods bailed (163)
1) S. 151 - Care to be taken by bailee –
In all cases of bailment the bailee is bound to take as much care of the
goods bailed to him as a man of ordinary prudence would, under similar
circumstances, take of his own goods of the same bulk, quality and value
as the goods bailed.

• Bailee responsible for every kind of bailment (gratuitous/non-gratuitous)

if negligent: Uniform standard of care
• The burden of proof that he took reasonable care and did not act
negligently lies on the bailee.
• Bailee cannot be made liable for events beyond his control but the Court
will always infer what was reasonable and prudent – Depends on facts
• Difference in care depends on difference in goods Eg : for protecting gold
and in protecting a book
• Section 152 :
Bailee when not liable for loss, etc., of thing bailed.—The bailee, in the
absence of any special contract, is not responsible for the loss, destruction or
deterioration of the thing bailed, if he has taken the amount of care of it
described in section 151.

No cast- iron standard can be laid down for measure of care due from a bailee
and nature and amount of care must vary with the posture of each case

The burden of proof that he took reasonable care and did not act negligently
lies on the bailee: if the bailee places before court evidence to show that he
undertook all reasonable care, to avoid damages reasonably foreseeable or
had taken reasonable precautions to obviate risks reasonably apprehended,
he would be absolved
Gopal Singh Hira Singh vs Punjab National Bank ( AIR 1976 Delhi 115)

Facts: Goods pledged before 1946, after partition that branch

became part of Pakistan. Bank failed to return the goods. Bank
pleaded that the goods have been destroyed by the rioters.
Held: The obligation of the bank to take of the goods must be seen
in the context of the extraordinary situation that developed. And
thus, bank is not liable for the negligence.
2) S. 154 - Liability of bailee making unauthorized use of goods bailee –
If the bailee makes any use of the goods bailed, which is not according to
the conditions of the bailment, he is liable to make compensation to the
bailor for any damage arising to the goods from or during such use of
them.
Discussion:
(a) A lends a car to B for his own riding only. B allows C, a member of his
family, to drive the car. C drives with care, but the car by chance
meets with an accident and damages the car.
B is liable.
(b) A hires a horse in Calcutta from B expressly to march to Benares. A
rides with due care, but marches to Cuttack instead. The horse
accidentally falls and is injured.
A is liable to make compensation to B for the injury to the horse.
c) You lend a watch to your friend to be worn for the party. She wears it
to class and loses it.
You can claim damages from your friend.

Section 154 Read with S. 153 – If bailee does not conform to the terms
of the contract – the contract is voidable at the option of the bailor.
Duty of Bailee and Right of the Bailor
3) In a contract of bailment the bailee should maintain the identity of the
bailor’s goods.

S. 155 - Effect of mixture with bailor's consent of his goods with bailee's -
If the bailee, with the consent of the bailor, mixes the goods of the bailor with
his own goods, the bailor and the bailee shall have an interest, in proportion to
their respective shares, in the mixture thus produced. (to the extent mixed)

S. 156 - Effect of mixture without bailor' s consent, when the goods can be
separated –
If the bailee, without the consent of the bailor, mixes the goods of the bailor
with his own goods, and the goods can be separated or divided, the property in
the goods remains in the parties respectively; but the bailee is bound to bear
the expense of separation or division, and any damage arising from the mixture.
Illustration
157. Effect of mixture, without bailor' s consent, when the goods
cannot be separated –
If the bailee, without the consent of the bailor, mixes the goods of the
bailor with his own goods, in such a manner that it is impossible to
separate the goods bailed from the other goods and deliver them back,
the bailor is entitled to be compensated by the bailee for the loss of
the goods.
Discussion:
1. A bails 50 bags of cement of Ambuja Co. to B. without A' s consent, B mixes
the 50 bags of cement with other bags of his own from a different company.
A is entitled to have his 50 bags returned, and B is bound to bear all the
expense incurred in the separation of the bags (additional labour), and any
other incidental damage.

