How does an equitable lien work?
How does an equitable lien work?
An equitable lien is placed on property to prevent unjust enrichment of one party. Equitable liens are created when there is “no adequate remedy at law”[2] for a breach of contract or other harm, which usually means a money judgment is impractical or impossible.
What is an example of an equitable lien?
An equitable lien is a claim on a wrongdoer’s property that is placed by a court of equity, or through an equivalent legal proceeding. A common example of a situation where an equitable lien might be appropriate involves the embezzlement of the proceeds from a trust by a trust administrator or trustee.
Is an equitable lien a charge?
Equitable liens do not require possession the relevant property and have some qualities of charges: they give rise to a right to sell the property with the permission of a court. For instance the Law of Property Act 1925 applies and the interest should be registered as a charge over land.
What is an equitable lien claim?
Specifically, it is “a right of a special nature over a particular property that may arise from a written contract which shows an intention to charge the particular property with a debt or obligation, or it may be declared by a court of equity out of a general consideration of right and justice as applied to the …
What is the difference between a constructive trust and an equitable lien?
Two types of equitable restitution exist: equitable lien and constructive trust. An equitable lien is a claim on property by someone other than the owner when an unpaid debt is owed. A constructive trust is a transfer of property to someone other than the owner, when the owner wrongfully acquired the property.
What is an equitable period of redemption?
Equity of redemption (also termed right of redemption or equitable right of redemption) is a defaulting mortgagor’s right to prevent foreclosure proceedings on the property and redeem the mortgaged property by discharging the debt secured by the mortgage within a reasonable amount of time (thereby curing the default).
What does equitable lien mean?
achieve fairness
equitable lien. n. a lien on property imposed by a court in order to achieve fairness, particularly when someone has possession of property which he/she holds for another. See also: constructive trust equity lien.
What is lien process?
A lien is a legal claim or a right against a property. 1 Liens provide security, allowing a person or organization to take property or take other legal action to satisfy debts and obligations. The debt is now secured, and the lender has a better chance of getting repaid.
What is an equitable charge?
An equitable charge is an arrangement in which a debtor chooses to use an asset as security for some type of financial obligation, such as a debt. The creation of an equitable charge begins with the offer of some sort of property by the owner as security for a debt that is owed to a creditor.
What is the purpose of equitable right of redemption?