Deck 30: Personal Property and Bailment

Question 1

During her second year at the Juilliard School of Music in New York City, Ann Rylands had a chance to borrow for one month a rare Guadagnini violin made in 1768. She returned the violin to the owner in Philadelphia, but then she telephoned her father to ask if he would buy it for her. He borrowed money from his pension fund and paid the owner. Ann traveled to Philadelphia to pick up the violin. She had exclusive possession of the violin for the next 20 years, using it in her professional career. Unfortunately, she became an alcoholic, and during one period when she was in a treatment center, she entrusted the violin to her mother for safekeeping. At about that time, her father died. When Ann was released from the center, she requested return of the violin, but her mother refused. Who owns the violin

Answer 1

Even though Ann's father originally paid for the violin, he gave it to Ann as a gift; she even went to physically assume ownership of the violin at the original owner's location. As stated in the problem, Ann had absolute ownership of the violin for twenty years.
Bailment is the rightful possession of goods by someone who is not the owner. The one who presents the items is the bailor and the one in possession is the bailee. In the situation outlined in the book, Ann Rylands is the bailor and her mother is the bailee, since Ann entrusted her prized violin to her mother for safekeeping and her mother accepted. As the bailee, her mother is obligated to return the violin to the bailor, Ann, when she requests. Ann is still the owner of the violin.

Question 2

Marjan International Corp. sells handmade Oriental rugs. V. K. Putman, Inc., is a Montana trucking company. Marjan delivered valuable rugs to Putman for shipment from New York City to Tacoma, Washington. Unfortunately, there were several delays in transit. The truck driver encountered snowstorms and closed roads. His truck also overheated and required repairs in a garage. Before the driver resumed the trip, he stopped to pick up and load other goods. When the truck finally arrived in Tacoma, two bales of rugs were missing. Marjan sued on the grounds that Putman was a common carrier, but Putman claimed it was a contract carrier. What difference does it make whether Putman was a common carrier or a contract carrier, and how is that determined

Answer 2

MI, a rug selling company makes a sale in Montana and hired the services of a carrier company called P Man Co. The truck carrying the rugs got delayed due to several reasons and also carried other luggage along with the rugs. When it reached the destination, two bundles of rugs were missing.
In this case, common carrier refers to the one that provides its services to the general public on regular basis. Since, the common carrier is governed by the Carmack amendment pertaining to which a bailor is required to prove that the property is delivered to the carrier in adequate or appropriate condition and the cargo owned by the carrier arrived damaged. Thus under such situation the carrier is held liable unless it is proved that loss was not due to act of public enemy and act of god. Since, P made its services available on a regular basis to the general public as a result of which it is a common carrier and the act is not associated with public enemy and god, therefore P is liable for the full amount of rugs that were missing.

Question 3

CPA QUESTION: Which of the following requirements must be met to create a bailment
I) Delivery of personal property to the intended bailee
II) Possession by the intended bailee
III) An absolute duty on the intended bailee to return or dispose of the property according to the bailor's directions
(a) I and II only
(b) I and III only
(c) II and III only
(d) I, II, and III

Answer 3

A bailment is the rightful ownership of goods by someone who is not the owner. The one who supplies the goods is the bailor, and the one in ownership is the bailee.
The conditions which are necessary to create a bailment are:
I. Delivery of the intended property to the bailee
II. Possession of the property by the bailee.
These two conditions are necessary for an intended bailment.
The III condition that the duty of the bailee is to dispose off or return the goods or the property based on bailor's directions, is incorrect.
Therefore, the correct option is
.

Question 4

Car Moves hauls autos anywhere in the country. Valerie hires Car Moves to take her Porsche from Chicago to Los Angeles. The Porsche arrives badly damaged because the Car Moves truck was hit by a bus. The accident was caused by the bus driver's negligence. If Valerie sues Car Moves for the cost of repairs, what will happen
(a) Valerie will win.
(b) Valerie will win only if she can prove Car Moves was partly negligent.
(c) Valerie will win only if she can prove that Car Moves agreed to strict liability.
(d) Valerie will lose because Car Moves did not cause the accident.
(e) Valerie will lose because this was a bailment for mutual benefit.

Question 5

Circle true or false:
T F A gift is unenforceable unless both parties give consideration.

Question 6

Circle true or false:
T F A common carrier is strictly liable for harm to the bailor's goods.

