Question 1

Which of the following statements is true regarding the nature of bailments?
A) Bailments may be express but not implied.
B) Bailments may be implied but not express.
C) Bailments may be implied or express.
D) Bailments that are not express may be enforced as implied bailments only if a gratuitous bailment is involved.
E) Bailments that are not express may be enforced as implied bailments only if a mutual benefit bailment is involved.

Accepted Answer

Bailments can be either implied or express. An express bailment is created by an explicit agreement between the bailor and bailee, while an implied bailment arises from the actions or circumstances without a specific agreement.

Question 2

In the text case of J&L Jewelry v. EPK Management, the plaintiff, J&L, sued EPK for breach of an implied bailment after thieves broke in and stole J&L's entire inventory of jewelry. The trial court dismissed J&L's complaint for failure to state a claim upon which relief could be granted. What was the result upon appeal?
A) The motion to dismiss was affirmed in part, reversed in part, on the grounds that while an implied bailment was created, the bailment for the benefit of the bailor and not the bailee, and liability was a matter best determined by a jury.
B) The motion to dismissed was reversed, because EPK's refusal to allow J&L access to the building after closing hours created an implied bailment and shifted liability for J&L's merchandise to EPK.
C) The motion to dismiss was affirmed, because a bailment agreement must be in writing and signed by both parties in order to be upheld.
D) The motion to dismiss was reversed and the case remanded for a new trial, on the grounds that EPK had a duty to protect J&L's merchandise when the mall was closed for the night.
E) The motion to dismiss was affirmed, because the retail space license agreement created a licensee relationship, not a tenancy, and J&L failed to sufficiently allege a constructive bailment.

Accepted Answer

The answer of In the text case of J&L Jewelry...

Question 3

A bill of lading is a document that is issued by a person engaged in the business of transporting goods that verifies what?
A) Receipt of the goods for shipment.
B) That the goods are insured.
C) That the goods are properly marked for shipping.
D) That the bank has released the goods to ship.
E) That customs forms are completed.

Accepted Answer

A bill of lading serves as a receipt issued by the carrier to acknowledge they have received the goods for shipment.

Question 4

Which of the following statements is true if a bailment is for the mutual benefit of both the bailee and the bailor?
A) The bailee is liable for harm to the bailed property arising out of the bailee's ordinary or gross negligence.
B) The bailee is liable for harm to the bailed property arising only out of the bailee's gross negligence.
C) The bailee is liable for harm to the bailed property caused by even the slightest lack of due care on the part of the bailee.
D) The bailee is strictly liable for harm to the bailed property.
E) The bailee is not liable for harm to the bailed property because of the doctrine of assumption of the risk.

Accepted Answer

In a mutual benefit bailment, the bailee is held to a standard of ordinary care and is liable for harm to the bailed property arising from either ordinary or gross negligence. This means the bailee must exercise the care that a reasonably prudent person would under similar circumstances to prevent damage or loss to the property.

Question 5

If a bailment is intended to benefit only the bailor, which of the following statements is accurate?
A) The bailee is liable for harm to the bailed property arising out of either the bailee's ordinary or gross negligence.
B) The bailee is liable for harm to the bailed property arising only out of the bailee's gross negligence.
C) The bailee is liable for harm to the bailed property caused by even the slightest lack of due care on the part of the bailee.
D) The bailee is strictly liable for harm to the bailed property.
E) The bailee is not liable for harm to the bailed property because of the doctrine of assumption of the risk.

Accepted Answer

In a bailment intended to benefit only the bailor, the bailee is held to a lower standard of care compared to a mutual benefit bailment. The bailee is liable for harm to the bailed property arising only out of the bailee's gross negligence, not for ordinary negligence. This recognizes that the bailee is providing a service or favor to the bailor without receiving a direct benefit.

Question 6

Which of the following statements is NOT true regarding common carriers?
A) Common carriers are licensed to provide transportation services to the public.
B) Common carriers provide transportation services only to a select group.
C) Common carriers are subject to regulation by government agencies.
D) Common carriers may be limited in scope of services they provide by geographic region.
E) Common carriers may be limited in scope of services they provide by type of goods carried.

Accepted Answer

Common carriers offer transportation services to the general public rather than limiting their services to a select group of customers. This distinguishes them from private or contract carriers, which might serve specific clients or industries.

Question 7

Which of the following statements is false regarding bailments?
A) A bailment may be gratuitous.
B) A bailment may be for consideration.
C) A bailment agreement must be contained in a written agreement.
D) The parties to a bailment contract can limit or expand the liability of the bailee by contract.
E) The standard of care varies depending on who benefits from the bailment.

Accepted Answer

A bailment agreement does not necessarily have to be in writing; it can be oral or even implied by the conduct of the parties involved.

