BAILMENTS 1. Definitions.—Bailment has been defined as a de livery of a thing by one person to another for a certain purpose, upon the promise that the bailee shall return the same thing to the bailor, or deliver it to someone in accordance with the bailor's instructions, after the pur pose has been fulfilled.
The contract may be express or it may be implied. All kinds of movable or personal property may be the subject of a bailment. Altho the word is derived from a French word, meaning "to deliver," the delivery may be actual, constructive or by opera tion of law. It is not necessary that the bailor be the owner of the property; it sometimes happens that a bailee himself becomes a bailor as toward some new bailee. The new bailee is not regarded as the bailee of the true owner, and his obligations are toward his immediate bailor. Thus A finds an unregistered bond of the X Company, Limited, which has been lost by B. A borrows money from C, and puts up the bond as security. By operation of law, A is B's bailee, and, by actual delivery, C is A's. C could not refuse to return the bond to A when the debt was paid on the ground that A did not own it; but if C did make a delivery to B, he would be protected.
2. bailment must be distinguished from a sale. A sale transfers the title or ownership of the thing sold. In the case of a bailment, only the possession of the thing changes. This distinction is unsatisfactory, as it is frequently difficult to say whether the title as well as the possession is trans ferred. It has been held, for instance, that when a farmer delivers wheat to a miller to be ground into flour, this is only a bailment, and the miller's creditors cannot seize the flour or the wheat.
The distinction between a bailment and a sale or barter is important when we consider that, in the case of a bailment, if the goods bailed are destroyed acci dentally, the loss falls upon the bailor; in the case of a barter or exchange, as where A delivered to B certain oats for B's horses, the loss would fall upon B. A frequent instance of a bailment is the storage of grain in elevators. A number of owners may store their grain in the same elevator, the various deliveries being mixed together. The owner of the elevator is the common agent or bailee of them all. In such a case the owner of any part of the grain so stored may sell his interest in the undivided mass, and, as we have seen, a valid sale may be made of such an interest without dividing the portion from the bulk, the order on the warehouseman to deliver the quantity so sold, and the acceptance of this order by the warehouseman or elevator owner being sufficient.
Instead of being a bailment, however, the trans action may be a sale, when, for example, the ware houseman, by agreement with the various owners, is entitled to sell any part of the grain stored with him, provided that he substitutes an equal quantity of sim ilar grain of his own, or of other persons.
3. Classification of bail•ents.—Various classifica tions of bailments will be found in the different text books on the subject. The most practical classifica tion for our purpose, however, may be set out as fol lows : (a) Those which are for the sole benefit of either the bailor or bailee.
(b) Those which benefit both bailor and bailee. Further classification may be made, viz.: (1) Gratuitous bailments, (2) Bailments for reward.
Class (a) or class (1) would include deposits, gratu itous loans for use, and mandates. Class (b) or class (2) would include what are called pledges and hirings.
A bailment may be in the nature of a deposit, as when A delivers a thing to B to be kept for him. A may lend goods to B to be used by him without charge. A may deliver goods to B to be used by him for hire. Again, A may deliver goods to B as a pawn, or as se curity for money borrowed : this is a pawn or pledge. A may deliver goods to B who is a carrier, or in order that B may do something to them or with them, and B is to be paid for his services. A, on the other hand, may deliver goods to B, to carry them or do something about them or with them, without any charge for his work or carriage. So if A, who is going away for the summer, delivers to B some valuable plants to be kept and cared for by him, this is a bailment for the sole benefit of A, the bailor. It is a deposit. If A bor rows B's automobile,.this is a gratuitous loan for the sole benefit of A, the bailee. If A borrows one hun dred dollars from B, and gives B as security for the loan five shares of stock, this is a bailment for the benefit of both parties, and is a pledge. If A hires a horse and carriage from B, and agrees to pay B two dollars, B gives A the use of his property for compensation, and this is a bailment in the nature of a hiring. If A stores his household furniture with B at ten dollars a month, this also is a bailment, and for the benefit of both parties. A gives B a trunk to take to C, and agrees to pay B one dollar. This is a bailment in the nature of a contract for carriage for hire.