ARTICLE · 01 OCTOBER 2024
Cautionary Note: When An Owner Should Not Advance Payment To The Contractor
A recent decision of the British Columbia Supreme Court, Lonsdale Quay Market Corporation v Klondike Contracting Corporation, 2024 BCSC 1605, clarifies the mechanism under the Builders Lien Act, SBC 1997, c 45 (the "BLA"), for owners to remove claims of lien from title to the lands and reinforces the importance of strict adherence to the legislative scheme.
CanadaReal Estate and Construction
A recent decision of the British Columbia Supreme Court,
Lonsdale Quay Market Corporation v Klondike Contracting
Corporation, 2024 BCSC 1605, clarifies the mechanism under
the Builders Lien Act, SBC 1997, c 45 (the
"BLA"), for owners to remove
claims of lien from title to the lands and reinforces the
importance of strict adherence to the legislative scheme. In
particular, the decision highlights the risk to owners if payments
are made to a contractor after the owner has actual notice of a
subcontractor's lien.
Facts
Lonsdale Quay Market Corporation
("Lonsdale") entered a contract with
Klondike Contracting Corporation
("Klondike") valued at approximately
$5.2 million under which Klondike agreed to act as the general
contractor for renovations to Lonsdale's property (the
"Contract"). Lonsdale held back 10% of
the Contract value (the "Holdback"), as
required under section 4 of the BLA. The parties agreed
that the Holdback totaled $521,008.
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