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Exam 15: Bailment and Leasing

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Question 1

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In both chattel leases and bailment,ownership remains with the property owner who gives possession of the property to another for a period of time on the understanding that it will be returned.

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Question 2

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Regarding bailments,which of the following is TRUE?

A) Articles held under bailment form assets available to creditors in bankruptcy.
B) Bailments are not confined to personal property.
C) Trusts are bailments because there is a transfer of property.
D) Chequing accounts at the bank are a form of bailment.
E) Contents in a safety deposit box are a form of bailment.

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Question 3

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The transfer of possession of personal property without a transfer of ownership is referred to legally as bailment.Which of the following is NOT considered a type of bailment?

A work associate leaves his bike each day in your garage while both of you commute to work in your car.(This associate pays $5 per day for riding in your car.) One day the bike is stolen out of your locked garage.Are you responsible for the loss of this bike?

Rex,a licensed contractor,rented a heavy duty brush cutter from YouRentAll Inc.Within the first few minutes of use,the blade came off and extensively damaged the shroud and housing of the machine.It was determined that the bolts that held the blade on were left loose by some previous user.YouRentAll sued Rex for the repair costs,claiming Rex should have checked out the machine before using.Assuming the lease contract did not speak to this type of situation,how would the court rule?

Use the fact situation above to answer the question. Using the fact situation above,assume that just after B,the dealer,enters into the lease agreement with A,he assigns the lease to a financing company,which gives notice to A to make all payments to the company until the price has been paid in full,at which time the company will transfer the car to A.In this case,the lease is best described as

A sends a package valued at $400.00 to B by means of the courier company X Co.In the contract between A and X Co.,there is a limitation of liability clause that limits X Co.'s liability for damage or loss caused to the goods by any reason whatsoever,including the negligence of X Co.and/or its employees,to $20.00.When the goods reach B,they are damaged.If A sues X Co.for the full $400.00

A reason to sue for breach of a contract of bailment rather than for negligence is that in a contract of bailment

A bailor is better off on the insolvency of its bailee than a creditor is on the insolvency of its debtor.

If goods are damaged while in the possession of a bailee,the bailee is strictly liable.

What are the bailment rights of the lessee?

Common carriers may limit the amount of their liability when the shipper does not declare the value of goods.Usually these terms must be approved by the Canadian Transportation Agency,which has jurisdiction over the common carrier.Discuss the benefit to both the shipper and the common carrier with this arrangement.

Quincy owns a metal fabricating company.He is desperately in need of working capital in order to carry out several large orders.Therefore he sells his heavy stamping equipment to Beneficial Leasing Inc.in a five-year purchase lease plan.This arrangement amounts to

Marcus rented some scaffolding to aid in replacing the siding of his house.This type of lease would be referred to as

Under the rules of what general area of law is there a duty imposed on all bailees to take care of property bailed to them?

Marie drove her car to a parkade.The attendant took her keys,saying that he would park the vehicle and that he needed the keys because the vehicle might be required to be moved.In the parkade,vehicles were parked in two tiers.To remove a vehicle from the second tier,it was necessary to move the vehicle immediately in front of it in the first tier.Marie paid for the parking and was given a ticket with her vehicle licence number written on it.At the entrance to the parkade,two signs were prominently displayed,one requesting that the conditions on the ticket be read and the other stating that the car with its contents were left at the owner's risk.The conditions on the ticket repeated that the car was parked at the owner's risk and that charges were only for parking space use and that the parkade assumed no responsibility for loss through fire,theft,collision,or otherwise to the car or its contents,whether due to the parkade's negligence or otherwise.During the day Marie's vehicle was temporarily parked on the street immediately in front of the parkade to accommodate the removal of several vehicles.The attendant threw the keys under the front seat and left the car unlocked.The vehicle was stolen and never recovered.Marie said she did not see the signs nor read the conditions on the ticket.Identify the issues raised by these facts.Should Marie succeed in an action against the parkade?

Which of the following is TRUE regarding bailments?

A leases a harvesting machine from B to be used during the harvesting season in Ontario,which is from the beginning of August to the end of September.In this case,the lease is best described as

The notion of an "inherent vice" is a defence.

When can a warehousing firm that has issued a warehouse receipt for goods avoid liability in not returning the exact goods stored?