What is a construction lien?
Posted: 2013-05-29 08:00:57
Ontario has given contractors and suppliers of work, services and supplies special protections under the Construction Lien Act (CLA) that allow them to collect monies they are owed for work they have done on a property. Section 14(1) of the CLA provides that Â“a person who supplies services or materials to an improvement for an owner, contractor or subcontractor, has a lien upon the interest of the owner in the premises improved for the price of those services or materials.Â” What this means is that anyone who provides services or materials for a construction job automatically has the right to a security interest on that property, called a Â“lien.Â” A lien allows the holder to force the owner of the property to sell it in order to satisfy your lien up to the price of the work and materials you supplied.
This is an especially important option for subcontractors who do not have a direct contract with the owner and would therefore have no ability to sue the property owner in the civil courts.
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