Imagine you visited a mall with valet parking.


Imagine you visited a mall with valet parking. You gave your car key to the mall’s staff to park your car. The parking tag given by the mall’s staff reads “In the event of any loss, theft or damage, the management shall not be held responsible for the same and the guest shall have no claim whatsoever against the management”. When you came out of the mall, you learnt that someone stole your car key and stole your car. In spite of the police complaint, the car is not traceable. Insurance company settles your claim of Rs.3 lakhs. Please analyse following points
a. Thereafter, can you issue a letter of subrogation in favour of the insurance company and approach the Consumer Commission by filing a complaint against the Mall’s management seeking payment of the value of the car and compensation for deficiency in service? Give your reason for either of your answer
b. Analyse whether you are a “bailer” and mall’s management is “bailee” in the aforesaid case


Answer a:

The insurance industry is widely regarded as a main application of the subrogation principle. Subrogation allows an insurance company to seek reimbursement from the party that caused the harm for the amount of the insurance claim paid to the covered client. Take note that in certain instances, the insurance company represents the insured client’s interests. Subrogation, in other terms, is a claim against the insurance company for a paid-out insurance claim.


Generally, the insurance company’s subrogation right is defined in contracts with the insured party. Contracts may contain special terms granting the insurance company the authority to initiate the process of collecting the insurance claim payment against the party who caused the insured party’s damages.

Car owner can’t get compensation for deficiency in service as per given situation. The Mall will file their Written Version, in which they will assert that the Complainants do not meet the definition of ‘consumer’ under Section 2(1)(d) of the Consumer Protection Act;

  • Mall has not taken any consideration from car owner;
  • That the purported subrogation was carried out by a non-consumer, and thus the car owner lacks locus standi to file the Complaint;
  • That the Mall provides valet parking services to guests without regard for cost;
  • That the tag issued to the car owner makes it abundantly clear that what was provided was merely a parking space and not a secure storage facility;
  • That it would be unreasonable to expect the Mall to assume risks and responsibilities for the vehicle’s safety and security solely because it has offered to park the vehicle to alleviate inconvenience to car owners;
  • That visitors were not required to utilize valet parking services;
  • That the Mall is not liable for any theft, damage, or loss resulting from a condition expressly and prominently stated on the parking tag;
  • That having accepted the said condition, the car owner was no longer entitled to assert a contrary claim on the grounds that the conditions were not binding, unenforceable, or defective;
  • That what was provided was merely a valet parking service, not a secure storage facility for the motor vehicle;
  • That the alleged letter of subrogation and said Power of Attorney are meaningless and ineffective in light of the Insurance Company’s inability to maintain a claim against the Mall;
  • That no services were hired because no consideration was paid by the car owner, and thus the Complaint could not be maintained before the Consumer Forum.


This car is being parked at the guest’s request and is being done so at his or her own risk and expense within or outside the mall premises. The management shall not be liable for any loss, theft, or damage, and the guest shall have no claim against the mall management.

Answer b:


Bailment contracts are a subclass of contract. These are dealt with in Chapter IX of the Indian Contract Act, 1872, from S.148 to 181. Bailment is a term that refers to a situation in which one person temporarily takes possession of another.


When a customer pays to park his car in a parking lot and it is stolen or damaged, the bailment laws apply. A bailment occurs when the car’s owner (bailor) transfers possession, care, and/or control of the car to another person (bailee) for a specified period of time and for a specific purpose.

The Contract Act, 1872, Chapter IX, contains provisions relating to bailment. Bailment is defined in Section 148. It is the delivery of goods by one person to another for a specific purpose with the understanding that they will be returned according to the directions of the person who delivered them once the purpose is fulfilled. The bailor is the person who delivers the goods, and the bailee is the person to whom the goods are delivered. Under Section 151, the bailee is required to treat the goods bailed to him with the same care that a prudent person would treat his own goods in similar circumstances. In the absence of a special contract, the bailee is not liable for the loss, destruction, or deterioration of the thing bailed if he has exercised the degree of care required by Section 151. Under Section 161, if the bailee fails to return or deliver the goods due to his fault, he is liable to the bailor for any loss of the goods. Thus, the bailment entails a contract between the bailor and bailee. Consideration must flow from the promisor to the promisee, or from the bailor to the bailee.

In this case, we will assume that the price paid for food consumed includes the consideration paid by the consumer, the bailor, to the Mall, the bailee. We will not consider the matter if the car is given to the Mall management for free parking. It cannot be the case, however, that Car Onwer lent the car to the Mall management for gratuitous use, as required by Section 151 of the Contract Act.


In any case, the contract expressly stated that Mall management would not be liable for car theft, loss, or damage. As a result, we believe that Car Owner, the complainant, is not entitled to make a claim for the loss of his car under the bailment laws.