Ontario's Prompt Payment legislation is a law that establishes a clear timeline for when owners and contractors must make payments to contractors and subcontractors for work completed on construction projects.
The legislation applies to all public and private sector construction projects in Ontario, except for single-family homes.
Under the legislation, owners and contractors are required to make progress payments to contractors and subcontractors on a regular basis, based on a set schedule. The following are some key timelines under the legislation:
The owner must make a progress payment within 28 days after receiving a proper invoice from the contractor.
The contractor must pay subcontractors within 7 days of receiving payment from the owner.
The subcontractor must pay its sub-subcontractors within 7 days of receiving payment from the contractor.
If a payment is not made on time, interest will accrue, and the contractor or subcontractor can file a dispute to seek resolution through adjudication. The goal of the Prompt Payment legislation is to promote timely payment practices and prevent payment delays and disputes in the construction industry.
A lawyer who specializes in construction law in Ontario can help in various ways, such as:
Providing legal advice on the Prompt Payment legislation: A lawyer can help you understand the legal requirements and obligations under the Prompt Payment legislation and how it applies to your construction project.
Drafting or reviewing contracts: A lawyer can help draft or review construction contracts to ensure that they comply with the requirements of the Prompt Payment legislation, and to include appropriate provisions for dispute resolution.
Representing you in adjudication: If a payment dispute arises, a lawyer can represent you in the adjudication process to seek resolution and recover the payment you are owed.
Providing general legal support: A lawyer can provide general legal support for construction-related issues, such as reviewing construction liens, resolving construction disputes, and representing you in court if necessary.
The Prompt Payment legislation aims to promote fairness and timely payment practices in the construction industry. A lawyer who specializes in construction law in Ontario can help you navigate the legislation and protect your rights as a contractor or subcontractor.