Builders’ Liens and OH&S:NOT TO BE FORGOTTEN

Presented by: Collin K. Hirschfeld to Saskatchewan P3 Summit 2014

Date: September 9, 2014

AGENDA

Overview of Builders’ Liens

Trust ProvisionsLien ProvisionsHoldback ProvisionsPractical Considerations

OH&S

Prime ContractorRequired WorksitePrime Contractor Obligations

BUILDERS’ LIENS

PRELIMINARY THOUGHTS

Pay attention to the definitions and concepts under the Act, like:

• Contract• Subcontract• Substantial performance (section 3)• Completion (section 4) (NEW)• ALL APPLY TO A P3 SITUATION

TRUST PROVISIONS

Three types

Owner, Contractor, Subcontractor

If have non-monetary consideration, the value can be part of the trust

TRUST PROVISIONS (CONT’D)

Directors and others in control can be liable for breach of trust

Have to assent or acquiesce in conduct knew or ought to have known was breach

Two years from completion to sue

LIEN PROVISIONS

Arises as soon as work or materials are provided to a project

Provided doesn’t necessarily mean actually on site

Is a lien on the real property and the materials for as much as remains unpaid

LIEN PROVISIONS (CONT’D)

Can have a general lien on more than one parcel

If you can’t identify which piece of land was improved

Cannot register against Crown landbut serve Crown

LIEN PROVISIONS (CONT’D)

Lien is a charge againstHoldbackAny additional amounts owing

Needs to be registered within 40 days of:

Substantial completionAbandonmentCompletion

LIEN PROVISIONS (CONT’D)

Two ways to claim lien

Claim of LienAttaches to land and holdback

Can discharge in whole or in part

BUT cannot be revived

LIEN PROVISIONS (CONT’D)

Written Notice of Lien

Binds other 90% Effective in stopping project

Cuts both ways though Can still pay other funds if holdback lien amount Can withdraw and reserve

HOLDBACK PROVISIONS

Each payer in the pyramid has to maintain

Applies regardless of payment terms under the contract

Mortgagee may maintain

HOLDBACK PROVISIONS (CONT’D)

Is inviolable

Can’t be used to complete project

But not forever – 40 day period

Can be sued if fail to release

HOLDBACK PROVISIONS (CONT’D)

Owner has to maintain a holdback trust account

Crown does not have to maintain a holdback trust account

PRACTICAL CONSIDERATIONS

Liens can be lapsed under Land Titles Act

Section 47 direct payment

Section 56 application (no notice)

Section 57 application (holdback)

PRACTICAL CONSIDERATIONS

Can request information from owner or mortgagee

Can be questioned on lien claim

Cannot contract out of Act

Can argue substantially complied with form

PRACTICAL CONSIDERATIONS

Pay attention to if there is a certificate of substantial completion

Can request certification of completion of subcontract or contract

Important because it can affect when holdback is released

PRACTICAL CONSIDERATIONS

Is allowance for liens filed outside 40 days

But affects what you attach

Owner could payout funds and you are left with nothing

PRACTICAL CONSIDERATIONS

Are two holdback funds

Pre-substantial completionPost-substantial completion

PRACTICAL CONSIDERATIONS

Holdback on large contracts

Has to be over 1 year to complete

Value has to be over $25M

Allows for yearly release of holdback

OH &S

PRIME CONTRACTOR

Effective January 1, 2015

Applies to construction, forestry, and oil and gas industries

Applies to a required worksite

REQUIRED WORKSITE

Has 10 or more self-employed persons or workers under the direction of two or more employers

WHO IS THE PRIME CONTRACTOR

Party who enters agreement with owner to be the prime contractor

OR

If no agreement, owner of the worksite is the prime contractor

OBLIGATIONS OF PRIME CONTRACTOR

Gather all policies, procedures and safe work practices of all employers and self-employed parties on site

Coordinate activities at the work site affect health and safety

OBLIGATIONS OF PRIME CONTRACTOR (CONT’D)

Ensure all parties on site have adequate and appropriate policies etc. re safety and ensure compliance with them

Prepare written plan prior to work that outlines above and lists supervisors of parties on site

OBLIGATIONS OF PRIME CONTRACTOR (CONT’D)

Identify hazards and inform

Ensure parties on site eliminate hazards identified before work starts OR identified after work starts.

Thank You!