Deck 43: Personal Property and Bailment

Question 1

Charles agrees to store Tuan's car in Charles's garage for the winter months while Tuan visits his grandmother in California.As a bailee,Charles is automatically entitled to use Tuan's car while Tuan is away.

Answer 1

False

Question 2

Stephen wants to give his niece,Dawn,a piece of jewelry as a gift.Stephen gives Tracy,his agent,the bracelet to take to Dawn.The delivery element of making a gift has been completed.

Answer 2

False

Question 3

In January,Erwin told David,his nephew,that he would give him a car when he graduates from college.David graduated in May.If Erwin refuses to give David a car,David can sue him for breach of an inter vivos gift.

Answer 3

False

Question 4

A bailment was created for the parties' mutual benefit.This means that the bailee must use ordinary care with the property.

Question 5

Jerry enters a restaurant and hangs his coat in an unattended cloakroom near the entrance of the restaurant.Even though no employee of the restaurant is present,the provision of the cloakroom makes Jerry think it will be safe.In this situation,the restaurant is the bailor of Jerry's coat.

Question 6

While shopping at the mall,Everett's wallet fell out of his pocket.Jon found the wallet.The wallet is abandoned property and Jon may keep it.

Question 7

Dersett Trucking hauls granite for the major granite companies in Minnesota.Dersett Trucking does not make its trucking services available to the general public.Dersett Trucking is a contract carrier and does not incur strict liability.

Question 8

If property is mislaid,the finder of the property will have a superior claim to possession of the property against everyone except the true owner.

Question 9

Alexander loans Miko his baking dish so she can make lasagna for dinner tonight for her family.What kind of bailment is this?

A)bailor benefit bailment
B)bailee benefit bailment
C)constructive bailment
D)mutual benefit bailment

Question 10

Buck,fearing death from severe injuries suffered in a machinery accident,assigned over a certificate of deposit worth $100,000 and delivered the certificate to Pearl,a friend,who gladly accepts.Buck ends up recovering from the injuries.Why must Pearl give the certificate of deposit back to Buck?

A)This type of gift is known as a gift causa mortis.It is a conditional gift which is conditioned on Buck actually dying.Because Buck recovered,the gift is automatically revoked.
B)This is an inter vivos gift because Buck was still alive when the gift was made.Any inter vivos gift is revocable because there is no consideration to make Buck's delivery of the certificate binding under contract law.
C)This is an inter vivos gift and due to state laws,gifts in contemplation of death must be written into a valid will or otherwise the deceased's assets will be distributed according to state statute.
D)This gift is an ordinary gift,but it is revocable because we don't know if the certificate of deposit has matured or not.

Question 11

After a meeting with his advisor to register for a class at State University,Ron forgot his calculator in the dean's outer office.Theresa,another student,found the calculator.The calculator is treasure trove and Theresa may keep it.

Question 12

All bailments have to be by agreement between the bailor and bailee.

Question 13

While digging in his backyard to plant a pear tree,Jonah discovers a bag of gold coins -- all of which were minted in the 1800s.The bag of coins would most likely be considered

A)lost property.
B)mislaid property.
C)treasure trove.
D)abandoned property.

Question 14

Jimmy stole Dave's motorcycle and completely revamped the engine and changed the body.These accessions were very expensive,but Jimmy was completely satisfied with the results,intending to sell the motorcycle for a huge profit.If the motorcycle is recovered from Jimmy,Dave must pay Jimmy for the improvements.

Question 15

The difference between an inter vivos gift and a gift causa mortis is that the inter vivos gift is made during the donor's lifetime and a gift causa mortis is a gift made after the donor's lifetime by the donor's estate.

Question 16

If one party makes accessions without agreement and the improvements can be "undone" without damaging the property,the improver must undo them.

Question 17

In which of the following scenarios has a gift been made?

A)Alice takes her vacuum cleaner to the repair shop to be fixed.The owner tells her he won't be able to get to the repair for two weeks."OK," says Alice."Keep it until then and then go ahead with the repair."
B)Tim knows that Noah likes his collection of Spiderman comics.He tells Noah,"Even though my comics are worth $500,you can have them for $100." Noah agrees and pays Tim the reduced price.
C)Grandpa chuckles as Jessica admires his pocket watch."Go on,put it in your own pocket,Jessica," he tells her."You can have it." Jessica thanks her grandpa and happily tucks the watch into her pocket.
D)Edith tells her friend,Mateo,that he may have her antique Victrola record player after she passes away.Mateo gratefully thanks Edith for her kindness. 

