Ontario’s construction act is getting a face lift July 1, 2018 and here are some highlights:

  • Providing more time for contractors and subcontractors to resolve their disputes outside of court by extending time lines to file liens and start court actions from 90 days to 150 days
  • Ensuring contractors and subcontractors know when to expect full payment by requiring hold back funds to be paid as soon as the deadline to file a liens passes
    • A construction lien is a charge or security on property that can be registered by anyone who has supplied services or materials to improve it.
    • A holdback is a requirement that all contractors and subcontractors withhold 10 per cent of the cost of the services or materials supplied on a project. This helps to ensure that there is enough money to satisfy any lien claims that may arise.
  • Protecting subcontractors and workers if the general contractor files for bankruptcy by requiring surety bonding on public sector projects above a certain amount (50% performance, labour and material bonds on projects over $500,000)
  • Allowing condominium unit owners to remove liens from their unit in relation to common elements (e.g., corridors, lobbies, etc.)
  • Referring construction lien claims under $25,000 to small claims court.
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