5 Common Questions About Builders Liens
Construction projects feature many moving parts and require many workers and labourers to get the job done. Once the project is complete, it is crucial to ensure that all workers and other parties have been paid what they are owed. If a construction worker remains unpaid after their work is finished, they may be able to claim a BC builders lien to seek compensation directly from the owner of the land to which they contributed labour or materials. As experts in construction law, the team at Linley Welwood knows how complex builders liens can be. That is why we have compiled a list of 5 common questions about builders liens to answer them and provide workers with the information they need to understand their rights.
5 Things to Know About Builders Liens
When discussing builders liens, the following questions are the most commonly asked:
1. What is the Builders Lien Act?
The Builders Lien Act provides rights for workers and suppliers for construction projects through a comprehensive structure that ensures the proper flow of payments for all involved parties. The Act also helps to limit the liability of the property owner.
2. How do you Remove a Builders Lien?
A builders lien can be removed in one of three ways:
- If there is a flaw in the lien, it can be removed by going to the Land Titles Office and pointing out the flaw with a formal procedure.
- Paying the amount of the lien or the amount of the holdback into court. The amount of the holdback may be significantly less than the amount of the lien.
- If no legal proceedings have taken place within a year, the builders lien can be removed from a property by submitting the appropriate forms under the Land Title Act.
3. How Long do Builders Liens Last?
A builders lien claim will last one year from the date it was filed unless legal action is taken by the claimant. It is important to note that this one-year period can be shortened to 21 days by sending the claimant a notice to commence an action. This forces the claimant who put the lien on the property to start a lawsuit within 21 days of receiving the notice.
4. Who can File a Builders Lien?
Builders liens can be filed against a property by anyone working on the project. These parties include, but are not limited to:
- General workers
5. What is a Builders Lien Holdback?
A builders lien holdback is a pool of money that can be used to pay claims. The value of this pool must be equal to 10% of the value of the work/materials provided under the contract/subcontract or the amount of any payment made on account of the contract or subcontract, whichever is greater.
To learn more about builders liens or another area of construction law, get in touch with the team at Linley Welwood. We can be reached through our online contact form and will be happy to answer any questions you may have regarding our services.