The Empire Theatre Co. operated a movie theatre and a free parking lot which was adjacent to the theatre building. The lot had posted a prominent "FREE PARKING" sign as well as another much smaller sign which disclaimed the lot's liability for loss or damage. Scarlett parked her car in the theatre's lot while she attended the theatre to see her favourite classic film, "Gone With The Wind." While in the theatre, Scarlett's car was stolen. It was subsequently recovered, although some damage had resulted, and the car needed repairs. Scarlett brought an action against the Empire Theatre for recovery of damages with respect to the car. What arguments might the parties raise in this case?

This case is based on Way Sagless Spring Co. v. Bevradio Theatres Ltd., [1942] O.W.N. 236. The plaintiff will claim a bailment in which the bailee, the theatre, has a duty of care to protect vehicles in its lot from risk of harm, and will be liable if damage occurs as a result of a failure to meet its standard of care. The theatre, in its defence, will argue that the relationship was not one of bailment, as in the typical parking lot cases where the lot requires the vehicle to be left in its care and the keys deposited with the attendant. This situation is simply the use of space for the convenience of the patron and for which the theatre receives no remuneration. Moreover, the disclaimer sign was posted in the lot.
The arrangement here may be described as a gratuitous bailment for the benefit of both the bailor and bailee. The patron receives the benefit of free parking while attending the theatre and the theatre receives the benefit of the patron's attendance by providing the service. In such a case, the standard of an ordinary prudent person applies. The court held that the theatre, having invited the public to attend, offered a further inducement to do so in the form of free parking. By offering this inducement it undertook to take care of the patrons' cars. There was no evidence that the disclaimer sign was brought to the driver's attention. Furthermore, after noticing the free parking sign, patrons were unlikely to look for additional signs.