Fingers crossed... Prompt Payment is coming! • From the Editor
November 7, 2016 - It’s been a few years now that we’ve been tracking the Prompt Payment movement in Ontario. To make a long story short, the Province of Ontario commissioned an “expert review” of the Construction Lien Act in February 2015. The review was to include an examination of payment issues within the construction sector.
This past September, the Office of the Attorney General released the long-awaited results from the review, which was led by construction law experts Bruce Reynolds and Sharon Vogel of Borden Ladner Gervais LLP. Their findings and recommendations can be found in the report, “Striking the Balance: Expert Review of Ontario’s Construction Lien Act”, which you can download below (PDF).
Of particular interest is Chapter 13, Clause 47, which states:
We recommend that a prompt payment regime be legislated in Ontario and that it be applied to both the public and private sectors.
“Overall, I think the report is fair and balanced,” said Jeff Koller, Electrical Contractors Association of Ontario (ECAO), when I asked for his take on the review. “I think Bruce and Sharon understand the problem of systemic payment delays in the construction industry, and I think they’ve made recommendations that could go a long way to addressing that, including a legislated Prompt Payment regime for the public and private sectors, holdback reform, mandatory project trust funds, and expedited and binding dispute resolution.”
To ensure balance—and to confirm they’re on the same page—I also sought opinion from the Ontario Electrical League.
“We support the recommendations and look forward to the legislation to implement the changes required to improve the conditions in which our members operate,” said OEL’s Stephen Sell.
However, the report is just that... a report with a bunch of recommendations, and no teeth.
“Ultimately, it will come down to how this report—with its recommendations—translates into legislation,” Koller noted.
To Koller’s point, the province plans on introducing legislation in Spring 2017 based on the report’s main principles. “We’ll be watching that process closely and making our views known,” Koller added.
We should all do the same and, hopefully, see Prompt Payment translate across more Canadian jurisdictions.
P.S. Register now for an important webinar November 22, 2016, at 2 pm EST, where out Legal Desk columnist Dan Leduc will break down the results of the review, and explain the ramifications for you and your business. Visit EBMag.com/webinars.