BUSINESS LAW QUESTIONS AND ANSWERS A+ GRADED
Bailment of personal property
a relationship that arises when one party, the bailor, transfers possession of personality
to another, the bailee, to be used by the bailee in an agreed-on manner for an agreed-
on time period
Example: Woman leaves her coat in a coat check room. She hands her coat to the clerk
and is given a ticket identifying the object of the bailment so that it can be reclaimed.
Determining who benefits from bailment is a key factor in determining the
standard of care owed by the bailee.
If bailment intended to benefit only the bailor--->?
the bailee is liable for damage to property caused by the bailee's gross negligence
Bailment solely for the bailee's benefit
the bailee is responsible for harm to the property caused even by the slightest lack of
due care on the part of the bailee
Example: Jim borrowed his roommates bike to go to the library and even though he
parked the bike as far away from other bikes as he could....if someone scratched the
bike while Jim was in the library, Jim would have to compensate his roommate for the
damage done to the bike
If bailment is for the mutual benefit of the bailee and bailor
the bailee is liable for harm to the bailed property arising from the bailee's ordinary or
gross negligence
If property is harmed by an unpreventable "act of God" there is no liability on the part of
the bailee under any circumstance
Conspicuous signs can be hung to limit liability
Example: a health club sign may say "rent a locker for $1. Health club is not responsible
for items stolen from unlocked lockers."
Rights of the Bailor
Right to expect that the bailee take reasonable care of the bailed property, repairing and
maintaining it as necessary.
Right to expect that the bailee use the bailed property only as stipulated in the bailment
agreement.
Right to expect that the bailee will not alter the bailed property in any unauthorized
manner.
Right to expect that the bailee will return the bailed property in good condition at the end
of the bailment.
Duties of the Bailor
Bailor must provide the bailee with any agreed-on compensation for the bailment
Bailor must reimburse the bailer for any necessary costs uncured by te bailee during the
bailment
Rights of the Bailee
Right to possess the bailed property during the term of the bailment
Right to use the property in a manner consistent with the terms and purpose of the
bailment
,Right to receive compensation for the bailment unless the bailment is gratuitous
Right to retain the bailed property until payment is received
Duties of the Bailee
Bailee must take reasonable care of the bailed property, repairing and maintain it as
necessary
Bailee must use the bailed property only as stipulated in the bailment agreement
Bailee must not alter the bailed property in any unauthorized manner
Bailee must return the bailed property in good condition at the end of the bailment
Bailment Agreements
Bailments can be expressed or implied
When a bailment is express, there is no requirement for a written agreement unless the
statue of frauds applies.
Documents of Title
when a bailment is for the purpose of transportation or storage of goods these
documents of title may be issued in conjunction with the bailment
A document of title "must purport to be issued by or addressed to a bailee and purport
to cover goods in the bailee's possession which are either identified or are fungible
portions of an identified mass
Bill of landing
document issued by a person engaged in the business of transporting goods that
verifies receipt of the goods for a shipment
Warehouse receipt
a receipt issued by one who is engaged in the business of storing goods for
compensation
Delivery order
written order to deliver goods directed to a party who issues warehouse receipts or bills
of landing
Common carriers
mutual-benefit bailment is created, but because the bailee is a common carrier, her or
she is held to a higher standard of carecarrier is absolutely liable for any harm done to
the property even if there was not negligence (only exception is an act of god, an act of
a public enemy, act of the shipper, or inherit nature of good)
Innkeepers' Liability
innkeepers and anyone else who is in the business of regularly providing lodging to to
others are held to a strict liability standard for their guest's property.
Some states allow innkeepers to avoid or limit strict liability for their guests' property if
they provide guests with a safe for their valuables...guests must be notified that there is
a safe
Generally, innkeeper does not have any responsibility for a guests car unless they
provide parking facilities
Personal Property
all property that is not land or not permanently affixed to land
Tangible property: is property that can be identified by the senses. You can see or touch
it. (cars, furniture, etc.)
Intangible property
, items like bank accounts, stocks, and insurance policies
Voluntary Transfer of Property
Transfer of property by purchase
the acquiring party gives some consideration to the seller in exchange for the title to the
property
Usually no formalities, but in a few cases changes of ownership mist be registered with
a government agency.... this would include sales of motor vehicles, watercraft,
airplanes, etc.
Certificate of title must be signed by the seller, taken to the appropriate government
agency, and then reissued in the name of the new owner
Gifts: do not require consideration
3 elements for a valid gift
Delivery, Donate Intent, acceptance.
delivery
may be actual, where the gift is physically presented, or constructive, which entails the
delivery of an item that gives access to the gift or represents it (i.e. car keys)
Donative Intent
the doner makes the delivery with the purpose of turning over ownership at the time of
the delivery
Acceptance
willingness of the donne to take the gift from the donor
Inter vivos gifts
gifts that are made by a person during his or her lifetime
Gift causa mortis
gift that is made in contemplation of one's immediate death. It can be revoked any time
before the death of the donor, and it is automatically revoked if the donor recovers.
Involuntary Transfer of Personal Property
Occurs when property has been abandoned, lost, or mislaid.
Finder of such property may acquire ownership rights to such property through
possession
Abandoned property
property that the original owner had discarded. Anyone that finds such property
becomes the owner by possessing it.
Lost property
property that the true owner has unknowingly or accidentally dropped or left
somewhere. He or she has no way of knowing how to retrieve it. In most states, the
finder of the lost property has title to the lost good against all EXCEPT the true owner
Mislaid property
differs from lost property in that the owner had intentionally placed the property
somewhere but has forgotten its location. The person who owns the realty on which the
mislaid property was placed has the right to hold this mislaid property since the true
owner will probably return looking for the mislaid property.
