Can I withhold payment if the work is not done properly?

Yes, in Ontario you can withhold payment for defective work, but you must follow specific legal procedures to protect yourself from construction liens and legal issues.

Under Ontario's Construction Act, you have the right to withhold payment for work that doesn't meet the contract specifications or acceptable trade standards. However, this isn't as simple as just refusing to pay - there are important steps you must follow.

Your Rights Under Ontario Law

The Construction Act allows you to withhold payment for "defective work" or work that doesn't comply with the contract. You can hold back payment until the contractor fixes the problems or provides adequate assurance that they will be corrected. This is separate from the mandatory 10% holdback that applies to all construction contracts over $500 in Ontario.

Proper Procedure for Withholding Payment

First, document everything thoroughly. Take photos of the defective work, keep detailed notes about what's wrong, and reference specific contract terms or building standards that aren't being met. Send written notice to the contractor describing the defects and requesting correction within a reasonable timeframe - typically 10-15 business days.

If the contractor disputes your claims, consider getting an independent assessment from another qualified contractor or building inspector. This professional opinion can be crucial if the dispute escalates. For work requiring permits in Ottawa, you can also contact City of Ottawa Building Code Services at 613-580-2424 to discuss whether the work meets Ontario Building Code requirements.

What You Can and Cannot Withhold

You can only withhold payment proportional to the defective work. For example, if 20% of the job has problems, you generally cannot withhold 100% of payment. You must still pay for completed, acceptable work. The amount withheld should reasonably relate to the cost of fixing the defects.

Protecting Yourself from Liens

Here's the critical part: even with defective work, contractors can still file construction liens against your property for unpaid amounts. Under Ontario's Construction Act, they have 60 days from substantial completion to file a lien. To protect yourself, consider placing disputed funds in a separate account or with a lawyer in trust, demonstrating you're not simply avoiding payment but holding funds pending resolution.

When to Involve Authorities

For electrical work, contact the Electrical Safety Authority (ESA) if the work doesn't pass inspection or appears unsafe. For gas or HVAC work, contact the Technical Standards and Safety Authority (TSSA). If your contractor is licensed through a trade organization, file a complaint there as well.

For consumer protection issues, contact the Ontario Consumer Protection office. If the contractor is avoiding your calls or refusing to address legitimate defects, this may constitute a breach of Ontario's Consumer Protection Act.

Getting Resolution

Many disputes can be resolved through negotiation or mediation. If the contractor won't cooperate, you may need legal advice, especially for larger amounts. Small claims court in Ontario handles construction disputes up to $35,000, but construction lien issues often require Superior Court proceedings.

The key is acting reasonably and documenting everything. Courts will look at whether you gave the contractor reasonable opportunity to fix problems and whether your payment withholding was proportional to the actual defects.

Official Resources:

• Construction Lien Act information: ontario.ca/laws/statute/91c30


• Consumer Protection: ontario.ca/consumer


• City of Ottawa Building Services: 613-580-2424