Question 18

Jody loaned her neighbor,Phil,her snow blower.Phil set it near his driveway and later accidentally ran over and destroyed it.In a suit to recover damages,Jody as plaintiff has the burden of proving that Phil was negligent and caused the destruction of her snow blower.

Question 19

Mega Corporation,the bailor,negotiates a bailment agreement with Huge Corporation,the bailee.Huge Corporation insists that an exculpatory clause be included in the terms and conditions of the bailment agreement.Later,Huge Corporation negligently (ordinary negligence,not gross negligence)damages the property that is the subject of the bailment.Most courts will allow Huge Corp.to stand behind its exculpatory clause and deny liability.

Question 20

Ed wants to give Howard his old car,but Howard says he doesn't want it.Howard later reconsiders and tells Ed he does want the car.His previous repudiation means there is no gift,and Howard has no rights in the car.

Question 21

George gave his great-grandfather's pocket watch to Nurse Nadene because he expected to die soon.This is a(n)

A)testamentary gift.
B)inter vivos gift.
C)executed gift.
D)gift causa mortis.

Question 22

Jake owns an old piece of exercise equipment.He has been using the equipment merely to hang his clothes on,so Jake decides to get rid of the thing.He takes the unused exercise machine to the landfill and throws it off the back of the truck.Maggie,a teenager,is at the landfill rummaging for useful items.Maggie sees the exercise equipment and decides it is just the thing to give her sister for Christmas,so she decides to take it home.As she is loading it into the back of her pickup truck,Jake stops and tries to get it back.The landfill owner sees the commotion and decides he would like to have the equipment as well.Who has the best rights in the exercise equipment?

A)they are all joint owners
B)Maggie
C)Jake
D)the landfill owner

Question 23

The element that distinguishes a contract from a gift is

A)performance of the offeror's or donor's promise.
B)the element of consideration which is present in a contract,but not in a gift.
C)whether or not the offeree or donee accepts the offer.
D)whether or not the subject of the gift or contract is illegal.

Question 24

Bruce tells his son,"You can have my 1990 truck,but if your grades fall,I'm taking it back." Bruce

A)has made no gift.
B)has made a "revocable gift," which is effective as a gift as long as the stated condition is met.
C)intended to transfer ownership.
D)has made a constructive gift.

Question 25

Which of the following is/are generally subject to a standard of strict liability for bailed goods?

A)contract carriers and common carriers
B)common carriers and innkeepers
C)common carriers
D)contract carriers

Question 26

Farmer Fred is leasing pasture land from Wealthy Warren.Farmer Fred is working the soil to turn the pasture land into land that will be able to grow crops.As Farmer Fred is preparing the field,he discovers a treasure chest full of gold and silver coins.The coins are all dated before 1810.A finder of treasure trove under common law,

A)is entitled to keep the treasure trove.
B)is required to turn the property over to the owner.Here,under common law,Farmer Fred is required to turn the treasure trove over to Wealthy Warren.
C)is required to turn the treasure trove over to the State.
D)is required to turn the treasure trove over to the federal government who will give the treasure trove to the closest Native American reservation.

Question 27

Hanna intends to give her granddaughter,Melodee,her antique hat pin.This heirloom has been kept under lock and key in the wall vault in the library of Hanna's house in Virginia.The hat pin is currently the only item in the vault.When Hanna is visiting Melodee in Connecticut,Hanna gives Melodee the only key to the vault.Melodee is grateful for the present and excitedly accepts.In this situation has there been a completed gift?

A)No.There has been no physical delivery of the hat pin.
B)Yes.There has been physical delivery of the hat pin.
C)No.There has only been constructive delivery of the hat pin.
D)Yes.There has been constructive delivery of the hat pin.

Question 28

Mitch takes his two best suits to Quality Cleaners and receives a ticket as a receipt.Quality tells Mitch his suits will be cleaned and will be ready to be picked up on Monday.Another customer overhears the exchange and early on Monday goes to Quality,convinces the worker he is Mitch but that he has lost his receipt.He identifies and retrieves the suits,which happen to fit him perfectly too.Quality Cleaners

A)is strictly liable to Mitch for the suits.
B)is liable to Mitch only if Mitch can prove Quality was grossly negligent.
C)has no liability unless Mitch proves Quality did not use ordinary care.
D)will avoid liability if the receipt contained an exculpatory clause excluding gross negligence.

