There is plenty of example of Bailment in our day to day life. We borrow our friend’s bike or car or anything for personal uses is an example of Bailment. For the time being, in this article, we will study the difference between Bailment and Pledge.
Nevertheless, before we go ahead, let us first understand Pledge and Bailment’s meaning and definition in short so that their differences can be grabbed easily.
A Bailment is a transfer or delivery of movable goods/property from one party/person to another person/party for any specific task or service, or promise.
On the other hand, Pledge is defined as delivering movable asset/goods/property to secure debt/ loan or performance of a contract or promise.
The pledge is a type of bailment that means a bailment is a broad term, whereas a pledge is a narrow term. The difference between bailment and pledge lies in their purposes of delivering goods or property from one party to another.
Meaning and Definition:
A bailment refers to transferring movable goods from one party to another party for specific purposes such as service, promise, or need. Further, if the purpose is accomplished, the goods should return to the bailor.
On the other hand, a pledge refers to a transfer of movable goods/property to the lender (banks or financial institutions) or person as security to acquire a loan/debt or performance of contract or promise.
Defined As Per:
Bailment is defined as per Section 148, Indian Contract Act 1872, whereas Pledge is defined as per Section 172, Indian Contract Act 1872.