Environmental Engineering Chapter 25 Question Viewed Bailment Relationship Which Party Liable

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Chapter 25 Property 13

Public Use. If the premises are to be used for a public purpose, such as a store or office, the landlord is

generally obligated to repair any dangerous defects, although the tenant is probably liable as well. The

purpose of this stricter rule is to ensure that the general public can safely visit commercial establishments.

Additional Case: You Be the Judge: McGuire v. K & G Management Co.9

Facts: The McGuire family rented a second-story apartment from K & G Management, which managed

a residential complex on behalf of Avant Co. Robin McGuire notified K & G that a window screen was

loose in her son’s bedroom, and had fallen out once. Neighbors had also complained about loose-fitting

screens. Five days after Robin reported the loose screen, her son, 26-month-old Devin, was playing in his

bedroom with his eight-year-old cousin. Somehow, Devin fell or leaned into the window screen, which

gave way. Devin fell to the ground and was seriously hurt.

screens is not to prevent tenants from exiting through the windows.”

General Questions: If you agree with the tenant’s position, answer these questions:

• A window screen is supposed to keep bugs out, not children in. Why should a landlord be

responsible for the child’s fall?

• Isn’t the danger of an open window as obvious as any risk can be?

If you agree with the landlord’s position, answer these questions:

• A properly fitted window screen might well save lives. Why shouldn’t the law require a landlord

Personal Property

Personal property is all property other than real property

Gifts

A gift is a voluntary transfer of property from one person to another without any consideration. A gift has

three elements:

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• The donee accepts the property.

Inter Vivos Gifts and Gifts Causa Mortis

An inter vivos gift means a gift made “during life,” when the donor is not under any fear of impending

death.

• An inter vivos gift becomes final upon delivery.

• The donor can revoke the gift at any time before he dies.

You Be The Judge: Albinger v. Harris10

Facts: Michelle Harris and Michael Albinger lived together in a stormy relationship, marred by alcohol

abuse and violence, on and off for three years. When they announced their engagement, Albinger gave

You Be The Judge: Who owns the ring?

Holding: Michelle Harris gets to keep the ring. The court was unwilling to create a new type of

conditional gift. The court discussed the history of anti-heart balm statutes, the history of ring giving, and

other issues. Some excerpts of the decision follow.

Abolition of Breach of Promise Actions

By the mid-1930′s, several state legislatures questioned the efficacy of court “interference with

domestic relations” and passed statutes barring actions for breach of promise to marry, alienation of

affections, criminal conversation and other inappropriate conduct of the “private realm.”

Engagement Ring Symbology

The custom of giving expensive engagement rings is largely a mid– to late 20th Century phenomenon.

Conditional Gift Theory

According to Montana law, “a gift is a transfer of personal property made voluntarily and without

consideration.” The essential elements of an inter vivos gift are donative intent, voluntary delivery,

and acceptance by the recipient.

10 2002 MT 118, 2002 WL 1226858 Supreme Court of Montana, 2002

Chapter 25 Property 15

Another essential element of a gift is that it is given without consideration. A purported “gift” that is

part of the inducement for “an agreement to do or not to do a certain thing,” becomes the

consideration essential to contract formation. An exchange of promises creates a contract to marry,

albeit an unenforceable one. When an engagement ring is given as consideration for the promise to

marry, a contract is formed and legal action to recover the ring is barred by the abolition of the breach

of promise actions.

Albinger maintains he held a reversionary interest in the gift of the engagement ring grounded in

of death. This Court declines the invitation to create a new category of gifting by judicial fiat.

Gender Bias

Article II, Section 4 of the Montana Constitution recognizes and guarantees the individual dignity of

each human being without regard to gender. This Court and the Montana State Bar have recognized

the harm caused by gender bias and sexual stereotyping in the jurisprudence and courtroom of this

state.

Conditional gift theory applied exclusively to engagement ring cases, carves an exception in the

state’s gift law for the benefit of predominately male plaintiffs.

Engagement Ring Disposition

To preserve the integrity of our gift law and to avoid additional gender bias, we decline to adopt the

theory that an engagement ring is a gift subject to an implied condition of marriage.

