The province of British Columbia is in the process of revising and updating the Builders Lien Act, which is now more than 20 years old. To facilitate these changes, the British Columbia Law Institute (“BCLI”) has worked with a number of experienced lawyers to draft a consultation paper that outlines recommended revisions to the Act. The BCLI has solicited feedback on the recommendations from all stakeholders in the industry.
Copies of the BCLI’s Consultation Paper and a summarized overview of the Consultation Paper are linked here:
Notable recommendations from the Consultation Paper:
- Changes aimed at preventing errors in the Lien Claim Form
- A provision that certain errors will not invalidate lien claim
- Clarification as to when lien period expiry starts to run
- Elimination of the 10-day gap between lien filing and holdback release
- Changes to certificates of completion requirements, and a new certificate of cessation (for abandoned projects)
- Eliminate the requirement for retention of entire holdback where there has been a claim of lien filed (instead, just holding back enough to satisfy the lien claim)
- Allowing for gradual periodic release of holdbacks in large projects of over one-year duration;
- Simplification of procedures for putting alternate security in place of lien claim
- A requirement that holdback accounts be held at a branch of a financial institution in BC
- Changes to certain procedural deadlines to be more in step with Rules of Court
Recommendations we had hoped to see in the Consultation Paper that were not included:
- Prompt payment provisions (*The BCLI stated that this issue is beyond their mandate for this particular Act)
- More effective information disclosure provisions that facilitate communication between various parties in the construction pyramid (e.g. subcontractors, materials suppliers, general contractors, etc.)
- S. 41 of the Act currently allows for information exchange between parties in the construction pyramid. However, the practical reality is that the information is not requested or provided until a dispute is well underway. Would a provision for mandatory disclosure of certain information, such as the location of a holdback account, better serve parties down the pyramid?
- Effective penalties for owners/general contractors that do not comply with the Act
If you have any questions about Builders Lien law, Stephanie Streat would be pleased to hear from you at [email protected].