Discuss the Right and Obligations of Pledger

Section 177 of the Indian Contract Act, 1872 states as under:

“If a time is stipulated for the payment of the debt, or performance of the promise for which the pledge is made and the pawner makes default in payment of the debt or performance of the promise at the stipulated time, he may redeem the goods pledged at any subsequent time, before the actual sale of them; but he must, in that case, pay, in addition, any expenses which have arisen from his default.”

Rights

From the above statement, the main rights of the pledger are given below:

(a) The pledger has a right to claim accruals to the goods pledged.

(b) The pledger has a right to receive any surplus from the pledgee in case of sale, that may remain with him after the debt is paid off.

(c) The pledger has a right to claim back the security pledged on repayment of the debt along with interest.

(d) In case the pledgee intends to sell the goods, the pledger has a right to receive a notice in stipulated time.

(e) In case there is any increase in the goods, the pledger has right to such increase.

Obligations (Duties)

(a) It is necessary for a pledger to disclose any fault or risk before the pledgee.

(b) The pledger must repay from the loan and take the delivery of the property from the pledgee within the stipulated time.

(c) The pledger is bound for any loss of the pledgee in case of any defects in pledger’s title to the goods.