Question: If you think that Michelle Harris should win, please answer these questions:

• Intent is an element of a gift. Wasn’t Albinger’s intent to give Harris the ring only if the couple

married?

has been no need of such a law – because everyone understood that the ring had to be returned?

Question: If you think that Michael Albinger should win, please answer these questions:

• Why should a court help someone who beat up his girlfriend?

• If Albinger did not want Harris to keep the ring, why did he keep giving it to her?

Bailment

A bailment is the rightful possession of goods by one who is not the owner.

• Bailor: the person who delivers the goods

• Bailee: the person in possession of the goods.

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Example: Negative Wedding

Shana and Meng-Lu hired Billy to photograph their wedding, agreeing to pay $1,500 when Billy

delivered the proofs, negatives, and contact sheets, and extra sums for any prints they ordered. The

wedding went off beautifully and Billy snapped away feverishly. The photographer developed hundreds

of color proofs and many black and white contact sheets, and the pictures looked great. Later that week,

as Billy was driving his girlfriend to her business law class, the two had a bitter fight over the definition

of “bailment.” In a moment of forensic rage, Billy hurled into the river what he believed was his

girlfriend’s backpack of business law books, only to realize moments later that it was his own backpack,

containing all of Shana and Meng-Lu’s pictures, that was racing downstream and out to sea. Shana and

Meng-Lu sued, claiming breach of a bailment agreement and breach of contract. Billy has moved to

dismiss both the bailment and contract claims.

Question: On the bailment claim, argue for Shana and Meng-Lu.

Answer:

• The parties created this bailment by agreement–namely, the contract to take pictures.

Question: On the bailment claim, argue for Billy.

Answer: There is no bailment.

• A bailment is the rightful, temporary possession of property by one who is not the owner. The

owner gives the property to the bailee. Here, Shana and Meng-Lu were not the owners of the

negatives belonged to Billy, as did the camera and the printing paper.

Question: Please rule on the bailment claim.

Answer: Motion to dismiss the bailment claim granted. The plaintiffs never owned the property,

there was no bailment agreement, and there was no delivery.

Question: Please comment on the contract claim.

Answer: Billy has clearly breached. The big question is, what are the damages? Shana and Meng-

Lu have not paid anything, so they are not out of pocket any money. Their losses are expectation

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Control

To create a bailment, the bailee must assume physical control of the bailor’s property with intent to

possess.

Additional Case: Mitchell v. Bank of America National Association11

Facts: Donna and Timothy Mitchell rented a safe deposit box from a Dallas branch of the Bank of

America. The lease agreement stated that the bank “had no possession or custody of, nor control over, the

contents of the Box, and the Lessee [the couple] assumes all risks in connection with the depositing of

such content.” The lease also permitted the bank to remove the box’s contents if the rental fee went

unpaid.

Bank officers, believing the Mitchells were behind in their rental fees, drilled into the box and

The Mitchells sued the bank, claiming that its negligence enabled bank employees to learn of the

box’s contents, orchestrate the flat tire, and steal the bag.

The trial court gave summary judgment for the bank, finding that the contract language quoted above

meant that there was no bailment, and no possible negligence. The Mitchells appealed.

Issue: Was there a bailment?

Holding: Summary judgment for the Bank reversed. Common law negligence principles generally

govern liability in bailment relationships. Parties to a bailment can alter the law of bailment by agreeing

to contract terms that clearly vary the liability imposed by law. To the extent the lease agreement clearly

However, the lease authorized the Bank to remove the contents of the box for non-payment of rent.

The lease thus contemplated a delivery of the property to the Bank under certain circumstances and did

not change the duties imposed by law once the Bank exercised its right to take control of the property.

The trial court thus erred in granting summary judgment for the Bank on the grounds the Mitchells’

common law cause of action for breach of bailment was superseded by the written contract.

Question: What law governed the Mitchells’ lease of the safe deposit box from the Bank?

Answer: Contract law, because initially the terms of the box-rental agreement established their

relationship.

Question: How did the box-rental agreement deal with the parties’ liability?

Question: Why do the Mitchells argue that there was a bailment?