Question 29

Jeannie carelessly packed her grandmother's antique glassware and had it shipped to her 30-year-old daughter,Abby,via Common Freight Carriers.When the china arrived at Abby's house,most of the pieces were broken.As between Jeannie and Common Freight Carriers,who will bear the loss?

A)Under the Carmack Amendment,Jeannie is liable for the loss if Common Freight Carriers shows it was not negligent and that the loss was caused by Jeannie's failure to wrap and pack the glassware properly.
B)Under the Carmack Amendment,Common Freight Carriers is liable.A common carrier is strictly liable.
C)Under the Carmack Amendment,Common Freight Carriers is liable because of its negligence in not inspecting Jeannie's packing job.
D)Liability is governed by state statute and will depend on which state law will control.

Question 30

Select the correct answer:

A)Rosie rents a locker at the airport,and she puts a bag in the locker.Rosie keeps the locker key.In this case,the bag has been delivered to and accepted by the airport.The airport is a bailee.
B)Hill rents a boat to Dan.The boat is located at a lake 30 miles away.Hill gives Dan keys to the boat.Dan drives to the lake and takes possession of the boat.In this case,the boat has been delivered to and accepted by Dan,and Dan is a bailee.
C)Unknown to Lon,Jeff left a bike at Lon's house.Lon has not found the bike,and he is not likely to find it because Jeff left the bike under the front porch.In this case,Lon is a bailee of the bike.
D)Ken parked a car in a self-service lot,and Ken kept the keys.The parking lot is a bailee.

Question 31

In the Tannenbaum v.New York Dry Cleaning,Inc.case,

A)there was a bailment for hire,and the fact that the bailee was unable to return the bailed item except in a damaged condition created an irrebuttable presumption that the damage to the item was attributable to the bailee's negligence.
B)the court stated that a company cannot,under New York law,use an exculpatory clause to relieve itself from liability for the consequences of its own negligence.
C)the court found that the claimant was not bound by the terms of the dry cleaning company's limitation clause because,even if it applied to the situation before the court,the claimant had not read the clause nor had he assented to its terms.
D)the court found that the claimant was negligent in not reading the limitation clause on the back of his claim ticket,so he could not recover the cost of his shirt.

Question 32

Sarah works for a company that has offered a promotion if she is willing to relocate.Sarah accepts the position and puts her house on the market right away.She sells her house the first day that the realtor holds an open house.The buyer agrees to pay cash for the full purchase price of the house.Sarah is thrilled,except that it means that she will have to put her furniture in storage until she finds another house in her new city.She enters into a written contract with Safe Storage,Inc.The agreement includes a clause excusing Safe Storage,Inc.from any liability for loss or damage,even if the loss or damage results from Safe Storage's negligent acts.Because of Self Storage's negligence,a fire destroys the warehouse and all of its contents,including Sarah's household goods and furniture.Sarah claims that Safe Storage,Inc.is liable for the full value of the contents,which is approximately $10,000.Is Sarah correct?

A)Yes,because storage warehouses are strictly liable for loss or damage,regardless of fault and regardless of exculpatory clauses.
B)No,because there was equal bargaining power between Sarah and Safe Storage,Inc.
C)Yes,because exculpatory clauses are illegal and never enforceable.
D)Probably,because often a court will reject an exculpatory clause against a bailor who is a consumer.

Question 33

Ali took a seat at a booth at Midway Diner.Between the salt and pepper shakers,Ali noticed something glittering.It was a diamond ring.The ring is

A)abandoned property.
B)an accession.
C)mislaid property.
D)treasure trove.

Question 34

Beth owned an original U.S.flag.She had previously loaned the flag to Ross,a lawyer,so that he could display the flag on the wall behind his office desk.One day while visiting Ross in his office and admiring the flag,Beth said to Ross,"You are so fond of that flag,I would like you to have it!" Ross responded with a gracious "thank you." In this situation

A)Beth has not made a valid,binding gift of the flag because gifts are never binding and can always be revoked by the donor.
B)Beth has not made a valid,binding gift of the flag because the donor must deliver the property to the donee,which was not done here.
C)Beth has made a valid,binding gift if Beth agreed to give the flag in exchange for Ross's legal services.
D)Beth has made a valid,binding gift because she intended to transfer present ownership to Ross and Ross accepted the flag.