Question 7

Consider revocable gifts. The example early in the chapter was, "The mule is yours from now on, but if you ever start acting stupid again, I'm taking her back." In such a case, the giver still owns the mule and can take it back at any time. Is this reasonable Should stating a condition "cancel" a gift, or should the gift recipient in this example own the mule

Question 8

Match the following terms with their definitions:

Question 9

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. Oneand- a-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

Question 10

Martin is a rich businessman in perfect health. On Monday morning, he tells his niece, Stephanie, "Tomorrow I'm going to give you my brand new Ferrari."
Stephanie is ecstatic. That afternoon, Martin is killed in a car accident. Does Stephanie get the car
(a) Stephanie gets the car because this is a valid inter vivos gift.
(b) Stephanie gets the car because this is a valid gift causa mortis.
(c) Stephanie gets the car because there is no reason to dispute that Martin made the promise.
(d) Stephanie gets the car unless Martin left a wife or children.
(e) Stephanie does not get the car.

Question 11

Circle true or false:
T F A gift causa mortis is automatically revoked if the donor dies shortly after making it.

Question 12

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

Question 13

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 them over to Murphy. Was Murphy entitled to the $25,000 To the shares

Question 14

Margie has dinner at Bill's house. While helping with the dishes, she takes off her Rolex watch and forgets to put it back on when she leaves for the night. Bill finds the watch in the morning and decides to keep it.
(a) This is abandoned property, and Bill is entitled to it.
(b) This is lost property, and Bill is entitled to it.
(c) This is lost property, and Margie is entitled to it.
(d) This is mislaid property, and Bill is entitled to it.
(e) This is mislaid property, and Margie is entitled to it.

Question 15

Circle true or false:
T F A bailee always has the right to possess the property.

Question 16

After a baseball game, Randy cannot find his car in the stadium parking lot. For the life of him, he cannot remember where he parked. He wanders down row after row for an hour, and then another hour. Eventually, he gives up and calls a cab. Is Randy's car lost, abandoned, or mislaid If Randy never returns to reclaim the car, who owns it

Question 17

Artist James Daugherty painted six murals on the walls of the public high school in Stamford, Connecticut. Many years later, the city began to restore its high school. The architect and school officials agreed that the Daugherty murals should be preserved. They arranged for the construction workers to remove the murals to prevent harm. By accident, the workers rolled them up and placed them near the trash dumpsters for disposal. A student found the murals and took them home, and he later notified the federal government's General Services Administration (GSA) of his find. The GSA arranged to transport the murals to an art restorer named Hiram Hoelzer for storage and eventual restoration when funds could be arranged. Over 19 years went by before anyone notified the Stamford School system where the murals were. In the meantime, neither the GSA nor anyone else paid Hoelzer for the storage or restoration. By 1989, the murals were valued at $1.25 million by Sotheby's, an art auction house. Hoelzer filed suit, seeking a declaration that the murals had been abandoned. Were they abandoned What difference would that make when determining ownership

Question 18

Arriving at a restaurant, Max gives his car keys to the valet. When the valet returns the car three hours later, it has a large, new dent. The valet says he did not cause it.
Max sues the valet service.
(a) The burden is on the valet service to prove it did not cause the dent.
(b) The burden is on Max to prove that the valet service caused the dent.
(c) The valet service is strictly liable for harm to Max's car.
(d) The valet service has no liability to Max, regardless of how the dent was caused.
(e) The valet service is only liable for gross negligence.

Question 19

Circle true or false:
T F A finder of lost property generally may keep the property unless the true owner comes forward.

Question 20

Ann is Becky's best friend. Tomorrow, Ann will move across the country to start a new job. Feeling sentimental on a night of goodbyes, Becky gives Ann a necklace that has been in Becky's family for 50 years. "You've always liked this, and I want you to have it," she says. Ann accepts the necklace. Early the next morning, Becky reconsiders. She finds Ann at the airport and sees her wearing the necklace. "Ann, my grandmother gave me that necklace. I'm sorry, but I want it back," she pleads. "You know," Ann replies with a smile, "I think I'm going to keep it." Is Ann legally required to return the necklace Is she ethically required to return the necklace

Question 21

Dan checks into a nice beachfront hotel. He does not want to expose his $10,000 Patek Phillipe wristwatch to salt water, so he leaves it in the dresser in the room. When he returns from the beach, the watch is gone. He is shocked to learn that the hotel is not legally responsible for the value of his watch. Is the law reasonable in such cases Should the hotel be liable Why or why not