Section 171 The Indian Contract Act, 1872
Section 171 of the Indian Contract Act, 1872 deals with the liability of a finder of goods. It establishes the duties and responsibilities of a person who comes across goods that do not belong to them (a finder of goods), but they come into possession of the goods either accidentally or inadvertently. The section is primarily concerned with the responsibility of a finder in relation to the goods found and the rights of the true owner.
Text of Section 171:
The text of Section 171 of the Indian Contract Act, 1872 reads as follows:
"Finder of goods.
A person who finds goods and takes them into his custody is subject to the same responsibility as a bailee, but he does not have the right to use them, except to the extent required to preserve them, and shall be entitled to a reasonable reward for his trouble, provided he returns the goods to the rightful owner when the owner is found."
Key Points of Section 171:
Finder of Goods as a Bailee:
Section 171 treats the finder of goods in a manner similar to a bailee under Section 148 of the Indian Contract Act. A bailee is someone who temporarily receives goods from another person (the bailor) for a specific purpose (such as repair, safekeeping, or transportation).
A finder of goods has the same responsibility as a bailee, meaning they are obligated to take reasonable care of the found goods as if they were their own.
Obligations of the Finder:
The finder is required to take reasonable care of the goods found, which includes not using them for personal gain, unless it is necessary for preserving the goods.
If the goods are perishable or need to be preserved, the finder is allowed to take reasonable steps to preserve the goods in a manner that ensures their safekeeping until the true owner is found or identified.
No Right to Use the Goods:
The finder of goods is not entitled to use the found goods for personal purposes. The use of goods is only permissible if it is absolutely necessary to preserve them or to avoid damage. For example, if a person finds a perishable item (like food), they may use it temporarily for preservation.
Right to a Reward:
The finder is entitled to a reasonable reward for the trouble and expense incurred while safeguarding the goods until the rightful owner is found. However, this reward is not mandatory and depends on the specific circumstances.
The finder does not have an automatic right to claim compensation unless the owner agrees or a local custom or agreement is in place.
Returning the Goods to the Owner:
Once the rightful owner of the goods is identified or located, the finder is under a legal obligation to return the goods to the owner. If the goods are not returned, the finder may be liable for conversion, which is unlawful possession or use of someone else's property.
No Right to Dispose of the Goods:
The finder of goods has no right to sell or dispose of the goods unless the goods are perishable and require immediate action to prevent them from going to waste or deteriorating. Even in such cases, the sale must be carried out in accordance with the law.
Legal Principle: Finder as Bailee
The legal principle underlying Section 171 is that the finder of goods, in taking possession of lost goods, assumes a responsibility akin to that of a bailee. The finder holds the goods in trust for the true owner and is obligated to care for them.
The contractual relationship between the finder and the true owner can be viewed as a bailment (though not voluntarily entered into), where the goods are found without the intention of the finder to take ownership.
Examples of Section 171 in Practice
Lost Wallet:
If a person finds a lost wallet, they are required to take reasonable care of it and make efforts to return it to the rightful owner. The finder cannot use the money inside the wallet for personal purposes and must attempt to find the owner, either by contacting the police or looking for identifying information within the wallet. If the owner cannot be found, the finder may be entitled to a reasonable reward for their trouble.
Found Bicycle:
If someone finds a bicycle on the side of the road and takes it into their custody, they must take care of it and cannot use it for personal purposes. If the true owner is identified, the bicycle must be returned to them. The finder may ask for a reward for their trouble, but they cannot sell or keep the bicycle as their own.
Perishable Goods:
If a person finds perishable goods like fruits or vegetables and does not have the means to store them, the finder can use or sell them to prevent them from spoiling. However, this must only be done to preserve the goods and not for personal benefit. Any sale proceeds should be kept aside to return to the owner, should they come forward.
Legal Consequences of Non-Compliance
If the finder of goods fails to return the goods to the rightful owner or misuses the goods, they may be liable for conversion (a civil wrong) or even criminal liability for misappropriation. A person who takes or uses property without the owner's consent could face legal action for theft or dishonest misappropriation under Sections 378 or 403 of the Indian Penal Code (IPC).
For example, if the finder decides to sell a found piece of jewelry or a watch without making any effort to return it to the rightful owner, they may be charged with theft or criminal misappropriation of property.
Comparison with Common Law
The concept of a finder of goods is well-established in common law, where the finder is seen as having a legal duty to take care of the property until the true owner is found. The Indian approach under Section 171 is largely aligned with common law principles, as it treats the finder similarly to a bailee and places similar responsibilities on them.
In common law, the finder of goods can also claim a reward or reimbursement for their trouble, and their rights over the goods are typically secondary to the rights of the true owner.
Conclusion
Section 171 of the Indian Contract Act, 1872 provides a framework for the responsibilities of a finder of goods, treating them as a bailee with duties to take care of the goods found and to return them to the rightful owner. This section ensures that the finder cannot claim ownership of the goods, must not misuse them, and can claim a reasonable reward for their trouble. It upholds the principle of trust and custody, with the finder essentially acting as a temporary custodian until the goods are returned to their rightful owner. The provision reinforces the idea that a person who comes into possession of another's property must act in good faith and return the property to the owner whenever possible.
RELATED Blog
{!! (isset($postDetail['review_mapping']) && count($postDetail['review_mapping']) > 0 ? count($postDetail['review_mapping']) : 0) }} comments