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ARTICLE · 03 AUGUST 2016

Promising Payment To A Contractor Can Extend The Contractor's Lien Rights

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A recent case from Alberta applied an old, but still valid, legal exception to the strict interpretation of the Construction Lien Act.

CanadaReal Estate and Construction
Christopher Stanek
Christopher Stanek
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A recent case from Alberta, Boulevard Real Estate Equities Ltd. v. 1851514 Alberta Ltd., 2015 ABQB 619, applied an old, but still valid, legal exception to the strict interpretation of the Construction Lien Act: the effect of a promise to pay in exchange for a promise not to lien the property.

In Boulevard, the defendant 1851514 ("185") supplied labour and materials to the plaintiff owner ("Boulevard") on two Alberta projects.  185 was unpaid and registered builders' liens against both projects under Alberta's Builders' Lien Act.  After registration, Boulevard promised to pay 185 after a meeting where they would "sit down and reconcile all of the accounts" and on the condition that 185 remove its builders' liens, so that Boulevard could obtain financing.  185 relied on this promise, removed its liens and then, of course, nothing happened.  Boulevard not only didn't pay 185, it didn't even schedule a meeting. 185 re-registered the liens it previously discharged

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