Section 28: Bailee’s liability

1) A bailee shall look after and arrange for the safety of the property received by him/her as bailed property as mentioned in the terms and conditions of the contract or as his/her own property in case nothing has been mentioned in the contract.

2) Except when otherwise provided for in the contract, in case any bailed property depreciates or is lost, stolen, damaged, destroyed, decreased or harmed because of natural calamities despite taking care and arranging for its security under sub-section (1), the bailee need not return such property.

Provided that, in case the property is depreciated or is lost, stolen, damaged, destroyed, decreased or harmed because of the negligence or malfide intention of the bailee, or of his/her failure to take care or ensure its safety according to the terms and conditions of the contract, he/she must return the property or pay an equivalent amount to the bailer.

3) In case the bailee uses the bailed property without having the right to do so under the contract or in a manner contrary to the terms and conditions of the contract, and in case such use causes any loss, damage, destruction, depreciation or harm to the property, the bailee shall pay for compensation to the bailer.

4) Except when otherwise provided for in the contract, the bailee shall not mix up the bailer’s property with his/her own property.

Provided that, in case the bailee has mixed up his/her own property with that of the bailer, both parties shall have the title on that property, as well as to the income accruing therefrom, in proportion to their respective shares.

5) In case the bailee has mixed up his/her own property with the bailer’s property and the property so mixed up can be separated, the two parties shall have title to their respective property so separated, and the expenses incurred for separating the property so mixed and the loss, if any caused, to the bailer while mixing-up such property in that manner shall be borne by the bailee.

6) In case the bailee has mixed up his/her own property with the bailer’s property without the consent of the bailer and their property cannot be separated as mentioned in Sub-section (5), the title of the bailer to the bailee’s property shall terminate if he/she agrees to obtain his/her share from the property so mixed-up. In case the bailer does not agree to take his/her share from such property the bailee shall be required to pay compensation for his/her property.