LienA right which entitles a party to hold on to assets in his possession pending payment of a debt owed. It can arise in the following ways:
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What is the legal definition of a lien?
From the operation of law (a legal or common law lien). Bargained for, or extended, as a matter of contract (a contractual lien). Created by statute (a statutory lien). It does not confer on the lien holder an automatic right to sell the assets.
What are the different types of liens?
There are two types of liens: particular and general. When a person claims a right to retain property, in respect of money or labor expended on such particular property, this is a particular lien. Liens may arise in three ways:
What are the rights of an lienholder?
Liens may be recognised by common law or may be created by contractual agreement. only grant the right to retain the goods which are subject to the lien don’t grant the holder the power to sell the goods to discharge or reduce the debt owed may be asserted to retain possession of goods until the relevant charges or debt is paid.
What happens if a lien is placed on a property?
Dealing with property contrary to the terms of the lien are likely to discharge it and render the lienholder liable to the owner of the property in the tort of conversion. Particular liens only apply to secure the debt arising from a particular transaction, rather than a series of transactions.