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Apr 9, 2020

Newsflash - Emergency Management and Civil Protection Act Order and Release of Construction Lien Holdbacks

By: Leor Margulies

I am writing to update you , further to my E blast yesterday, regarding a resolution to the current dilemma relating to construction lien holdbacks because of the potential freeze on registration of construction liens.  BILD, Rescon and OHBA (after I and others suggested they do so), and presumably other construction organizations, made representations to the Ontario government to exempt procedures under the Construction Act from the applicability of the Emergency Order. The Ontario Attorney General issued a notice late yesterday evening, April 9, 2020, confirming that the suspension relating to the Construction Act will be lifted April 16, 2020, retroactive to the date of the order, March 16, 2020, restoring the system as it was before the Emergency Order was enacted.
 
Although we should see the wording of the regulation when it comes out, I am comfortable recommending that release of holdback monies can now flow as before, in reliance upon the bulletin.
 
Have a great Easter and Passover weekend.
 
I have attached below the announcement from the Attorney General.

If you have any questions, please do not hesitate to contact me or any member of my development and lending team here at Robins Appleby LLP.
 
Leor Margulies
Robins Appleby LLP
lmargulies@robapp.com
Tel. (416) 360-3372
 
Sent: Thursday, April 9, 2020 9:19:36 PM
Subject: Construction Act to be Exempt from Emergency Order Suspending
 
Our Reference #: M-2020-3888
 
 
I am writing to let you know that the Ontario government is revising one element of a previous emergency order, O. Reg. 73/20 made under the Emergency Management and Civil Protection Act, which suspended limitation periods and procedural time periods retroactive to March 16, 2020.
 
The previous order was made to help Ontarians who are having difficulty meeting those time requirements as a result of the COVID-19 outbreak.
 
The emergency order has been amended to lift the suspension of limitation periods and procedural time periods under the Construction Act. This will allow for the release of holdback payments to contractors and subcontractors in the normal course, helping to resolve a potentially significant cash flow problem as a result of the order for the construction industry.
 
The suspension will be lifted on April 16, 2020, to give the industry time to prepare for these changes. Once lifted, parties will have the same amount of time to meet a deadline that had been remaining before the suspension began on March 16, 2020.
 
The amendments to the order also address the Niagara Escarpment Planning and Development Act.  The amendments to O. Reg. 73/20 will be posted on e-Laws at:
 
Please note that at the time you receive this email, e-Laws may not yet be updated to reflect the amendments.
 
Sincerely,
 
Doug Downey
Attorney General
 


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