What is a lien, and can a contractor put one on my house?

Yes, contractors in Ottawa can put a construction lien on your house if they're not paid for work performed, but Ontario's Construction Act provides specific protections for homeowners when you follow the rules.

A construction lien is a legal claim against your property that gives the contractor (or subcontractors/suppliers) a security interest in your home until they're paid. In Ontario, this right is governed by the Construction Act, and it's designed to ensure workers and suppliers get paid for legitimate work.

How Construction Liens Work in Ottawa

Any contractor, subcontractor, or material supplier who provides labor or materials for your Ottawa home improvement project can file a lien if they're not paid. This includes everyone from your main contractor to the drywall supplier to individual tradespeople. The lien attaches to your property title, meaning you typically can't sell or refinance until it's resolved.

However, Ontario law provides important protections. Contractors must file their lien within 60 days of finishing their work or last supplying materials. They must also register it with the Land Registry Office and serve you with proper notice. The lien expires after two years unless the contractor takes legal action to enforce it.

The 10% Holdback Protection

Ontario's Construction Act requires a 10% holdback on all payments for construction projects. This means you should only pay 90% of each progress payment, holding back 10% until 60 days after the project is substantially complete. This holdback period allows time for any subcontractors or suppliers to file liens if your main contractor hasn't paid them.

After the 60-day holdback period expires without any liens being filed, you can safely pay the final 10%. This system protects you from having to pay twice - once to your contractor and again to unpaid subcontractors who might lien your property.

Protecting Yourself from Liens

Before hiring any contractor in Ottawa, verify they're properly licensed and insured. For electrical work, check their ESA license at esasafe.com. For gas work, verify TSSA certification at tssa.org. Always confirm WSIB clearance at wsib.ca to ensure worker coverage.

Get everything in writing, including a detailed contract with payment schedules tied to completion milestones. Never pay large amounts upfront - legitimate contractors don't need significant money before starting work. Follow the 10% holdback rule religiously, even if your contractor requests full payment.

What to Do If You Face a Lien

If a lien is filed against your Ottawa property, don't panic. Contact a construction lawyer immediately to understand your options. Sometimes liens are filed incorrectly or for invalid amounts. You may be able to have the lien discharged by paying the legitimate amount owing or posting security with the court.

For disputes with contractors, contact Consumer Protection Ontario at ontario.ca/consumer or call 1-800-889-9768. They can provide guidance on your rights and help with resolution.

The key is following proper procedures from the start - verify your contractor's credentials, use written contracts, follow the holdback rules, and ensure all permits are properly obtained through the City of Ottawa at 613-580-2424. When done correctly, the lien system protects everyone involved in your renovation project.