In this modernizing world where everything around us is changing at a high pace, where the heart and soul of a nation i.e. constitution needs modifications, The Indian Contract act, 1872 necessities significant consideration in a few of its areas. One such area of the Indian Contract act of 1872 is where if any person finds a lost good belonging to others and takes them into his custody acts as the bailee to the owner of the good1.

 

A brief review of Quasi Contract

There are some circumstances wherein certain people are required to perform an obligation despite the way that he hasn't broken any contract nor committed any tort. For example, a man is obligated to restore the products left at his home, by mistake, and keep it in great condition; such obligations are called quasi-contracts2.
 

Position of Finder of Goods under the Indian Contract Act

The act of placing the property in the custody and control of another person usually by agreement in which the bailee is responsible for its safekeeping and return is called bailment3. Examples: bonds left with the bank, a storage facility (as long as the goods can be moved and are under the control of the custodian). The duties and liability of a finder are treated at par with the bailee4. The finder position, therefore, has been considered alongside bailment. As the legitimate arrangement in the Indian Contract Act in itself says the obligation of the discoverer of goods would be an imitation of duty of a bailee in the contract of bailment.

Under English Law: In English Law5 the finding of lost good isn't generally a bailment, however, the discoverer is dealt with as a gratuitous bailee for some reason based on an inferred request from the owner to take the good into the possession on behalf of the owner, and the discoverer has no Right of lien6 on the good for any cost to which he may have been put in keeping or safeguarding it, In Newman v. Bourne and Hollingsworth7, P, a customer in D’s shop, put down a brooch with her coat, and forgot to pick it up. One of D’s assistants found it missing on Monday, D was held liable to P given the absence of that ordinary care which in the circumstances a prudent man would have taken.
 

Rights of Finder of Goods

Section 168 and 169 confer certain rights on the finder of goods8.
 

Section 168 – May Sue For Specific Reward Offered

The finder of goods has no right to sue the owner for compensation for trouble and expense voluntarily incurred by him to preserve the goods and to find out the owner, but he may retain the goods against the owner until he receives such compensation, and where the owner has offered a specific reward for the return of goods lost, the finder may sue for such reward and may retain the goods until he receives it9.
 

Right of Lien:

According to section 168, a finder of goods has no right to sue the owner for trouble and expenses voluntarily incurred by him to preserve the goods and to find the owner. He has, however, the right of particular lien in respect of those goods. He may retain the goods against the owner until he receives compensation for trouble and expense voluntarily incurred by him to preserve the goods and to find the owner10.

Right of Claiming The Reward, If Announced By The OwnerWhere the owner has offered a specific reward for the return of goods lost the finder may sue for such a reward and also may retain the goods until he receives it. If the goods have already been found voluntarily, and then the owner of the goods promises to compensate the finder for his past voluntary services, the contract is binding and the owner is bound to pay the promised amount.
 

Section 169-

When finder of thing commonly on sale may sell it11: When a thing which is commonly the subject of sale is lost, if the owner cannot with reasonable diligence be found, or if he refuses upon demand, to pay the lawful charge of the finder, the finder may sell it –

1. When the thing is in danger of perishing or losing the greater part of its value,
2. When the lawful charge of the finder, in respect of the thing found the amount to two-third of its value,

The Right to sell the goods found by him under certain circumstances mentioned in section 169.
 

Such a right is available to the finder of the lost goods when the following conditions are satisfied:

1. If the owner of the goods cannot be found; or if he refuses to pay the lawful charges of the finder, and
2. When the good is in danger of perishing its value; or when the lawful charges of the founder in respect of the thing found the amount to two-thirds of its value.
 

Duties of Finder of Any Lost Goods:

If A Person Finds Any Lost Goods He Does Not If a person finds any lost goods he does not become the actual of those goods. He, in fact, becomes a special kind of bailee in the sense that he has to take care of the goods until the actual owner of the goods is found. Thus he possesses the same duties towards the lost goods as of a bailee, and therefore finder’s position has been considered along with bailment. A finder of the lost goods has to observe the following duties towards the goods he possesses:
 

1. Duty To Take Reasonable Care of Goods (Section 151 & 152)

According to Section 151, the finder of goods should take such care of the goods as a man of ordinary prudence would take of his own goods. If he fails to act like an ordinary prudent man, he cannot be excused by pleading that he had taken similar care of his own goods also, and his goods have also been lost and damaged along with those of the ordinary prudent man12.