Question 35

A bailment is different from a gift because

A)a gift requires consideration,but a bailment does not.
B)a gift requires delivery,but a bailment does not.
C)in a bailment,only possession of the property is transferred to the bailee,whereas with a gift,both possession and ownership must pass to the donee.
D)a gift is always a contract,but a bailment is generally not a contract.

Question 36

Lacy set her textbook under her chair in her business law class and then forgot to take it with her when she left the classroom.A janitor later discovered the textbook and gave it to the Dean of the Business College.In this situation,

A)the college is a constructive bailee,obligated to return the textbook to Lacy,and until it does,it is liable for harm to the property.
B)the college is a bailee by agreement because holding items in a lost and found box is generally part of the college-student agreement when the student enrolls for classes.
C)the college is responsible for the discovered textbook because in this situation,the college is subject to implied warranties unless the college has disclaimed such warranties in the student handbook.
D)this is a bailment for the sole benefit of the bailee.

Question 37

Which of the following occurs when a person uses labor and/or materials to add value to personal property belonging to another?

A)accession
B)bailment
C)an inter vivos gift
D)a mutual-benefit bailment

Question 38

Which of the following would NOT be considered personal property?

A)collection of vinyl record albums
B)field of soybeans
C)antique quilt 
D)None of these are correct.

Question 39

Bertha,from Chicago,traveled to San Francisco to attend a conference.Her sister,Martha,lives in San Francisco and consequently,Bertha made arrangements to spend a couple of days with her sister.The next morning sitting at the breakfast table,Bertha realizes that she packed a mismatched pair of shoes (one is black and the other is blue).Luckily,Martha wears the same size of shoes and lends Bertha a pair of black leather pumps.During the day,the shoes are damaged while Bertha is wearing them.Bertha's duty of care would be a duty of

A)extraordinary care,because this is a bailment for the sole benefit of the bailee.
B)ordinary care,because this is a bailment with both parties receiving mutual benefits.
C)only slight care,because this is a bailment for the sole benefit of the bailor.
D)none,as the sisters would share without condition.

Question 40

Jared owns 100 acres of woodland.One day,he and Margie are hiking through Jared's woods and Margie finds a gold ring.The true owner is never discovered.Which of the following statements about this situation is correct?

A)Because the ring was found on Jared's property,he is probably entitled to keep it.
B)Margie found the ring,and since the true owner is unknown the ring now belongs to her.
C)By law,Margie needs to return the ring to the spot where she found it,just in case the true owner returns for it.
D)The ring must be sold and the profit split evenly between Jared and Margie.

Question 41

Griffith Manufacturing ships 40 crates of goods by Trusty Shipping,a common carrier.Trusty offers Griffith a shipping rate of $725 for a limited liability of $5,000 or a rate of $975 for full liability for any harm to the goods.Griffith chooses the $725 rate.In transit,Trusty's driver has an accident during an ice storm and all of Griffith's goods are destroyed,causing a loss of $12,000.If Griffith sues Trusty,

A)Trusty will be liable for only $5,000 because a common carrier is allowed to limit its liability by contract.
B)Trusty will be liable for the full $12,000 because common carriers have strict liability.
C)Trusty will automatically be liable for the full $12,000 under the Carmack Amendment.
D)Trusty is subject to normal bailment rules and can escape liability for any damage to the goods by proving that it exercised due care of the property and that the loss was caused by an act of God.

Question 42

Distinguish between a contract and a gift.Give an example of each.

Question 43

Discuss whether or not the following common transactions are bailments and if so,who the bailor/bailee is,and what type of bailment is involved.

A)Renting storage space in Farmer's Frank's huge barn to keep your classic car out of the snow and ice of winter.The rental agreement provides for $100/month rent and Farmer Frank has the only access to the barn.
B)Hiring a moving company to move your belongings to a new residence.
C)Loaning your lawn mower to your neighbor.
D)Parking your car in a "park and lock" parking lot.

Question 44

Bill was shopping at the mall.As he was walking to Tonne's Department Store,his wallet fell out of his pants.While trying on a new suit,Bill left his leather jacket in the change room.Sue found Bill's wallet.Arnie,a sales associate,found his coat.What kind of found property is Bill's wallet? What kind of property is his jacket? What rights do Sue and Arnie have in the found property?

Question 45

Most of the goods contained in a freight train (a common carrier)were destroyed when a tornado wrecked the train.The carrier was sued for damages by all the shippers that had merchandise on the train.Is the carrier strictly liable for the damage done to the goods by the tornado?