A bailment is a delivery of goods or property upon a contract, express or implied, to carry out the execution of a special object beneficial either to the bailor or bailee or both and to dispose of the property in conformity with the purpose of the trust.
(Orig. Code 1863, § 2031; Code 1868, § 2032; Code 1873, § 2058; Code 1882, § 2058; Civil Code 1895, § 2894; Civil Code 1910, § 3467; Code 1933, § 12-101.)
Law reviews.- For comment on Goodyear Clearwater Mills v. Wheeler, 77 Ga. App. 570, 49 S.E.2d 184 (1948), see 11 Ga. B.J. 229 (1948).
JUDICIAL DECISIONSANALYSIS
Bailment is similar in nature to contract of hiring. Queen v. Patent Scaffolding Co., 46 Ga. App. 364, 167 S.E. 789 (1933).
Lease and bailment distinguished.
- A lease may refer to a contract involving realty or personalty, or both, whereas a bailment involves the custody of personalty. Buena Vista Loan & Sav. Bank v. Bickerstaff, 121 Ga. App. 470, 174 S.E.2d 219 (1970).
Lease and bailment are not necessary mutually exclusive terms; both are indicative of a contractual relationship. Buena Vista Loan & Sav. Bank v. Bickerstaff, 121 Ga. App. 470, 174 S.E.2d 219 (1970).
Notes pledged as collateral security.
- Where notes of a third party are pledged as collateral security, the creditor, in the absence of special contractual provision, is entitled to retain possession of the notes so deposited until the purpose for which they were deposited is at an end, that is, until the payment of the debt secured. Johnson v. Hinson, 188 Ga. 639, 4 S.E.2d 561 (1939).
Customer's assent to limitations on warehouse receipt a jury question.
- In a dispute over a storage facility's storage of a customer's seed, in which the facility sought to bind the customer to limitations printed on the reverse of the facility's warehouse receipts, the trial court erred by concluding that evidence that the facility routinely mailed warehouse receipts to the facility's customers was sufficient to bind the customer as a matter of law; because the customer denied receiving the receipts, the customer's assent was a question for the jury. Turfgrass Group v. Ga. Cold Storage Co., 346 Ga. App. 659, 816 S.E.2d 716 (2018).
Cited in Baugh v. McDaniel & Strong, 42 Ga. 641 (1871); Cabaniss v. Ponder, 65 Ga. 134 (1880); Massillon Engine & Thresher Co. v. Akerman, 110 Ga. 570, 35 S.E. 635 (1900); Atlantic Coast Line R.R. v. Baker, 118 Ga. 809, 45 S.E. 673 (1903); Haines v. Chappell, 1 Ga. App. 480, 58 S.E. 220 (1907); Jenkins v. Seaboard Air-Line Ry., 3 Ga. App. 381, 59 S.E. 1120 (1908); Howell v. Luttrell, 55 Ga. App. 627, 190 S.E. 813 (1937); Millender v. Looper, 82 Ga. App. 563, 61 S.E.2d 573 (1950); Heughan v. State, 82 Ga. App. 640, 61 S.E.2d 685 (1950); United States v. One 1946 Mercury Sedan Auto., 100 F. Supp. 957 (N.D. Ga. 1951); Tyner & Blackmon v. Fryer Truck & Tractor Co., 85 Ga. App. 518, 69 S.E.2d 793 (1952); Gillham v. Federal Express Money Order, Inc., 112 Ga. App. 171, 144 S.E.2d 557 (1965); Saunders v. Vikers, 116 Ga. App. 733, 158 S.E.2d 324 (1967); Brock v. Patterson, 128 Ga. App. 257, 196 S.E.2d 351 (1973); Alley v. Great Am. Ins. Co., 160 Ga. App. 597, 287 S.E.2d 613 (1981); Northside Motors, Inc. v. O'Berry, 167 Ga. App. 155, 305 S.E.2d 894 (1983); Citizens Jewelry Co. v. Walker, 178 Ga. App. 897, 345 S.E.2d 106 (1986); Harper v. Mayor of Savannah, 190 Ga. App. 637, 380 S.E.2d 78 (1989); South Ga. Pecan Co. v. Alimenta Processing Corp., 195 Ga. App. 688, 394 S.E.2d 545 (1990); Park 'N Go of Ga., Inc. v. United States Fid. & Guar. Co., 266 Ga. 787, 471 S.E.2d 500 (1996).
Types of Bailments
Loan is bailment of O.C.G.A. Art. 3, Ch. 12, T. 44 for a certain time to be used by the borrower without paying for its use. Industrial Lumber Co. v. Strickland, 71 Ga. App. 298, 30 S.E.2d 792 (1944).
Conditional sale is species of bailment whereby the vendee unconditionally promises to pay the purchase price and the vendor reserves title personally until such payment is made. Nix v. Farmers Mut. Exch. of Calhoun, Inc., 218 F.2d 642 (5th Cir. 1955).
