Payment Certifier and Contract Considerations in Construction Projects
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Questions and Answers

What is the purpose of the Builders Lien Act according to the text?

  • To encourage lawsuits between contractors and subcontractors.
  • To secure financial interests of contractors and workers until they are fully paid. (correct)
  • To ensure that all improvements are done for free.
  • To provide security to architects and engineers only.

    • What is the ultimate remedy available to lien claimants who remain unpaid?

  • Seeking alternative dispute resolution.
  • Negotiating a new contract with the owner.
  • Court-supervised sale of the lands. (correct)
  • Initiating a lawsuit based on the contract.

    • Which of the following interests cannot be liened under the Builders Lien Act?

  • Highways or roads
  • Leases
  • Provincial Crown and municipal lands
  • Federal Crown interests (correct)

    • Who has lien rights for their services under the Builders Lien Act?

    <p>Architects and engineers with a 'prime' consulting contract</p> Signup and view all the answers

    What do lien claimants need to rely on in the absence of the Builders Lien Act?

    <p>Their contractual rights through lawsuits</p> Signup and view all the answers

    Which types of interests can the lien security created by the Act attach to?

    <p>Nearly all registered or equitable interests in land</p> Signup and view all the answers

    How is 'completed' defined under the Act?

    <p>When substantially completed or performed</p> Signup and view all the answers

    What is the purpose of a 'threshold formula' mentioned in the text?

    <p>To prevent premature or frivolous applications for completion</p> Signup and view all the answers

    When can the relevant lien holdback be safely released according to the text?

    <p>After 55 days of abandonment or termination of the head contract</p> Signup and view all the answers

    What is the significance of missing or defective items in an improvement, as mentioned in the text?

    <p>They may jeopardize the performance of the improvement</p> Signup and view all the answers

    What must architects be aware of in order to properly certify completion of a subcontract?

    <p>The subcontract's terms</p> Signup and view all the answers

    When can the owner's holdback from the contractor be progressively released according to the text?

    <p>55 days after the head contract meets the statutory definition of 'complete'</p> Signup and view all the answers

    What does the 'certification of completion for lien purposes' entail according to the text?

    <p>It requires a different analysis than other certifications</p> Signup and view all the answers

    When must a lien be filed in the case of a single contractor (head contractor) engaged to do substantially all the work?

    <p>45 days after substantial completion of the head contract</p> Signup and view all the answers

    In which situation is the lien filing deadline not based on the completion of a 'head contract'?

    <p>Owner sells the strata lot</p> Signup and view all the answers

    What is the cost of filing a lien at the Land Title Office?

    <p>$5 per title</p> Signup and view all the answers

    What action will cause a lien to be automatically extinguished?

    <p>Not initiating a lawsuit to enforce the lien within one year</p> Signup and view all the answers

    When does the issuance of a Certificate of Completion trigger the lien filing period?

    <p>When requested by the contractor or subcontractor</p> Signup and view all the answers

    What is required to retain lien holdback monies by both owners and contractors?

    <p>Depositing the monies into a dedicated trust account</p> Signup and view all the answers

    In what situation will the issuance of a Certificate of Completion not extend the lien and holdback periods?

    <p>When completion has already occurred according to Act definitions</p> Signup and view all the answers

    What is architects' responsibility regarding legal disputes between owners, contractors, and subcontractors?

    <p>To remain neutral and not 'take sides'</p> Signup and view all the answers

    'Payment certifier' architects may find themselves responsible for preparing what under the Act?

    <p>A Certificate of Completion</p> Signup and view all the answers

    In construction management projects with multiple contracts, when should a lien be filed?

    <p>45 days after substantial completion of the improvement</p> Signup and view all the answers

    Who is responsible for requesting the publication of an advertisement of completion?

    <p>The owner</p> Signup and view all the answers

    What is the importance of using forms of agreement consistent with provincial legislation?

    <p>To ensure the agreement is legally binding</p> Signup and view all the answers

    What does the term 'lien holder' refer to under the Act?

    <p>A person entitled to a lien</p> Signup and view all the answers

    When is the builders lien holdback typically triggered in a construction contract?

    <p>Once triggered by Substantial Performance of the work</p> Signup and view all the answers

    In what situation do CCDC 5A, 5B, and 17 contracts attract their own holdback trust account?

    <p>When handled on their own merits</p> Signup and view all the answers

    Under what circumstances do the Act's holdback provisions not apply?

    <p>When a design-build stipulated price contract is used</p> Signup and view all the answers

    Which type of construction contracts are CCDC 2 and CCDC 3 considered to be?

    <p>Stipulated Price Contracts</p> Signup and view all the answers

    What is General Condition 5.6 under CCDC 2 2008 related to?

