Indian Contract Act Section 150 — Bailor’s duty to disclose faults in goods bailed
CHAPTER IX OF BAILMENT
Commercial / Corporate
Summary
A bailor must tell the bailee about any faults in the goods being bailed that the bailor knows about, if those faults would seriously affect how the goods can be used or would put the bailee at unusual risk. If the bailor does not disclose these faults, the bailor is responsible for any damage the bailee suffers directly because of those faults.
If the goods are bailed for hire, meaning the bailee is paying to use them, the bailor is responsible for such damage even if the bailor did not know about the faults in the goods.
Official Text
The bailor is bound to disclose to the bailee faults in the goods bailed, of which the bailor is aware, and which materially interfere with the use of them, or expose the bailee to extraordinary risks; and if he does not make such disclosure, he is responsible for damage arising to the bailee directly from such faults. If the goods are bailed for hire, the bailor is responsible for such damage, whether he was or was not aware of the existence of such faults in the goods bailed. Illustrations