Relationship between automobile dealer and prospective purchaser is that of bailor and bailee, not principal and agent or master and servant. Harris v. Whitehall Chevrolet Co., 55 Ga. App. 130, 189 S.E. 392 (1936).
Where an automobile dealer lends a demonstrator automobile to a prospective purchaser for the purpose of allowing such purchaser to test and operate it, under an oral agreement that the purchaser is to return the automobile at the end of two days in the same condition, less reasonable wear and tear, as it was when delivered to the purchaser, this constitutes the purchaser being a bailee. Warren v. Mitchell Motors, Inc., 52 Ga. App. 58, 182 S.E. 205 (1935).
Creation of Bailments
1. Requirements
Assent to bailment required to create duty.
- Before the bailee is charged with the duty of safekeeping property the bailee must assent to the bailment, either expressly or impliedly. Davidson v. Ramsby, 133 Ga. App. 128, 210 S.E.2d 245 (1974).
Delivery essential to bailment contract.
- Delivery, under which the bailee acquires an independent and temporarily exclusive possession, is essential to a contract of bailment. Hartley v. Robinson, 78 Ga. App. 594, 51 S.E.2d 617 (1949).
A bailment is not created unless there is a delivery of the article to be accepted by the bailee. Goodyear Clearwater Mills v. Wheeler, 77 Ga. App. 570, 49 S.E.2d 184 (1948), commented on in 11 Ga. B.J. 229 (1948).
To create a bailment, express or implied, there must be an actual or constructive delivery of goods with an actual or constructive possession in the bailee, exclusive and independent of the bailor and all other persons. Davidson v. Ramsby, 133 Ga. App. 128, 210 S.E.2d 245 (1974).
An essential element of the bailor-bailee relationship is the actual or constructive delivery of property to the bailee who thereby acquires independent and temporarily exclusive possession of the delivered property. McDaniel v. American Druggists Ins. Co. (In re Nat'l Buy-Rite, Inc.), 11 Bankr. 196 (Bankr. N.D. Ga. 1981).
Independent and temporarily exclusive possession of property required.
- In order to constitute a bailment, it is essential that the bailee acquire an independent and temporarily exclusive possession of the property. Elliott v. Levy, 77 Ga. App. 562, 49 S.E.2d 179 (1948); A.A.A. Parking, Inc. v. Bigger, 113 Ga. App. 578, 149 S.E.2d 255 (1966); Buckley v. Colorado Mining Co., 163 Ga. App. 431, 294 S.E.2d 665 (1982).
A bailee acquires no title to the property held as bailee; the interest is limited to a right of possession for which the bailee may maintain an action if this right is impaired. McDaniel v. American Druggists Ins. Co. (In re Nat'l Buy-Rite, Inc.), 11 Bankr. 196 (Bankr. N.D. Ga. 1981).
2. Activities Establishing Bailor-Bailee Relationship
Transfer of property by seller to prospective purchaser on approval clearly creates bailment under O.C.G.A. § 44-12-40. Stephens v. Thompson, 177 Ga. App. 528, 339 S.E.2d 784 (1986).
Purpose of transaction determines existence of bailment.
- If the furnishing of an automobile is within what may be said to be a "business" of the owner, one to whom the car is entrusted for such purpose is not a bailee, as in a case of lending, but is a servant or agent; if, on the other hand, the car is entrusted by the owner merely as an accommodation, with no interest or concern in the purpose for which the car will be used, then its use, whether for recreation or otherwise, is not within the business of the owner, and the transaction is a mere bailment. Hubert v. Harpe, 181 Ga. 168, 182 S.E. 167, answer conformed to, 52 Ga. App. 262, 183 S.E. 98 (1935).
Permission to use employer's truck after working hours creates bailment.
- Where the defendant, employed to pick up and deliver dry cleaning and laundry, drives the employer's truck in doing this work, uses the truck, with the employer's permission, after the employee finishes work in going to and from home and, where the defendant is to keep the truck in proper repair with the employer paying for such repairs, the status of bailor and bailee exists between the employer and the defendant with reference to the use of the truck by the defendant after the employee finishes work. Smith v. Burks, 89 Ga. App. 278, 79 S.E.2d 52 (1953).
Bailment creating liability of employer for tractor carrying trash.
- Because an employer, as bailor, sent the employer's own employee with the thing bailed, a tractor with attached trash trailer, under O.C.G.A. § 44-12-62(b), a contractor, as the hirer, was liable only for the consequences of the hirer's own directions or for the hirer's gross negligence; the trial court erred in concluding that the contractor was entitled to summary judgment on the basis that the employee was not a borrowed servant because the evidence presented at least a factual issue regarding whether the employee was the contractor's borrowed servant since there was evidence that the contractor alone supervised the employee's work hauling debris, that the contractor controlled the employee's schedule for each day, and that the contractor dictated which landfill would receive the debris and when a load was ready. Coe v. Carroll & Carroll, Inc., 308 Ga. App. 777, 709 S.E.2d 324 (2011).
Also contract for car storage in garage.
