What is Lien?

Legal Definition
A lien (/ˈln/ or /ˈlən/) is a form of security interest granted over an item of property to secure the payment of a debt or performance of some other obligation. The owner of the property, who grants the lien, is referred to as the lienee and the person who has the benefit of the lien is referred to as the lienor or lien holder.

The etymological root is Anglo-French lien, loyen "bond", "restraint", from Latin ligamen, from ligare "to bind".

In the United States, the term lien generally refers to a wide range of encumbrances and would include other forms of mortgage or charge. In the USA, a lien characteristically refers to non-possessory security interests (see generally: Security interest—categories).

In other common-law countries, the term lien refers to a very specific type of security interest, being a passive right to retain (but not sell) property until the debt or other obligation is discharged. In contrast to the usage of the term in the USA, in other countries it refers to a purely possessory form of security interest; indeed, when possession of the property is lost, the lien is released. However, common-law countries also recognize a slightly anomalous form of security interest called an "equitable lien" which arises in certain rare instances.

Despite their differences in terminology and application, there are a number of similarities between liens in the USA and elsewhere in the common-law world.
-- Wikipedia
Legal Definition
A security interest or legal right acquired in one's property by a creditor. A lien generally stays in effect until the underlying obligation to the creditor is satisfied. If the underlying obligation is not satisfied, the creditor may be able to take possession of the property involved.

The major categories of liens are as follows: Agricultural lien, Common law lien, Statutory lien, Contractual lien, Maritime lien, Legal lien, and Equitable lien.

Within these categories, many liens have specific names that usually stem from the type of creditor involved. See, e.g., Artisan's lien, Carrier's lien, Floating lien, Mechanic's lien, Storage lien, and Tax lien.
Legal Definition
Contracts. In its most extensive signification, this term includes every case in which real or personal property is charged with the payment of any debt or duty; every such charge being denominated a lien on the property. In a more limited sense it is defined to be a right of detaining the property of another until some claim be satisfied. 2 East 235; 6 East 25; 2 Campb. 579; 2 Meriv. 494; 2 Rose, 357; 1 Dall. R. 345.

2. The right of lien generally arises by operation of law, but in some cases it is created by express contract.

3. There are two kinds of lien; namely, 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: 1st. By express contract. 2d. From implied contract, as from general or particular usage of trade. 3d. By legal relation between the parties, which may be created in three ways; When the law casts an obligation on a party to do a particular act, and in return for which, to secure him payment, it gives him such lien; 1 Esp. R. 109; 6 East, 519; 2 Ld. Raym. 866; common carriers and inn keepers are among this number. 2. When goods are delivered to a tradesman or any other, to expend his labor upon, he is entitled to detain those goods until he is remunerated for the labor which he so expends. 2 Roll. Ab. 92; 3 M. & S. 167; 14 Pick. 332; 3 Bouv. Inst. n. 2514. 3. When goods have been saved from the perils of the sea, the salvor may detain them until his claim for salvage is satisfied; but in no other case has the finder of goods, a lien. 2 Salk. 654; 5 Burr. 2732; 3 Bouv. Inst. n. 2518. General liens arise in three ways; 1. By the agreement of the parties. 6 T. R.14; 3 Bos. & Pull. 42. 2. By the general usage of trade. 3. By particular usage of trade. Whitaker on Liens 35; Prec. Ch. 580; 1 Atk. 235; 6 T. R. 19.

4. It may be proper to consider a few, general principles: 1. As to the manner in which a lien may be acquired. 2. To what claims liens properly attach. 3. How they may be lost. 4. Their effect.

5. - 1. How liens may be acquired. To create a valid lien, it is essential, 1st. That the party to whom or by whom it is acquired should have the absolute property or ownership of the thing, or, at least, a right to vest it. 2d. That the party claiminig the lien should have an actual or constructive, possession, with the assent of the party against whom the claim is made. 3 Chit. Com. Law, 547; Paley on Ag. by Lloyd, 137; 17 Mass. R. 197; 4 Campb. R. 291; 3 T. R. 119 and 783; 1 East, R. 4; 7 East, R. 5; 1 Stark. R. 123; 3 Rose, R. 955; 3 Price, R. 547; 5 Binn. R. 392. 3d. That the lien should arise upon an agreement, express or implied, and not be for a limited or specific purpose inconsistent with the express terms, or the clear, intent of the contract; 2 Stark. R. 272; 6 T. R. 258; 7 Taunt. 278;. 5 M. & S. 180; 15 Mass. 389, 397; as, for example, when goods are deposited to be delivered to a third person, or to be transported to another place. Pal. on Ag. by Lloyd, 140.

