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Bailment Notes

Law Notes > LAWS203 Property Law Notes

This is an extract of our Bailment document, which we sell as part of our LAWS203 Property Law Notes collection written by the top tier of Univerity Of Otago students.

The following is a more accessble plain text extract of the PDF sample above, taken from our LAWS203 Property Law Notes. Due to the challenges of extracting text from PDFs, it will have odd formatting:

Bailment Steps for bailment Onus Bailor must prove:
* There was a bailment
? The bailee voluntarily took possession of goods belonging to another.
* (A duty of reasonable care than arises)
* Damage
? Damage has occurred to be remedied. Bailee must prove:
* She took reasonable care
? "Care and diligence which a careful and diligent man would exercise in custody of his own chattel of like character and in like circumstances." - Conway v Cockram Motors [1986]
? "reasonable care for the safety of the chattel and ... To ensure that the chattel is redelivered in due course to its owner in the same order and condition in which it was received." - Skyway Service Station v McDonald [1986]
* Did not take reasonable care, but loss would have occurred even if she had.
? i.e. Needs to be causation

Conway v Cockram Motors [1986]
* Cockram = 2nd hand car dealer, had left Conway's keys in car's visor.
? General industry practice for quick removal in case of fire.
* Car stolen from dealership and damaged. Need to take reasonable care to protect against all reasonably likely forms of damage, not just one - protecting from fire hazard not enough. Complying with industry standard not enough to show 'reasonable care'. Defendant first failed to show that it was unreasonable to expect it to install an alarm system. Defendant also failed to discharge the alternative onus, to show that even if it had taken installed an alarm, the burglary still would have taken place. Reasonable care is to be shown on the balance of probabilities - though the judge isn't clear on this.

Skyway Service Station v McDonald [1986]
Car stored at airport garage, damaged and goods stolen. What care did SSS take?
* Cars were parked together and chained
* Lean-to roof
* Service station attended during day (only)
* Airport security guards offered some protection
* Well-lit

What would have been reasonable?
* Barbed wire fence, stop access.
* Have their own security guards
* Dogs
* Must consider cost in reasonableness.

* No fence, so clearly easily accessible for theft.
* Fire = risk
* Need to think of circumstances, what risks there are to the property, what can reasonably be done to protect against those risks. Effect of bailor's awareness of bailment's circumstances?
Does the bailor assume the risk of damage if she understands the conditions in which the bailment takes place?
Held: no. It depends on the exact content of the agreement. Firstly, in this case McDonald wasn't made aware of the circumstances, didn't see where car would be parked. Secondly, court insists on an agreement to limit liability in this way. Something like an exclusion clause. If the bailor was a regular at SSS, and was patently aware of any risks tied to the storage conditions, this may mean an agreement could be inferred that limits the bailee's liability. Only evidential of an agreement to limit liability - does not substantively limit liability. Court assesses bailee's duty of care objectively (what is objectively the reasonable standard of care), only looks at subjective expectations if there are specific terms of contract for the bailment to fall back on.

If a bailee commits a conversionary act to the bailor's goods, the bailor's right to immediate possession immediately revives (so can sue in trover as well as breach of bailment).

Coggs v Bernard (1703), shows how much has changed in 300 years Circumstances giving rise to bailment: Custody, loan, hire, pledge, carrying of goods with/out reward. Then
* Consensual
* Delivery from bailor to bailee
* Return of goods to bailor in form they were in when transferred Now Property Page 5

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