According to section 152, the finder of goods in the absence of any special contract, is not responsible for the loss, destruction or deterioration of the goods, if he has taken the amount of care of it described in section 15113.
 

Duty not to make unauthorized use of goods (section 153 & 154)

According to section 153, termination of bailment by the finder of good’s act inconsistent with conditions: – a contract of bailment is voidable at the option of the actual owner if the finder of goods makes any unauthorized use of the goods found inconsistent with the condition of the bailment14.

According to section 154, liability of finder of goods making unauthorized use of goods bailed: – if the finder of goods makes any use of the goods found, which is not according to the conditions of the bailment, he is liable to make compensation to the owner of goods for any damage arising to the goods from or during such use of them15.
 

Duty not to mix goods (section 155 – 157)

According to Section 155, effect of mixture with owner’s consent, of this goods with finder of good’s: – if the finder of goods, with consent of the owner, mixes the goods of the owner with his own goods, the owner and the finder of goods must shall have an interest in proportion to their respective shares, in the mixture thus produced16.

According to section 156, the effect of mixture without owner’s consent when the goods can be separated: – when the goods mixed can be separated, the finder and the owner will remain the possessor of their respective shares. But the finder of goods is bound to bear the expense of separation, and any damage arising from the mixture17.

According to section 157, the effect of mixture, without owner’s consent when the goods cannot be separated: – in case, the nature of the goods is such that the owner cannot be separated from those of the finder’s good, it is deemed to be loss of goods and the owner cannot recover compensation for the same from the finder of goods18.
 

Duty to return goods (section 160 & 161)

According to section 160, the return of goods found on expiration of time period: – it is the duty of the finder of the goods to return or deliver the goods found to the true owner as per his directions before the expiration of the time period specified by him19.

According to section 161, finder of goods responsibility when the goods are not duly returned: – if by the default of the finder of goods, the goods are not returned or delivered at the proper time, he is responsible for the loss or destruction of goods from that time20.

Conclusion:
Finder of goods is a part of a quasi-contract or certain connection resembling those made by a contract. Here it would be worth nothing that finder of goods has similar criteria of obligations and duties towards the innocent parties as given to the bailee. A few terms are questionable and should be defined clearly like the meaning of reasonable care vary from person to person, similarly situations where theft of goods from bailee happens and it is hard to prove the duty.

Sometimes goods are delivered to the wrong person, where the benefit earned it is hard to disseminate. At times, it is hard to find the right owner while sometimes the owner dies or there is bad belief of owner. Likewise there is a duty not to set up Jus Tertii21, right of the third person asserting goods bailed or expiry date of good.

Endnotes:
1 Section 71 of Indian Contract Act, 1872
2Moses v. Macferlan, (1760) 2 Bur 1005
3 Coggs v Bernard, (1703) 2 Ld Raym 909
4 Section 148 of Indian Contract Act, 1872
5 Chitty on Contracts, 28th edn., paras 33-034, p. 115-116
6 Halsbury’s Laws of England, Vol 20 (2nd Edn) 552, para 695
7 (1915) 31 TLR 209
8 Section 168 and 169 of Indian Contract Act, 1872
9 Ram Krishna Tarafdar v. Nemai Krishna Tarafdar And Ors, AIR 1974 Cal 173
10 Kavita Trehan And Ors. v. Balsara Hygiene Products Limited, AIR 1992 Delhi 92
11 Swastik Gear Ltd. And Ors. vs Income-Tax Officer And Ors.
12 Section 151 of Indian Contract Act, 1872
13 Section 152 of Indian Contract Act, 1872
14 Section 153 of Indian Contract Act, 1872
15 Section 154 of Indian Contract Act, 1872
16 Section 155 of Indian Contract Act, 1872
17 Section 156 of Indian Contract Act, 1872
18 Section 157 of Indian Contract Act, 1872
19 Section 160 of Indian Contract Act, 1872
20 Section 161 of Indian Contract Act, 1872
21 In Gissel v. State, 727 P.2d 1153

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