This is a right conferred upon a party law or trade usage or custom in certain circumstances and is exercisable as a security for the fulfilment of an obligation owned another.
Types of Lien
1. Possessory lien
2. Equitable lien
1. POSSESSORY LIEN
This is the right of a party in possession of another’s goods to retain them as a security for the fulfilment of an obligation. The lien is dependent on possession which must be lawful and continuous and is enforceable without any court action.
Possessory Lien may be general or particular.
a. General Lien-This is a possessory lien which entitles the party in possession to retain the goods for the fulfilment of any obligation owned the owner .e.g An advocate has a general lien on a clients documents for any unpaid fees.
b. Particular Lien-This is a possessory lien which entitles the party in possession to retain the goods for the fulfilment of the particular owning e.g price of the goods held.
An unpaid seller’s lien is particular in nature.
2. EQUITABLE LIEN
This is the right of a party to have certain property in particular manner e.g. in the dissolution of a partnership every partner is entitled to have the firms assets applied in the 1st instance in the payment of its debts and liabilities and is enforceable court action.
3. MARITIME LIEN
This is the right of a party to have a ship or its cargo sold and the proceeds applied in a particular manner e.g a ship captain and crew members have an equitable lien in relation to unpaid usage. This lien is independent of possession and is enforceable court action.
Termination of Lien
A lien may come to an end in any of the following ways:
1. Discharge of the obligation owing
2. Mutual agreement between the parties
3. Dealing with the goods in a manner inconsistent with the lien.
4. Waiver the party entitled to the right.