Answer: Because if the box-rental agreement controlled, the Bank as a matter of law is entitled to

Question: Why?

Answer: Because if there was a bailment, the Bank’s duties with respect to the contents of the safe

11 2002 WL 31139375 Court of Appeals of Texas, 2002

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Question: The box-rental agreement said the Bank had no possession, custody, or control over the

contents of the box. Since bailment requires that the bailee exercise control over the property, how

can there be a bailment?

Answer: The no-bailment terms controlled the relationship as long as the contents remained in the

Question: Viewed as a bailment relationship, which party is liable for the loss?

Answer: The court did not determine who was liable. It ruled that the Bank was not entitled to

judgment as a matter of law that it was not liable.

Rights of the Bailee

The bailee’s primary right is possession of the property. Anyone who interferes with the bailee’s rightful

possession is liable to her.

Even a bailor is liable if he wrongfully takes back property from a bailee.

The bailee is typically, though not always, permitted to use the property.

Duties of the Bailee

The bailee is strictly liable to redeliver the goods on time to the bailor or to whomever the bailor

designates. Strict liability means there are virtually no exceptions.

Due Care

The bailee is obligated to exercise due care. The level of care required depends upon who receives the

benefit of the bailment:

• if the bailee is the sole beneficiary, she must use extraordinary care;

Burden of Proof

In an ordinary negligence case, the plaintiff has the burden of proof to demonstrate that the defendant

was negligent and caused the harm alleged. In bailment cases, the burden of proof is reversed. Once the

bailor has proven the existence of a bailment and loss or harm to the goods, a presumption of negligence

arises, and the burden shifts to the bailee to prove adequate care.

Long before his time as President, Abraham Lincoln was a lawyer who argued more than 150 cases

before the Supreme Court of Illinois. The case for Weedman is modeled after the arguments that a

young Lincoln actually made.

You Be the Judge: Johnson v. Weedman12

Facts: Johnson left his horse with Weedman, paying him to board and feed the animal. Johnson did not

grant Weedman permission to ride the horse. Nonetheless, Weedman took the horse for a 15 mile ride.

Later that day, the horse died. However, the trial court found that Weedman had not abused the

animal, and that the ride had not caused the horse’s death. The court did not grant damages to Johnson,

and Johnson appealed.

12 5 Ill. 495, Supreme Court of Illinois, 1843

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Weedman made personal use of my client’s property when he took a 15 mile ride that was in no way

necessary. The trial court’s finding that Weedman did not abuse the horse during the ride is irrelevant.

My client must be compensated for the loss of his animal.

Argument for Weedman: My client had a legal right to possession of the horse. Riding the horse was

horse.

Holding: Summary judgment for the Bank reversed. Common law negligence principles generally govern

liability in bailment relationships. Parties to a bailment can alter the law of bailment by agreeing to

contract terms that clearly vary the liability imposed by law. To the extent the lease agreement clearly

addressed the duties and liabilities of the Bank for the Mitchells’ property, the lease agreement controls.

To establish a bailment, there must be a delivery of personal property from one person to another for

However, the lease authorized the Bank to remove the contents of the box for nonpayment of rent.

The lease thus contemplated a delivery of the property to the Bank under certain circumstances and did

Question: What law governed the Mitchells’ lease of the safe deposit box from the Bank?

Answer: Contract law, because initially the terms of the box-rental agreement established their

relationship.

Question: How did the box-rental agreement deal with the parties’ liability?

Question: Why do the Mitchells argue that there was a bailment?

Answer: Because if the box-rental agreement controlled, the Bank as a matter of law is entitled to

Question: Why?

Question: The box-rental agreement said the Bank had no possession, custody, or control over the

contents of the box. Since bailment requires that the bailee exercise control over the property, how

can there be a bailment?

Answer: The no-bailment terms controlled the relationship as long as the contents remained in the

Question: Viewed as a bailment relationship, which party is liable for the loss?

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Answer: The court did not determine who was liable. It ruled that the Bank was not entitled to

Rights and Duties of the Bailor

The bailor’s rights and duties are the reverse of the bailee’s. The bailor is entitled to the return of his

property on the agreed-upon date. He is also entitled to receive the property in good condition and to

recover damages for harm to the property if the bailee failed to use adequate care.

