Gregory B. Castellano, Barrister & Solicitor
 

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Frequently Asked Questions about Construction Liens

What is a "lien"?
A lien is a legal claim to property owned by another person.

What is a Construction Lien?
A construction lien is a claim against land by a person who supplied labour, materials or service to an improvement being carried out on the land.

Who is entitled to a Construction Lien?
Any person, company or business who supplies labour, services or materials is entitled to a lien. This includes contractors, sub-contractors, trades, persons supplying equipment or machinery or persons supplying materials.

When is a person entitled to a Construction Lien?
A person referred to in the preceding paragraph is entitled to a lien as soon as he or she provides labour or materials and payment is not received when it is due.

How do I enforce a Lien?
A construction lien is enforced by registering it against the title to the property for which the services or materials were supplied. A lawsuit must thus be commenced in the Ontario Court (General Division). A lawsuit commenced in the Small Claims Court is not sufficient for the purpose of enforcing a lien, although one can still obtain judgment or monies owing; you simply lose the benefit of the lien.

What is the advantage of registering a Construction Lien?
The advantage to registering a construction lien is that generally the owner of the property is forced to deal with payment problems, even if payment ought to have been made by the general contractor or even a sub-contractor or trade. The owner is entitled to deduct from amounts owing to a general contractor or anyone else enough to pay an amount claimed in a lien.

How do I register a Construction Lien?
You have to complete the appropriate form and swear an affidavit stating what services or materials you supplied and how much you are owed. These documents are then filed in the Land Registry Office for the Regional Municipality or County where the property is located.

How long do I have to register a Construction Lien?
The process for determining the deadline for registering a construction lien is complicated. However, once the time expires, a lien can never be registered. It is therefore imperative that you seek legal advice immediately if you suspect that you may have problems getting paid.

How can I prevent a Construction Lien from being registered on my property?
An owner can start the time limits running for the filing of liens, and thus end the time for filing liens, by having the project architect publish a notice or if there is no architect by signing an agreement with the general contractor in accordance with the Construction Lien Act.

The person I am working for made me sign an agreement that I would not register a Construction Lien and now I haven't been paid. Can I still register a Lien?
Yes. The Construction Lien Act states that an agreement not to register a Construction Lien is unenforceable.

I found out that there is a lien registered against my property from work that was done a long time ago. How do I get it removed?
You have to apply to the court to remove a lien that has expired.