The OBA has provided the government with expert advice on its work to develop the proposed regulations necessary to implement the amended Construction Lien Act. The OBA received the following update from the Attorney General with respect to the new regulations to support and implement amendments to the Construction Lien Act. The message reads as follows:
I am writing to advise you that the government has made four new regulations to support and implement the amendments to the Construction Lien Act (the “Act”):
- Forms (each form is available online);
- Procedures for Actions under Part VIII;
- General; and
- Adjudications under Part II.1 of the Act.
I would like to acknowledge and thank everyone who took the time to submit their feedback when draft versions of the regulations were posted on the Regulatory Registry in February. The ministry, in collaboration with Bruce Reynolds and Sharon Vogel, carefully reviewed and considered your written submissions, and the regulations were revised to incorporate a number of suggested changes before being approved by Cabinet. The development of the regulations also benefited from the feedback and expertise of the Advisory Group and AFP Taskforce.
Effective Dates and Transition
The new regulations will take effect at the same time as the amendments they support:
Amendments and Regulations
Amendments to modernize the construction lien and holdback rules, and related regulations
July 1, 2018
Amendments related to prompt payment, adjudication and liens against municipalities, and related regulations
October 1, 2019
I would like to take this opportunity to remind you of the transition rules under subsections 87.3 (1) - (3) of the amended Act. To ensure predictability and certainty for the industry’s contractual arrangements, the transition rule follows the long-standing presumption of statutory interpretation that legislation is not given retroactive effect, unless made so expressly.
Therefore, the old legislation (i.e. prior to the amendments) will apply to an improvement if:
- a contract for the improvement is entered into before the date the amendments come into effect (regardless of when any subcontract under the contract is entered into);
- a procurement process for the improvement (including a request for qualifications, a request for proposals, or a call for tenders) is commenced by the owner of the premises before the date the amendments come into effect; or
- the premises is subject to a leasehold interest, and the lease is first entered into before the date the amendments come into effect.
The amended legislation will apply to contracts entered into and procurement processes commenced on, or after, the date the applicable amendments come into effect. This means, for example, that the prompt payment and adjudication scheme will only apply to contracts entered into and procurement processes commenced on, or after, the date the relevant amendments take effect on October 1, 2019, as well as to subcontracts under those contracts.
To assist the industry in preparing for the upcoming changes, the ministry is currently developing informational materials to describe what will change when the amendments to modernize the construction lien and holdback rules come into force on July 1, 2018.
Designation of the Authorized Nominating Authority
The government is developing a fair, open and competitive process to select a private body to be designated to act as Authorized Nominating Authority (ANA). We currently anticipate that the ANA selection process will be administered in fall 2018.
Once designated, the ANA will undertake preparatory work in order to be ready to begin regular operations on October 1, 2019. The ANA will develop and oversee training and qualification for adjudicators, maintain a registry of qualified adjudicators, and perform other functions set out in the Act and new adjudication regulation.
I note that information regarding the changes to the Act is available online on the ministry’s Construction Lien Act webpage. Further information will be made available in the coming weeks and months.
Thank you, once again, for your valuable support and participation as we move toward the implementation of these important changes.
Attorney General of Ontario
The OBA will continue to monitor these developments. As always, member questions can be addressed to firstname.lastname@example.org.