The Devil is in the Details: A Cautionary Tale about Filing Builders Liens

Contributed by David Classen of Jenkins Marzban Logan LLP

The Builders Lien Act (the “Act”) provides powerful rights for unpaid contractors, subcontractors, and workers to file a claim of lien against the project land for the price of unpaid work and material. In exchange for these rights, the Act requires strict compliance with the prescribed manner, form, and time limits set out in the Act. Failure to comply with any of these requirements will be fatal to the lien claim.

The British Columbia Supreme Court recently emphasized the importance of strict compliance with the Act when filling out the form to file a lien in Omnique Construction Inc. v. Xu, 2017 BCSC 208.  

In this action, the defendant property owners had engaged the plaintiff, Omnique Construction Inc,. to provide forming and framing services. Following the termination of the contract, Ms. Sun, a director and officer of Omnique Construction Inc., attempted to file a builders lien. In filling out the builders lien form, Ms. Sun mistakenly named herself as the lien claimant instead of her company. She had correctly identified the amount owing and that the money was owed to the company and not to herself on the form, but had named herself as the lien claimant. The company subsequently commenced an action against the property owners to enforce the lien and filed a certificate of pending litigation (“CPL”) against the property.

The defendants applied for an order cancelling the claim of lien on the basis that the lien claimant was not identified correctly on the form. Omnique Construction Inc. and Ms. Sun opposed the order on the basis that the error was technical in nature and did not go the substance of the claim. They argued that the defendants were not misled or prejudiced in any way about the debt being claimed against them.  

The British Columbia Supreme Court rejected these arguments, relying on the well-settled law that there is a principle of strict compliance with the requirements of the Act regarding the time and manner in which the claim of lien is filed. The Court found that this principle was not fact-dependent and could not be relaxed to take into account the party’s intention when the claim of lien was filed. In accordance with the Act, the Court cancelled the lien, cancelled the company’s CPL and awarded costs and damages to the defendant property owners.

Omnique Construction v. Xu serves as an important reminder to lien claimants about the consequences of failing to carefully follow the requirements of the Act and, in particular, of incorrectly identifying the lien claimant on the lien form.

Although contractors, subcontractors, and workers are able to file a claim of lien without the assistance of a lawyer, seeking timely and appropriate legal advice can ensure that the strict requirements and timelines of the Act are met and that your lien rights are properly secured.  If you are inexperienced in filing builders liens or have any questions about the requirements of a lien claim, consulting with a lawyer can avoid making costly mistakes. If you do elect to file a claim of lien on your own, it is good practice to ensure you understand the legal distinction between incorporated and unincorporated entities and to consult your corporate records prior to filing a claim of lien to ensure you are naming the lien claimant correctly. 


This article first appeared in the Fall 2017 issue of SICA's Construction Review Magazine. To read the entire magazine click here.

8F - 2006 Mack Dump Truck.jpg
December 13, 2017

Member Spotlight: Ok Excavating

Adaptability, initiative, and customer service are the keys to longevity for a local commercial and residential excavation business in Kelowna. OK Excavating is celebrating 50 years of business in 2017 and, in those years, has undergone many evolutions.
Read More
7-1 BCCA Trish before.jpg
December 06, 2017

Employee Benefits are Your Secret Weapon when Life Gets Tough!

As a Client Services Associate with BCCA Employee Benefits, my job revolves around helping companies and their employees with their benefits. I know how important my work is, but when I started new jobs in the past, I often wondered whether the premiums were worth it. I am young and healthy, so is it worth the cost? I learned the true value of having employee benefits when, in a moment frozen in my mind, I heard the dreaded “c” word – cancer.
Read More
cyber-security-2851201_1920.jpg
November 29, 2017

Construction and Cyber Risk: An Overview

A hazard such as a fire has protocols and procedures that are designed to mitigate risks – inspections, suppression systems, and risk management practices. Cyber protection of a business should also employ a rigorous process to develop both a risk prevention and incident response plan. Most cyber insurance applications serve as a catalyst in moving towards this process.
Read More
calculator-1044173_1280.jpg
November 15, 2017

Could Tax Issues Throw Your Business Off Track?

To stay on track, real estate and construction companies should develop a better understanding of where tax issues are likely to complicate or disrupt their business — and develop a plan to mitigate those risks well in advance.
Read More
father-2090061_1920.jpg
November 08, 2017

Top Five Reasons for Having an Employee Benefits Plan

One of the biggest investments employers can make is in their employees. And it makes sense to want productive, healthy, and engaged employees. Employees with poor health cannot exert the effort required to be highly productive, and you need engaged employees in order to create innovative solutions.
Read More
courthouse-1799353_640.jpg
August 30, 2017

Obligation of Good Faith in Contracting

The Supreme Court of Canada changed the legal landscape for contracts in the decision of Bhasin v. Hrynew, [2014] SCC 71. This decision created a new common law obligation of good faith that applies to all commercial contracts.
Read More
write-593333_1920.jpg
August 23, 2017

Embracing the Purpose Era

Regardless of the size of your business or the sector you operate in, the purpose movement is shaking up the rules of business and ringing in a new era where business is an active participant in making the world a better place.
Read More
blueprints-1837238_1920.jpg
April 05, 2017

Reaching the Millennials | Attracting the right people is in how the story is told

With businesses adjusting to the era of the happy workplace, concepts such as social responsibility, company culture, and employee engagement are common buzz words used around the open-concept, flexible, shared workspace. They are used more so as companies shift their recruiting focus toward the millennials, the largest generation in the workforce today.
Read More
News-Feature.PNG
May 09, 2016

SICA's New Website Launches

We are excited to announce that our new website is live! We have been busy working behind the scenes and are so excited for you to utilize all the new features.
Read More
kelowna-yacht-club.jpg
October 15, 2015

Kelowna Yacht Club takes top honors

Kelowna Yacht Club was the Judges’ Choice best overall entry winner in the 7th Annual Southern Interior Construction Association Commercial Building Awards Thursday night at the Coast Capri Hotel.
Read More
Commercial_Building_Awards2016.png

Commercial Building Awards - Finalists Announced!

A spectacular assortment of commercial and industrial buildings have been named as finalists for the 8th Annual Southern Interior Construction Association Commercial Building Awards, set for Thursday, Oct. 27 at the Four Points Sheraton Hotel in Kelowna.
Read More