Problem 23. B bought of C a car load of cedar posts to be shipped by C to B. When they arrived B's servants unloaded a part of them, and discovering they were not of good quality so informed B. The latter then inspected them, and because they were not of good quality had those taken from the car replaced, and refused the whole lot. C sues B for the price. Is B liable?

Problem 24. C bought of B by sample "102 bales second quality Ceará scrap rubber as per sample." When the bales arrived they were found not to be second quality, but inferior, though they were like the sample. Is C bound to keep the rubber and pay for it without offsetting the damages for breach of warranty?

Problem 25. (a) A manufacturer sells B powder for blasting. It is of poor quality and unfit for the purpose. Is there a breach of warranty?

(b) A dealer who purchased of the manufacturer sold C some of the same powder for the same purpose. Is the dealer liable to C for breach of warranty?

56. What is meant by the rule of caveat emptor? What are the exceptions to the rule? If A sells B a horse without express warranty, is there any implied warranty? If A sells B seeds?

57. Can the buyer rescind the contract for a breach of an express warranty if title has passed? for breach of an implied warranty? If goods are ordered by description and they do not answer the description, may the buyer take them and sue for breach of implied warranty?

58. State all the rights of an unpaid seller against the goods. What is the seller's lien? How is it lost? What is the right of stoppage in transitu? When may it be exercised? How is it lost? Explain the exercise of the right of resale; of rescission.

Problem 26. B sells C a horse, payment and delivery to be one week later. At the time fixed C does not take or pay for the horse. Explain all the remedies to which B may resort against the property itself.

Problem 27. B sells C a horse on credit, delivery to be one week later ́and payment one month later. What are B's rights against the property? 59. State the seller's rights against the buyer. How does he measure his damages for a breach?

60. State the remedies of the buyer (a) where the title has passed and (b) where it has not passed. What are general and what special damages? When may special damages be recovered?

CHAPTER V

BAILMENT OF GOODS

61. Definition and distinctions. A bailment1 of goods is a transfer of the possession without a transfer of the general ownership, upon a contract, expressed or implied, that after the purpose of the transfer shall have been accomplished the property shall be redelivered to the bailor or to some person designated by him.

The person making the delivery is called the bailor. The person to whom it is made is called the bailee.

Such a transfer of possession usually occurs by delivery from the bailor to the bailee. It may take place, however, without such delivery.

Examples. If one finds an article and takes it into his custody, he is a bailee for the unknown owner, although there has been no delivery, and is under an obligation created by the law to return it to the true owner upon demand. So if one steals or converts property belonging to another, he is a bailee, and the law creates for him a promise to return it to the owner. So also an officer who seizes goods under a legal process is a bailee of the goods. In all these cases there is a transfer of possession without delivery, but in all of them the bailee is bound to deliver up the property either upon demand or when the purpose for which he has taken it is accomplished.

The duty of the bailee is usually fixed by his own promise, and is therefore the result of contract. But in the cases last given there is no promise and no real contract. The law treats these cases upon the fiction that there is a promise, that is, the law creates the promise and requires the bailee to return the goods or pay damages for withholding them.

The consideration for the bailee's promise is the detriment suffered by the bailor in parting with his property. Sometimes the bailor furnishes some other consideration, as when he pays or promises to pay the bailee for caring for the property or doing work upon it. But in the case of a gratuitous bailee—

1 Bailment is from the French bailler to deliver.

one who cares for the property without compensation the only consideration is the parting with the property by the bailor. This is an act which the owner is not legally bound to do, and is therefore a sufficient consideration.

Bailment applies only to personal property. This may be corporeal, as a horse, or incorporeal, as a document of title. The bailor need not be the true owner of the property. One may hire a horse and put him in a livery stable; in such a case there are two bailments, by the owner to the hirer, and

by the hirer to the livery-stable keeper. One who finds a jewel may deliver it to a jeweler to be tested; in such a case the finder is bailor and the jeweler is bailee, and the finder may recover the jewel, or its value, if the jeweler refuses to surrender it. The bailee cannot dispute his bailor's title.

Distinctions. A bailment must be distinguished from a sale or barter. A bailment differs from a sale in this: in a sale there is a transfer of the general ownership or title, while in a bailment there is the transfer of possession for a particular purpose, the general ownership or title remaining in the bailor.

