Builders Liens and Arbitration

British Columbia’s Builders Lien Act protects participants in a construction project such as subcontractors, workers, and suppliers of material by providing for a special claim on property for the payment or performance of some debt, obligation, or duty called a lien. A lien is claimed against the construction project itself, and if successful will allow a claimant to access the “holdback” which is a percentage of a contract price retained by a contractor or lender until the project is complete and all bills are paid. The assertion of a lien claim generally means the claimant alleges that money owed has not been paid. A lien claimant must commence an action in court to enforce the lien. This procedure is in contrast to the well-established practice in the construction industry not to use the courts to resolve construction disputes. These opposing approaches have resulted in concerns and questions surrounding the interface between builders’ lien legislation and arbitration procedures, which this project sought to address.

Keywords: builders liens, legislation, Builders Lien Act, alternative dispute resolution (ADR), arbitration, Commercial Arbitration Act, housing, tenancy & neighbours, buying or selling a home, construction law, business & non-profits, construction, Uniform Law Conference of Canada