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Trisura Reviews Construction Lien Act (Bill 142)


December 8, 2017   by Trisura Guarantee Insurance Company

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Canadian Surety Brokers and Bill 142

TORONTO, Dec. 8th, 2017 /insPRESS/ – The Construction Lien Act, Bill 142, which recently passed after an 87-0 vote in the Ontario Legislature brings about several long awaited improvements for the Ontario construction industry. While the new legislation is limited to Ontario, it has the potential for national ramifications as other provinces continue to update their lien acts which include grappling with prompt payment.

The new legislation presents a significant opportunity for brokers to assist their clients in understanding and navigating some of the potential impacts that the new legislation may have.

Here is a basic rundown of Bill 142:

  • Long overdue updates to 35 year-old legislation that includes payment protection throughout the construction pyramid
  • Contractors and sub-contracts now have security and assurance regarding timelines for payment
  • Mandatory performance and payment bonds on publicly funded projects over a threshold contract price (similar to the Miller Act in the United States)
  • The adjudication process will now provide an opportunity for resolution of construction disputes without disruption of project schedule and will assist in avoiding costly legal battles
  • No-exceptions rule to hold-back release deadlines means a no-exceptions rule to when contractors and sub-contractors get paid
  • Mandatory payment protection for sub-trades

Not only does this present an opportunity for brokers to lead the discussion with existing clients on how the above will impact their business but it will result in a new group of contractors reaching out for brokers support and advice in preparing to provide bonds where they otherwise may not have been required in the past. This is a generational opportunity that has the potential to increase the Ontario surety premium pool in a material way.

Early in the lien act review process, The Surety Association of Canada commissioned a report by The Canadian Centre for Economic Analysis (CANCEA) which provided an impartial look at the value of surety bonds in Canada. The findings strongly supported the economic value of surety bonds in protecting the construction process and the wider economy. This report was instrumental in demonstrating the value of our industry’s primary product. Throughout this process, Trisura has had members of various working groups participating in discussion and development related to the surety bonds and their role in the lien act review. We are certainly excited at the outcome and look forward to further developments as regulations are crafted, as this is where all the details will be contained about the new act.

As the construction landscape continues to shift, Trisura continues to innovate with new offerings like our e-bond Platform which was launched in 2017 to provide Trisura brokers and contractors access to a free online platform to procure their electronic bonds. We’ve also developed the Contractors Bond Program which provides brokers with the ability to obtain modest surety credit for their clients through a streamlined, online process. As always, we remain committed to you, our broker partners, and the Canadian construction industry as a whole and look forward to supporting you through this transition.

For further information on the Construction Lien Act review and Trisura offerings, click on any of the following valuable links:


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