March 19, 2012
CCA Conference Blog: The Changing Face of Construction Law
The Changing Face of Construction Law was one of the first topics tackled in a session on Monday, March 12th at the Canadian Construction Association annual conference in Savannah, Georgia.
Richard Shaban of Borden Ladner Gervais LLP was the moderator of the panel, with Yvan Houle, James W. Maclellan and John Melia also participating.
Yvan Houle started with “the changing face of friends with benefits.” He immediately addressed the charges of corruption in the Quebec construction industry and said the Quebec government has responded to public pressure with a series of measures to eliminate corruption.
Houle said statutory requirements are in place so that a license is issued only if a company can establish it is financially viable, that they have a licensing bond, and that they have not been found guilty of certain expressly defined infractions.
Directors must not be acting for someone else, and cannot have acted as directors of another corporation that was declared bankrupt.
Violations of these rules can lead to a repeal of the license.
People applying for licenses can also not be found guilty of an infraction to tax related statutes, or have a criminal offense related to construction industry activities. The test of the law is if the offense is related to those construction activities.
Bill 35, enacted in December 2011, has increased sanctions for license holders. License holders, shareholders, lenders and directors must all now disclose past offenses. Additionally, license will automatically be restricted where a corporation is found guilty of certain tax related offences.
In regard to bids, bidders must disclose communication they have had with competitors in preparation for their bids.
The next topic was Project Security. James MacLellan said certainty is the cornerstone of project security.
A Performance Guarantee is the standard instrument for security, and there are on-default instruments vs on demand.
Performance bonds are tied into the contract, and non-standard contract forms can create uncertainty around the bond.
Collateral contractual obligations include liquidated damages, loss of revenue related to delayed completion, loss of funding due to delayed completion and even a ‘key person’ provision.
The surety industry is responding with an enhanced performance bond, and there is a movement afoot to create P3 bonds.
The next topic was the changing face of tendering process. Moving to an electronic process will eliminate many delays and other old bottlenecks. Online transactions follow the familiar “paper process” but will be signed with digital signatures, and that information is encoded in the bond and can be verified and audited. There is no longer a need for a courier to deliver the bond as it will be delivered electronically.
The changing face of the Canada Revenue Agency was the final topic, which has a new mandate to collect every cent possible and not negotiate. This is an issue the Canadian Construction Association is aggressively getting in front of, Shaban said. ..dThere have been discussions to see if there is some way to introduce some measure that ensures balance and keeps rogue elements out of the mix. Michael Atkinson said that the ministry of revenue in Quebec has even stronger powers.
|MOST POPULAR STORIES|
|TODAY’S TOP CONSTRUCTION PROJECTS|
These projects have been selected from 479 projects with a total value of $1,224,678,004 that Reed Construction Data Building Reports reported on Wednesday.
$80,000,000 Calgary AB CANCELLED/ DEFERRED
$33,500,000 Port Moody BC Prebid
$30,000,000 Calgary AB CANCELLED/ DEFERRED
- Journal of Commerce Preview for the week of April 28th, 2014
- Merit Contractors Association president announces retirement
- Truss Lift
- B.C. government reverses sweet gas deregulation
- CCA looking to engage Aboriginal communities with new taskforce
- Pembina Pipelines building regional headquarters in Alberta
- Biomaterials growing on construction
- Manitoba town is a design showcase
- Saskatchewan wind project moves forward
- Suncor worker death investigated
- Olympic builders return to the job
- Having a blast on the job — demo with finesse
- Does a roadmap to a sustainable future exist?
- Work complete on South Kent Wind project
- Draft standard for snow loads on buildings in northern Canada open for feedback
- Community murals brighten up construction hoarding on TTC projects
- Protecting endangered species a focus on Highway 15 work
- Intricate demolition saves venerable newspaper building façade
- London Roundhouse project takes selective demolition to high art
- London hospital tear down not your average demo
- Strategic demolition repurposes Bowater Mersey paper plant
- Barn razing: demolition of Charlottetown racehorse stables
- Incarceration gives way to innovation at Bridgepoint
- Breaking good: National Demolition Association updates safety manual
- Droppings responsible for respiratory illness at Quebec demolition site
- Innovative storm water solution under Denison Road