Builders Lien Act to be strictly construed

The Builders Lien Act must be interpreted strictly because it creates a preference in favour of one creditor over another:
 
It is settled law that the Builders Lien Act must be interpreted strictly because it creates a preference in favour of one creditor over another…The lien is a creature of statute, and the court has no discretion to depart from the statutory requirements…
(Nita Lake Lodge Corp. v. Conpact Systems (2004) Ltd., 2006 BCSC 885 at para. 9).
 
As noted above, the Builders Lien Act does not contain a curative provision that mandates forgiveness of mistakes by lien claimants, but rather liens which do not comply with the requirements of the legislation may be struck out. In light of the lack of any curative provision in the legislation, and the fact that the Builders Lien Act provides lien claimants with significant power to interfere with the ability of land owners to deal with their land, it has been held that in order to obtain the protection of the Builders Lien Act lien claimants must strictly comply with the provisions of the legislation. However, once lien claimants bring themselves within the legislation the provisions of the legislation will be broadly construed to ensure the purposes of the legislation are fulfilled:
 
[The Act] constitutes an abrogation of the common law to the extent that it creates, in the specified circumstances, a charge upon the owner’s lands which would not exist but for the Act, and grants to one class of creditors a security or preference not enjoyed by all creditors of the same debtor; accordingly, while the statute may merit a liberal interpretation with respect to the rights it confers upon those to whom it applies, it must be given a strict interpretation in determining whether any lien-claimant is a person to whom a lien is given by it.
(Chaston Construction Corp. v. Henderson Land Holdings (Canada) Ltd., 2002 BCCA 357 at para. 50 citing Clarkson Co. v. Ace Lumber Ltd., [1963] S.C.R. 110 at 114).
 
Similarly:
 
The jurisprudence is clear that because the Act creates new rights, the threshold question of entitlement is strictly construed; it is only once entitlement is established that the Act is to be construed liberally and with consideration to its remedial purpose...
(Bank of Montreal v. Peri Formwork Systems Inc., 2012 BCCA 4 at para. 62, citations omitted).
 
The above emphasizes the importance of lien claimants correctly filling out claim of lien forms and complying with all deadlines i.e. if they fail to do so lien rights may be lost. The requirement for strict compliance with the legislation provides an opportunity for owners to defeat lien claims by seizing upon defects in steps taken by lien claimants. 
 

 

 

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