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ARTICLE · 23 DECEMBER 2022

When Worlds Collide: The Interplay Between Liens And Adjudication Orders

Most construction disputes are about payment. Contractors and subcontractors have historically relied on liens to provide some security for non-payment.

CanadaReal Estate and Construction

Alberta's prompt payment and adjudication provisions are based heavily on Ontario's Construction Act, but a major difference is the extent of trust provisions.

In Alberta, a trust only arises when a certificate of substantial performance is posted. Any funds received by the contractor from the owner after the date the certificate is posted are trust funds for the benefit of subcontractors. Any funds received by the owner before that date are not subject to any trust requirements.

Most construction disputes are about payment. Contractors and subcontractors have historically relied on liens to provide some security for non-payment.

Over the past several years, some Canadian provinces have introduced "prompt payment" legislation aimed at speeding up the payment process through legislated payment deadlines and the use of "adjudication" as a fast-tracked process for payment disputes. Under this process, parties to a dispute can apply to an Adjudicator, who will

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