ARCANA Construction Adjudication

Service Alberta Prompt Payment Legislation

Overview

The construction industry is a multi-billion dollar sector of Alberta’s economy that creates thousands of jobs for Albertans.

Payment timelines for Alberta’s construction industry, along with timelines for filing liens and rules for adjudication in the event of a payment dispute, are outlined in the Prompt Payment and Construction Lien Act, the Prompt Payment and Adjudication Regulation, and the Prompt Payment and Construction Lien Forms Regulation.

All new construction contracts in Alberta must adhere to the rules of the Prompt Payment and Construction Lien Act as of August 29, 2022.

Existing contracts that are scheduled to end before August 29, 2024 do not need to be changed to adhere to the new rules. Existing contracts that extend beyond August 29, 2024 have to become compliant by August 29, 2024.

View the Service Alberta Prompt Payment page here

Prompt Payment Construction Adjudications under the PPCLA Legislation are intended to provide the construction sector and the public with quick, accessible, affordable and enforceable Determinations and Orders – usually in under 60 days. The PPCLA allows disputants in the construction sector to avoid lengthy and costly litigation in the Courts.

Construction Adjudication Determinations and Orders are confidential, provided they are complied with. Construction Adjudication Orders are as enforceable as Court Orders. However, parties should note that neither the Courts nor ARCANA (AB) provide enforcement services.

As noted in the fee schedule, the appointed adjudicator may require a retainer to be paid when the adjudication is initiated. While it is preferable that the disputing parties share the cost of the retainer, the applicant should be prepared to pay the full cost at the outset – noting that the adjudicator has the authority to allocate the total cost of the adjudication equally or unequally between the parties as part of the final Determination and Order.

For more information on Prompt Payment Construction Adjudication or how to initiate the adjudication process, please consult the drop down menus above or contact an agent by emailing arcana@adralberta.com

Quick Facts

These legislative changes, passed in the fall 2020 and spring 2021 sessions, are now in force:

  • A new adjudication process for the construction industry to address payment disputes.
  • 28 calendar-day timelines for owners to pay proper invoices from general contractors.
  • Contractors and subcontractors are required to pay their own subcontractors within seven calendar days of being paid themselves.

Extended timelines (in calendar days) for registering liens from:

  • 45 days to 60 days for the construction industry
  • 45 days to 90 days for suppliers within the concrete industry only
  • The oil and gas lien period remains at 90 days.

New language has been added around public-private partnerships:

  • Prompt payment rules only apply to construction, not operations and maintenance.
  • Municipal public works projects are subject to prompt payment legislation, but provincial government projects under the Public Works Act are not.
  • Clarification was added that the prompt payment rules apply to professional consultant (engineers and architects) contracts.