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The Government of Canada, through Public Services and Procurement Canada (“PSPC”), announced on August 2, 2018 that the executive summary of the report prepared by Bruce Reynolds and Sharon Vogel of Singleton Urquhart Reynolds Vogel LLP (“Singleton Reynolds”) titled Building a Federal Framework for Prompt Payment and Adjudication, is now public. The executive summary is available here. The full report is available upon request by making a request here.
Singleton Reynolds was retained in January of this year in order to conduct an expert review which included a series of stakeholder engagement sessions and the development of a recommendations package for the federal government regarding promptness of payment and adjudication in relation to federal construction projects (“Federal Review”).
The team held 55 stakeholder engagement sessions with over 500 participants across Canada between March 6 and April 25, 2018 which resulted in positive dialogue with all levels of the construction pyramid. Following those sessions, formal submissions were received from some stakeholders as well as a variety of letters of support from local associations or member associations’ for submissions made at the national level.
The feedback received became the basis for the recommendations package (in the form of a report), which was delivered to PSPC on June 8, 2018. The package includes 53 recommendations in relation to the introduction of prompt payment and adjudication legislation.
“It has been an honour to have been involved in this federal initiative and to have had the opportunity to engage with stakeholders and PSPC to create this recommendation package,” said Vogel.
“We’re just starting to see the changes to the Ontario Construction Act roll out,” commented Reynolds, “and the Government of Canada will be moving ahead with its legislation in the Fall. At the same time, other Provinces and Territories are considering the issue of prompt payment and adjudication, and the leadership role undertaken by the federal Government will be an important factor in the evolving situation.”
Since the early 1980s, Ontario’s Construction Lien Act (the Act) had not been holistically reviewed, due in part to a lack of industry consensus. Latterly, a movement had emerged that strongly advocated the legislation of prompt payment.
In early 2015, the Province of Ontario retained us to conduct an expert review (Review), which was to include broad consultation focusing on the issues of modernization, promptness of payment, and efficiency of dispute resolution.
The issue was a) how to conduct an effective consultation process with the construction industry, including contractors, subcontractors, organized labour, suppliers, public and private owners, and others, b) how to identify and properly consider all the relevant issues, and c) how to produce a report that was appropriate to our mandate.
We proceeded to develop a Stakeholders List, and an Issues List, and provide the Stakeholders an Information Package. We then received Stakeholder Submissions and held 30 Consultation Meetings with over 60 Stakeholder groups. As the Review progressed, and the number and the complexity of issues grew, we convened a 15-member expert Advisory Group to discuss the key issues, while direct Stakeholder consultations continued in parallel. On April 30, 2016, we delivered our Report, titled “Striking the Balance”, making 101 recommendations, including the adoption of prompt payment and statutory adjudication in Ontario.
Following the delivery of our Report and its release to the public, the Attorney General conducted a series of feedback meetings that confirmed the existence of a broad industry consensus regarding the recommendations. Subsequently, the Ontario Cabinet approved 98 of the 101 recommendations we had made, and the Attorney General continued our retainer to work with his Ministry to develop draft legislation implementing the approved recommendations.
On May 31, 2017, the Attorney General introduced Bill 142 (the Construction Lien Amendment Act, 2017) for First Reading. Following a further round of consultations, Second Reading on October 4th, and the hearings of the Standing Committee of the Legislative Assembly held in October and November, the Bill was unanimously passed by the Ontario Legislative Assembly on December 5th and the new Construction Act received Royal Assent on December 12, 2017. The modernization provisions take effect on July 1, 2018, while the prompt payment and adjudication provisions take effect on October 1, 2019.