Multiple Choice Questions

1. Quick, Onyx, and Nash were deeded a piece of land as tenants in common. The deed provided

that Quick owned one-half the property and Onyx and Nash owned one-quarter each. If Nash

dies, the property will be owned as follows:

(a) Quick 1⁄2, Onyx 1⁄2.

(b) Quick 5⁄8, Onyx 3⁄8.

(d) Quick 1/2 Onyx 1/4, Nash’s heirs 1/4

2. Which of the following forms of tenancy will be created if a tenant stays in possession of leased

premises without the landlord’s consent, after the tenant’s one-year written lease expires?

(a) Tenancy at will

(b) Tenancy for years

(d) Tenancy at sufferance

3. Consider the following:

I. A house (value: $150,000)

II. A giant HD television in the house (value: $4,999)

III. The land that the house sits upon (value: $30,000)

IV. An old car in the house’s garage (value: $5,001)

How many of these items are personal property?

(a) All 4 of them

(b) 3 of them

(d) 1 of them

(e) None of them

4. Holding out an envelope, Alan says, “Ben, I’m giving you these opera tickets.” Without taking

the envelope, Ben replies, “Why would I want opera tickets? Loser.” Alan leaves, crestfallen.

Later that day, a girl whom Ben has liked for some time says, “I sure wish I were going to the

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opera tonight.” Ben scrambles, calls Alan, and says, “Alan, old buddy, I accept your gift of the

opera tickets. I’m on my way over to pick them up.” Does Ben have a legal right to the tickets?

(a) Yes, because Alan intended to transfer ownership.

(b) Yes, because offers to give gifts cannot be revoked.

(d) No, because Ben did not accept the gift when offered.

5. A tenant renting an apartment under a three-year written lease that does not contain any specific

restrictions may be evicted for:

(a) Counterfeiting money in the apartment

(b) Keeping a dog in the apartment

(d) Making structural repairs to the apartment

Essay Questions

1. You Be the Judge: WRITING PROBLEM Frank Deluca and his son David owned the

Sportsman’s Pub on Fountain Street in Providence, Rhode Island. The Delucas applied to the city for

a license to employ topless dancers in the pub. Did the city have the power to deny the Delucas’

request? Argument for the Delucas: Our pub is perfectly legal. Further, no law in Rhode Island

prohibits topless dancing. We are morally and legally entitled to present this entertainment. The city

should not use some phony moralizing to deny customers what they want. Argument for Providence:

This section of Providence is zoned to prohibit topless dancing, just as it is zoned to bar

manufacturing. There are other parts of town where the Delucas can open one of their sleazy clubs if

they want to, but we are entitled to deny a permit in this area.

Answer: Yes, the city could use its zoning powers to deny the license. Earlier zoning ordinances had

2. Kenmart Realty sued to evict Mr. and Ms. Alghalabio for nonpayment of rent and sought the unpaid

monies, totaling several thousand dollars. In defense, the Alghalabios claimed that their apartment

was infested with rats. They testified that there were numerous rat holes in the walls of the living

room, bedroom, and kitchen, that there were rat droppings all over the apartment, and that on one

occasion they saw their toddler holding a live rat. They testified that the landlord had refused

numerous requests to exterminate. Please rule on the landlord’s suit.

Answer: The Alghalabio’s defense was breach of the implied warranty of habitability. The landlord

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3. Lisa Preece rented an apartment from Turman Realty, paying a $300 security deposit. Georgia law

states: “Any landlord who fails to return any part of a security deposit which is required to be

returned to a tenant pursuant to this article shall be liable to the tenant in the amount of three times the

sum improperly withheld plus reasonable attorney’s fees.” When Preece moved out, Turman did not

return her security deposit, and she sued for triple damages plus attorney’s fees, totaling $1,800.

Turman offered evidence that its failure to return the deposit was inadvertent and that it had

procedures reasonably designed to avoid such errors. Is Preece entitled to triple damages? Attorney’s

fees?

Answer: The court held the defendant liable for $900 (treble damages) and an additional $900 in

LEXIS 1216 (Ga. App. 1997).

