Loan, Gratuitous - Definition - Law Dictionary Home Dictionary Definition loan-gratuitous

Definition :

Loan, gratuitous, a class of bailment called commodatum in the Roman Law, and denominated by Sir William Jones a loan for use (pret a usage), to distinguish it from mutuum, a loan for consumption.

The borrower has the right to use the thing during the time and for the purpose agreed upon by the parties. the loan is to be considered as strictly personal, unless from other circumstances a different intention may fairly be presumed. The borrower must take proper care of the thing borrowed, use it according to the lender's intention, and restore it at the proper time, and in a proper condition.

The lender must suffer the borrower to use and enjoy the thing lent during the time of the loan, according to the original intention, without any molestation or impediment, under the peril of damages. He must reimburse the borrower the extraordinary expenses to which he has been put for the preservation of the thing lent. He is bound to give notice to the borrower of the defects of the thing lent; and if he does not, but conceal them, and an injury occurs to the borrower thereby, the lender is responsible. Where the thing has been lost by the borrower, and, after he has paid the value thereof, is restored to the lender, the later must return either the price paid or the thing; for, by such payment of the loss, the property is effectively transferred to the borrower.

Mr. Justice Story thus concludes his observations on gratuitous loans. 'It has, however,' says he, 'furnished very little occasion for the interposition of judicial tribunals, for reasons equally honourable to the parties and to the liberal spirit of polished society. The generous confidence thus bestowed is rarely abused; and if a loss or injury unintentionally occurs, an indemnity is either promptly offered by the borrower, or compensation is promptly waived by the lender.''Story's Bailments, c. iv.