Often we are asked by clients to register Construction Liens for them. This generally is not a problem, except for when we find out that the day of last attendance at the construction site was 44 days ago. Why is that a problem? Because of the due diligence searches that law firms do before registering a Construction Lien. Sometimes the property cannot be located on the online Registry System (Teranet) as the address known to the client is different than how it was inputted into Teranet. For this reason you need keep an close eye on your timelines and ensure you give enough notice to the ones preparing the Liens.
You have 45 days from the date of last attendance to register your Construction Lien in the Land Registry Office. If you are outside of your 45 days, then your Lien has expired and your course of action would be suing in the Court system. If you have registered the Lien within the 45 days, you then have another 45 days to perfect your Lien by issuing and registering a Certificate of Action.
Currently, Construction Liens are commenced through the Superior Court, even if the amount you are seeking is under $25,000.00. For many, this may not be worth it as only a lawyer can attend on these matters and not a paralegal. They may choose the Small Claims Court jurisdiction if the amounts are lower than $25,000.00 to recover their losses as it is more cost effective.
Good news: On December 5, 2017, Ontario passed legislation to improve the efficiency of the Construction Lien process and referring Liens under $25,000.00 to the Small Claims Court.
When will this come into effect? We aren’t sure, however, this is great news for our clients with smaller lien amounts and is more cost effective for them.