Notice of Non-Payment Under Prompt Payment Rules

A notice of non-payment (NoNP) is the formal document a payer must issue if they intend to withhold all or part of a proper invoice under prompt payment legislation. In Ontario, the owner has 14 days from receiving a proper invoice to issue a NoNP if they want to dispute payment (Construction Act s.6.4). The NoNP must specify the amount being withheld and the reasons. Without a timely NoNP, the full invoice amount becomes payable on the 28-day clock. The same mechanism applies downstream: a GC must issue a NoNP to a subcontractor within 7 days of receiving (or not receiving) the owner's payment if they want to withhold from the sub. Saskatchewan, Alberta, New Brunswick, and Manitoba have similar mechanisms with slightly different timing.

Why it matters to Canadian contractors

The NoNP is the gatekeeping mechanism for disputes. If a payer fails to issue one in time, they lose the right to dispute and must pay the full proper invoice.
It forces transparency. Vague allegations of 'work is not done correctly' will not survive an adjudication; the NoNP must specify what is being withheld and why.
For subcontractors, the chain of NoNPs is what protects you. If your GC has no NoNP from the owner, the GC cannot legitimately withhold from you on the same grounds.
Missing the 14-day window is a common owner mistake. Subcontractors should track every invoice's clock to spot when the owner has effectively waived dispute rights.

Common mistakes and pitfalls

A NoNP must be sent to the contractor in writing. Verbal disputes or email comments to a project manager are not sufficient.
If the payer withholds for a reason not stated in the NoNP, the withholding is invalid. Catching this in adjudication is your leverage.
The 14-day window in Ontario runs from receipt of the proper invoice, not from the invoice date or the date you mailed it. Email read receipts and certified mail matter here.
An undisputed portion of a partially-NoNP-protected invoice must still be paid on the 28-day clock. Many owners hold the entire invoice while disputing a small portion, which is non-compliant.
In a multi-tier chain, the NoNP timing is staggered. By the time a sub's clock starts, the owner's clock has already partially elapsed. Track each layer separately.

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.

Why it matters to Canadian contractors

The NoNP is the gatekeeping mechanism for disputes. If a payer fails to issue one in time, they lose the right to dispute and must pay the full proper invoice.

It forces transparency. Vague allegations of 'work is not done correctly' will not survive an adjudication; the NoNP must specify what is being withheld and why.

For subcontractors, the chain of NoNPs is what protects you. If your GC has no NoNP from the owner, the GC cannot legitimately withhold from you on the same grounds.

Missing the 14-day window is a common owner mistake. Subcontractors should track every invoice's clock to spot when the owner has effectively waived dispute rights.

Common mistakes and pitfalls

A NoNP must be sent to the contractor in writing. Verbal disputes or email comments to a project manager are not sufficient.

If the payer withholds for a reason not stated in the NoNP, the withholding is invalid. Catching this in adjudication is your leverage.

The 14-day window in Ontario runs from receipt of the proper invoice, not from the invoice date or the date you mailed it. Email read receipts and certified mail matter here.

An undisputed portion of a partially-NoNP-protected invoice must still be paid on the 28-day clock. Many owners hold the entire invoice while disputing a small portion, which is non-compliant.

In a multi-tier chain, the NoNP timing is staggered. By the time a sub's clock starts, the owner's clock has already partially elapsed. Track each layer separately.

Notice of Non-Payment Under Prompt Payment Rules

Why it matters to Canadian contractors

Common mistakes and pitfalls

Related

Notice of Non-Payment Under Prompt Payment Rules

Why it matters to Canadian contractors

Common mistakes and pitfalls

Related