A builders' lien (called a construction lien in Ontario and a mechanics' lien in the Atlantic provinces) is a statutory claim that a contractor, subcontractor, supplier, or worker can register against real property to secure unpaid amounts owed for construction work performed or materials supplied. Quebec uses the related but distinct concept of a legal hypothec under the Civil Code, art. 2724. The lien attaches to the land and any improvement, giving the lien-holder a secured interest that follows the property even if it is sold. Each province has its own lien statute: Ontario's Construction Act, British Columbia's Builders Lien Act SBC 1997 c.45, Alberta's Prompt Payment and Construction Lien Act RSA 2000 c.P-26.4, Saskatchewan's Builders' Lien Act, Manitoba's The Builders' Liens Act, New Brunswick's Construction Remedies Act (which replaced the Mechanics' Lien Act in 2022), and equivalent legislation in the other provinces. The statutes share the same purpose but differ in preservation deadlines, perfection requirements, holdback rates, and exemptions.
Why it matters to Canadian contractors
- A builders' lien is the most powerful collection tool a Canadian contractor has on construction work. It converts an unsecured trade debt into a secured claim against the property itself.
- Owners cannot sell or refinance a property with an active lien without addressing the lien claim. This makes the lien process the primary lever for forcing settlement.
- Lien rights apply regardless of whether the contractor has a written contract. The work and the supply are what create the right, not the contract document.
- Each link in the construction chain has its own lien right. A supplier two tiers below the owner can still register against the owner's property if their GC or sub does not pay them.
Common mistakes and pitfalls
- The names of the statutes differ ('builders' lien', 'construction lien', 'mechanics' lien'), but the legal mechanism is essentially the same. Do not assume a US contractor's understanding of 'mechanics' lien' maps onto Canadian law without checking.
- Each province has its own preservation deadline and these are strictly enforced. 30 days in QC and NL, 40 days in SK, 45 days in BC and NT, 60 days in ON / AB / MB / NB / NS / PE.
- After preservation, a separate perfection step (court action) is required within another fixed window. Skipping perfection is just as fatal as missing preservation.
- Liens against residential homesteads are subject to additional exemptions in some provinces that limit the enforceable amount.
- Registering a baseless lien is itself a tort (slander of title) and can expose you to damages. Do not register a lien for amounts that are genuinely in dispute without legal advice.
Related
- Glossary: Lien preservation deadline→
- Glossary: Lien perfection→
- Lien deadline calculator→
- Lien deadlines by province→
This glossary entry is for general information only and does not constitute legal or tax advice. Canadian tax and construction law rules vary by province and contract. For advice specific to your situation, consult a licensed professional.