CAIB 2 - Chapter 5 Exam Questions and Answers Completely Solved

identify three reasons why a bailee may have temporary custody of the personal property of another - ANSWER-for repair for safekeeping or storage for delivery to others identify three examples of businesses who may be bailees for hire - ANSWER-small engine repair shops dry cleaners tailors briefly explain the level of 'ordinary care' to be exercised by a bailee - ANSWER-there is a legal duty on the bailee to take the same care of goods of others as would be taken by a prudent and diligent owner of such goods briefly explain how the level of 'ordinary care' may vary by the type of bailee - ANSWER-may vary with the class of property over which bailment is being exercised (ex. jewelry vs. wheat) identify two ways a bailee may be responsible for the goods of others - ANSWER--liable for loss to customers property when the required level OF ORDINARY CARE HAS BEEN BREACHED because of negligence -purchase additional liability for customers property under contract (ex. if stolen by thieves) identify three ways bailees can insure their legal and contractual responsibility for damages to customer goods *** (3 ways a bailee can look after a customers property) - ANSWER--include the value of customers property in the amount of stock insurance -purchase separate policy insuring the legal liability of the bailee for loss -purchase a specialized bailees customers policy (coverage can be purchased which totally ignores the issue of the legal liability for the loss) identify three examples of clients who may need inland transportation insurance - ANSWER-incoming and outgoing shipments moving or storage companies trucking or delivery firms identify the two parties who may have an insurable interest in property while in the course of transit - ANSWER-the owner the carrier (bailee for hire) identify how the decision of who should purchase insurance on property in transit is determined - ANSWER-if the owner or carrier would be responsible for loss to the property and to what extent identify the three types of carriers which can be used to transport goods of owners or shippers * - ANSWER-common carrier contract carrier private carrier identify five excluded losses for which a common carrier would NOT be liable to the owner of the goods * - ANSWER-acts of god acts of public enemies acts of public authority neglect or default of the shipper inherent vice in the goods transported ( perishable goods, eggs, shelf life) identify the document used to establish the liabilities of common carrier * - ANSWER-bills of lading identify the three types of bills of lading normally used by common carriers - ANSWER-standard (ordinary) bill of lading valued bill of lading released bill of lading how are the goods valued under a standard (ordinary) bill of lading? - ANSWER-amount is established at a certain amount per kilogram/pound or parcel identify two reasons to use a released bill of lading - ANSWER-when the value of goods is less than stated on standard (ordinary) bill of lading when the value of goods is more than what is stated on the standard tariff (tax) identify the liability of: 1) contract carriers 2) private carriers - ANSWER-1) contract carriers- will be stated on his contract with the owner of the property 2) private carriers- are responsible for the amount of the loss of goods carried by them identify the four ways that the owners of goods may insure them under the inland transportation insurance - ANSWER-transportation floater - broad form transportation floater rider - limited form