Release date: August 15, 2019
Dear <<First Name>>,
THE SECOND ROUND OF CHANGES TO THE CONSTRUCTION ACT
The first round of amendments to the Construction Act came into effect on July 1, 2018 (see our previous legislative newsflash for information about the first round of amendments!). The next round of amendments are slated to come into effect on October 1, 2019.
Some of those upcoming amendments may have a significant impact on condominium corporations engaging contractors to supply labour or work on condominium property. For example:
The “Prompt Payment System” – a mechanism of ensuring that contractors, subcontractors and workers are paid on time. Some of the key requirements are as follows:
- As of October 1, 2019, contractors will be required to provide “proper invoices”. A “proper invoice” must include:
- the contractor’s name and address;
- the date of the invoice and the period during which the services or materials were supplied;
- information identifying the authority under which the services or materials were supplied;
- a description of the services or materials that were supplied;
- the amount payable for the services or materials that were supplied, and the payment terms;
- the name, title, telephone number and mailing address of the person to whom payment is to be sent; and,
- any other information that may be prescribed (there no further prescribed requirements as of yet).
- Unless a condominium corporation and a contractor agree to a certain deadline to submit an invoice, a contractor must submit a proper invoice to a condominium corporation on a monthly basis.
- A condominium corporation will be required to pay contractors within 28 days after the condominium corporation receives a proper invoice.
- Contractors and subcontractors will be entitled to charge mandatory interest on late payments, from when the amount is due (at the prejudgment rate determined under the Courts of Justice Act or the rate set out in the contract, whichever is higher).
- If a condominium corporation disputes the amount owed or the quality of work, a condominium corporation will be permitted to deliver a notice of non-payment to the contractor within 14 days of receiving the proper invoice.
A new dispute resolution process, which allows construction projects and liens to continue, while disputes as to are resolved. The key features of this dispute resolution process are as follows:
- Adjudicators will be experts in the construction industry.
- “ADR Chambers” has been selected as the successful candidate to serve as the Authorized Nominating Authority (the “ANA”). The ANA, among other things, will oversee adjudicator training, qualifications and appointments, and will maintain a public registry of adjudicators.
- Adjudicators will hear all types of disputes, including disputes relating to delays, set offs, deductions, security, proper invoicing, the valuation of work, services and materials. Adjudicators will also hear “any other matter that the parties to the adjudication agree to”.
- Adjudication will be “swift”. Within 30 days of a Notice of Adjudication, the adjudicator must provide a written determination of his or her decision, with reasons (unless an extension is granted). Those decisions will be binding and enforceable.