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In This Volume

  • 1 (1) In this Act:
  • “certificate of completion” means a certificate under section 7 stating that work under a contract or subcontract has been completed and includes an order made under section 7(5);
  • “claim of lien” means a claim of lien in the prescribed form;
  • “class of lien claimants” means all lien claimants engaged by the same person in connection with an improvement;
  • “completed”, if used with reference to a contract or subcontract in respect of an improvement, means substantially completed or performed, not necessarily totally completed or performed;
  • “contractor” means a person engaged by an owner to do one or more of the following in relation to an improvement:
  • (a) perform or provide work;
  • (b) supply material;
  • but does not include a worker;
  • “court” means the Supreme Court;
  • “head contractor” means a contractor who is engaged to do substantially all of the work respecting an improvement, whether or not others are engaged as subcontractors, material suppliers or workers;
  • “holdback period” means the period of time calculated under section 8;
  • “improvement” includes anything made, constructed, erected, built, altered, repaired or added to, in, on or under land, and attached to it or intended to become a part of it, and also includes any clearing, excavating, digging, drilling, tunnelling, filling, grading or ditching of, in, on or under land;
  • “land title office” means the land title office for the land title district or districts in which the land or any part of it is located and on which the improvement is made or is being made;
  • “lien claimant” means a person who files a claim of lien under this Act;
  • “lien holder” means a person entitled to a lien under this Act;
  • “material” means movable property that is delivered to the land on which the improvement is located and is intended to become part of the improvement, either directly or in a transformed state, or is consumed or used in the making of the improvement, including equipment rented without an operator;
  • “material supplier” means a contractor or subcontractor who supplies only material in relation to an improvement;
  • “notice of certification of completion” means a notice in the prescribed form stating that a certificate of completion or a court order to the same effect has been issued;
  • “notice of interest” means a notice in the prescribed form warning other persons that the owner’s interest in the land described in the notice is not bound by a lien claimed under this Act in respect of an improvement on the land unless that improvement is undertaken at the express request of the owner;
  • “notice to commence an action” means a notice in the prescribed form requiring a claim holder to commence an action to enforce a claim of lien;
  • “operator” means an individual who operates equipment at an improvement site but does not include an individual who temporarily or periodically is present at the improvement site to install, inspect, service, empty or remove equipment;
  • “owner” includes a person who has, at the time a claim of lien is filed under this Act, an estate or interest, whether legal or equitable, in the land on which the improvement is located, at whose request and
  • (a) on whose credit,
  • (b) on whose behalf,
  • (c) with whose knowledge or consent, or
  • (d) for whose direct benefit
  • work is done or material is supplied, and includes all persons claiming under the owner, but does not include a mortgagee unless the mortgagee is in possession of the land;
  • “registrar” means the registrar of a land title office;
  • “required holdback” means, in relation to a contract or subcontract, the amount required under section 4 to be retained from payments under that contract or subcontract, less any payments made under an entitlement to payment arising under section 9;
  • “services” includes
  • (a) services as an architect or engineer whether provided before or after the construction of an improvement has begun, and
  • (b) the rental of equipment, with an operator, for use in making an improvement;
  • “subcontractor” means a person engaged by a contractor or another subcontractor to do one or more of the following in relation to an improvement:
  • (a) perform or provide work;
  • (b) supply material;
  • but does not include a worker or a person engaged by an architect, an engineer or a material supplier;
  • “wages” means money earned by a worker for work and includes
  • (a) salaries, commissions or money, paid or payable by an employer to an employee for work,
  • (b) money that is paid or payable by an employer as an incentive and that relates to hours of work, production or efficiency,
  • (c) money, including the amount of any liability under section 63 of the Employment Standards Act, required to be paid by an employer to an employee under that Act,
  • (d) money required to be paid in accordance with a determination or an order of the tribunal under the Employment Standards Act,
  • (e) money required under a contract of employment to be paid, for an employee’s benefit, to a fund, insurer or other person and includes money payable under Parts 10 and 11 of the Employment Standards Act, and
  • (f) money required to be paid under a collective agreement;
  • “work” means work, labour or services, skilled or unskilled, on an improvement;
  • “worker” means an individual engaged by an owner, contractor or subcontractor for wages in any kind of work, whether engaged under a contract of service or not, but does not include an architect or engineer or a person engaged by an architect or engineer.
  • (2) For the purposes of this Act, a head contract, contract or subcontract is substantially performed if the work to be done under that contract is capable of completion or correction at a cost of not more than
  • (a) 3% of the first $500,000 of the contract price,
  • (b) 2% of the next $500,000 of the contract price, and
  • (c) 1% of the balance of the contract price.
  • (3) For the purposes of this Act, an improvement is completed if the improvement or a substantial part of it is ready for use or is being used for the purpose intended.
  • (4) For the purposes of this Act, the construction of a strata lot, as defined by the Strata Property Act, is completed, or a contract for its construction is substantially performed, not later than the date the strata lot is first occupied.
  • (4.1) With respect to common property or common assets held by a strata corporation under the Strata Property Act, for the purposes of sections 7 and 41 of this Act, and any other provision of this Act specified in the regulations, the strata corporation is deemed to be the owner.
  • (4.2) With respect to common property or common assets held by a strata corporation under the Strata Property Act, for the purposes of section 25 of this Act and any other provision of this Act specified in the regulations, a reference to an owner includes the strata corporation.
  • (5) For the purposes of this Act, a contract or improvement is deemed to be abandoned on the expiry of a period of 30 days during which no work has been done in connection with the contract or improvement, unless the cause for the cessation of work was and continued to be a strike, lockout, sickness, weather conditions, holidays, a court order, shortage of material or other similar cause.
  • (6) Anything that may be done under this Act by or with reference to an owner, contractor, subcontractor, worker or mortgagee is valid if done by or with reference to an agent of that person.

