Tick-Tock Goes the Lien Clock

Tick-Tock Goes the Lien Clock

Catriona Otto-Johnston and Jill Bishop

Builders’ liens are an important tool, providing contractors, subcontractors, and suppliers security for unpaid work. The template s.48 Order requires a lien claimant to file a Statement of Claim within 180 days of registering the lien; however, before the template Order came into existence, this requirement was regularly seen in s.48 Orders in order to keep the matter moving forward, as is the intent of the Builders’ Lien Act. When a s.48 Order (pre- or post-template) contains such a deadline, will a lien survive if the deadline is missed?

Justice Brooker’s recent decision in Manseau & Perron Inc v ThyssenKrupp Industrial Solutions (Canada) Inc, 2018 ABQB 949, dealt with this very issue. The s.48 Order (pre-template), to which Manseau consented, required Manseau to file a Statement of Claim within the 180 days of registration of the lien. Manseau did not adhere to this deadline and, as a result, Master Robertson declared that Manseau’s lien ceased to exist. Manseau appealed Master Robertson’s decision on a number of grounds. This blog focuses on Manseau’s argument that it should be allowed to file a Statement of Claim after the 180-day deadline in reliance on the Court of Appeal’s decision in TRG Development Corp. v Kee Installations, 2015 ABCA 187 .

In TRG, a lien was cancelled by the Registrar of Land Titles for the lienholder’s failure to file a CLP as required by s.43 of the Builders’ Lien Act. Manseau relied on the TRG case to argue that “where an owner has notice of a lien, and where no prejudice will result from a failure to comply with a timeline, and where parallel proceedings are in place, the Court will apply equitable principles of waiver and estoppel to preserve lien rights” [para 67]. In TRG, the Court waived the CLP requirement noting that each case is fact-specific. Manseau argued it should be allowed to file the Statement of Claim late because the owner and contractor had notice of the lien, and therefore no prejudice resulted from the failure to file on time.

The Court in Manseau distinguished the facts from those in the TRG case, finding that unlike in TRG where the Court dealt with “waiving a notice requirement when everyone concerned already had notice” [para.69], Manseau failed to comply with a specific requirement of a valid Court Order. Further, the Court held that ThyssenKrupp hadn’t done anything to suggest it had waived the requirement for Manseau to file its Statement of Claim. Lastly, the Court found there would be prejudice to ThyssenKrupp if Manseau were to be allowed to file its claim and have its lien reinstated, (i.e. increased premium costs and litigation costs). Manseau’s appeal was dismissed in its entirety.

How does this affect you?

Although there is some case law allowing flexibility with certain requirements of the Builders’ Lien Act, these cases are very fact specific. It is always best to err on the side of strict compliance with the Act and with deadlines in Court Orders. If you have questions about how and when to pursue prosecution of your builders’ lien, contact Catriona Otto-Johnston, lawyer and Partner with Field Law.

Catriona Otto-Johnston

Catriona Otto-Johnston

Catriona Otto-Johnston is an experienced litigator whose practice focuses on resolving complex construction disputes. She represents clients in a broad range of litigation matters before courts and arbitration panels, including builders’ liens, delay and impact claims, scope of work disputes, wrongful termination, and debt recovery.

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