Question 8

Which of the following statements describes the applicable standard used in determining the liability of a common carrier when harm befalls property that is the subject of a bailment placed in the care of the carrier?
A) The carrier is liable only if ordinary or gross negligence can be proven.
B) The carrier is liable only if gross negligence can be proven.
C) The carrier is liable only if it can be proven that the carrier acted in a reckless manner.
D) The carrier is generally strictly liable for harm to the bailed property.
E) Because of the doctrine of assumption of risk, the carrier is not liable for harm to the bailed property.

Accepted Answer

Common carriers are generally held to a standard of strict liability for harm to property in their care, meaning they are liable for damages even without proof of negligence.

Question 9

Which of the following items would best be characterized as a "fixture?"
A) A tractor owned by a farmer and stored in her barn.
B) A barn constructed on the land after the land was initially purchased by the farmer.
C) A camper that was originally used for cross-country travel, but which is now permanently attached to a cement foundation on the farmer's land.
D) The free-standing appliances in the farmer's kitchen, such as the refrigerator.
E) The intangible elements connected with and owned by the farmer, such as the value of her equipment and the equity in the property.

Accepted Answer

A fixture is an item that is permanently attached to real property. In this case, the camper is permanently attached to a cement foundation on the farmer's land, so it would be considered a fixture.

Question 10

Documents of title are governed by ________, which may be issued in conjunction with the bailment, when a bailment is for the purpose of transportation or storage of goods.
A) Article II of the Constitution
B) Article VII of the Uniform Commercial Code
C) state law
D) federal law
E) the state or federal courts depending on the goods

Accepted Answer

Documents of title are governed by Article VII of the Uniform Commercial Code (UCC), which applies to documents issued in connection with the bailment of goods for purposes such as transportation or storage.

Question 11

In order to enforce a right to sell property that is subject to a bailment when the bailor does not pay an agreed upon price, a bailee is given a[n] ________.
A) Bailee's lien
B) Bailor's lien
C) Bill of lading
D) Lien document
E) Enforcement lien

Accepted Answer

A bailee's lien is a legal right granted to the bailee to retain possession of the property under bailment until the bailor pays the agreed upon price or fulfills the agreed upon terms.

Question 12

A ________ of personal property is a relationship that arises when one party transfers possession of personality to another to be used in an agreed-upon manner for an agreed-upon time period.
A) Bailment
B) Transfer
C) Loan
D) Release
E) Lease

Accepted Answer

A bailment involves the transfer of possession of personal property from one party to another, with the understanding that the property will be returned or otherwise disposed of according to the owner's directions once the purpose of the bailment is fulfilled.

Question 13

In the "Case Nugget", Ziva Jeweler, Inc. v. Car Wash Headquarters, Inc., what was the decision rendered by the Supreme Court of Alabama, as related to the plaintiffs assertion that the carwash employees failed to safeguard jewelry in the trunk of a vehicle that was being cleaned?
A) The carwash was held liable for the stolen jewelry inside the trunk of the vehicle.
B) There was no evidence that the car wash knew or should have reasonably foreseen that it was taking responsibility for over $850,000 worth of jewelry.
C) The Supreme Court overturned the prior decision that the bailee was responsible for the loss of contents.
D) The carwash was held liable for both the stolen vehicle and the contents in the vehicle.
E) Since bailment had been established, as ruled by the trial court, the carwash was fully liable for the stolen jewelry.

Accepted Answer

The Supreme Court of Alabama decided that there was no evidence to suggest that the car wash knew or should have reasonably foreseen that it was taking responsibility for the jewelry valued at over $850,000 in the trunk of the vehicle being cleaned. This implies that the car wash was not held liable for the stolen jewelry based on the lack of foreseeability regarding their responsibility for such valuable items left in the vehicle.

Question 14

When property that is subject to a bailment is damaged due to an "act of God," which of the following is true?
A) The bailee is liable for harm to the bailed property arising out of the bailee's ordinary or gross negligence.
B) The bailee is liable for harm to the bailed property arising only out of the bailee's gross negligence.
C) The bailee is liable for harm to the bailed property caused by even the slightest lack of due care on the part of the bailee.
D) The bailee is strictly liable for harm to the bailed property.
E) The bailee is not liable for harm to the bailed property.

Accepted Answer

When damage to bailed property is caused by an "act of God," the bailee is not liable for the harm. This is because such events are outside the bailee's control, and liability generally requires some level of fault or negligence on the part of the bailee, which is not present in cases of natural disasters or other unforeseeable events.

Question 15

In the "Case Nugget," Ziva Jewelry Inc., v. Car Wash Headquarters Inc., the plaintiff left his car and keys with a car wash employee and a thief drove off with the car, abandoning it unharmed after stealing jewelry valued at over $800,000 from the car's trunk. What was the final holding of the court in this case?
A) That the car wash was liable to the plaintiff because the car wash accepted responsibility as a bailee.
B) That the car wash was not liable to the plaintiff because the car wash employees had no notice they were taking responsibility for the jewelry.
C) That the car wash and the plaintiff would be required to split the loss.
D) That the car wash was liable to the plaintiff for the loss because the car wash had not issued a valid disclaimer.
E) That it would be unconscionable to hold the car wash liable for the loss.

