Lien Bond has no Effect on Existence and Application of Trust Remedies Under the Manitoba Builders’ Liens Act: Stuart Olson Dominion Construction Ltd. v. Structal Heavy Steel, 2015 SCC 43

By Taylor McCaffrey LLP on 2015/09/21

On September 18, 2015, the Supreme Court of Canada unanimously dismissed an appeal from the decision of the Manitoba Court of Appeal which was successfully argued by Kevin T. Williams and Kyla A. Pedersen of Taylor McCaffrey LLP.

The case dealt with the relationship between the trust and lien remedies under the Manitoba Builders’ Liens Act. The Supreme Court of Canada agreed with the interpretation of the legislation put forward by Kevin and Kyla on behalf of the respondent sub-contractor, and clarified that the trust and lien remedies are two distinct and separate remedies. The Supreme Court of Canada further clarified that the filing of a lien bond has no effect on the existence and application of the trust remedy. A lien bond does not extinguish an owner or contractor’s trust obligations under the statutory trust and does not amount to a “double payment”.

The case will have an impact upon the way lien bonds are utilized and trust monies are handled by Owners, Contractors and Subcontractors (and potentially upon the advice provided by Consultants) in the Manitoba construction industry.

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