A bailment arises when one party takes possession of another’s personal property with an obligation to return it. It is the legal framework for warehousing, repair, consignment, shipping and equipment loans.
Standard of care. Traditionally graded by whose benefit the bailment serves — slight care for a bailment solely for the bailor’s benefit, great care for one solely for the bailee’s, ordinary care for mutual benefit. Most modern courts apply ordinary reasonable care in the circumstances.
Burden shifting. Where goods are delivered in good condition and returned damaged or not at all, a presumption of negligence arises and the bailee must explain.
Limitation of liability. Warehouse receipts and repair tickets commonly limit liability per unit or per pound. These are enforced where the bailor had a reasonable opportunity to declare a higher value and pay a higher rate, and are struck where the opportunity was illusory.
Documents of title. Warehouse receipts and bills of lading, negotiable or non-negotiable, which affect who may claim the goods and the priority of competing claims.
Insurance. Bailees’ coverage for goods of others; owners should confirm whether the bailee’s coverage or their own responds and should not assume.
Liens. Warehousemen, carriers and repairers commonly have statutory liens for their charges, with foreclosure procedures.