    <p>Builders Lien Holdback Release</p> Signup and view all the answers

    What is the main purpose of the standard owner/contractor form of contract?

    <p>To enable consistent lien holdback percentage stipulation</p> Signup and view all the answers

    What additional action might be required to use CCDC 3 with BC lien legislation?

    <p>Supplementing the standard form of agreement</p> Signup and view all the answers

    If a project owner is the provincial government, to whom does the holdback interest accrue after the holdback period expires?

    <p>Contractor</p> Signup and view all the answers

    Who is responsible for the administration of holdback trust accounts as per the text?

    <p>Owner</p> Signup and view all the answers

    Who can be designated as the payment certifier as per the Act?

    <p>Architect, engineer, or other person</p> Signup and view all the answers

    What entities are exempted from the requirement to open a holdback account as per the Builders Lien Public Bodies Holdback Exemption Regulation?

    <p>Local governments, school boards, colleges and universities</p> Signup and view all the answers

    What additional duties and responsibilities does the Act mention with regard to payment certification?

    <p>Multiple holdbacks, formula for completion determination, time lines for certification</p> Signup and view all the answers

    Who should act as the payment certifier for subcontracts according to common practice mentioned in the text?

    <p>Head contractor and owner acting together</p> Signup and view all the answers

    How can a role as a payment certifier be acquired according to the text?

    <p>&quot;By specific inclusion in the client-architect agreement&quot;</p> Signup and view all the answers

    "What happens if an architect issues only a 'Certificate of Completion' without being the payment certifier throughout a project?"

    <p>&quot;Not fulfilling statutory obligations&quot;</p> Signup and view all the answers

    What is NOT an exemption from opening a holdback account?

    <p>Architect.</p> Signup and view all the answers

    What is one of the two important caveats to an architect’s lien rights mentioned in the text?

    <p>Architects or engineers engaged by each other do not have lien rights against each other.</p> Signup and view all the answers

    What did British Columbia’s courts rule regarding architects' lien rights in relation to construction commencement?

    <p>Lien rights are contingent upon construction having commenced.</p> Signup and view all the answers

    What does the Act define as an 'improvement' regarding architects' lien rights?

    <p>Any work done, alteration, or addition to land.</p> Signup and view all the answers

    What is the purpose of a lien holdback according to the text?

    <p>To address incomplete work or deficiencies in construction.</p> Signup and view all the answers

    Who is entitled to share pro rata in a fund when claiming under the same contractor or subcontractor?

    <p>All unpaid lien holders except workers.</p> Signup and view all the answers

    What does 'services' include under the Act regarding lien rights?

    <p>'Services' encompass work provided by architects or engineers before construction begins.</p> Signup and view all the answers

    What qualifies as a contractor under the Act in relation to lien rights?

    <p>'Contractor' is someone engaged by an owner concerning an improvement project.</p> Signup and view all the answers

    What are 'subcontractors' defined as under the Act regarding lien rights?

    <p>'Subcontractors' refer to persons engaged by a contractor or another subcontractor for work on an improvement project.</p> Signup and view all the answers

    What percentage must owners and contractors retain as holdbacks under the Act?

    <p>10</p> Signup and view all the answers

    'Improvement' includes which of the following under the Act regarding lien rights?

    <p><strong>Physical alterations</strong> made on land.</p> Signup and view all the answers

    Why is it recommended to use the standard General Condition 3.7 of CCDC-2/08 according to the text?

    <p>To ensure proper review and certification based on subcontract terms</p> Signup and view all the answers

    What is the architect's role when subcontracts involve work largely of an engineering nature?

    <p>To rely on the project's professional engineer(s)</p> Signup and view all the answers

    Why are schedules of values required to be prepared by the 'parent' contractor according to the text?

    <p>To represent subcontract prices accurately</p> Signup and view all the answers

    When is it possible to receive numerous applications for certification of completion by every subcontractor?

    <p>When there are tight deadlines and coincidental timelines</p> Signup and view all the answers

    What is the specific lapse of time within which a payment certifier must respond to an application for certification of completion according to the text?

    <p>10 days</p> Signup and view all the answers

    What happens if the payment certifier fails to deliver copies to relevant parties within 7 days of certifying a contract complete?

    <p>Exposure to liability</p> Signup and view all the answers

    Why does the architect not undertake to be the payment certifier for subcontracts largely of an engineering nature?

    <p>'Parent' contractors are better suited for this role</p> Signup and view all the answers

    What is one reason for separate certification of completion for some subcontractors mentioned in the text?

    <p>'Parent' contractor's coordination needs</p> Signup and view all the answers

    Why does the text emphasize that schedules of values need to be accurately prepared by the 'parent' contractor?