1997-45-1, effective February 1, 1998 (B.C. Reg. 1/98), 1998-43-297, effective July 1, 2000 (B.C. Reg. 43/2000).

CROSS REFERENCES AND OTHER SOURCES OF INFORMATION

Interpretation of Words and Phrases

See the discussion on the “Interpretation of Words and Phrases” in the Introduction located in the front material of this Manual.

See the definition of “person” in s. 29 of the Interpretation Act, R.S.B.C. 1996, c. 238, which provides:

  • “person” includes a corporation, partnership or party, and the personal or other legal representatives of a person to whom the context can apply according to law.

Use of this word in many of the above definitions should be contrasted with the use of “individual” in the definitions of “operator” and “worker”.

CASE LAW

“Deemed to Be Abandoned”

See the annotation for Coupal Climbing Cranes Ltd. v. Chen, 2004 BCSC 570, under s. 20 of this Act.

The plaintiff, a general contractor, filed a claim of builders lien against the defendants’ property on March 15, 2006. Section 1(5) of the Act states that a contract or improvement is deemed to be abandoned after 30 days if no work has been done unless the cessation of work was caused by weather, holidays, or other similar causes. In this action to determine the validity of the lien, the court found that, although no work had been done on the property between November 30, 2005, and January 9, 2006, the cessation of work was caused by weather conditions and holidays. In reaching this conclusion, the court adopted a modern and liberal approach to the interpretation of s. 1(5) of the Act and found that, if the Legislature had wanted to restrict the interpretation of the term “holidays”, it could have said “statutory holidays” rather than just “holidays”. As such, the 30-day period for deemed abandonment did not start to run until at least January 9, 2006, the time for filing the claim of lien did not start to run until at least February 9, 2006, and, thus, the plaintiff’s claim, filed on March 15, 2006, fell within the 45 days required under s. 20 of the Act (McManamna v. Farley, 2007 BCSC 1304). The Court of Appeal upheld the trial decision and added that the Legislature did not intend the deemed abandonment provision to override proof of a clear intention of the parties not to abandon a project. In the court’s view, it was more reasonable to interpret s. 1(5) as a default position applicable where the parties’ intentions were uncertain. The interpretation of deemed abandonment as creating a presumption of abandonment rebuttable by proof of an intention not to abandon accorded with the scheme of the statute and the practical realities of construction (McManamna v. Chorus, 2008 BCCA 471).

“Engaged”

The term “engaged” in the definition of a subcontractor can mean hired or employed but it also has a broader meaning. A person can be engaged when he is being occupied, taking part in, or being involved in something, or committed to an undertaking. There is a non-commercial aspect to the meaning of “engaged” at least to the point of not requiring consideration in a pure contractual sense. In this case, the subcontractor did not take a fee from the contractor, who was his brother, but he was engaged in finding and supervising the work of his subcontractors and as such he was entitled to file a claim of builders lien for work he carried out on behalf of the contractor (Chandler v. Champion Enterprises (Canada) Ltd., 2013 BCSC 1518).

“Improvement”

The claimant, a subcontractor, fabricated large steel moulds that were moved to and installed in a shed constructed by the general contractor on lands leased from a third party. Concrete piles were driven into the ground to support the weight of both the moulds and the concrete poured into them. Footings for the moulds were built into the floor of the shed, and the assembled moulds were bolted to the footings. The claimant appealed from an order discharging its claim of builders lien against the property leased by the general contractor. In granting the appeal and reinstating the claimant’s lien, the court affirmed that the moulds were erected or built on the land, that they were attached to the land, and that they were intended to be in place for at least the duration of the project; that is, for a substantial period of time. In these circumstances, even though the moulds might be moved at some time in the future, the measure of their attachment to the land was enough to establish that they were improvements as that term is defined in s. 1(1) of the Act (Deal S.r.l. v. Cherubini Metalworks Ltd., 2001 BCCA 49).

