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What is a Bailment and Why Should I Care?

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Have you ever lent someone an item of yours? Given your car to a valet? Or has your friend let you borrow the lawnmower? If so, it’s likely that you have entered into a legal arrangement that the law calls a “bailment.” You may have wondered what happens and who is responsible if something goes wrong, or your property is lost or stolen.

A bailment is created when a person delivers his or her personal property to another person to hold for a period of time. The person who gives over the personal property is the “bailor” and the individual who receives and holds the personal property is the “bailee.” In this arrangement, the bailor still retains ownership and control of the personal property, and the bailee merely gains the right to possess the property for a little while. The use of the personal property, and the duration of the bailment is totally up to the parties!

For example, I am in a bailment with my neighbor – so what? If you find yourself in a bailment situation, you ought to be aware of the standard of care that the law requires of you. The standard of care for a bailee depends on who receives the benefit from the arrangement.

  • If the bailor receives the sole benefit (i.e. your friend looks after your car while you’re on vacation, but receives no payment), then the bailee is only responsible for acting with gross negligence (extreme departure from an ordinary level of care).
  • If the benefit is mutual (i.e. a car valet on your dinner date) then the bailee must exercise ordinary care.
  • If the bailee receives the sole benefit (i.e. a gratuitous loan) then the bailee must exercise the utmost amount of care (a much higher standard)

If you loan out your leaf blower, let the valet park your car, or have someone look after your prized possession, be cautious of the level of care you, or the other person, must exercise.

Unsure as to whether you have created a bailment or whether you are taking care of property in your possession? Give us a call! It’s unusual that many issues arise out of a bailment situation, but our legal team is fully prepared to give you all the advice you need to protect you and your personal property. Call our office today!