06/22/2021
If the bailment is for the mutual benefit of the bailor and bailee, it carries a moderate level of duty of care. This happens when there is an exchange of performances between the parties, for example, a service that requires payment. This may involve repair, storage, or alteration of an item, for a fee. It is considered mutual benefit as both parties receive a benefit (the bailor’s chattel is improved/repaired, and the bailee gets paid).
If the bailment is for the sole benefit of the bailor, it carries the lowest level of duty of care. This occurs when the owner is the only one benefitting from the bailment and the bailee is acting gratuitously. For example, an owner leaves a valuable item such as a car, a piece of jewelry, some art, an appliance, etc. in the safekeeping of a trusted friend while the owner is traveling or moving. There is no agreement or expectation to compensate the friend.
If the bailment is for the sole benefit of the bailee, it carries the highest duty of care. For example, a person loans their car to their neighbour, or loans a piece of equipment to a friend. The bailee (receiver) must exercise the highest level of care since the loan is being done solely for their benefit and no payment is being made to the owner. The bailee is liable for any damages arising from their own negligence or the negligence of others who gain access to the item, for example, the item is stolen by an unknown third party while in the borrower’s possession, or someone else uses the borrowed car while in the borrower’s possession. The borrower is deemed liable for the replacement cost.