Accepted Answer

The court held that the car wash was not liable to the plaintiff because the car wash employees had no notice they were taking responsibility for the jewelry, indicating the importance of knowledge and intent in establishing liability for bailees.

Question 16

Who does a bailment benefit?
A) The bailor only.
B) The bailee only.
C) A bailment may benefit either a bailor or a bailee, or both.
D) A donor beneficiary.
E) A debtor.

Accepted Answer

A bailment is a legal relationship where physical possession of personal property is transferred from one party (the bailor) to another (the bailee) who temporarily holds it under an agreement. This arrangement can benefit either the bailor, the bailee, or both, depending on the terms of the agreement and the circumstances of the bailment. For example, a bailor benefits by having their property safely stored or transported, while a bailee might benefit by being paid for the service or being allowed to use the property.

Question 17

In a bailment situation, the person who receives transfer of possession of property is the ________.
A) Transferor
B) Transferee
C) Novator
D) Bailor
E) Bailee

Accepted Answer

In a bailment situation, the person who receives transfer of possession of property is known as the bailee.

Question 18

In the "Case Nugget" Ziva Jewelry, Inc. v. Car Wash Headquarters, Inc., what was the main rule regarding bailee liability to come from this case?
A) A bailee is only liable for unknown property if that property is valued at over $100,000.
B) Knowledge of possession of property is irrelevant when establishing bailee liability.
C) Only bailees in a commercial setting can be liable for property they do not know they possess.
D) A bailee can only be liable for property she knows she possesses.
E) A bailee can be liable for property, even if he is not aware that he is in possession of it.

Accepted Answer

A bailee can only be liable for property she knows she possesses. This principle emphasizes the importance of awareness of possession in establishing bailee liability.

Question 19

Which of the following statements is true regarding lost property?
A) In most states, the finder of lost property has title against all others, including the person who lost the property.
B) In most states, the finder of lost property has title against all others except the person who lost the property.
C) In most states, the finder of lost property has no title against others and must turn over the property to the police department for later sale if the true owner cannot be located.
D) In all states, the finder of property has an obligation to put a notice in the local paper looking for the true owner attempting to claim ownership.
E) In most states, the finder of lost property has against all others except the person who lost the property, but that right only arises if the finder of the property can establish that she spent an amount of at least one-fifth of the fair market value of the property attempting to locate the owner.

Accepted Answer

In most jurisdictions, the finder of lost property has rights to the property superior to everyone except the original owner, meaning they can claim ownership unless the person who lost the item comes forward to claim it.

Question 20

The ________ is the person who transfers possession of personality in a bailment situation.
A) Transferor
B) Transferee
C) Novator
D) Bailor
E) Bailee

Accepted Answer

The bailor is the person who transfers possession of personal property to another (the bailee) in a bailment situation.

Quiz 48: The Nature of Property, Personal Property, and Bailments

Which of the following statements is true regarding the nature of bailments?

A bill of lading is a document that is issued by a person engaged in the business of transporting goods that verifies what?

Which of the following statements is true if a bailment is for the mutual benefit of both the bailee and the bailor?

If a bailment is intended to benefit only the bailor, which of the following statements is accurate?

Which of the following statements is NOT true regarding common carriers?

Which of the following statements is false regarding bailments?

Which of the following statements describes the applicable standard used in determining the liability of a common carrier when harm befalls property that is the subject of a bailment placed in the care of the carrier?

Which of the following items would best be characterized as a "fixture?"

Documents of title are governed by ________, which may be issued in conjunction with the bailment, when a bailment is for the purpose of transportation or storage of goods.

In order to enforce a right to sell property that is subject to a bailment when the bailor does not pay an agreed upon price, a bailee is given a[n] ________.

A ________ of personal property is a relationship that arises when one party transfers possession of personality to another to be used in an agreed-upon manner for an agreed-upon time period.

In the "Case Nugget", Ziva Jeweler, Inc. v. Car Wash Headquarters, Inc., what was the decision rendered by the Supreme Court of Alabama, as related to the plaintiffs assertion that the carwash employees failed to safeguard jewelry in the trunk of a vehicle that was being cleaned?

When property that is subject to a bailment is damaged due to an "act of God," which of the following is true?

Who does a bailment benefit?

In a bailment situation, the person who receives transfer of possession of property is the ________.

In the "Case Nugget" Ziva Jewelry, Inc. v. Car Wash Headquarters, Inc., what was the main rule regarding bailee liability to come from this case?

Which of the following statements is true regarding lost property?

The ________ is the person who transfers possession of personality in a bailment situation.