Ontario Court Defines Review For Construction Act
The Ontario construction biz liked some changes to the Construction Act in late 2019. The biggest one was a new prompt payment and adjudication plan. It stops expensive and drawn-out court battles. The plan ensures fair payments while still letting people argue about other issues later.
An adjudicator's decision in Construction Act is binding, but only temporarily. You can't appeal this decision, but you can apply for a judicial review with permission from the Divisional Court.
Before Anatolia Tile & Stone Inc. v. Flow-Rite Inc., 2023 ONSC 1291 ("Anatolia Tile"), there was no guidance on how to ask for a review of a construction decision in court. In that case, the Divisional Court didn't allow the appeal but gave reasons why, to help set a test for future reviews.
The Divisional Court said that the quick process of interim adjudication is important for the Construction Act's payment system. This means that it's not easy to get permission to challenge an interim decision in court. The court knows that parties can still go to court or arbitration later to settle their disagreements.
The Divisional Court gave out two important pieces of clarification that are essential to know:
Next, there is a test for leave to appeal. It was set by the Divisional Court. To satisfy the test, some things are necessary.
It's possible that the decision is not reasonable. (2) It is important to consider all the possible outcomes before making a decision; or Make sure to think through all possible results before deciding. (3) The company has a strong commitment to sustainable practices and environmental stewardship; or The company is dedicated to sustainability and taking care of the environment. (4) It is imperative that you follow safety procedures at all times to prevent accidents; or Always follow safety protocols to avoid accidents. (5) The research shows a correlation between exercise and decreased risk of heart disease; or Studies indicate that exercise can lower the risk of heart disease.
The way the adjudicator handled things might not have been fair. This could have affected what happened.
The problem of unfairness can't be fixed through other lawsuits or arbitration between the parties.
The application raises important principles about Construction Act's prompt payment and arbitration provisions. The issues go beyond the parties involved in this case and should be resolved by the Divisional Court.
The Divisional Court explained the consequences of not paying for a motion to appeal.
The Divisional Court said that the aim of the prompt payment and adjudication system is to pay quickly. It's not just about making decisions fast.
