Frivolous Lien Results in Costs Against the Lien Claimant Of $130,000!

Date: June 2023

A recent decision from Associate Justice Wiebe serves as a clear reminder that registering a lien without merit can lead to significant cost consequences. In this case, following a finding that a lien claimant had registered a frivolous and vexatious claim for lien, parties were instructed to provide cost submissions.

With an upcoming sale of the property, the multi-million dollar lien was a significant problem. This fact, among others, resulted in the lien claimant being held liable for substantial indemnity costs.

The court emphasized that such conduct warrants severe sanctions, and in this instance, the lien clamant was ordered to pay costs to both moving parties.

Furthermore, the court pierced the corporate veil and held the individual who controlled the lien claimant, personally responsible for the costs incurred by the moving parties – and on a substantial indemnity basis pursuant to s. 86(1)(b) of the Construction Act.

The registration of a lien should not be done lightly and this case serves as a good reminder of why.

Click here for a link to the decision.

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