What principles do the courts use to determine whether a lien holder has a claim against an owner for a holdback retained by a contractor after the expiration of the statutory period?
Saskatchewan, Canada
The following excerpt is from Smithson v. M. L. Plumbing & Heating Ltd., 1977 CanLII 1461 (SK CA):
Among the principles decided by Doig v. Stehn, only two are material to this case: (i) Where a lien claimant makes a claim against an owner for his pro rata share of the holdback retained by that owner from his contractor (as is the situation here), the term “statutory period” as used in s. 37(2) (b) means the owner-contractor statutory period and not the contractor-subcontractor statutory period (see Lamont J.A. at p. 1170). For our purposes then, the expression “after the expiration of the statutory period” as used in s. 37(2) (b) means “after 14th February 1975”. (ii) A premature payment of the holdback does not give a lienholder any greater right than he would have had the owner retained the money for the statutory period and then made the payment.
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