4. Ronald Armstead worked for First American Bank as a courier. His duties included making deliveries

between the bank’s branches in Washington, D.C. Armstead parked the bank’s station wagon near the

entrance of one branch in violation of a sign saying: “No Parking Rush Hour Zone.” In the rear

luggage section of the station wagon were four locked bank dispatch bags, containing checks and

other valuable documents. Armstead had received tickets for illegal parking at this spot on five

occasions. Shortly after Armstead entered the bank, a tow truck arrived and its operator prepared to

tow the station wagon. Transportation Management, Inc., operated the towing service on behalf of the

District of Columbia. Armstead ran out to the vehicle and told the tow truck operator that he was

prepared to drive the vehicle away immediately. But the operator drove away with the station wagon

in tow. One and one-half hours later, a bank employee paid for the car’s release, but one dispatch bag,

containing documents worth $107,000, was missing. First American sued Transportation

Management and the District of Columbia. The defendants sought summary judgment, claiming they

could not be liable. Were they correct?

Answer: The trial court held that this was a gratuitous bailment and that therefore the defendants

were liable only for gross negligence. Because there was no gross negligence, the court found for the

5. You Be the Judge: WRITING PROBLEM Eileen Murphy often cared for her elderly

neighbor, Thomas Kenney. He paid her $25 per day for her help and once gave her a bank certificate

of deposit worth $25,000. She spent the money. Murphy alleged that shortly before his death,

Kenney gave her a large block of shares in three corporations. He called his broker, intending to

instruct him to transfer the shares to Murphy’s name, but the broker was ill and unavailable. So

Kenney told Murphy to write her name on the shares and keep them, which she did. Two weeks later

Kenney died. When Murphy presented the shares to Kenney’s broker to transfer ownership to her,

the broker refused because Kenney had never endorsed the shares as the law requires, that is, signed

Chapter 25 Property 23

them over to Murphy. Was Murphy entitled to the $25,000? To the shares? Argument for Murphy:

The purpose of the law is to do what a donor intended, and it is obvious that Kenney intended

Murphy to have the $25,000 and the shares. Why else would he have given them to her? A greedy

estate should not be allowed to interfere with the deceased’s intention. Argument for the Estate:

Murphy is not entitled to the $25,000 because we have no way of knowing what Kenney’s intentions

were when he gave her the money. She is not entitled to the shares of stock because Kenney’s failure

to endorse them over to her meant he never delivered them, and that is an essential element of a gift.

Answer: Murphy gets the $25,000. There was delivery, acceptance, and adequate evidence that

Discussion Questions

1. Is it sensible to distinguish between inter vivos gifts and gifts causa mortis? Should someone “on his

deathbed” be able to change his mind so easily?

2. Donny Delt and Sammy Sigma are students and roommates. They lease a house in a neighborhood

near campus. Few students live on the block.

The students do not have large parties, but they often have friends over at night. The friends

sometimes play high-volume music in their cars, and sometimes speak loudly when going to and from

their cars. Also, departing late night guests often leave beer cans and fast food wrappers in the street.

Neighbors complain about being awakened in the wee hours of the morning. They are considering

filing a nuisance lawsuit against Donny and Sammy. Would such an action be reasonable? Do you

think Donny and Sammy are creating a nuisance? If so, why? If not, where is the line– what amount

of late night noise does amount to a nuisance?

3. Imagine that you sign a lease, and that you are to move into your new apartment on August 15. When

you arrive, the previous tenant has not moved out. In fact, he has no intention of moving out.

Compare the English and the American rules. Should the landlord be in charge of getting rid of the

old tenant, or should you have the obligation to evict him?

4. When landlords wrongfully withhold security deposits, they can often be sued for three times the

amount of the security deposit. Is this reasonable? Should a landlord have to pay $3000 for a $1000

debt? What if you fail to pay a rent on time? Should you have to pay three times the amount of your

normal rent? If your answers to these two questions are different, why is that?

5. In the case of a gratuitous bailment, the bailee is only liable if he is grossly negligent. Is this good

policy? If you agree to watch someone’s property, shouldn’t you be required to be careful even if you

are not being paid?

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