BC Builders Lien Act — Buyer Risk Reference

The three numbers

Worked examples

Frequently asked questions

• What is a builder's lien?

  A builder's lien is a charge registered against a property's title under the BC Builders Lien Act (SBC 1997, c. 45) by a contractor, sub-trade, worker, or material supplier who has not been paid for work or materials supplied to that property. Once registered in the Land Title Office, a lien encumbers the title — the owner cannot sell or refinance with clean title until the lien is paid out, posted off (security replaces the lien), or expires. For a buyer, a builder's lien on title is the kind of issue that delays or kills a closing.

• How long do contractors have to file a lien?

  45 days. The lien-claim period under section 20 of the Act runs 45 days from substantial completion (or abandonment) of the head contract — or, for contracts where a payment certifier issues a certificate of completion, 45 days from that certificate. After the 45-day window expires WITHOUT a lien being filed, the lien right is extinguished. This is why the 55-day post-completion holdback release is the buyer-side milestone that matters: 45-day filing window + 10-day cushion = clean title becomes provable.

• What is the 10% statutory holdback?

  Under section 4 of the Act, owners and head contractors must retain 10% of every progress payment to a contractor and continue holding it until 55 days after substantial completion of the head contract. The holdback funds are the source the lien claimant gets paid out of when a lien is filed — and the size of the holdback is the maximum lien exposure for the head contract chain (subject to certain rules). For a buyer of a recently-renovated home, the question to ask the seller is: was the holdback retained AND held until day 55 AND is the renovation past day 55 AT closing?

• I'm buying a recently-renovated home. What do I ask my lawyer?

  Three questions: (1) When was the renovation work substantially complete? (2) Has the 55-day holdback release date passed? (3) Is the title clear of any builder's lien at the date of closing? Your lawyer's standard practice is to do a Land Title search at the time of closing, but the timing of when in the day that search is done — relative to filings made the same day — is what matters. Ask your lawyer to do the title search as close to funding as practically possible (typically within hours of the actual completion), and to walk you through the result before they release funds.

• I'm buying a new build from a developer. Different rules?

  Same Act, different mechanics. For a new build, the developer is the head contractor (or has hired a head contractor). The 45-day clock typically runs from the certificate of completion issued by the project's payment certifier. The developer's lawyer is responsible for clearing any liens at the time of conveyance to you — but a buyer's lawyer should still do an independent title search at closing to confirm. New-build closings have additional complications around 2-5-10 New Home Warranty, deposit insurance, and possessory occupancy rights that interact with the lien framework; these are worth asking about specifically.

• I'm the buyer at completion and there IS a lien on title. What happens?

  Your lawyer flags it BEFORE funds release. You have several options: (1) The seller pays the lien out from sale proceeds (most common path — the lien is simply paid off at closing, and the title clears as part of conveyance). (2) The seller posts security to vacate the lien (a cash deposit or bond replaces the lien on title, the lien is removed, and the dispute continues separately between the seller and the lien claimant). (3) The closing is delayed until the lien is resolved. (4) You walk from the deal and recover your deposit (subject to the contract terms and any subject removal that occurred). What you do NOT do: complete the purchase with the lien still on title and your funds released — the lien follows the property, not the seller.

• How do I check for liens before I make an offer?

  Order a Land Title search through your realtor or notary — costs around $10–15 via the BC Online registry and shows every charge currently registered against title. A pre-offer title search is a cheap diligence step that catches obvious issues (existing liens, easements, restrictive covenants, prior judgments) before you write. For renovated homes specifically, ask the seller in writing: when was the renovation work completed, who was the head contractor, and has the holdback been retained and held to the 55-day release date. Document the answers — they're evidence if a dispute arises later.

• Does the lien framework apply to my home repairs (e.g., a kitchen reno)?

  Yes if the repair is "improvement" to the land under the Act — most major renovations qualify. As an owner contracting renovation work, you (the homeowner) are responsible for retaining the 10% statutory holdback from each progress payment to your contractor and continuing to hold it for 55 days after substantial completion of the work. Many homeowners do not retain the holdback because the contractor's invoice does not separately itemize it — but the Act applies regardless. If you sell the home before the 55-day window has cleared on a recent renovation, you may need to retain the holdback in trust through closing or post security to allow conveyance.

• Builder's lien vs. Mechanics' lien — same thing?

  In BC, "builder's lien" is the statutory term used in the Builders Lien Act. "Mechanic's lien" is the older term and the one used in some other Canadian provinces (and historically in BC before the 1997 Act consolidated the prior framework). They refer to substantively the same kind of charge — a non-consensual charge on real property to secure unpaid contractor and material-supplier amounts. In BC documentation post-1998, use "builder's lien" — it's the current statutory term and the search keyword that returns the relevant Land Title Office records.

Related

• · BC buyer due-diligence checklist — the 12-step pre-offer + subject-removal framework
• · BC closing costs — every dollar a BC buyer pays at completion
• · BC Property Transfer Tax — the largest closing line item
• · BC Transit-Oriented Development Areas — lien diligence on TOD-area new builds
• · Glossary — Builder’s lien
• · Glossary — Material latent defect — a parallel buyer-side disclosure obligation
• · Glossary — Property Disclosure Statement — where seller-side renovation history is documented
• · Closing-day cash calculator — budget for the holdback-in-trust scenario
• · Codex — Builders Lien Act overview
• · BC Real Estate Codex