OBA position on Prompt Payment Act noted in QP Briefing

  • March 20, 2014

Bill goes “too far in curtailing rights of contracting parties”

The Ontario Bar Association’s position raising concerns about Bill 69, the Prompt Payment Act, was noted in a recent story by Andrew Reeves of QP Briefing.

QP Briefing is a subscription, Toronto Star-owned electronic newsletter covering the Ontario Legislature which is closely read by policy makers at Queen’s Park.

The story, which is behind a pay wall, says the bill, if passed, would require developers to make progress payments to contractors while a project is under construction to cut down on the large amounts of money owed to trades people months after a build is complete.

The bill also sets out rigid timelines for how long an owner has to review and certify the work being expensed before it is automatically approved.

The QP Briefing story notes that the bill received severe criticism at a March 19 legislative committee hearing, including from Mississauga Mayor Hazel McCallion, who said municipalities were not consulted sufficiently before the bill was presented.

Others lining up against the bill included the Association of Municipalities of Ontario and the Ontario Home Builders’ Association.

A brief submitted by the Ontario Bar Association’s Construction and Infrastructure Law Section was noted by the QP Briefing story.

"Concerns also rolled in from the legal profession,” the story reads.

“The Ontario Bar Association submitted a brief to the committee on March 10, arguing Bill 69 went too far in curtailing the rights of contracting parties to negotiate terms such as payment, holdbacks, and disclosure, all of which are highly negotiable in the construction sector."

The bill, which is a private bill sponsored by a Liberal MPP, Steve Del Duca, but not an official government bill. It passed second reading May 16, 2013 and now resides at the regulations and private bills committee. It will return to the committee March 26.