    <p>'Parent' contractor's general conditions representation</p> Signup and view all the answers

    What could be a consequence of overloading the payment certifier(s) with numerous applications for completion certifications?

    <p>Counter-productive outcomes and delays</p> Signup and view all the answers

    What legal obligation does an architect have towards a subconsultant?

    <p>To pay the subconsultant monies due under the agreement</p> Signup and view all the answers

    Under what circumstances is an architect not subject to builders lien holdback?

    <p>When the architect is a prime consultant engaged by a client</p> Signup and view all the answers

    What ethical duty does an architect have even if paid by their client for the subconsultant's earnings?

    <p>To pay the corresponding monies to the subconsultant</p> Signup and view all the answers

    What is emphasized as important for architects when reviewing construction for conformance?

    <p>Rendering decisions impartially</p> Signup and view all the answers

    What is NOT a part of the standard references on contract administration mentioned in the text?

    <p>CCDC-25 A Guide to Payment Processing</p> Signup and view all the answers

    What do architects rely on in order to stay informed about laws applicable to their profession according to the text?

    <p>Other knowledgeable professionals and qualified persons</p> Signup and view all the answers

    What must architects do when reviewing construction for conformance, according to the text?

    <p>Render decisions impartially</p> Signup and view all the answers

    What does the Practice Guideline recommend architects do in terms of obtaining legal advice?

    <p>Obtain legal advice and consult with professional liability insurers</p> Signup and view all the answers

    What should architects do in light of changes to legislation according to the text?

    <p>Consult their own legal, accounting, or insurance representatives for professional advice</p> Signup and view all the answers

    What is the ethical duty of an architect, even if they have been paid by their client for the subconsultant's earnings?

    <p>To pay the corresponding monies to the subconsultant.</p> Signup and view all the answers

    What does an architect's legal obligation entail in relation to a subconsultant?

    <p>To fulfill the agreement by paying monies due under the agreement.</p> Signup and view all the answers

    When reviewing construction for conformance, what must architects do according to the text?

    <p>Keep apprised of laws applicable to their profession and render decisions impartially.</p> Signup and view all the answers

    What is emphasized for architects in terms of legal disputes between owners, contractors, and subcontractors?

    <p>Maintain impartiality and stay informed about laws applicable to their profession.</p> Signup and view all the answers

    What is one of the responsibilities of architects regarding construction conformance reviews?

    <p>To render decisions impartially and keep apprised of laws applicable to the practice of their profession.</p> Signup and view all the answers

    What should architects do in light of changes to legislation according to the text?

    <p>Obtain legal advice and consult with their professional liability insurers.</p> Signup and view all the answers

    When do architects have an ethical duty to pay corresponding monies to a subconsultant?

    <p>Regardless of whether they have been paid by the client for the subconsultant.</p> Signup and view all the answers

    'Payment certifier' architects may find themselves responsible for preparing what under the Act?

    <p>'Certificate of Completion' only.</p> Signup and view all the answers

    What is NOT a reason for separate certification of completion for some subcontractors mentioned in the text?

    <p>To expedite payment processes by applying general completion certificates</p> Signup and view all the answers

    What is an architect's ethical duty when they have been paid by their client on account of a subconsultant's earnings?

    <p>To pay the corresponding monies to the subconsultant.</p> Signup and view all the answers

    What is the legal obligation of an architect towards a subconsultant?

    <p>To pay the subconsultant monies due under the agreement.</p> Signup and view all the answers

    What role should architects undertake regarding legal disputes?

    <p>Stay neutral and not get involved in legal disputes.</p> Signup and view all the answers

    What must architects do when reviewing construction for conformance, as per the text?

    <p>Render impartial decisions and consider applicable laws.</p> Signup and view all the answers

    Why are architects encouraged to obtain legal advice, according to the text?

    <p>To avoid legal disputes and ensure compliance with laws.</p> Signup and view all the answers

    'Completed' under the Act is defined as:

    <p>'Completed' based on substantial performance without defects.</p> Signup and view all the answers

    What is one of the reminders given to architects regarding their decisions when reviewing construction for conformance?

    <p>They must keep apprised of laws applicable to their profession while reviewing conformance.</p> Signup and view all the answers

    What is one significant aspect of architects' responsibility mentioned in the text?

    <p>They need to render impartial decisions while reviewing construction conformance.</p> Signup and view all the answers

    When should architects rely on other knowledgeable professionals and qualified persons, according to the text?

    <p>When it benefits the project and helps ensure compliance.</p> Signup and view all the answers

    Why are architects recommended to consult with their professional liability insurers?

    <p>To ensure they have adequate insurance coverage.</p> Signup and view all the answers

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