Construction Law 101: Explaining Construction Liens Posted onSeptember 22, 2020April 10, 2024/ Christopher W. Statham What is a Construction Lien? Under the Construction Act a person who supplies services or materials to an improvement for an owner, contractor or subcontractor, has a lien for the price of the services or materials over the interest of the owner on the premises. In this respect, a lien functions as a security interest, securing payment of the individual providing services or materials. A lien arises and takes effect as soon as a person first supplies services or materials to the improvement. It is also important to note that a lien does not attach to the premises where the Crown (defined broadly under the Construction Act) is the owner of the premises. Preservation and Perfection of Liens Construction liens are typically (but not always) registered on title and recorded in the Land Registry Office. This means that the registered lien will be publically accessible to anyone seeking information about that property. However, not every construction lien can be registered on title ( i.e. when the land subject to the improvement is owned by the Crown) In such cases, a copy of the lien is given to the owner of the land. In order to perfect a lien, the claimant must commence an action in the Superior Court of Justice. Where the lien attaches to the premises, a lien claimant must also register a certificate of action on the title. There are strict deadlines for the preservation and perfection of liens. If you require assistance, pertaining to construction law matters, involving liens, holdbacks and contractual disputes, please contact the construction lawyers at Devry Smith Frank LLP to discuss your rights and options. This blog was co-authored by Law Student Amar Gill. “This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs.” Authors Christopher W. Statham 416-446-5839 416-446-5839 christopher.statham@devrylaw.ca Related Posts Posted onDecember 6, 2019July 5, 2023/ Christopher W. Statham More Changes to the Construction Lien Act Are Coming in 2019 Ontario’s new Construction Lien Amendment Act (the “Act”) has significantly overhauled Ontario’s construction law rules. While the first set of the amendments have already come into force (see our previous blog here), the second set of changes with respect to prompt payment, a new adjudication process and procedural rules are set to come into force [...] Read more Posted onNovember 27, 2019July 5, 2023/ Christopher W. Statham Ontario Has a New Construction Act: What You Need to Know About the Transition Period On July 1, 2018, the first set of changes under Ontario’s Construction Lien Amendment Act (the “Act”) came into force. This Act overhauls Ontario’s construction regulatory framework. Not only should the changes be made note of by Ontario businesses in the construction sector, but the implementation of similar legislation is expected to follow in other [...] Read more Posted onMay 12, 2017June 23, 2020/ Devry Smith Frank LLP Construction Trust Claims: How to Protect Yourself Caught up in the moment of construction work chaos and scrambling to complete jobs, it is all too easy for invoices to accrue and accounts to build up. While construction liens provide one way to secure payment due to contractors and subcontractors, preventing one’s lien rights from expiring requires meeting strict deadlines, which are often [...] Read more Posted onJanuary 20, 2017June 16, 2020/ Devry Smith Frank LLP Leaning on Liens for Payment Construction and renovation work can sometimes involve multi-layered contractual relationships between the various players in a construction project, where there are numerous complex areas of consideration. An owner or developer may hire a general contractor, who will then contract with subcontractors for various jobs such as carpentry, plumbing, and electrical work. In the same way, [...] Read more