In December 2017, Bill 142, the Construction Lien Act Amendment Act, 2017 (Ontario) received Royal Assent, introducing substantive amendments to the current Construction Lien Act (Ontario). For an overview of the key amendments, refer to Cassels Brock’s previous post Ontario’s Construction Act: The Construction Industry’s New Reality.
Though a selection of amendments were expected to come into force in early 2018, Ontario's Lieutenant Governor has now proclaimed July 1, 2018, as the date when the first tranche of amendments for the new Construction Act will come into force. The Lieutenant Governor has also proclaimed that, for now, a second tranche of amendments will come into force on October 1, 2019.
Along with several other changes, the notable amendments that come into force on July 1, 2018 include:
The key amendments that will be delayed and not come into force until October 1, 2019 include, among other amendments:
In addition, the regulations to the Construction Lien Act (R.R.O. 1990, Reg. 175) will be revoked as of July 1, 2018. Four new regulations have been drafted covering:
The four proposed regulations were posted by the Ministry of the Attorney General for public comment on February 9, 2018, and comments were closed on March 8, 2018. The regulations were finalized at the end of April 2018. Of particular note are the following:
The finalized regulations also provide a landing spot for some of the provisions that were repealed from the Construction Lien Act, which were noted in our prior post, including:
Under 50(2) of the Construction Lien Act, the joinder of trust claims and lien claims was strictly prohibited. As of July 1, 2018, section 50(2) of the Construction Lien Act is being repealed and replaced with a new, unrelated provision. The finalized regulations make no reference to the joinder of trust claims and lien claims under the Construction Act. Time will tell how the new legislation will treat this particular issue.
All participants in construction projects need to take note of the transition provisions in section 87.3 of the Construction Act. Pursuant to that section, the provisions of the current Construction Lien Act continue to apply with respect to an improvement if:
Any contract entered into on or after July 1, 2018, but prior to October 1, 2019, will be subject to the amendments that will come into force on July 1, 2018. Any contract entered into on or after October 1, 2019, will be subject to the prompt payment and adjudication amendments (and any other October 1, 2019 amendments), together with all other amendments as of July 1, 2018.
The pending amendments and regulations can be viewed within the current Construction Lien Act, in greyed notations, here.