Ontario Construction Act lien rights give contractors (and subcontractors) the legal right to register a claim against your home for unpaid work. Even if you've paid your GC in full, subcontractors with unpaid invoices can lien YOUR property. Here's how to protect yourself.
When a contractor or sub provides work or materials to your property, they have a statutory lien right against the property for the value of unpaid work. The lien gives them the right to force a sale of your home (rare but possible) to satisfy the debt. Lien must be: registered within 60 days of last work supplied, and perfected (lawsuit started) within 90 days of registration. Once registered, a lien clouds your title — you can't sell or refinance until it's resolved.
For any project over $50,000 in Ontario, the homeowner is required by law to hold back 10% of each progress payment to the contractor for 45 days post-completion. This holdback funds any subcontractor lien claims. After 45 days with no liens registered, you release the holdback to the GC. Failing to hold back 10% means YOU can be on the hook for subcontractor lien claims even after paying the GC in full. Reputable Ottawa contractors expect this and price-in.
(1) Always hold back 10% on $50K+ projects (mandatory). (2) Request lien waivers from each subcontractor before final GC payment (Construction Act allows you to require this). (3) Pay GC by cheque with subcontractors named as co-payees on large draws (controls sub payment). (4) Maintain a list of all subs working on your property. (5) Request weekly proof of WSIB and insurance for each sub. (6) Don't release final payment until all sub lien waivers received.
(1) Don't ignore — contact a construction lawyer immediately ($500-$2,000 initial consultation). (2) Verify lien validity (60-day filing window from last work). (3) Identify lien claimant and the underlying debt. (4) If you've paid GC properly with 10% holdback maintained, the GC should resolve. (5) If GC has financially failed, you may need to pay the sub directly from holdback. (6) If lien is invalid (filed late, no work actually performed), challenge it in court. (7) Lien can be vacated by po...
Last day of work (or supply) → 60 days to register lien. Lien registration → 90 days to start lawsuit (or lien expires automatically). Substantial completion → 45-day holdback period starts. Holdback release → if no liens registered after 45 days, holdback released to GC. Total maximum lien exposure period: typically 105 days from last work performed by any contractor.
(1) GC financially fails mid-project — subs lien for unpaid invoices. Your protection: 10% holdback (already in your hands). (2) GC paid you correctly but doesn't pay subs — subs lien your home. Your protection: lien waivers from subs before final payment. (3) Disputed work quality — GC liens you for outstanding balance you're disputing. Your protection: cure notice process before withholding payment + lawyer involvement. (4) Sub disputes GC over invoice — sub liens your home even if GC and you ...
A legal claim by a contractor or subcontractor against your property for unpaid work or materials. Lien clouds your title and can force a sale (rare). In Ontario, lien must be registered within 60 days of last work and perfected (lawsuit started) within 90 days of registration.
Yes — Ontario law protects subcontractor lien rights regardless of your payment to the GC. This is why the 10% holdback and sub lien waivers matter so much. Without these protections, you could pay twice for the same work.
Mandatory under Ontario Construction Act for projects over $50,000 — homeowner holds back 10% of each progress payment for 45 days post-completion. This funds any subcontractor lien claims. Reputable Ottawa contractors expect and price-in this holdback.
Request from each subcontractor as a condition of final payment release to the GC. Standard form (one-page) signed by sub confirming they've been paid in full and waive lien rights for the project. GC coordinates collection; you require all waivers before releasing holdback.
Title is clouded; you can't sell or refinance until resolved. Contact construction lawyer immediately. Options: pay the lien claim from your holdback (if you maintained one), challenge invalid lien (filed late, no work performed), or post security in court to vacate lien while dispute resolves.