Construction Liens: Preservation and Perfection

This is an illustrated image of building development planners What if you’re a subcontractor who finished working on someone’s land and the general contractor doesn’t want to pay you? Or you’re a supplier who’s left building supplies at a job site and whoever ordered the supplies does not want to pay? What can you do? How can you sue the property owner if you do not have a contract with them? Fortunately, the Construction Act may be a source of relief.

One of the main purposes of the Construction Act is to assist suppliers of services and material in securing their rights as against a property owner. The construction lien is registered in the provincial land registry office against land in favour of the supplier of goods and services for the amount which has not been paid. The owner will usually have a difficult time selling the land or obtaining a mortgage unless the lien is discharged. This gives the supplier the security that they will get paid if they can prove their claim, and provides an incentive for the owner to promptly deal with the lien.

However, the law surrounding construction liens is both complex and time-sensitive. A supplier of goods and services must move quickly to secure its rights. A construction lien must be secured by preserving it within 60 days of when the contract was certified or declaration that it was substantially performed or 60 days from when the contract was completed or abandoned.

Once that is done, the lien must be perfected by starting a court action and registering a certificate of action on title. This must be effectively done within 90 days from the day the project ended as described above. If either of these timelines is missed, the lien expires, and substantial rights to sue the owner of the land may be lost.

If you believe you have a construction lien and would like to enforce it, please contact us immediately to discuss. The team at Malicki Sanchez Law are experienced in construction law and can assist you in prosecuting and defending construction lien claims.

This article was originally created by Paul Wojtis and has been updated by Gibrian Malicki-Sanchez, J.D. April 17, 2020