CCDC contracts are ubiquitous in the construction industry. They are used for all manner of different project types and sizes, so much so that familiarity with these documents is almost becoming required to do business in Ontario’s construction industry.
An important deadline for any litigation is the limitation period, which is the final date by which a lawsuit for specific a claim must be commenced. The limitation period is important because, if missed, the plaintiff may be barred from ever bringing a lawsuit to seek recovery of that claim.
An owner in a construction contract is required to retain 10% of the price of the services and materials as they are supplied under the contract. The holdback is to be retained until all liens that may be claimed against the holdback have expired, been satisfied, discharged or otherwise provided for under the Construction Act. The requirement to retain holdback applies from large infrastructure projects to small home renovations.
A recent amendment to the Rules of the Small Claims Court allows for a lawyer or paralegal to prove service of a document by way of a Certificate of Service (Form 8B) if the lawyer or paralegal served the document or caused it to be served and is satisfied that service was effected. In cases such as this,
Residential construction and renovation can be complicated. So can the contracts. Contractors and homeowners alike should understand when the Ontario Consumer Protection Act, 2002 (the CPA) applies and what its requirements are. The recent Ontario Superior Court of Justice case of The Fifth Wall Corp. v Tonelli, 2022 ONSC 6590 helps to clarify when the CPA applies to residential construction and renovation contracts.
“But the payment certifier hasn’t approved the invoice yet” is no longer a reason for an owner to refuse to pay a contractor’s proper invoice.
Any owner must pay a contractor within 28 days of receiving the contractor’s proper invoice, unless the owner gives the contractor a Notice of Non-Payment within 14 calendar days of receiving the proper invoice.
The golden rule when dealing with construction liens is that they must be preserved and perfected on time. Preserving a lien requires registering a claim for lien on title to the property or in certain cases, giving a copy of the claim for lien through the proper channels. Perfecting a lien is the next step in the process and requires commencing an action to enforce the lien and potentially registering a certificate of action on title to the relevant property. Ontario’s courts have repeatedly confirmed that they have no ability to revive an expired lien if a deadline is missed—so it is essential for contractors and suppliers to be aware of the timelines associated with their lien rights.
What are reprisal clauses and what is their effect?
A reprisal clause is a provision in an owner’s procurement documents, or, for a government owner, its by-laws or procurement policy, allowing the owner to reject or exclude any bidders or proponents that are in a dispute with the owner.
The Heavy Construction Association of Windsor is challenging a decision by the County of Essex to obtain an estimate directly from a contractor following a procurement process where no contract was awarded. Procurement processes are complex but important, especially for public projects. Parties involved in procurement should ensure they follow all processes and policies carefully. Otherwise, bidders may be excluded or, as in this case, owners may face legal action in court.