A bailor is better off on the insolvency of its bailee than a creditor is on the insolvency of its debtor.

Question

Quizplus · Accepted Answer

When a bailee (the person who receives property from the bailor) becomes insolvent, the bailor (who owns the property) has a right to recover their property before it is distributed to the bailee's creditors. On the other hand, a creditor of a debtor who becomes insolvent may not be able to recover the full amount owed, as they may have to compete with other creditors for a limited pool of assets. Therefore, the bailor is better off in this situation.

A Bailor Is Better Off on the Insolvency of Its