COCA: Prompt payment legislation “battle not yet won”

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The Council of Ontario Construction Associations (COCA) says Reynolds/Vogel report on reforming the Construction Lien Act “is an important step along the path towards a modern Construction Payments Act that includes provisions for prompt payment BUT we are not there yet.”

In the Construction in Ontario newsletter, COCA says it “has been lobbying for reform of the Lien Act for more than 20 years and for prompt payment legislation since 2011 and the battle is not yet won.”

“Going forward, before we reach our goal, the government has to carefully consider the many recommendations contained in the Reynolds/Vogel Report, consult with stakeholders, roll-up stakeholder feedback and draft a Bill that captures the intent of the report, introduce the Bill and make it a high priority to push it through the legislative process (first, second readings, Committee hearings and review, third reading, Royal Assent) and make it law before the next general election.”

In this regard, we are encouraged by the Attorney General’s mandate letter from Premier Wynne directs the AG to ‘Introduce legislation in spring 2017 to modernize the Construction Lien Act in order to strengthen the province’s construction sector and support the government’s economic plan for Ontario’.

Further encouragement was offered by the Attorney General himself when he spoke at COCA’s recent Construction Season Reception at Queen’s Park and promised that legislation would be passed by the end of 2017. We’ll have to keep the pressure on to make sure the government lives up to these commitments.”

The CLA review report included these recommendations:

  • That a prompt payment regime be legislated for both the public and private sectors in Ontario
  • That interest must be paid on late payments
  • That basic holdback must be released, i.e. mandatory release of holdback
  • That amendments be made to make partial and early release of holdback possible
  • That record keeping must clearly identify project monies (but separate trusts not required)
  • That a two year pilot project be undertaken to evaluate mandatory project trust accounts
  • That there should be a legislated expedited binding dispute resolution process for construction projects, the decisions from which would be enforceable through the courts and subject to appeal
  • That if, following adjudication proceedings, a payer continues to be in default, a contractor may suspend work

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