Prompt Payment Ontario’s Ontario Construction Act Trade Contractors Guide authored by Geza R Banfai, Counsel, McMillan LLP, with the assistance of Imran Sheikh (McMillan LLP) and Sandra Skivsky (Ontario Masonry Contractors’ Association on behalf of Prompt Payment Ontario).
Ontario’s new Construction Act (the “Act”) replaces the former Construction Lien Act (the “CLA”) which has been in effect since 1983. The Act contains the most sweeping set of reforms governing construction payment obligations that the industry has seen in more than a generation. In addition to updates to the former CLA, the Act prescribes a mandatory prompt payment regime and a system for the fast-track adjudication of payment disputes. The objectives of the Act include ensuring that payments flow down the construction pyramid faster, and that disputes over payments are dealt with much more quickly and efficiently. It is essential that all participants in construction become familiar with the Act, in order to take advantage of their new rights and to understand their new obligations. This Guide is primarily intended for trade contractors. Much of the time, trade contractors will be contracting with someone other than the owner, whether as subcontractors to the general contractor or as subsubcontractors to other trade contractors. There are situations, however, where trade contractors will contract directly with an owner, for example in a multi-prime construction management project.
This Guide is intended to provide general information to the reader. It is not intended to provide legal advice, and the provision of legal advice should not be inferred. Neither Prompt Payment Ontario, the author, nor any members, representatives, servants or agents thereof, assume any liability in connection with the information contained herein, including any errors or omissions in such information. The website references in this Guide are current as of May, 2020, and remain subject to change and updating by the hosts. Users of this Guide should consult the website references mentioned to ensure that their information is up to date. As with any new legislation, the information contained in this Guide is subject to judicial interpretation and clarification, and possible change. Users are encouraged to obtain legal advice as necessary in connection with their specific requirements.