Learn the top 5 legal issues in construction contracts every Canadian contractor should understand to protect their business.
The legal landscape in Canadian construction is evolving. Whether you are a general contractor or a subcontractor, staying ahead of legal risks is key to avoiding costly disputes and keeping your projects on track. Here are the top five legal issues contractors should be watching.
Prompt Payment Laws
The prompt payment and adjudication rules are designated to ensure you get paid on time – but they also come with strict deadlines and procedures. Missing a notice window could cost you your right to payment. Make sure your contracts reflect the proper timelines and requirements.
Contractor Insolvency and Security Provisions
With rising market uncertainties, it is important to understand your rights under performance and payment bonds and include proper security provisions in your contracts. If a contractor upstream from you goes under, you need to know how to protect your interests.
Dispute Resolution Clauses
Many contracts now include arbitration or adjudication clauses. These can be faster and cheaper than court, but they also may limit your options. Always review dispute resolution terms with a lawyer, to ensure you know what you are signing.
Tariffs and Supply Chain Risks
U.S. tariffs and global supply chain disruptions are impacting material prices. Make sure your contracts provide for a price adjustment or force majeure protection, otherwise you could be stuck absorbing the extra costs.
Occupational Health and Safety Liability
Occupational health and safety laws are shifting more responsibility onto contractors. Make sure your contracts clearly define who is responsible for what, otherwise you could be held liable for incidents outside your control. Clearly define roles and stay compliant.
Takeaway for Contractors
A solid, well-drafted contract is your best defence. It is also part of your risk management. Do not wait for a dispute to find out what is missing. If you would like to review and discuss your construction agreements with a corporate/commercial lawyer, please contact Pavel Malysheuski at Boardwalk Law: [email protected] / 905.863.7428. Pavel has achieved the Osgoode Certificate in Construction Law.