***finder of lost or mislaid property acquires title to the property against all except the
true owner
Zoning
Bailment of personal property
a relationship that arises when one party, the bailor, transfers possession of personality
to another, the bailee, to be used by the bailee in an agreed-on manner for an agreed-
on time period
Example: Woman leaves her coat in a coat check room. She hands her coat to the clerk
and is given a ticket identifying the object of the bailment so that it can be reclaimed.
Determining who benefits from bailment is a key factor in determining the
standard of care owed by the bailee.
If bailment intended to benefit only the bailor--->?
the bailee is liable for damage to property caused by the bailee's gross negligence
Bailment solely for the bailee's benefit
the bailee is responsible for harm to the property caused even by the slightest lack of
due care on the part of the bailee
Example: Jim borrowed his roommates bike to go to the library and even though he
parked the bike as far away from other bikes as he could....if someone scratched the
bike while Jim was in the library, Jim would have to compensate his roommate for the
damage done to the bike
If bailment is for the mutual benefit of the bailee and bailor
the bailee is liable for harm to the bailed property arising from the bailee's ordinary or
gross negligence
If property is harmed by an unpreventable "act of God" there is no liability on the part of
the bailee under any circumstance
Conspicuous signs can be hung to limit liability
Example: a health club sign may say "rent a locker for $1. Health club is not responsible
for items stolen from unlocked lockers."
Rights of the Bailor
Right to expect that the bailee take reasonable care of the bailed property, repairing and
maintaining it as necessary.
Right to expect that the bailee use the bailed property only as stipulated in the bailment
agreement.
Right to expect that the bailee will not alter the bailed property in any unauthorized
manner.
Right to expect that the bailee will return the bailed property in good condition at the end
of the bailment.
Duties of the Bailor
Bailor must provide the bailee with any agreed-on compensation for the bailment
Bailor must reimburse the bailer for any necessary costs uncured by te bailee during the
bailment
Rights of the Bailee
Right to possess the bailed property during the term of the bailment
Right to use the property in a manner consistent with the terms and purpose of the
bailment
,Right to receive compensation for the bailment unless the bailment is gratuitous
Right to retain the bailed property until payment is received
Duties of the Bailee
Bailee must take reasonable care of the bailed property, repairing and maintain it as
necessary
Bailee must use the bailed property only as stipulated in the bailment agreement
Bailee must not alter the bailed property in any unauthorized manner
Bailee must return the bailed property in good condition at the end of the bailment
Bailment Agreements
Bailments can be expressed or implied
When a bailment is express, there is no requirement for a written agreement unless the
statue of frauds applies.
Documents of Title
when a bailment is for the purpose of transportation or storage of goods these
documents of title may be issued in conjunction with the bailment
A document of title "must purport to be issued by or addressed to a bailee and purport
to cover goods in the bailee's possession which are either identified or are fungible
portions of an identified mass
Bill of landing
document issued by a person engaged in the business of transporting goods that
verifies receipt of the goods for a shipment
Warehouse receipt
a receipt issued by one who is engaged in the business of storing goods for
compensation
Delivery order
written order to deliver goods directed to a party who issues warehouse receipts or bills
of landing
Common carriers
mutual-benefit bailment is created, but because the bailee is a common carrier, her or
she is held to a higher standard of carecarrier is absolutely liable for any harm done to
the property even if there was not negligence (only exception is an act of god, an act of
a public enemy, act of the shipper, or inherit nature of good)
Innkeepers' Liability
innkeepers and anyone else who is in the business of regularly providing lodging to to
others are held to a strict liability standard for their guest's property.
Some states allow innkeepers to avoid or limit strict liability for their guests' property if
they provide guests with a safe for their valuables...guests must be notified that there is
a safe
Generally, innkeeper does not have any responsibility for a guests car unless they
provide parking facilities
Personal Property
all property that is not land or not permanently affixed to land
Tangible property: is property that can be identified by the senses. You can see or touch
it. (cars, furniture, etc.)
Intangible property
, items like bank accounts, stocks, and insurance policies
Voluntary Transfer of Property
Transfer of property by purchase
the acquiring party gives some consideration to the seller in exchange for the title to the
property
Usually no formalities, but in a few cases changes of ownership mist be registered with
a government agency.... this would include sales of motor vehicles, watercraft,
airplanes, etc.
Certificate of title must be signed by the seller, taken to the appropriate government
agency, and then reissued in the name of the new owner
Gifts: do not require consideration
3 elements for a valid gift
Delivery, Donate Intent, acceptance.
delivery
may be actual, where the gift is physically presented, or constructive, which entails the
delivery of an item that gives access to the gift or represents it (i.e. car keys)
Donative Intent
the doner makes the delivery with the purpose of turning over ownership at the time of
the delivery
Acceptance
willingness of the donne to take the gift from the donor
Inter vivos gifts
gifts that are made by a person during his or her lifetime
Gift causa mortis
gift that is made in contemplation of one's immediate death. It can be revoked any time
before the death of the donor, and it is automatically revoked if the donor recovers.
Involuntary Transfer of Personal Property
Occurs when property has been abandoned, lost, or mislaid.
Finder of such property may acquire ownership rights to such property through
possession
Abandoned property
property that the original owner had discarded. Anyone that finds such property
becomes the owner by possessing it.
Lost property
property that the true owner has unknowingly or accidentally dropped or left
somewhere. He or she has no way of knowing how to retrieve it. In most states, the
finder of the lost property has title to the lost good against all EXCEPT the true owner
Mislaid property
differs from lost property in that the owner had intentionally placed the property
somewhere but has forgotten its location. The person who owns the realty on which the
mislaid property was placed has the right to hold this mislaid property since the true
owner will probably return looking for the mislaid property.
***finder of lost or mislaid property acquires title to the property against all except the
true owner
Zoning