6. - 2. The debts or claims to which liens properly attach. 1st. In general, liens properly attach on liquidated demands, and not on those which sound only in damages; 3 Chit. Com. Law, 548; though by an express contract they may attach even in such a case as, where the goods are to be held as an indemnity against a future contingent claim or damages. Ibid. 2d. The claim for which the lien is asserted, must he due to the party claiming it in his own right, and not merely as agent of a third person. It must be a debt or demand due from the very person for whose benefit the party is acting, and not from a third person, although the goods may be claimed through him. Pal. Ag. by Lloyd, 132.

7. - 3. How a lien may be lost. 1st. It may be waived or lost by any act or agreement between the parties, by which it is surrendered, or becomes inaplicable. 2d. It may also be lost by voluntarily parting with the possession of the goods. But to this rule there are some exceptions; for example, when a factor by lawful authority sells the goods of his principal, and parts with the possession under the sale he is not, by this act, deemed to lose his lien, but it attaches to the proceeds of the sale in the hands of hte vendee.

8. - 4. The effect of liens. In general, the right of the holder of the lien is confined to the mere right of retainer. But when the creditor has made advances on the goods of a factor, he is generally invested with the right to sell. Holt's N P. Rep. 383; 3 Chit. Com. Law, 551; 2 Liverm. Ag. 103; 2 Kent's Com. 642, 3d ed. In some cases where the lien would not confer power to sell, a court of equity would decree it. 1 Story Eq. Jur. §566; 2 Story, Eq. Jur. §1216; Story Ag. §371. And courts of admiralty will deeree a sale to satisfy maritime liens. Abb. Ship. pt. 3, c10. §2; Story, Ag. §371.

9. Judgments rendered in courts of record are generally liens on the real estate of the defendants or parties against whom such judgments are given. In Alabama, Georgia and Indiana, judgment is a lien; in the last mentioned state, it continues for ten years from January 1, 1826, if it was rendered from that time; if, after ten years from the rendition of the judgment, and when the proceedings are stayed by order of the court, or by an agreement recorded, the time of its suspension is not reckoned in the ten years. A judgment does not bind lands in Kentucky, the lien commences by the delivery of execution to the sheriff, or officer. 4 Pet. R. 366; 1 Dane's R. 360. The law seems to be the same in Mississippi. 2 Hill. Ab. c. 46, s. 6., In New Jersey, the judgments take priority among themselves in the order the executions on them have been issued. The lien of a judgment and the decree of a court of chancery continue a lien in New York for ten years, and bind after acquired lands. N. Y. Stat. part 3, t. 4, s. 3. It seems that a judgment is a lien in North Carolina, if an elegit has been sued out, but this is perhaps not settled. 2 Murph. R. 43. The lien of a judgment in Ohio is confined to the county, and continues only for one year, unless revived. It does not, per se, bind after acquired lands. In Pennsylvania, it commences with the rendering of judgment, and continues five years from the return day of that term. It does not, per se, bind after acquired lands. It may be revived by scire facias, or an agreement of the parties, and terre tenants, written and filed. In South CaroIina and Tennessee a judgment is also a lien. In the New England states, lands are attached by mesne process or on the writ, and a lien is thereby created. See 2 Hill. Ab. c. 46.

10. Liens are also divided into legal and equitable. The former are those which may be enforeed iu a court of law; the latter are valid only in a court of equity. The lien which the vendor of real estate has on the estate sold, for the purchase money remaining unpaid, is a familiar example of an equitable lien. Math. on Pres. 392. Vide Purchase money. Vide, generally, Yelv. 67, a; 2 Kent, Com. 495; Pal Ag. 107; Whit. on Liens; Story on Ag. ch. 14, §351, et seq: Hov. Fr. 35.

11. Lien of mechanics and material men. By virtue of express statutes in several of the states, mechanics and material men, or persons who furnish materials for the erection of houses or other buildings, are entitled to a lien or preference in the payment of debts out of the houses and buildings so erected, and to the land, to a greater or lessor extent, on which they are erected. A considerable similarity exists in the laws of the different states which have legislated on this subject.

12. The lien generally attaches from the commencement of the work or the furnishing of materials, and continues for a limited period of time. In some states, a claim must be filed in the office of the clerk or prothonotary of the court, or a suit brought within a limited time. On the sale of the building these liens are to be paid pro rata. In some states no lien is created unless the work done or the goods furnished amount to a certain specified sum, while in others there is no limit to the amount. In general, none but the original contractors can claim under the law; sometimes, however, sub-coutractors have the same right.