2. Above example – if B opened all the bags and mixed the cement with his, this
would be inseparable and now if A asks for his cement.. What will happen?
B will have to pay A for the entire cement.
4) S. 160 - Return of goods bailed on expiration of time or accomplishment of purpose-
It is the duty of the bailee to return, or deliver according to the bailor's directions, the
goods bailed, without demand, as soon as the time for which they were bailed has
expired, or the purpose for which they were bailed has been accomplished.
Obligation on bailee:
a) Once the purpose is served
b) the time expired
c) The duty to deliver the goods back to the bailor or give them to whom he was
directed to under the contract
d) Even if not demanded so by the bailor
e) Unless there is a contract to the contrary – if bailee has been told to return when the
bailor demands or bailor will himself collect them (This also the Court has interpreted
to be done within reasonable time)

Extension to this is S. 161 – loss, destruction or deterioration to goods if not delivered

will make the bailee liable for it.
S. 161 Bailee's responsibility when goods are not duly returned –
If, by the default of the bailee, the goods are not returned, delivered or tendered
at the proper time, he is responsible to the bailor for any loss, destruction or
deterioration of the goods from that time.

J.K. Oil Mills vs. Union of India (AIR 1976 SC 227)

Facts: The appellants consignment of mustard was being transported by the
respondent from Kanpur to Calcutta. On reaching Calcutta, but before delivery to
the Appellant, it was seized by the Food Inspector on the doubts of being
adulterated and was destroyed by the orders of the Calcutta High Court.
Issue: Was the respondent liable for the failure of delivery of the goods and their
destruction?
Held: NO. The loss and the damage was not due to the misconducts of the
respondent.
Rights of Bailee

Rights –
1. Right to recover necessary expenses – S. 158
2. Right to recover compensation (when bailee not entitled to make the
bailment) – S. 164
3. Right against third party – Right to subrogation – S. 180
4. Instances when bailee not liable – S. 152
5. Right to delivery to one co-owner without the consent of all - 165 +
166
6. Right to Lien – S. 170 & S. 171
Rights of Bailee
5)Right to delivery to one co-owner without the consent of all
S. 165 - Bailment by several joint owners –
If several joint owners of goods bail them, the bailee may deliver them back
to, or according to the directions of, one joint owner without the consent of
all, in the absence of any agreement to the contrary.
Duty not to set up “jus tertii” : i.e to say the goods belong to someone else

S. 166 - Bailee not responsible on re-delivery to bailor without title-

If the bailor has no title to the goods, and the bailee, in good faith, delivers
them back to, or according to the directions of the bailor, the bailee is not
responsible to the owner in respect of such delivery
6)Right to Lien – This right to retain the goods until the charges due in
respect of the goods are paid is called “Lien”.

Discussion: A delivers a rough diamond to B, a jeweller, to be cut and

polished, which is accordingly done. A comes to B to collect the Diamond. B
asks for the money for the services rendered, A refuses. What option does B,
the Bailee has? Is he bound to deliver the goods and then seek
compensation?
B is entitled to retain the stone till he is paid for the services he has rendered.

S. 170 & 171 – Lien is the right to retain the goods till the dues are cleared.
Two types – General and Particular
S. 170 - Bailee' s ‘particular’ lien-
Particular – Only that good can be retained with regard to which the services were rendered
“Where the bailee has, in accordance with the purpose of the bailment, rendered any service
involving the exercise of labour or 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 due remuneration for
the services he has rendered in respect of them.”
Essentials –
1. The bailee should have rendered some service involving exercise of labour or skill in respect
of the goods bailed (Factual)
2. Such services should be in accordance with the terms of the contract
3. No contract b/w parties excluding lien
4. Goods in possession of the Bailee
5. Services performed in due time
Right of Lien may be lost in the cases of
1. Loss of possession
2. Payment of due amount
3. Waiver of amount
4. Accepting security instead of Lien
5. Unauthorized use