“In Relation To”

As defined in the Act, “contractor” means a person engaged by an owner to perform or provide work or to supply material in relation to an improvement. The words “in relation to” must be limited in some way to prevent owners from getting the benefit of buildings erected or work done at the expense of those who provided the materials and did the work and to protect suppliers and workers by giving them a security interest in an owner’s land. Either there must be a direct relationship between the service and the improvement, or the work or service must be an “integral and necessary part of the actual physical construction”. In this case, there was no direct relationship between an air carrier that provided transportation of construction personnel and their baggage to a construction site and the resulting improvement. Furthermore, the air transportation was not an integral and necessary part of the improvement. In these circumstances, the air carrier was not entitled to a claim of lien under the Act (Northern Thunderbird Air Ltd. v. Royal Oak Mines Inc., 2002 BCCA 58).

“Services”

The addition of the present definition of services to the Act was intended to remedy previous uncertainty. A reasonable interpretation of such a definition in a statute that affects property rights would be to limit the definition of services to those services specifically identified as included, rather than read it as a limitless expansion of services that could come within its meaning. The definition of services should be read as remedial, including only those specified services whose inclusion might previously have been in doubt (Northern Thunderbird Air Ltd. v. Royal Oak Mines Inc.).

The inclusion of the definition of “services” in the Act has brought about no more than the change recommended by the Law Reform Commission in 1972; namely, that architects and engineers should be included within the range of persons able to claim a lien, and the definition of services should include all work done in connection with an improvement, whether or not the work was done before the commencement of the construction. However, the mischief at which the inclusion of the definition of services was aimed was limited in scope and was not intended to provide protection for architects and engineers for preconstruction work regardless of whether construction commenced. In this respect, the Court of Appeal disagreed with the decision of the trial court in Harmony Co-ordination Services Ltd. v. 542479 B.C. Ltd., below, and held that before architects and engineers have lien rights under the Act, construction of the improvement must have commenced. In this case, work done by architects and engineers for a tenant in connection with improvements to premises leased from the building’s owner fell within the definition of services and established their lien rights under the Act (Chaston Construction Corp. v. HendersonLand Holdings (Canada) Ltd., 2002 BCCA 357, followed in Stanley Paulus Architect Inc. v. Windhill Holdings Ltd., 2014 BCSC 1816).

See the annotation for “E.C.R.A.” Elderly Citizens Recreation Assn. v. Loeppky Consulting Ltd., 1999 CanLII 5631 (BC SC), under s. 25 of this Act.

“Services” and Work “in Relation to an Improvement”

The plaintiff, a residential home designer and builder, was retained by the defendants to provide design and construction services in relation to the defendants’ proposed subdivision development. The defendants terminated the plaintiff’s services before the commencement of construction and refused to pay the plaintiff’s invoice for this work. Legislative changes in the Act now provide a broader, more flexible approach to the interpretation of work “in relation to an improvement”. As contemplated under the definitions of “contractor” and “improvement”, a contractor is entitled to a lien for work including preparatory work performed off-site, provided that the work forms a necessary and integral part of the physical construction of the improvement. In the present case, the plaintiff’s work was performed “in relation to an improvement”, even though its work was performed off-site before any construction commenced. The respondents eventually built homes in the subdivision and the designs and drawings prepared by the plaintiff were substantially similar to those used by the respondents in the physical construction. Further, under the definition of “services”, the Act no longer requires that architectural or engineering services be performed on-site in some supervisory role over the construction of the improvement or that they directly contribute to the physical construction of the improvement. If the services of a contractor fall within the definition of “services as an architect or engineer”, they are lienable for intended construction, even if an improvement is never constructed. By definition, the Act does not restrict services to services performed by registered architects or professional engineers. The plaintiff was entitled to its lien because its work was performed “in relation to an improvement” and because its services fall within dictionary definitions for architects and engineers (Harmony Co-ordination Services Ltd. v. 542479 B.C. Ltd., 1999 CanLII 6125 (BC SC); but see the above annotation for Chaston Construction Corp. v. Henderson Land Holdings (Canada) Ltd., 2002 BCCA 357).

“Work”

See the annotation for Alexander Construction Ltd. v. Al-Zaibak, 2011 BCSC 590, under s. 20 of this Act.