Manitoba Law Reform Commission Report on Building Liens Modernization
The Manitoba Law Reform Commission today released its report entitled The Builders’ Liens Act of Manitoba: A Modernized Approach.
The purpose of The Builders’ Liens Act is to ensure that people involved in construction projects are paid for their contributions in accordance with their contractual entitlements. It provides legal remedies for those who provide work, perform services or supply materials upon a construction project.
The Commission's report proposes a series of remedies to the widespread issue of delays in payment.
Among other things, it proposes that Manitoba adopt the approach recently introduced by Ontario to incorporate statutory timelines for payments and prescribed penalties for payment delay (i.e. “prompt payment reforms”) within the Act.
The Commission also recommends the creation of a private adjudication system that would have tight timelines for determination of payment disputes and minimal disruption while the construction project is ongoing.
The Commission also recommends enhancements to the statutory trust remedy in the Act to better achieve the purpose of keeping project funds within the construction contract pyramid for each specific project, including changing the statutory trust from one whereby owners, contractors, and subcontractors hold all funds received as payments on account of a contract price for listed beneficiaries to a privity model whereby trustees hold project funds in trust for only those it has contracted with directly. This aligns Manitoba’s statutory trust provisions with those of other jurisdictions including Ontario, Nova Scotia, Saskatchewan, and British Columbia.
The purpose of The Builders’ Liens Act is to ensure that people involved in construction projects are paid for their contributions in accordance with their contractual entitlements. It provides legal remedies for those who provide work, perform services or supply materials upon a construction project.
The Commission's report proposes a series of remedies to the widespread issue of delays in payment.
Among other things, it proposes that Manitoba adopt the approach recently introduced by Ontario to incorporate statutory timelines for payments and prescribed penalties for payment delay (i.e. “prompt payment reforms”) within the Act.
The Commission also recommends the creation of a private adjudication system that would have tight timelines for determination of payment disputes and minimal disruption while the construction project is ongoing.
The Commission also recommends enhancements to the statutory trust remedy in the Act to better achieve the purpose of keeping project funds within the construction contract pyramid for each specific project, including changing the statutory trust from one whereby owners, contractors, and subcontractors hold all funds received as payments on account of a contract price for listed beneficiaries to a privity model whereby trustees hold project funds in trust for only those it has contracted with directly. This aligns Manitoba’s statutory trust provisions with those of other jurisdictions including Ontario, Nova Scotia, Saskatchewan, and British Columbia.
Labels: commercial and corporate law, government_Manitoba, law commissions
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