Chapter IX - Of Bailment
Section 162
Section 162: Death and gratuitous bailment
A gratuitous bailment ends on the death of either bailor or bailee.
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This article is for general information. Refer to the Indian Contract Act, 1872 official text for the official provisions. If you need professional advice for your situation, contact Bizeneed.
Statutory text
Bare law
A gratuitous bailment is terminated by the death either of the bailor or of the bailee.
Rule and business relevance
This short rule concerns gratuitous bailment specifically. Arrangements for the goods following death should be coordinated with the legally entitled representatives.
Limits and related provisions
Do not generalise it into a rule that every paid storage or hire contract ends on either party’s death. Other duties concerning custody and return still require attention.
Hypothetical business example
Hypothetical example: Goods are held without remuneration under a gratuitous bailment and the bailor dies. The custodian establishes proper representative instructions for return.
Practical decision flow
Confirm the bailment is gratuitous.
Record the death and termination event.
Identify the legally entitled person and safe return arrangements.
Check the applicable legal framework
This guide explains the central provision. Applicable State amendments, the agreement, transaction date and other governing laws can affect its application. Check the current legal framework before relying on it for a commercial decision.
Practical checklist
Do
- Confirm the bailment is gratuitous.
- Record the death and termination event.
- Identify the legally entitled person and safe return arrangements.
Avoid
- Do not generalise it into a rule that every paid storage or hire contract ends on either party’s death. Other duties concerning custody and return still require attention.
Glossary
- Gratuitous bailment
- Bailment without remuneration in the relevant arrangement.
- Termination
- The ending of the bailment under this provision.
Frequently asked questions
Whose death triggers the rule?
Either the bailor’s or the bailee’s.
Does the wording cover every paid bailment?
No. It specifically addresses gratuitous bailment.
Does termination remove the need to safeguard goods?
Do not treat termination as permission to abandon the goods; arrange lawful custody and return.
Need help applying this provision to your situation?
Contact BizeneedLast updated 10 October 2026