Lien registration processes are not necessarily uniform across provincial jurisdictions. A recent case in Alberta highlights the importance of understanding the differences when contrasted with processes used in Ontario, for example.
Lawson Lundell LLP partner Devin Itterman and associate Devlin Steers describe how the COVID-19 pandemic, combined with an active Alberta real estate market, increased the time gap between lien submission and lien registration from one or two weeks to over three months.
As a solution to the lengthy registration delays, the provincial government amended the Land Titles Act and its regulations in April 2021, and created the Pending Registration Queue (PRQ), also known as the Queue.
Time sensitive registrations, such as builders’ liens, which previously needed to be registered on an expedited basis, would now be registered in the same order as any other instrument, they write.
The problem, according to associate Tanner Oscapella and articling student Ali Sarhill of Whitelaw-Twining BCA LLP, was the Queue itself became overloaded. Those delays created potential ambiguity when it came to the 180-day lien registration deadline under Alberta’s Prompt Payment Construction Lien Act versus amendments to the Land Titles Act, RSA 2000. When a lien is put into the Queue, it appears as a “pending registration” until examined by staff at Land Titles, a status that can remain in place for months.
Fortunately, that ambiguity has been cleared up after a recent Alberta Kings Bench ruling.
CCS Contracting Ltd. (CCS) submitted a lien to the Queue in April, naming Condominium Corporation No. 1520090 as defendant. The lien wasn’t examined and approved to be registered on title by Land Titles until July 25, 2022, a delay of three months. The plaintiff then filed a statement of claim on Oct. 5, 2022, and registered its Certificate of Lis Pendens (CLP) on Nov. 21, 2022.
The defendant applied for CCS’s lien to be discharged, arguing the date of registration was when the plaintiff submitted their lien to Land Titles for placement in the Queue. Since the CLP was not registered until November, time had run out.
CCS countered, claiming a lien is only “registered” when it appears on title and not while sitting in the Queue.
The court decided in favour of CCS, ruling a lien submitted to the Queue only represents a request for registration, not registration itself, with no guarantee the lien will be registered.
On one hand, this ruling means the deadline for a lien claimant to file their statement of claim may be extended by the length of the Queue delay. But as Itterman and Steers explain, it concurrently creates uncertainty for owners, since delays at Land Titles are constantly changing.
Contrast that with Ontario.
Edward Lynde, partner with Fasken Martineau DuMoulin LLP, told the Daily Commercial News that Ontario does not suffer from a Queue problem, despite similar legal frameworks and requirements such as strict adherence to timelines related to the correct registration and validity of a construction lien.
“In Ontario, the registration process is done electronically via Teraview, which ensures that the lien instrument is registered instantaneously and is visible on the title to the property. After the registration, the Land Registry Office undertakes a process to certify the instrument registered on title, which involves ensuring that the Teraview forms were completed accurately and that the registration statements are appropriately marked.”
Lynde prefers Ontario’s system. Since construction liens are considered non-complex, certification typically takes only five days. Registration is retroactive to the date the document was received for registration.
“This aligns with the conceptual underpinnings of a lien, which is a charge against the owner’s interest in the property improved, and therefore a review of title immediately illustrates all interests in that property,” he said. “The process for registration in Alberta appears to be overly time consuming, appears to lead to delays and, as seen in the CCS Contracting decision, can lead to certain ambiguities.”
Project parties engaging in inter-provincial contracts need to be aware of differences in lien registration processes.
John Bleasby is a Coldwater, Ont.-based freelance writer. Send comments and Legal Notes column ideas to email@example.com.