Read the latest from Cunningham Swan:
- Firm Update: COVID-19 Update and Firm Response
- Family Law: Co-Parenting in the Face of COVID-19
- Employment Law: Employer Considerations: Short- and long-term planning in the face of COVID-19
There is no replacement for proper legal advice tailored to your individual needs. That said, Cunningham Swan is working to keep our clients and the Kingston community informed of business and other legal considerations arising during the evolving COVID-19 response. Updates will follow on our blog. Receive the latest update through our twitter account.
Cunningham Swan’s staff and lawyers are equipped to work remotely and we remain able to serve your needs with continued service should a physical office closure become necessary.
Construction Liens & Delayed Payments – Limitation periods aren’t suspended during COVID-19
The federal and provincial response to COVID-19 remains fluid and is evolving. It is unclear whether Ontario’s declaration of a public emergency and its immediate impact on identified workplaces will expand to other forms of business and locations, including construction and job sites. As it stands, we are seeing an increase in concerns over the potential for delayed payments on construction projects in light of COVID-19.
Contractors and owners should be aware that the suspension of the courts in Ontario has not otherwise impacted limitation periods. This remains true for liens that might arise under the Construction Act (formerly the Construction Lien Act). In contingency planning around COVID-19, it would be useful to recall the timelines that remain applicable and recall the process of preserving and perfecting construction liens.
Generally speaking, if your construction contract was entered into after July 1, 2018, then you have a time period of 60 days in which to register a lien against the property where the improvements were made. The lien period was extended from the previous time limit of 45 days. Registration of the lien is known as preserving the lien.
Cunningham Swan remains equipped to move quickly and register liens on an urgent basis. That said, the greater the advance notice of a potential need, the better.
Once a lien is preserved, the next deadline is issuance of a Statement of Claim and registration of a Certificate of Action on title to the property. This is known as perfecting the lien. A lien must be perfected within 90 days of its preservation (an increase from the previous 45-day time limit). The present suspension of court operations under COVID-19 has not suspended our ability to issue claims to perfect the lien.
In every instance, the following information will be necessary for a lien to the registered:
- Claimant: The name and address for service of the person claiming the lien
- Owner: The name and address of the owner of the premises
- Contracting Party: The name and address of the person for whom the services or materials were supplied
- Description: A description of the services/materials supplied and the time within which they were supplied
- Contract Price: The contract or subcontract price
- Amount Claimed: The amount claimed for the services or materials that have been supplied
- Description of Land: A description of the premises sufficient for registration if the lien attaches to the premises, or the address or other identification of the location of the premises where the lien does not attach to the premises.