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CMA Intermediate · Business Laws and Ethics · Special Contracts - Indemnity and Guarantee; Bailment and Pledge; Laws of Agency

Meera leaves her sewing machine with Kishore, a repairer, for servicing. Kishore keeps it in his shop and takes the same care of it as a man of ordinary prudence would take of his own goods of the same bulk, quality and value. A fire of unknown origin, without any fault of Kishore, destroys the machine. What is the legal position under the law of bailment?

Kishore is not liable. A bailee must take the care an ordinarily prudent person would take of his own similar goods, and if he does so, he is not responsible for loss or destruction. He is not an insurer, and the fire occurred without his fault.

  1. AKishore is liable for the full value, since a bailee is an insurer of the goods
  2. BKishore is liable for half the value, because the loss was shared
  3. CKishore is not liable, because he took the care required of a bailee and the loss occurred despite itCorrect
  4. DKishore is liable unless Meera had insured the machine

Explanation

A bailee must take as much care as a man of ordinary prudence would take of his own goods of similar bulk, quality and value. If he does so, he is not responsible for loss, destruction or deterioration. Kishore met this standard, so the insurer-style liability in the first option is wrong.

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