Joseph E. O’Hearn

The appellant general contractor appealed a decision finding that the former Construction Lien Act, rather than the amended Construction Act, applied to its dispute with the respondent owners.

The application judge held that the procurement process commenced before July 1, 2018, triggering the transitional provision in s. 87.3(1)(b), even though the initial proposal contemplated a different property and the respondents did not own the final property at the time of the proposal.

The Court of Appeal dismissed the appeal, finding that the proposal and the final contract related to the same improvement, and that a functional approach to ownership meant the respondents only needed to own the premises at the time of construction.

The applicant, Dalren Limited, sought payment of a final invoice and construction lien holdback, arguing that the prompt payment provisions of the Construction Act applied.

The respondents, Loadstar Trailers Inc. and 1978327 Ontario Ltd., contended that these provisions did not apply because the procurement process for the improvement commenced before July 1, 2018, falling under the Act's transitional rules.

The court found that the procurement process indeed began before the critical date, and that the applicant, despite not owning the land at the outset, qualified as an 'owner' under the Act for the purpose of commencing the procurement process.

Consequently, the prompt payment provisions were deemed inapplicable, and the application was dismissed.

The appellant construction manager appealed a motion judge's order reducing the amount of security posted by the respondent developer to vacate a construction lien.

The motion judge had reduced the security by the amount the developer paid directly to the appellant's subcontractors, finding these were valid payments under section 28 of the Construction Act.

The Divisional Court allowed the appeal, holding that the motion judge erred in law by interpreting section 28 to include payments to subcontractors who did not fall within the statutory definition of a 'person having a lien'.

The motion judge's order was set aside.