Gratuitous Bailee

Enofe v Capreit Limited Partnership, 2017 ONSC 2764 (CanLII)

[27] Bailment is the delivery of personal chattels on trust, usually on a contract, express or implied, that the trust shall be executed and the chattels be delivered in either their original or an altered form as soon as the time for which they were bailed has elapsed. The legal relationship of bailor and bailee can exist independently of a contract. It is created by the voluntary taking into custody of goods which are the property of another (see: Punch v. Savoy’s Jewellers Ltd. (1986), 1986 CanLII 2759 (ON CA), 54 O.R. (2d) 383 (C.A.)). That is what occurred in this case.

[28] This raises the following question: did Capreit owe any duty of care to Enofe in these circumstances to ensure that his property was not stolen or damaged?

[29] Whether a party is a bailee for hire or a gratuitous bailee, a duty of care nevertheless is imposed upon that party. The only difference is the applicable standard of care (see: Painter v. Waddington, McLean & Co., [2003] O.T.C. 1152 (S.C.)).

[30] A gratuitous bailee is responsible only for gross negligence (see: Leggo v. Welland Vale Manufacturing Co. (1901), 2 O.L.R. 45 (C.A.); Watson v. Dominion Bank (1936), 18 C.B.R. 266 (Ont. C.A.); Grafstein v. Holme & Freeman, 1958 CanLII 97 (ON CA), [1958] O.R. 296 (C.A.)).

[31] In comments made obiter, Perell, J. has recently upheld this long-established standard of gross negligence in circumstances of gratuitous bailment (see: Chan v. Gray, 2012 ONSC 2068).

[32] The standard of care required of a gratuitous bailee therefore is to keep the goods only as a prudent owner might reasonably be expected to take of his own goods in similar circumstances (see: Ginsberg v. Vanstone Motors Limited (1949), O.W. N. 345).

[33] In my view, Capreit was a gratuitous bailee subject only to the “prudent owner” standard of care.

[34] Accordingly, Capreit owed a duty of care to Enofe, but of a less strict nature that one that would arise in a commercial bailment scenario or any bailment for reward. Further, the circumstances surrounding the storage arrangement make it evident that such storage was only to be of very limited duration. To the extent there was risk involved in these arrangements, I conclude that Enofe willingly accepted some reasonable measure of that risk.

[35] The question therefore to be determined is: what care would a prudent owner have exercised for the safety of the articles if entrusted to him, under similar circumstances?

[36] The law of bailment imposes on the bailee an onus to prove that he took appropriate care or that his failure to do so did not contribute to the loss. The burden is on the bailee to show that the damage occurred without any neglect, default or misconduct on the part of himself or those for whom he is responsible (see: Ferguson et al. v. Birchmount Boarding Kennels Limited et al., 2006 CanLII 2049 (ON SCDC), [2006] O.J. No. 300 (S.C.J. (Div. Ct.)).