Bailment – Explained

Cite this article as: Jason Mance Gordon, "Bailment – Explained," in The Business Professor, updated January 8, 2015, last accessed April 1, 2020,
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Bailment of Personal Property
This video explains what is a bailment of personal property.

Next Article: Unilateral and Mutual Benefit Bailment


What is a “Bailment”?

A bailment is a situation where the owner of personal property gives the property to another person to hold or to use in a  specific manner. The owner of the property is called the “bailor” and the person receiving the property is called the “bailee”. A bailment can be express (pursuant to agreement by the bailor and bailee) or implied (simply a result of the parties’ conduct).

  • Example: To illustrate an express bailment, Alex gives his car to Brandi to sell. Brandi will receive a commission for selling the car. Until the car is sold, the situation is a bailment. Brandi is the bailee holding the property with the specific purpose of selling it for Alex. Another common form of express bailment is shipping a package through the public or private delivery service. The package is held by the common carrier is a bailment.
  • Example: To illustrate an implied bailment, Gary accidentally leaves his computer at Dina’s house. Dina leaves Gary a message to let him know he left it and that she will hold on to it until he can pick it up. In this situation, an implied bailment is created. Dina is holding the computer for Gary with the expectation that she return it whenever he comes to get it.

Discussion: What do you think about the prospect of creating a bailment by accident? Does it matter whether the parties realize that they are part of a legal relationship? Should the bailor and bailee know that the other exists?

Practice Question: Rhonda is leaving a restaurant and picks up her coat from the rack at the door. When she reaches her home, she realizes that she has picked up someone else’s coat. Rhonda decides to return the coat to the restaurant, but she cannot do so until the following day. What is Rhonda’s legal status while in possessions of someone else’s coat?

Proposed Answer

  • A bailment describes a legal relationship in common law where physical possession of personal property, or chattel, is transferred from one person (the ‘bailor’) to another person (the ‘bailee’) who subsequently has possession of the property. It arises when a person gives property to someone else for safekeeping. Bailment is distinguished from a contract of sale or a gift of property, as it only involves the transfer of possession and not its ownership. The bailee receives only the control or possession of the property while the bailor retains the ownership interest in it. Once the purpose for which the property has been delivered has been accomplished, the property will be returned to the bailor or otherwise disposed of pursuant to the bailor’s directions. In the practice question, Rhonda is acting in the capacity as a bailee. She can only be in possession of the coat and cannot act with the rights of a real owner.

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