- Where the owner of an automobile enters into an oral contract, for the storage of a car, with the operator of a storage and service garage of automobiles, the relationship of bailor-bailee is created. Bunn v. Broadway Parking Ctr., Inc., 116 Ga. App. 85, 156 S.E.2d 464 (1967).
Acceptance of car for repairs and adjustments.
- Where a driver hired by plaintiff took plaintiff's car, on orders from plaintiff, to defendant's garage and delivered it to the master mechanic to make repairs and adjustments, and where the master mechanic worked on the car and asked the driver to test-drive the car, along with the master mechanic, the existence of bailor and bailee relationship between the parties is established. Tyner & Blackmon v. Fryer Truck & Tractor Co., 83 Ga. App. 393, 63 S.E.2d 695 (1951).
Bailment denied where owner retains right to remove stored article at will without the knowledge of the person in charge of the premises and no bailment arises. Mossie v. Pilgrim Self-Service Storage, 150 Ga. App. 715, 258 S.E.2d 548 (1979).
Leaving of musical equipment in restaurant.
- Evidence could have authorized jury to find that bailment was in effect as to plaintiff's musical equipment left at defendant's restaurant and damaged in fire occurring when restaurant was closed. Buckley v. Colorado Mining Co., 163 Ga. App. 431, 294 S.E.2d 665 (1982).
No bailment created between insured and insurer.
- Court of appeals did not err in affirming an order granting an insured summary judgment in the insured's action against an insurer to recover indemnity under the insured's commercial general liability insurance policy for property damage to a company's commercial peanut cleaner because the care, custody, and control exclusion of the policy did not apply when the peanut cleaner was not in the insured's care, custody, or control; it could not be said either that a bailment of the peanut cleaner was created or that the insured had exclusive "care, custody, or control" of the cleaner at the time that the cleaner was damaged because the insured was operating as an instrumentality of the company, moving the company's peanut cleaner to serve the company's purposes while under the company's direction and control. Owners Ins. Co. v. Smith Mech. Contrs., Inc., 285 Ga. 807, 683 S.E.2d 599 (2009).
When the debtor was granted bare legal title to a residential loan package for purposes of resale as a bailment under O.C.G.A. § 44-12-40, but had no equitable interest in the loan, the loan was not property of the debtor's estate under 11 U.S.C. § 541(d), and the creditor's interest was not avoidable under 11 U.S.C. § 544(a)(1). HSBC Mortg. Servs. v. Pettigrew (In re Southstar Funding, LLC), Bankr. (Bankr. N.D. Ga. Oct. 4, 2008)(Unpublished).
Duty of Care
Borrower of loan is bound to take good care of thing borrowed, to use it according to the intention of the lender, and to restore it in the proper condition. Industrial Lumber Co. v. Strickland, 71 Ga. App. 298, 30 S.E.2d 792 (1944).
Bailee to act in good faith.
- A bailee is an agent who is required not only to use the property for the special object only for which the bailee was entrusted with it, and in conformity with the purposes of the trust, but to act in good faith where the interests of the principal are concerned. Industrial Lumber Co. v. Strickland, 71 Ga. App. 298, 30 S.E.2d 792 (1944).
Object of bailment mutually beneficial to both parties.
- Where the object of the bailment is beneficial to both parties, the degree of diligence required of the bailee is ordinary care. Elliott v. Levy, 77 Ga. App. 562, 49 S.E.2d 179 (1948).
Bailor entrusting defective automobile to another.
- Where bailor entrusts a defective automobile to another, or entrusts an automobile to an incompetent driver, the bailor must exercise ordinary care to prevent injuries to persons within the range of foreseeable operation of the automobile. Medlock v. Barfield, 90 Ga. App. 759, 84 S.E.2d 113 (1954).
Liability
Bailee's knowledge of automobile contents required for liability.
- A bailee for hire as to an automobile is not liable for the contents thereof unless the bailee has actual or implied knowledge or notice as to such contents. Davidson v. Ramsby, 133 Ga. App. 128, 210 S.E.2d 245 (1974).
Reasonable expectation of car contents is sufficient notice.
- Sufficient notice of the contents of a car exists if the articles are such as the bailee might reasonably expect to be therein. Davidson v. Ramsby, 133 Ga. App. 128, 210 S.E.2d 245 (1974).
Bailor's liability determined by bailment contract and doctrine of proximate cause.
- The bailor's liability is not determined alone by the provisions and warranties of the bailment contract, but also by the limits imposed by the doctrine of proximate cause; that is, whether the defendant should have foreseen the consequences of defendant's negligence as a natural and probable result. Medlock v. Barfield, 90 Ga. App. 759, 84 S.E.2d 113 (1954).
Automobile dealer not liable for prospective purchaser's negligent operation of car.
- Since the relationship between an automobile dealer and a prospective purchaser is that of bailor and bailee, the dealer is not liable for injuries accruing to a third person by reason of the negligent operation of the automobile by the prospective purchaser while trying it out. Harris v. Whitehall Chevrolet Co., 55 Ga. App. 130, 189 S.E. 392 (1936).