A bailor is a person who retains the title to property while giving it to someone else for physical safekeeping. There are a wide range of situations where bailment can come up, as for example when someone drops a car off with a mechanic for a tuneup. In this case, the driver is the bailor, as the car legally belongs to the driver while the mechanic has the car in physical custody for the agreed upon service. The laws surrounding bailment can become complex.
As a general rule, the bailee, the person who takes control of the property, agrees to care for the property in a reasonable fashion and return it. The property may be returned when a service is over, at the end of a set time period, or on demand from the bailor. The exception to this rule is a case where a bailee has a lien on the property, where the property can be retained if the bailor fails to fulfill the terms of a contract.
The law distinguishes between cases where people are given consideration specifically for acting as bailees, and situations where people become bailees as a result of circumstance. A bank, for example, is paid to hold valuables in safe deposit boxes and is held to a high standard of care because it is offering a bailment service. On the other hand, a dry cleaner who accepts temporary custody of clothes by necessity to clean them is held to less stringent standards.
Other legal considerations include when property can be considered abandoned by law, and what happens when someone finds stolen or lost property and acts as a bailee by accident. These issues can come up in court cases when questions of liability are raised, as for example if someone sues someone for failing to care for property properly while it was in custody.
In formal business arrangements, a contract is signed to spell out the rights and responsibilities of both parties. It is advisable to read contracts with care to make sure that they are understood. In the example of a mechanic above, for example, the mechanic may guarantee the security and safety of the vehicle, but will not offer such guarantees for objects left inside the vehicle. It is important to understand where the liability lies so that a bailor knows what can be done and what to do in the event of a problem.
