Legal Definitions - carrier's lien

A carrier's lien is a legal right that allows a transportation company (known as the "carrier") to hold onto goods it is shipping until the customer pays for the transportation services. Essentially, it provides the carrier with a security interest in the goods themselves, giving them a way to ensure payment for the work they've done. This right begins when the carrier takes possession of the items for transport and continues until the shipping fees are fully settled. If the customer fails to pay as agreed, the carrier can legally retain the goods as collateral until the debt is resolved.

Here are some examples to illustrate how a carrier's lien works:

• Commercial Freight Shipment: Imagine a large furniture manufacturer hires a trucking company to deliver a substantial order of custom-made office desks and chairs to a corporate client in another state. The trucking company successfully transports the furniture. However, upon arrival, the corporate client, who was responsible for the shipping costs, informs the trucking company that they are unable to pay the invoice due to an unexpected financial setback. In this situation, the trucking company can exercise a carrier's lien, refusing to unload or release the furniture until the shipping fees are paid. This protects the trucking company from losing money on the transportation service.

• International Ocean Cargo: Consider an electronics distributor in Asia shipping a container full of consumer gadgets via ocean freight to a retail chain in North America. The agreement specifies that the retail chain will pay the shipping costs upon the container's arrival at the destination port. When the container reaches the port, the retail chain disputes the quality of the goods and, as a result, refuses to pay the freight charges to the shipping line. The ocean freight carrier can then invoke a carrier's lien, legally holding the container at the port terminal and refusing to release the electronics until the shipping fees are settled. This ensures the carrier is compensated for their service, even if there's a separate dispute between the buyer and seller of the goods.

• Household Moving Services: A family hires a professional moving company to transport all their household belongings from their old home to a new one several hundred miles away. The contract states that the full payment for the moving services is due upon delivery at the new residence. After the moving company has loaded all the family's possessions, driven them to the new city, and is ready to unload, the family informs the movers that they cannot make the final payment due to an unforeseen emergency. The moving company can assert a carrier's lien, meaning they can legally keep the family's belongings on their truck or in a secure storage facility until the outstanding moving fees are paid. This provides the moving company with a legal mechanism to secure payment for the significant effort and cost involved in transporting the goods.