A bailment differs from a barter for the same reason. Further, in a bailment the identical thing is to be returned, though sometimes in an altered form, while in a barter some other thing is to be returned. If one delivers grain to be ground into meal and the meal returned, this is a bailment. But if one takes his grain to a mill and receives therefor meal already ground, this is a barter or sale. If one "lends" his neighbor a bag of oats to feed the neighbor's horse, this is a barter because the same oats are not to be returned but a like quantity of oats; this is technically called a mutuum.

Sometimes there is a bailment with an option to purchase, as where there is a "sale on approval" (see p. 76, ante). In such case the transaction becomes a sale when the bailee signifies his approval.

Sometimes there is a bailment with permission to mix the goods with others of a like kind, as where grain is placed in an elevator with the grain belonging to other bailors. The owners become owners in common of the mass, according to their respective shares. If there is no such permission, express or implied, the bailee must keep the bailor's goods separate from his own or others'.

62. Classification of bailments. Bailments fall into two classes, and each has subdivisions. The two classes are (I) bailments solely for the benefit of one party, and (II) bailments for the mutual benefit of both parties.

(I) Bailments solely for the benefit of one party, or gratuitous bailments, are divided into two classes.

I. Bailments for the sole benefit of the bailor are called either a deposit (or in the Roman law, depositum) or a mandate (or in the Roman law, mandatum). These are bailments in which the bailee without compensation is to keep the property of the bailor for him (deposit), or to do something to or about the property for the bailor's benefit (mandate).

Examples. C undertakes without reward to keep D's jewels. C without reward undertakes to repair D's watch. C without reward undertakes to carry D's grist to mill. The first case is a deposit. The others are mandates.

2. A bailment for the sole benefit of the bailee is called a commodatum, that is, a gratuitous loan. This is a bailment in which the bailor without compensation allows the bailee to use his property.

Examples. D loans C a jewel to wear, or D loans C his horse to drive, without compensation.

(II) Mutual benefit bailments may be divided into three classes, with two additional special instances.

1. The delivery of a chattel as security for a debt. This is called a pawn or pledge, or giving of collateral security (in the Roman law, pignus).

Examples. D borrows money of C and delivers his watch to Cas security. D borrows money of a bank and delivers bonds or shares of stock as collateral security.

2. The delivery of a chattel to the bailee to be used by him and such use paid for. This is like the second case given above, except that the bailee is to compensate the bailor. It is called a hiring, or, in the Roman nomenclature, locatio rei, the hired use of a thing.

Examples. D loans a jewel to C to wear, or D loans his horse to C to drive, in each case for a stipulated price.

3. The delivery of a chattel to the bailee to keep safely, or to do work upon, for a compensation. This is like the first case

given above, except that the bailee is to be paid instead of acting gratuitously. This is called a hiring (of services), or, in the Roman nomenclature, locatio operis, hired services about a thing. There are three special instances of this: (a) hired custody of a thing (locatio custodiae); (b) hired services upon a thing (locatio operis faciendi); (c) hired carrying of a thing (locatio operis mercium vehendarum).

Examples. C undertakes for a price to keep D's jewels safely. C for a price undertakes to repair D's watch. C for a price undertakes to carry D's grain to mill.

The following special cases of delivery for safe keeping or for transportation fall under mutual benefit bailments but call for separate treatment.

1. Innkeepers. The intrusting of goods to the protection of an innkeeper by a guest at the inn gives rise to peculiar liabilities.

2. Common carriers. The delivery of goods by a shipper to a common carrier for transportation gives rise to peculiar liabilities.

The following special cases do not fall strictly under bailment but may be treated here for convenience.

1. Public carriers of passengers and baggage.

2. Telegraph and telephone companies.

The classification of bailments may be thus summarized:

I. Gratuitous.

CLASSIFICATION OF BAILMENTS

1. Gratuitous services.

a. Deposit.

b. Mandate.

2. Gratuitous loans.

II. Mutual Benefit.

1. Pledge or pawn.

2. Hired use of a thing.

3. Hired services about a thing.

a. Custody of a thing (with special case of innkeepers).

b. Work upon a thing.

c. Transportation of a thing (with

special case of common carriers).