ARTICLE · 05 APRIL 2022

Third Party Payment Certification – Watch Your Language

Goldman Sloan Nash & Haber LLP

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Construction companies should remember the importance of contractual language when it comes to payment contingent on third-party certificates.

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Construction companies should remember the importance of contractual language when it comes to payment contingent on third-party certificates. In Pentad Construction Inc. v. 2022988 Ontario Inc., the Ontario Superior Court of Justice offers important considerations for companies involved in the construction pyramid.

Background

This case deals with a dispute between a sub-contractor and the project manager of a residential development. A dispute arose during the contract regarding the outstanding payments and value of work completed by the sub-contractor. The contract between the parties stipulated "work performed/provided under [the] Contract shall be inspected for quality and quantity and certified complete, received and approved by authorized Engineer, prior to any sums becoming due hereunder."

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