Understanding the deadlines for enforcing Mechanic's Lien and Payment Bond Rights in Canada and its provinces.
You must be proactive to Secure Your Lien Rights in Canada
In Canada there are three types of contracts Private, Provincial Crown, Federal Crown projects.
When selling to Government projects you are protected by Payment Bonds and REVIEW BOND TERMS AND THE STATUTES FOR DEADLINES
Provinces and Territories with 45 Day Deadlines
The following are the 7 Provinces and 3 Territories that require a lien to be recorded within 45 days from the last date of are as follows:
- Alberta
- British Columbia
- Manitoba
- New Brunswick
- Newfoundland/Labrador
- Nova Scotia
- Saskatchewan
- Northwest Territories
- Nunavut
- Yukon
60 Day Deadline
Ontario: 60 days from the last date of furnishing
Prince Edward Island: 60 days from the last date of furnishing
30 Day Deadline
Quebec: 30 days from the last date of furnishing
In Quebec private works, you are required to serve a Declaration of Contract to the owner before furnishing any services or fabricating specially fabricated materials.
In Ontario, Prince Edward Island, and Saskatchewan you are entitled to serve a notice upon the owner, prime contractor, and subcontractor requiring them to retain an amount sufficient to satisfy the lien in addition to the holdback.
What is a Holdback?
Property owners engaging contractors are required to "hold back" 10% of the amount owed to the contractor. Holdbacks function as security for a construction lien and are released when a construction lien has expired or is discharged from the title.
Under Ontario's Construction Act all players involved in the construction industry should be aware of newly "prescribed form" of the written notice of lien. Prior to the amendment, a written notice of lien was defined in s. 1(1) of the Act as follows: "written notice of a lien includes a claim for lien and any written notice given by a person having a lien that, (a) identifies the payer and identifies the premises, and (b) states the amount that the person has not been paid and is owed to the person by the payer."
As of July 1, 2018, a "written notice of lien" means a written notice of a lien in the prescribed form, given by the person having a lien. Essentially, the necessary requirements for the written notice came out of the definitions section of the Act and found their way into one of the prescribed forms, contained in a regulation to the Act that must be utilized.
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