When it comes to legal and contractual terms, it can be easy to get confused. Two terms that may seem similar at first glance are gifts and bailments by agreement. While both involve the exchange of property, there is one primary element that distinguishes the two.
A gift is a voluntary transfer of property by one party to another, without any expectation of payment or compensation in return. The key element here is that the transfer is voluntary and there is no expectation of anything in return. In other words, if you give someone a gift, you don`t expect them to pay you back or compensate you in any way.
On the other hand, a bailment by agreement is a transfer of property for a specific purpose, with the expectation that the property will be returned to the original owner once the purpose has been fulfilled. The key element here is that the transfer is for a specific purpose, and there is an expectation that the property will be returned.
For example, if you lend your friend a book for them to read, this would be considered a bailment by agreement. You are lending them the book for a specific purpose (for them to read), and you expect them to return the book once they have finished reading it. If, however, you give your friend the book as a gift, with no expectation of it being returned, this would be considered a gift.
Another example of a bailment by agreement could be when you leave your car with a valet at a restaurant. You are transferring possession of the car to the valet for a specific purpose (to park the car), and you expect the car to be returned to you when you are ready to leave.
In summary, the primary element that distinguishes a gift from a bailment by agreement is the presence of an expectation of return. If there is no expectation of anything in return, it is a gift. If there is an expectation that the property will be returned after a specific purpose has been fulfilled, it is a bailment by agreement. Understanding these legal distinctions can be helpful in clarifying contractual agreements and avoiding confusion or misinterpretation.