Amendments to Ontario’s °µÍø½ûÇøion Act – July 1, 2018
Frequently Asked Questions (FAQs)
Disclaimer:ÌýDaily Commercial News (DCN) is not permitted to provide legal advice or opinions, interpret the law or conduct legal research for its audience. Therefore, the general summary set out below and links to online resources provided are for information purposes only. A lawyer is in the best position to advise you about your legal rights and how the law applies to your situation. Daily Commercial News (DCN) does not warrant the accuracy or completeness of the information provided herein.
1. Why is Ontario’s °µÍø½ûÇøion Act (formerly °µÍø½ûÇøion Lien Act) changing?
The Ministry of the Attorney General of Ontario launched an independent expert review of Ontario’s construction laws in 2015.Ìý The review resulted in a report known asÌý.
According to the Ministry, Ontario has passed legislation based on the recommendations in that report in order to:
- “modernize the construction lien and holdback rules
- help make sure that workers and businesses get paid on time for their work
- help make sure payment disputes are addressed quickly and painlessly” ()
Complete details about the expert review process are available atÌý, and complete text ofÌýBill 142, °µÍø½ûÇøion Lien Amendment Act, 2017 is available atÌý.
2. When will the changes take effect?
According to the Ministry of the Attorney General of Ontario:
“The amendments to the construction lien and holdback rules will come into effect on July 1, 2018. New prompt payment and adjudication processes, and amendments related to liens against municipalities, will come into effect on October 1, 2019.
The government has made regulations to support the amendments. The new regulations will take effect at the same time as the amendments they support.”Ìý()
3. Are there any changes to the certificates and notices that I usually publish in the Daily Commercial News (DCN)?
Yes, there are a few changes you should be aware of.Ìý There are two new notices that are required to be published, and there are some changes to the three existing certificates and notices that are customarily published in the Daily Commercial News (DCN).
Two New Notices
Notice of Non-Payment of Holdback under
“27.1 An owner may refuse to pay some or all of the amount the owner is required to pay to a contractor under section 26 or 27, as the case may be, if,
(a) no later than 40 days after publication of the applicable certification or declaration of substantial performance under section 32, the owner publishes, in the manner set out in the regulations, a notice in the prescribed form, specifying the amount of the holdback that the owner refuses to pay; and
(b) the owner notifies, in accordance with the regulations if any, the contractor of the publication of the notice. 2017, c. 24, s. 24 (1).” ()
“(6) A notice of non-payment of a holdback under section 27.1 of the Act shall be in Form 6.” ()
“7. (1) An owner shall publish a notice of non-payment of a holdback under section 27.1 of the Act (Form 6) in a construction trade newspaper.
(2) For the purposes of clause 27.1 (b) of the Act, the owner shall, no later than three days after publication of the notice of non-payment, notify the contractor of its publication.” ()
Notice of Termination under
“(6) If a contract is terminated, either the owner or the contractor or other person whose lien is subject to expiry shall publish, in the manner set out in the regulations, a notice of the termination in the prescribed form and, for the purposes of this section, the date on which the contract is terminated is the termination date specified in the notice for the contract. 2017, c. 24, s. 26 (11).” ()
“(8) A notice of termination under subsection 31 (6) of the Act shall be in Form 8.” ()
“8. A notice of termination under subsection 31 (6) of the Act (Form 8) shall be published in a construction trade newspaper.” ()
Changes to Existing Certificates and Notices
Certificate of Substantial Performance of the Contract under
“(9) A certificate of the substantial performance of a contract under section 32 of the Act shall be in Form 9.” () (previously in Form 6)
“9. A certificate of substantial performance (Form 9) or declaration of substantial performance under section 32 of the Act shall be published in a construction trade newspaper.” ()
Certificate of Completion of Subcontract under
“(10) A certificate of completion of a subcontract under subsection 33 (1) of the Act shall be in Form 10.” () (previously in Form 7)
Notice of Intention to Register a Condominium in Accordance with the under
“(11) A notice of intention to register land described in a description in accordance with the condominium Act, 1998 under section 33.1 of the Act shall be in Form 11.” () (previously in Form 24)
“10. A notice of intention to register land described in a description in accordance with the Condominium Act, 1998 under section 33.1 of the Act (Form 11) shall be published in a construction trade newspaper.” ()
Click here to access all the new and updated forms
There are a number of other forms prescribed by Ontario’s °µÍø½ûÇøion Act.Ìý Please take note of the following:Ìý
- The complete text of Ontario’s °µÍø½ûÇøion Act is available atÌýÌýÌý
- The regulations related to these forms is available atÌýÌýÌý
- A complete list of the forms along with fillable copies of all forms is available on the Ontario Court Services website atÌý
- A number of other general regulations that should be reviewed to ensure compliance with procedures regarding these forms are available atÌýÌý
4. Are there any changes to lien and holdback timelines that I should be aware of?
According to the Ministry of the Attorney General of Ontario:
- “contractors and subcontractors will have 60 days to register a lien and 90 days to start a court action”
- “project owners and other payers will be required to pay contractors and subcontractors holdbacks once the timeline to file liens has passed. This helps contractors and subcontractors plan, accept contracts for new work and have more certainty about when the holdback will be paid” ()
There are just a couple of hand-picked items from the complete announcement by the Ministry.Ìý We urge you to read the complete announcement to ensure that you understand all relevant changes atÌý.Ìý
5. How do I determine if the old rules or the new rules apply to a particular contract / improvement?
The Ministry of the Attorney General of Ontario presents the following high level summary of the applicable transition rules:
- “The amendments taking effect on July 1, 2018 apply to all contracts entered into on or after that day (and any subcontracts made under them), unless,
(1) a procurement process for the improvement was commenced before that day, or
(2) the premises is subject to a leasehold interest, and the lease was first entered into before that day.
In either of those two cases, or if the contract was entered into before July 1, 2018, the old act (i.e. prior to July 1, 2018) continues to apply to the contracts and any subcontracts made under them.
- The amendments taking effect on October 1, 2019 apply to all contracts entered into on or after that day (and any subcontracts made under them). No legislative exceptions apply.”Ìý()
The Ministry further states, “The transition rules are set out in section 87.3 of the amended legislation. Please refer to the legislation and consult a lawyer to determine how the rules apply to your situation.”
Please refer to for further details.
6. Where can I find more information about the changes and the new rules?
We have put together a list of online resources for your convenience, which you can use to familiarize yourself better with the changes and the new rules: