A bailor is an individual or entity that temporarily entrusts possession of a property or good to another party, known as the bailee, under an agreement that the property will be returned or otherwise disposed of according to the bailor's instructions.
The relationship between a bailor and bailee is central to the concept of bailment, which involves a change in possession but not ownership of property. Bailment arrangements can be for various purposes, including storage, repair, transport, or for the use of the property.
The bailor retains ownership of the property and provides it to the bailee under conditions that may or may not involve compensation. The bailee is responsible for the care and custody of the property and is typically required to return it in good condition at the end of the bailment period.
Property Law: Bailment situations, where the bailor provides goods for storage, repair, or specific use.
Commercial Law: In commercial transactions, businesses act as bailors when they deliver goods to a transporter or repair service.
Many believe that the bailor-bailee relationship only arises in formal, written agreements.
While such relationships can be formalized through contracts, they can also arise from informal arrangements or even through tacit understanding based on the parties' actions. The crucial aspect is the transfer of possession with the expectation of the property's return or care, not necessarily the existence of a written agreement.
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