What is a Builders’ Lien?
The Alberta Builders’ Lien Act – exists to assist and protect the contractors, subcontractors, labourers and suppliers – who have provided labour or materials to a construction project.
The Builders’ Lien Act is enforced where companies or individuals – are not paid for their efforts.
How do Builders Liens work?
A Builders’ Lien is primarily used as leverage, with delinquent customers, to get paid.
When you file a Builders’ Lien in Alberta, you are registering your legal interest, against the property, where the work was done, or materials supplied.
Who may file a Builders’ Liens?
A contractor, sub-contractors, labourers and suppliers are entitled to register a Builders’ Lien where they have:
- Done work or caused any work to be done, based on an improvement in or on the land; or
- Provided any materials to be used in that improvement.
An “improvement” is anything that is constructed, built, erected, dug, or drilled or intended to be done so, in or on the land. It does not include anything that is not attached to the land or intended to be attached to the land.
What properties can a Builders’ Lien be registered against?
A lien can only be registered against the interests of an “owner” as defined in the Alberta Builders’ Lien Act.
Under the Act, an “owner” is a person having an estate or interest in land and for whose direct benefit of work is done on or material is furnished for an improvement to the land and includes all persons claiming under the owner whose rights are acquired after the commencement of the work or the furnishing of the material.
For the purposes of a lien, there may be multiple owners. For example, where a registered landowner hires a contractor, that contractor can lien the title of the land.
Lands and the estate of the Crown are not subject to lien claims, but there may be lien rights against the estate of a tenant or “lessee” of the Crown. The ability to do so depends on the nature and degree of control the Crown has over the estate.
A lien cannot be registered against an Indian Band’s interest, if the land is in the name of the Indian Band.
How long do I have to Register a Builders’ Lien?
Subject to some exceptions, a Builders’ Lien for materials, services or wages may be registered any time up to 45 days from the day the last materials, services or wages were provided.
How Do You Enforce a Builders’ Lien?
In order for a lien to be enforced, a Statement of Claim must be filed in Court of Queen’s Bench and a Lis Pendens must be registered, within 180 days or 6 months of registration of the Builders’ Lien.
A “Lis Pendens” is a certificate issued by the Court to confirm that a Statement of Claim relating to the land in question has been filed.
Court of Queen’s Bench Lawsuits – ARE VERY EXPENSIVE.
For a Builders’ Lien to remain on title – you will need to:
- hire a lawyer, and within 180 days or 6 months – of filing the Builders’ Lien;
- a lawyer will need to file a Statement of Claim in Court of Queen’s Bench.
If you fail to file a Court of Queen’s Bench action/lawsuit – the Builders’ Lien will expire and become invalid.
The risk of Registering a Builders’ Lien.
The other party has the option to pay the Builders’ Lien monies into Court of Queen’s Bench, and will then have the right to proceed to discharge the Builders’ Lien.
The money will remain with the Court – until the conclusion of the Court of Queen’s Bench lawsuit – which may take several years to resolve.
Served with a Notice to Commence Action ?
If you are served with a “Notice to Commence Action”, you have 30 days to commence an action in Court of Queen’s Bench through a lawyer.
If you don’t file a lawsuit in the Court of Queen’s Bench, then an application can be made to have the Builders’ Lien discharged, and costs awarded against you.
If, after you have registered a Builders’ Lien, you change your mind, you can discharge your own lien and pursue an action in Provincial Court Small Claims. The statutory limit on Alberta Small Claims is currently $50,000.