Answer in Law for rahul #228001

Q.4 (a) Differentiate between contract of indemnity and contract of guarantee.

(b) Define Bailment and also duties of Bailor.

(c) Explain the various implied conditions in a contract of Sale.

(d) Explain the rights of unpaid seller against goods.  

a)     Contract of Indemnity refers to a contract by which one party promises to save the other from loss caused by conduct of the promisor or another person. In this type of contract, the liability of the promisor is primary. Contract of Guarantee refers to a Contract to perform the promise or discharge the liability of a third person in case of his default. In this contract, the primary liability is of principal debtor and the liability of surety is secondary.

b)     A bailment is an agreement in common law that comes into effect when someone entrusts an asset to someone else for safekeeping. The bailor is the owner of the asset and temporarily relinquishes it to the bailee.

The duties of a bailor include;

  • It is the duty of a bailor to disclose all faults. …
  • Also, the bailor is under the duty to pay the extraordinary expenses incurred by the bailee for such bailment.
  • It is the duty of the bailor to accept the goods after the purpose for which such goods were bailed is accomplished.

c)     Implied conditions on the sale of goods include conditions based on the title, description, sale by sample, sale by sample as well as description, quality, merchantability, and wholesomeness.

d)     Rights of an unpaid seller against the goods

·        Right of lien. The right of lien is the right to retain possession of the goods until payment for the same is made.

·        Right of stoppage in transit. It is a right of stopping the goods while in transit after the unpaid seller has lost possession of the goods. 

·        Right of resale. The unpaid seller can re-sell the goods if the goods are of a perishable nature.



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