LAW 603 Lecture Notes - Lecture 9: Insurable Interest, Co-Insurance, Consignee
28 May 2018
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Lecture 9 - Personal Property: Bailment and Insurance
Tuesday, April 3, 2018
3:07 PM
Topics
• Overview
• What is Personal Property
• Personal Property Rights
o What are they?
o Acquisition and Loss
• Bailment
o What is it?
o Liability of Bailors, Bailees, Sub-Bailees
• Insurance
Overview
• The difference between personal property and real property
• How rights in personal property may be acquired and lost
• The legal concept of "bailment" i.e. granting possession in personal property to another party and
the risks in doing so
• Risk management issues and strategies for dealing with personal property
What is Personal Property?
• Personal property generally is defined as all property other than real property.
• Real property is immovable, while personal property is movable.
• Real property tends to be permanent, and personal property transitory.
• Personal property can be tangible (touchable) such as goods or chattels, or intangible (e.g., the
monetary value represented by a cheque).
• Intellectual property (copyright, patents, trademarks, etc.) is an increasingly important type of
intangible personal property.
Property "Rights"
• Having rights in property (real and personal) does not necessarily mean having ownership of, or
title to, property.
• There are many rights that a person or party may have in or to property that are less than
ownership (e.g., a licence to use software).
• Although not ownership, they provide certain privileges that the holder of the right can enforce
against the owner.
Acquiring Personal Property Rights
• Personal property rights can be acquired:
o By a contract or as a gift from another party;
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o By action, without the agreement or approval of another party (e.g., possessory rights);
o By the act of creation (e.g., copyright).
Losing Personal Property Rights
• Rights can be sold, abandoned or simply disappear.
• Fixture
o An item of personal property may transition into a fixture, which becomes a part of real
property by a degree of permanent attachment;
o The affixed thing becomes the property of the landowner.
• Factors for assessing the sufficiency of affixation:
o The degree of attachment;
▪ Is it sitting under its own weight or affixed to the ground?
o The purpose of attachment.
▪ Does the attachment make the thing more useful or does it enhance the value of the
land?
Bailment
• Bailment is the temporary transference of the possession of property to another party with the
expectation of disposing of it or getting it back.
o The bailor is the person transferring the property;
o The bailee is the person receiving the property.
• A consignment is a prime example of bailment.
o The consignor transfers possession of the goods to a third party (consignee) for the purpose
of selling them;
o The consignee effectively is the agent of the consignor.
Bailment vs. Licence
• This distinction is often critical in business risk-management analysis.
• Intention of the parties
o If the parties intend for possession and control of the property to be handed over, then it is
bailment;
o If one party intends to grant permission to another party to do something that it otherwise
could not do, then it is a licence.
What do you Think?
• Business Decision 17.1, pp. 420-1
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find more resources at oneclass.com
Document Summary
Lecture 9 - personal property: bailment and insurance. Topics: overview, what is personal property, personal property rights, what are they, acquisition and loss, bailment, what is it, liability of bailors, bailees, sub-bailees. Intellectual property (copyright, patents, trademarks, etc. ) is an increasingly important type of intangible personal property. Losing personal property rights: rights can be sold, abandoned or simply disappear. Fixture: an item of personal property may transition into a fixture, which becomes a part of real property by a degree of permanent attachment, the affixed thing becomes the property of the landowner. Factors for assessing the sufficiency of affixation: the degree of attachment; Bailment vs. licence: this distinction is often critical in business risk-management analysis. If the parties intend for possession and control of the property to be handed over, then it is bailment; If one party intends to grant permission to another party to do something that it otherwise could not do, then it is a licence.
