3 key features of the Builders Lien Act
Lien: The Builders Lien Act gives those who improve land (by supplying labour and/or materials) an in rem right against the land improved as a means of securing payment, or at least part payment. Following Shimco Metal Erectors Ltd. v. North Vancouver (District), 2003 BCCA 193 a lien is also available against the holdback fund required to be kept under s. 4 of the Builders Lien Act.
Holdback defence: Where A engages B who engages C1, C2, C3, the Builders Lien Act limits the liability of A (whether A is an owner or contractor) to all of C1, C2, C3 to 10% of the value of work supplied to A by B.
Trust provisions: Where A engages B who engages C1, C2, C3 the Builders Lien Act provides that monies paid by A to B are held by B in trust for C1, C2, C3 until C1, C2, C3 have been paid i.e. B must pay C1, C2 and C3 before B takes profit on the project for itself. C1, C2, C3 need not qualify as lien claimants in order to be trust beneficiaries.
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