Legal Question in Business Law in California

The property never really becomes the store's, except in the sense that, given enough time, the interest component of the tradesman's lien will exceed the fair market value of the article.

Here's what happens, and the applicable statutes. People who take in personal property for repair have a possessory lien on the property for the sum of (a) the repair bill and (b) if the item is not picked up and paid for when ready, interest on the repair bill, which accumulates at a statutory rate of 12% per annum (simple interest).

The shopkeeper can sell the property, if not picked up and the bill paid, within a relatively short time - the statute says after 10 days you can notice a sale to occur within the next 10 to 20 days - but I would advise waiting longer. If you sell the property, you must do so in a commercially-reasonable manner, generally meaning a public sale like an auction, or a private sale if the terms are commercially reasonable (eBay maybe a perfect vehicle for conducting such sales). After a sale, you can claim the portion of the proceeds representing the bill plus the interest as your own, but technically the owner of the property now owns the rest of the money and must be turned over (if and when possible).

The applicable statutes are Civil Code section 3051 which defines the lien itself, and section 3052, providing the auction sale rules. Note that although you or your workers may consider yourselves "mechanics," your lien is NOT a mechanic's lien as meant in the statutes - a so-called mechanic's lien relates only to work done on real property. I recommend that you locate and read these code sections for a fuller understanding of their provisions.

A final note of caution is that I recommend being very careful not to accept instruments for repair without getting a "permanent" address for the owner. The law expects you to make a bona-fide effort to send bills and then later to pre-notify the owner of a lien sale.