WC136 MayJune 2024 - Magazine - Page 9
A provision in a contract that makes
the giving of a proper invoice
conditional
prior certification
A provision in a contract that
makeson
thethegiving
of a proper
of a person or approval of the owner
invoice conditional on the prior certification
of a person or
is no longer enforceable.
approval of the owner is no longer enforceable.
Getty Images
For companies entering into drinking water treatment, wastewater treatment, and even hydroelectric construction projects, it is important to understand
the construction law in the province or territory where the work is being done.
further transparency and efficiency in the invoicing and billing
process. It is important to note that, as a result of the amendments, a provision in a contract that makes the giving of a
proper invoice conditional on the prior certification of a person or approval of the owner is no longer enforceable.Notably,
the new legislation provides an adjudication system to resolve
payment disputes (amongst other common disputes) on construction projects. Adjudications will be decided by adjudicators appointed by a “Nominating Authority”, and the PPCLA
provides for an expedited decision making process. Approved
Nominating Authorities include the ADR Institute of Alberta
and the Royal Institute of Chartered Surveyors. At the time of
this writing, we understand that cost schedules are now available from these entities, and that initial adjudication requests
are being seen in the residential market. Contracting parties
should ensure their agreements integrate the adjudication
process with existing alternative dispute resolution processes,
and once work is started ensure project personnel are alert to
the aggressive timelines created by the PPCLA. While the
process is intended to be informal, we recommend that parties
seek legal advice prior to engaging the adjudication process.
Mistakes may result in wasted time from a poorly selected
process, or worse, adjudication decisions which are not easily
WAT E R C A N A D A . N E T
challenged via other legal processes. Fortunately, as case law continues to emerge from Ontario, parties in Alberta will have more
ability to make informed decisions. Overall, we view adjudication as
one more helpful tool in a construction lawyer’s arsenal, to be used
in the appropriate circumstances.The foregoing amendments have
required parties in the construction industry to redefine their billing
and payment procedures to ensure compliance with the PPCLA.
Amendments to commonly used contract forms such as the CCDC
have been required to align contractual terms with the PPCLA. As
we come up on the two year anniversary since the PPCLA took
effect, parties need to be mindful of the transitional provisions
contained in the PPCLA and their effect on contracts entered into
prior to the PPCLA coming into force. More specifically, contracts
entered into prior to August 29, 2022 and lasting longer than two
years, have two years to be brought into compliance with the PPCLA. As such, parties need to review their construction contracts and
project agreements with an effective date prior to August 29, 2022,
which will continue to be in force after August 29, 2024 to ensure
such agreements will be in compliance and align with the provisions
of the PPCLA by August 29, 2024.
As the contracting environment continues to change and evolve,
all parties involved in water projects need to be mindful of both legislative changes and the case law that fleshes them out.
