Introduction

Section 71 of the Indian Contract Act, 1872 (ICA) deals with the responsibilities of the finder of lost goods. This Section is one of the five obligations which are known as quasi contracts. Quasi Contracts are contained in Sections 68 to 72 of ICA and these obligations are based on the principle that law as well as justice should try to prevent unjust enrichment.

Section 71 of ICA

• This Section deals with the responsibility of finder of goods.
• It states that a person who finds goods belonging to another, and takes them into his custody, is subject to the same responsibility as a bailee.
• Since the position of the finder of the goods is that of a bailee he is supposed to take the same amount of care with regard to the goods as is expected of a bailee.

Duties of Finder of Goods

• Duty to take care of goods- The Finder must take care of the goods until he returns the goods to the owner. It means the finder has to take reasonable care of the lost property. This means that he has to protect the lost property from damage, theft, and any harm that may occur.
• Duty to use the property for the agreed purpose- The finder must use the lost property only for its entrusted purpose. Without the consent of the owner, if he deviates, it would lead to the liability of the bailee.
• Duty to not mix the property- The finder is responsible for not mixing the owner’s goods with the other goods. If the goods are mixed, he will be held liable if the goods are unable to separate. If the goods can be separated, the bailee will bear the expenses to separate the mixed goods.
• Duty to return the property- The finder of the goods has to deliver or return the goods found to the actual owner before the expiration of time as specified by the owner.
• Duty to render Accounts- When the owner approaches the finder for information regarding the status of the property lost and the condition of the property, the finder must provide accurate reports of all transactions connected to the bailment and the bailee is required to maintain correct records.

Rights of Finder of Goods

• Right to Possession- One of finder’s rights is to have possession of the goods. But the right to possession is limited. The finder has to use the goods only for a specific purpose, not for any other purpose, without the consent of the owner.
• Right to Lien- The finder has the right to lien, which means the finder can take back the possession of the goods until the charges are paid in respect of the goods. This right would be applicable when there is a legal contract between the parties.

Case Law

• In the case of State of Bombay (Now Gujarat) v. Memon Mahomed Haji Hasam (1965), the Supreme Court has held that the finder of lost goods plays the role of the bailee and has the same responsibility as that of a bailee towards the owner of that goods.