Property Law

Section 1: Renting Property

Types of Bailments

As you can see from what you've read, there are several different types of bailments. All bailments, in fact, are divided into two broad classifications:

  1. Gratuitous (in other words, free) bailments: A gratuitous, or free, bailment is one in which only one of the two parties involved receives some benefit. For example, if you borrow your neighbour's snowblower to clear your driveway after a blizzard, you've created a gratuitous bailment. Your neighbour derives no obvious benefit-except, perhaps, your good will .

  2. Bailments for reward: a bailment for reward is one in which both parties benefit. If you pay your neighbour for the use of that snowblower, a bailment for reward has been created.


Bailments for reward are, in turn, classified according to type. Here's a list of the most common types:

  1. Rental bailments occur when a person rents or leases goods to another person for a fee. Common examples would be vehicles, tools, and equipment of various types.

  2. Repair, service, or processing bailments occur when someone temporarily turns goods over to another party for repair or processing. If you take your car in for servicing, or drop off a coat at the dry cleaners, you're creating a bailment of this sort.

  3. Storage or warehousing bailments are created when an individual places an article with someone else for storage or safekeeping. Examples would be a boat left in a marina, jewellery placed in a bank's safety deposit box, and a car parked in a downtown parking lot.

  4. Carriage of goods bailments occur when a person entrusts possessions to a public carrier such as a trucking company, a rail line, or a courier.

  5. Innkeeper bailments occur when travellers stay at a hotel, motel, or some other sort of lodging for which they're paying a fee. In this sort of situation, the person or company owning the establishment (known legally as the innkeeper ) takes temporary responsibility for any goods the traveller happens to have with him or her.

  6. Securities and valuables bailments are created when goods are left at places like pawnshops as security for borrowed money.



   I have never been quite clear on just how pawnshops work

 It is quite simple. The pawnbroker lends you money, and as a guarantee that you'll repay it, you leave some possession at the shop. The pawnbroker is the bailee, and he or she must return the goods to you when you pay back the money along with interest. If you don't pay it back, however, the pawnbroker can assume ownership of the goods and sell them. As soon as ownership is transferred, the bailment is over.             

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