A recurring question when working with debt collection is when the creditor may exercise a lien on the debtor's property until payment is made. As always, there is a general rule and some exceptions to when the customer's property may be retained. Most often, the question is relevant for car repair shops and similar, but it actually applies to all transactions.
The starting point in Danish law is the principle of simultaneity. Buyer and seller exchange services at the same time. That is, the seller delivers the goods at the same time that the buyer pays for the goods. This principle is known from all supermarkets and retail stores.
So, if you have repaired the customer's car, piano, watch or other item, you can demand that the customer pay immediately before you hand over the item to the customer. If the customer does not want to pay, you are not obligated to hand over the customer's belongings. This is called a lien.
If you have sold the item on credit, you cannot keep it. If you have promised the buyer that the buyer will receive the item here and now, but will only have to pay later, you may not exercise a right of retention in the item.
If you have already delivered the goods to the customer without receiving payment, even if no credit purchase has been agreed, you cannot subsequently demand the return of the goods until payment has been made. You must follow the general rules for requesting payment, debt collection, etc. to get your money back.
The right of retention is also limited if there is a major discrepancy between the services. For example, if you have repaired a car for a small amount, and where the customer is very dependent on the car or the product. This can be the case, for example, if it is a disabled car or similar assistive devices.
As a business owner, knowledge of the rules on liens is important in ensuring that you receive payment for your work.
You can read much more about how to avoid bad payers at Paragrafinkasso.dk.
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