Finder of Goods

A person who finds goods belonging to another and takes them into his custody, is subject to the same responsibility as a bailee (Sec 71). The finder of goods is given special privileges under the law. He is entitled to retain the goods as against the whole world except the true owner there of. He is, therefore like a custodian of goods found by him for and on behalf of the true owner. As and when the owner is found, he is to return the goods to him. He has to take all reasonable steps to find the true owner.

The following are the rights and liabilities of the finder of goods:

Rights: (1) he has a right to retain possession of such goods against the whole world except the true owner:

(2) He is entitled to lien, i.e. a right to retain the goods found even against the true owner until he receives compensation for trouble and expenses voluntarily incurred by him to preserve the goods and find out the owner. However, the finder of goods is not entitled to sue for such compensation, though he is entitled to retain the goods until he receives such compensation.

(3) The finder may sue for the reward, where the owner has offered a specific reward for the return of the goods. He may retain the goods until he receives it. He cannot claim any remuneration for services rendered by him.

(4) The finder may sell the goods if —

a) the owner cannot with reasonable diligence be found; or
b) he refuses, upon demand, to pay the lawful charges of the finder; or
c) the thing is in danger of persisting or of losing the greater part of its value, or
d) the lawful charges of the finder in respect of the thing found, amount to two thirds of its value.

A finder of goods cannot sell the goods otherwise than on above grounds. If he does so, he will be guilty of conversion.

Liabilities: The liabilities and obligations of the finder of the goods are:

1) he must use reasonable diligence and try to find out the true owner;
2) he must take due care of the goods
3) he must not use the goods for his own purpose



The bailment of goods as security for payment of a debt or performance of a promise is called pledge. The bailor in this case is called the pawnor. The bailee is called the pawnee (Sec 172). The transaction is called the pledge or pawn. Bailor in this case is also called the pledgor and the bailee is called the pledge. Pledge is therefore a kind of bailment.


A borrows Rs 4,000 against security of his jewelry. The bailment of jewelry is a pledge.

Any kind of movable property can be pledged by actual or constructive. Where a person pledges the goods in which he has only a limited interest, the pledge is valid to the extent of that interest. Rules of bailment are generally applicable to pledge.


(1) The goods must be delivered as security of payment of a debt or for performance of a promise;
(2) There must be actual or constructive delivery of goods pledged. When a third person having possession of the goods agrees to hold them on pledge’s behalf it will constitute sufficient delivery. Delivery of documents of title to the goods which would enable the pawnee to obtain possession thereof, like delivery of railway receipt would constitute the same thing as delivery of goods and would therefore be a pledge.
(3) The pledge can be made of movable goods only. Movable goods include documents, shares, or valuable things. Government promissory notes may be pledged by endorsement and delivery. Money cannot be pledged.
(4) Transfer of possession is essential. Agreement to transfer possession of goods when ready or in future does not create a pledge.

A bailment relates to specific moveable property of which delivery has been given by one person to another for a specific purpose. Where specific moveable and immovable properties were given in possession by one party to another under the contract but the right of realization was not confined to the specific moveable properties of which delivery was given but extended to other assets also, it was held that since no specific moveable property was given as a security for the debts of the transferee, the transaction could not be called a pledge.