Discussion: A gives, cloth to B, a tailor, to make into a coat. B promises A to deliver the
coat as soon as it is finished, and to give a three months credit for the price. Is B entitled
to ask for payment after he delivers?
B is not entitled to retain the coat until he is paid
S. 171 - General lien of bankers, factors, wharfingers, attorneys and policy-
brokers-
A right to retain all the goods for security for the general balance of account until the
full satisfaction of the claim dues whether in respect of those goods or any other
goods. Unless there is a contract to the contrary.
Available to: (1) Bankers
(2) Factors
(3) wharfingers
(4) attorneys of a High Court
(5) policy-brokers
They may retain the goods as a security for a general balance of account.
But no other persons have such a right, unless there is an express contract to that
effect.
1.Bankers –retain any of the debtor’s goods in the bank’s possession until any debt due from the
debtor, whether in connection with the retained goods/ securities or otherwise, has been paid.

Eg. Goods supplied as security for a loan and now a credit card bill is pending – the bank has the
right to exercise lien over those goods even though they have no connection with the outstanding
bill.

2.Factors - Agents entrusted with possession of goods for the purpose to sell the goods – can retain
if his charges are not paid as long as goods were given to him in the capacity of an agent in the
ordinary course of business

221. Agent’s lien on principal’s property.—In the absence of any contract to the contrary, an agent is
entitled to retain goods, papers and other property, whether movable or immovable of the principal
received by him, until the amount due to himself for commission, disbursements and services in
3.Wharfingers – Warf - permanent structure on the shore or bank of a river where
ships are docked to load and unload cargo. Wharfinger – the owner or manager of the
wharf – right to lien the goods bailed to him until his charges for use of wharf are not
paid.

4.Attorneys – BCI Rules – prohibit advocates from adjusting the fees against his own
personal liability of the client. He is entitled to money from the money paid in the
court but not by retaining papers and litigation files. ( Refer R.D Saxena vs Balram
Prasad)

5.Policy broker – Like an insurance agent. Right to lien can be exercised.

PARTICULAR LIEN GENERAL LIEN

Available against those goods in respect of Available against all goods

which charge were due

Purpose: Remuneration for services Also for general balancing the debt amount

Available to every Bailee Available for specific people

Available only when service involving Labour Available even when no such service has been
and skill has been involved rendered
• Syndicate Bank v Vijay Kumar AIR 1992 SC 1066
Bank has a general lien over all forms of securities or negotiable
instruments deposited by or on behalf of the customer in the ordinary
course of banking business
• The general lien is a valuable right of the banker judicially recognised
and in the absence of an agreement to the contrary, a Banker has a
general lien over such securities or bills received from a customer in
the ordinary course of banking business and has a right to use the
proceeds in respect of any balance that may be due from the customer
by way of reduction of customer's debit balance.
 FINDER OF GOODS

• Finder – when goods don’t belong to him.

• Acts as a Bailee without a Contract, all rights and duties of bailee applicable
• S.168 - Right of finder of goods, may sue for specific reward offered.—
1. The finder of goods has no right to sue the owner for compensation for trouble
and expense voluntarily incurred by him to preserve the goods and to find out
the owner; but he may retain the goods until he receives such compensation
2. where the owner has offered a specific reward for the return of goods lost, the
finder may sue for such reward, and may retain the goods until he receives it.
(Sue for rewards)
• S. 169 - When finder of thing commonly on sale may sell it.—
• Duties of a finder:
-Find the owner with reasonable diligence
-demand the owner, to pay the lawful charges of the finder
• The finder may sell it—
1. when the thing is in danger of perishing
2. when the lawful charges of the finder, in respect of the thing found, amount
to two-thirds of its value
 Third Party in a contract of Bailment
• Rights against a Third Person : Section 180, Subrogation
• Rights of a Third Person : Section 167 :
• Shiv Nath Rai Dhari v UOI AIR 1963 SC 422
• Mahendra Kumar Chandulal v C.B.I AIR 1984 Guj 53
• Prakash Road Lines Ltd v Oriental Fire and General Insurance ILR 1987
KAR 3576