Meaning
Legal right to retain possession of property belonging to another until a debt is satisfied. A common law lien arises automatically when a person performs work or provides services that improve the value of the property in their care. The right exists only as long as the creditor maintains physical control of the item and vanishes immediately upon voluntary release.
Possession Requirement
Physical custody of the asset is the fundamental condition for the existence of the security interest. If a party loses control of the goods, the common law lien is extinguished and cannot be revived by regaining the item later.
Debt Satisfaction
Payment of the full amount owed for the specific services rendered terminates the right of the holder to keep the property. Once the owner settles the invoice, the person holding the common law lien must return the goods in their original or improved condition.
Legal Enforcement
Protection of the creditor occurs through the right to refuse delivery rather than a right to sell the asset. Unlike a statutory charge, a common law lien does not provide an inherent power of sale without a separate court order. This limitation forces the parties to negotiate a settlement or seek judicial intervention to resolve the balance.