13. The remedy is various; in some states, it is by scire facias on the lien, in others, it is by petition to the court for an order of sale: in some, the property is subject to foreclosure, as on a mortgage; in others, by a common action. See 1 Hill. Ab. ch. 40, p. 354, where will be found an abstract of the laws of the several states, except the state of Louisiana; for the laws of that state, see Civ. Code of Louis. art. 2727 to 2748. See generally, 5 Binn. 585; 2 Browne, R. 229, n. 275; 2 Rawle R. 316; Id. 343; 3 Rawle, R. 492; 5 Rawle R. 291; 2 Whart. R. 223; 2 S. & R. 138; 14 S. & R. 32; 12 S. & R. 301; 3 Watts, R. 140, 141; Id. 301; 5 Watts, R. 487; 14 Pick. P,. 49; Serg. on Mech. Liens.
-- Bouviers Law Dictionary
Legal Definition
A qualified right of property which a creditor has in or over specific property of his debtor, as security for the debt or charge or for performance of some act. In every case in which property, either real or personal, is charged with the payment of a debt or duty, every such charge may be denominated a lien on the property. Whitak. Liens, p. 1. A lien is a charge imposed upon specific property, by which it is made security for the performance of an act. Code Civil Proc. Cal. § 1180. In a narrow and technical sense, the term "lien" signifies the right by which a person in possession of personal property holds and detains it against the owner in satisfaction of a demand ; but it has a more extensive meaning, and in common acceptation is understood and used to denote a legal claim or charge on prop erty, either real or personal, for the payment of any debt or duty; every such claim or charge remaining a lien on the property, although not in the possession of the person to whom the debt or duty is due. Downer v. Brackett, 21 Vt. 602, Fed. Cas. No. 4,043. And see Trust v. Pirsson, 1 Hilt. (N. Y.) 296; In re Byrne (D. Ct) 97 Fed. 764; Storm v. Waddell, 2 Sandf. Ch. (N. Y.) 507; Stansbury v. Patent Cloth Mfg. Co., 5 N. J. Law, 441; The Meno-minie (D. C.) 36 Fed. 199; Mobile B. & It. Ass'n v. Robertson, 65 Ala. 382; The J. E. Rumbell, 148 U. S. 1, 13 Sup. Ct. 498, 37 In Ed. 345. In the Scotch law, the doctrine of lien is known by the name of "retention," and that of set-off by the name of "compensation." The Roman or civil law embraces under the head of "mortgage and privllege" the peculiar securities which, in the common and maritime law and equity, are termed "liens." Classification. Liens are either particular or general. The former is a right to retain a thing for some charge or clnim growing out of, or connected with, the identical thing. A general lien is a right to detain a chattel, etc., until payment be made, not only of any debt due in respect of the particular chattel, but of any balance that may be due on general account in the same line of business. A general lien, being against the ordinary rule of law, depends entirely upon contract, express or implied, from the special usage of dealing between the parties. Wharton. Crommelin v. Railroad Co., 10 Bosw. (N. Y.) 80; McKenzie v. Nevius, 22 Me. 150, 38 Am. Dec. 291; Brooks v. Bryce, 21 Wend. (N. Y.) 16. A special lien is in the nature of a particular lien, being a lien upon particular property; a lien which the holder can enforce only as security for the performance of a particular act or obligation and of obligations incidental thereto. Green v. Coast Line R. Co., 97 Ga. 15, 24 S. E. 814, 33 In R. A. 806, 54 Am. St. Rep. 379; Civ. Code Cui. 1903, § 2875. Liens are also either conventional or by operation of law. The former is the case where the lien is raised by the express agreement and stipulation of the parties, in circumstances where the law alone would not create a lien from the mere relation of the parties or the details of their transaction. The latter is the case where the law itself, without the stipulation of the parties, raises a lien, as an implication or legal consequence from the relation of the parties or the circumstances of their dealings. Liens of this species may arise either under the rules of common law or of equity or under a statute. In the first case they are called "common-law liens;" in the second, "equitable liens;" in the third, "statutory liens." Liens are either possessory or charging; the former, where the creditor has the right to hold possession of the specific property until satisfaction of the debt; the latter, where the debt is a charge upon the specific property although it remains in the debtor's possession. Other compound and descriptive terms.
See also
-- Black's Law Dictionary
Legal Definition
A charge imposed upon specific property for the performance of an act. See 31 Am. Dec. 755.
-- Ballentine's Law Dictionary