As eagerly anticipated, the proposed changes to Ontario’s
Construction Lien Act were tabled in the Legislature on
May 31. There will be many modifications to the existing
provisions in the Act that should come into force in the spring of
2018.
There will also be two significant additions to the Act, Prompt
Payment and Adjudication, which represent monumental changes to
timing of payments on construction projects, and how disputes will
be resolved.
This article provides an explanation of the prompt payment
provisions. The next will focus on adjudication.
The Construction Act, as it will be known after the
amendments come into force, will include a new part, Part I.1,
titled “Prompt Payment”. This Part will be made
up of sections 6.1 to 6.8. Three of these sections set out 1)
the owner’s payment obligation down to a contractor, 2) the
contractor’s obligation down to its subcontractors, and 3)
the subcontractors’ obligations down to their
sub-subcontractors.
