Bailment and Pledge – MCQs with Answers

Which section of the Indian Contract Act defines Bailment?
a) Section 124
b) Section 148
c) Section 172
d) Section 126
Answer: b) Section 148

In bailment, the person delivering the goods is called the:
a) Bailor
b) Bailee
c) Lessor
d) Pledger
Answer: a) Bailor

The person to whom goods are delivered in a bailment is known as:
a) Bailor
b) Pledgee
c) Bailee
d) Lessee
Answer: c) Bailee

Which one of the following is NOT essential for a valid bailment?
a) Delivery of goods
b) Consideration must be present
c) Contract
d) Movable property
Answer: b) Consideration must be present

Bailment is related to:
a) Immovable property
b) Shares and debentures
c) Movable goods
d) Intellectual property
Answer: c) Movable goods

In pledge, the person who delivers the goods is called:
a) Bailor
b) Pledger
c) Bailee
d) Pawnor
Answer: d) Pawnor

In pledge, the goods are delivered for the purpose of:
a) Selling
b) Safe custody
c) Security for a debt
d) Usage
Answer: c) Security for a debt

A finder of goods is treated as a:
a) Owner
b) Pledger
c) Bailee
d) Buyer
Answer: c) Bailee

Lien means:
a) Right to buy
b) Right to use
c) Right to retain possession
d) Right to sell
Answer: c) Right to retain possession

Which of the following rights does a bailee NOT have?
a) Right of lien
b) Right to sue a third party
c) Right to sell the goods
d) Right to claim compensation
Answer: c) Right to sell the goods

11. A contract of bailment is valid only when the goods are:
    a) Delivered permanently
    b) Delivered with ownership
    c) Delivered temporarily for a specific purpose
    d) Sold for consideration
    Answer: c) Delivered temporarily for a specific purpose

12. In case of bailment, the bailee is bound to take care of goods as:
    a) An average person
    b) A prudent man
    c) An insurer
    d) A businessman
    Answer: b) A prudent man

13. Pledge is defined under which section of the Indian Contract Act?
    a) Section 172
    b) Section 148
    c) Section 126
    d) Section 124
    Answer: a) Section 172

14. A bailee has no right to:
    a) Retain the goods for charges due
    b) Sue for necessary expenses
    c) Use the goods for personal purpose
    d) Recover loss due to negligence
    Answer: c) Use the goods for personal purpose

15. Pledge is a special type of:
    a) Lease
    b) Sale
    c) Bailment
    d) Contract of agency
    Answer: c) Bailment

16. Which of the following is NOT a duty of bailee?
    a) Return goods after purpose is over
    b) Take reasonable care
    c) Use goods as per bailor’s instructions
    d) Sell goods if not claimed
    Answer: d) Sell goods if not claimed

17. A person who finds goods belonging to another is:
    a) Bound to return it
    b) Owner of the goods
    c) Not bound to care for it
    d) Treated as pledgor
    Answer: a) Bound to return it

18. Who bears the risk of loss in bailment if bailee takes reasonable care?
    a) Bailee
    b) Bailor
    c) Government
    d) Third party
    Answer: b) Bailor

19. A pledge made by a mercantile agent is valid if:
    a) Made without consent
    b) Made while acting beyond his authority
    c) Made in the ordinary course of business
    d) Made after termination of agency
    Answer: c) Made in the ordinary course of business

20. What happens if the bailee mixes the goods with his own without consent?
    a) No liability
    b) Bailee must compensate the bailor
    c) Bailor must accept
    d) Bailment becomes pledge
    Answer: b) Bailee must compensate the bailor

21. The delivery of goods by one person to another for a specific purpose is called:
    a) Sale
    b) Lease
    c) Bailment
    d) Exchange
    Answer: c) Bailment

22. Which of the following is essential for a valid bailment?
    a) Delivery of money
    b) Written contract
    c) Delivery of goods with transfer of ownership
    d) Delivery of goods without transfer of ownership
    Answer: d) Delivery of goods without transfer of ownership

23. In pledge, the person to whom the goods are delivered is called:
    a) Bailor
    b) Pledger
    c) Pledgee or Pawnee
    d) Agent
    Answer: c) Pledgee or Pawnee

24. If bailee returns goods damaged due to negligence, who is liable?
    a) Bailor
    b) Bailee
    c) Government
    d) Insurance company
    Answer: b) Bailee

25. Lien refers to the:
    a) Right to sell goods
    b) Right to return goods
    c) Right to retain goods until dues are paid
    d) Right to destroy goods
    Answer: c) Right to retain goods until dues are paid

26. A bailment becomes pledge when it is made:
    a) For safekeeping
    b) For lease
    c) As security for repayment
    d) For donation
    Answer: c) As security for repayment

27. Finder of goods is treated as a:
    a) Bailor
    b) Bailee
    c) Pledger
    d) Seller
    Answer: b) Bailee

28. Which of the following rights does a pledgee NOT have?
    a) Right to retain goods
    b) Right to sell after notice
    c) Right to use goods
    d) Right to claim compensation
    Answer: c) Right to use goods

29. Which contract is without consideration but still valid in case of bailment?
    a) Gratuitous bailment
    b) Commercial bailment
    c) Illegal bailment
    d) None of these
    Answer: a) Gratuitous bailment

30. The bailee can retain goods until payment of:
    a) Only agreed charges
    b) Additional penalties
    c) Market value
    d) Taxes
    Answer: a) Only agreed charges

31. Which of these is a type of bailment?
    a) Sale of goods
    b) Lease of immovable property
    c) Lending money
    d) Pledge
    Answer: d) Pledge

32. What is the primary duty of a bailor?
    a) To insure goods
    b) To return goods
    c) To disclose known defects
    d) To pay the bailee
    Answer: c) To disclose known defects

33. Which of the following can create a valid pledge?
    a) Person in possession under a void contract
    b) Thief
    c) Finder of goods
    d) Mercantile agent
    Answer: d) Mercantile agent

34. If bailee uses goods without authority, he is:
    a) Not liable
    b) Liable for compensation
    c) Treated as bailor
    d) Entitled to use
    Answer: b) Liable for compensation

35. Goods delivered under a pledge can be sold by pledgee if:
    a) Bailor permits
    b) Bailor delays payment
    c) Reasonable notice is given
    d) No condition is required
    Answer: c) Reasonable notice is given

36. The right of a pledgee to retain goods is known as:
    a) Right of resale
    b) Right of lien
    c) Right of redemption
    d) Right of exchange
    Answer: b) Right of lien

37. The contract of bailment is defined in:
    a) Section 148
    b) Section 126
    c) Section 171
    d) Section 73
    Answer: a) Section 148

38. Who is liable if bailee makes unauthorized use of goods?
    a) Bailor
    b) Bailee
    c) Agent
    d) None
    Answer: b) Bailee

39. Can goods be pledged by someone who is not the owner?
    a) Never
    b) Only with court permission
    c) Yes, if they are mercantile agents
    d) Only in foreign trade
    Answer: c) Yes, if they are mercantile agents

A bailment without reward is called:
a) Commercial bailment
b) Gratuitous bailment
c) Legal bailment
d) Mercantile bailment
Answer: b) Gratuitous bailmen