Legal Reasoning Questions for CLAT | QB Set 84 [Bailment]

Bailment means the temporary delivery of movable goods by one person, called the bailor, to another, called the bailee, for a specific purpose, with an understanding that the goods will be returned or dealt with according to the bailor’s directions after the purpose is completed. It is governed by Sections 148 to 181 of the Indian Contract Act, 1872. Ownership does not pass to the bailee; only possession is transferred. 

The bailee must take reasonable care of the goods, avoid unauthorised use and return them after the purpose is fulfilled. The bailor must disclose known defects that may create risks. In Coggs v Bernard, the court recognised the bailee’s duty of care. In Ultzen v Nicols, bailment was recognised through conduct. In State of Gujarat v Memon Mahomed Haji Hasam, the Supreme Court recognised duties similar to those of a bailee in cases of lawful custody.

Questions

Question 1

Riya gives her expensive camera to Kabir for two days so that he can photograph a college event. Kabir agrees to use the camera only for the event. Instead, he takes it on a trekking trip and uses it during heavy rainfall. The camera is damaged by water.

Which of the following is the most appropriate legal conclusion?

A. Kabir is not liable because ownership of the camera remained with Riya.

B. Kabir is not liable because the bailment was gratuitous.

C. Kabir is liable because he used the goods in a manner inconsistent with the terms of the bailment.

D. Kabir is liable only if Riya proves that Kabir intended to damage the camera.

Question 2

Arjun leaves his laptop with Mehul, a professional repair technician, for screen replacement. Mehul repairs the laptop but Arjun refuses to pay the agreed repair charges. Mehul retains possession of the laptop until payment is made.

Which of the following is the most appropriate legal conclusion?

A. Mehul must immediately return the laptop because a bailee can never retain the bailor’s goods.

B. Mehul becomes the owner of the laptop because the repair charges remain unpaid.

C. Mehul can sell the laptop immediately without giving Arjun an opportunity to pay.

D. Mehul may retain the laptop under his right of particular lien until the charges for the services involving labour or skill are paid.

Question 3

Naina lends a horse to Sameer for a recreational ride. Naina knows that the horse has recently developed a tendency to become uncontrollable when exposed to loud noises but does not inform Sameer. During the ride, a loud horn frightens the horse, causing Sameer to fall and suffer injuries.

Which of the following is the most appropriate legal conclusion?

A. Naina may be liable because a bailor must disclose known defects that materially interfere with the use of the goods or expose the bailee to extraordinary risks.

B. Naina cannot be liable because Sameer voluntarily accepted the horse.

C. Sameer alone is liable because every bailee assumes all risks connected with the goods.

D. Naina is liable only if Sameer had paid money for using the horse.

Question 4

Dev gives 100 kilograms of premium rice to Tara for temporary storage. Without Dev’s permission, Tara mixes the rice with 100 kilograms of her own rice of the same variety. The two quantities can be separated, although doing so will involve considerable expense.

Which of the following is the most appropriate legal conclusion?

A. Tara automatically becomes the owner of all the rice because the goods were mixed.

B. Dev is entitled to have his goods separated, and Tara must bear the expense and damage arising from the unauthorised mixing.

C. Dev loses all rights over the rice once physical mixing takes place.

D. The entire quantity must necessarily be sold and the proceeds divided equally.

Question 5

Ishita leaves a valuable painting with Rohit for safe custody while travelling abroad for three months. Rohit stores it in a secure room with proper locks and takes the same precautions that a prudent person would take with a valuable painting of their own. Despite these precautions, professional thieves break into the house and steal the painting.

Which of the following is the most appropriate legal conclusion?

A. Rohit may not be liable if he proves that he exercised the degree of care required from a bailee of ordinary prudence.

B. Rohit is automatically liable because every bailee is absolutely responsible for the safety of bailed goods.

C. Rohit becomes liable merely because the painting was stolen while it was in his possession.

D. Rohit can avoid liability only if Ishita had expressly waived her rights in writing.

Answers and Explanations

1. Correct Answer: C

Kabir is liable because he made an unauthorised use of the bailed goods. Riya had given him the camera specifically for photographing a college event, but Kabir took it trekking and exposed it to heavy rainfall.

Section 154 of the Indian Contract Act provides that when a bailee uses the goods in a manner inconsistent with the conditions of the bailment, the bailee is liable for damage arising from such use. The fact that the arrangement was gratuitous does not permit Kabir to disregard the agreed purpose.

Therefore, Option C is correct.

2. Correct Answer: D

Mehul has exercised labour and skill on Arjun’s laptop by repairing its screen. Since the repair charges remain unpaid, he may have a particular lien over the laptop.

Under Section 170 of the Indian Contract Act, where a bailee has rendered a service involving labour or skill in respect of the goods, the bailee may retain those goods until remuneration for the services is paid, provided there is no contract to the contrary.

Mehul does not become the owner of the laptop and cannot automatically sell it merely because payment is outstanding.

Therefore, Option D is correct.

3. Correct Answer: A

Naina knew about the dangerous tendency of the horse but failed to inform Sameer. This amounts to a failure to perform the bailor’s duty to disclose known defects.

Under Section 150 of the Indian Contract Act, a bailor must disclose faults in the goods that materially interfere with their use or expose the bailee to extraordinary risks, particularly where the bailor knows about those faults.

Since the horse’s reaction to loud noises created a significant danger and Naina was aware of it, she may be liable for the injury suffered by Sameer.

Therefore, Option A is correct.

4. Correct Answer: B

Tara mixed Dev’s goods with her own without Dev’s consent. However, the goods remain capable of separation.

Under Section 156 of the Indian Contract Act, where the bailee mixes the bailor’s goods with their own without consent but the goods can still be separated, ownership in the respective goods remains with the parties. The bailee must bear the expenses of separation as well as any damage caused by the mixing.

Therefore, Option B is correct.

5. Correct Answer: A

A bailee is not an insurer of the goods. Rohit’s liability depends upon whether he exercised the level of care required by law.

Under Section 151, a bailee must take as much care of the goods as a person of ordinary prudence would take of their own goods of similar nature, quality and value. Section 152 generally provides that where the bailee has taken such reasonable care, the bailee is not responsible for loss, destruction or deterioration of the goods, unless there is a special contract providing otherwise.

Since Rohit stored the painting securely and took reasonable precautions, he may not be liable merely because sophisticated thieves managed to steal it.

Therefore, Option A is correct.