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Conditional Lien Waiver for Canada

Conditional Lien Waiver Template for Canada

A Conditional Lien Waiver is a legal document used in Canadian construction projects that provides a conditional release of lien rights in exchange for payment. The document serves as a formal acknowledgment that, upon receipt of specified payment, the signing party waives their right to file a construction lien for work completed or materials supplied up to a specific date. This document is governed by provincial construction lien legislation, such as Ontario's Construction Act or similar legislation in other provinces, and must comply with specific provincial requirements for validity. It provides protection for both paying and receiving parties by ensuring that payment and lien release are synchronized.

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What is a Conditional Lien Waiver?

The Conditional Lien Waiver is a fundamental document in Canadian construction project management, used to facilitate smooth payment processes while protecting the rights of all parties involved. This document becomes necessary when contractors, subcontractors, or suppliers are receiving payment for completed work or supplied materials and need to provide assurance that they will not file a construction lien once payment is received. The conditional nature of the waiver means that the lien rights are only released when the specified payment is actually received and cleared, providing protection for the waiving party. The document must comply with provincial construction lien legislation, which varies by jurisdiction but generally follows similar principles across Canada. Conditional Lien Waivers are particularly important in larger construction projects where multiple parties are involved in the payment chain and clear documentation of lien releases is essential for project financing and risk management.

What sections should be included in a Conditional Lien Waiver?

1. Project Identification: Details of the construction project including project name, address, and any relevant project numbers or identifiers

2. Parties: Identification of the waiving party (contractor/subcontractor/supplier) and the party receiving the waiver (owner/contractor)

3. Payment Details: Specific information about the payment amount, invoice references, and payment period covered by the waiver

4. Waiver Statement: Clear statement of the rights being waived, specifically referencing lien rights and claims

5. Conditional Terms: Explicit conditions that must be met for the waiver to become effective, typically receipt and clearance of payment

6. Reservation of Rights: Statement preserving rights for retention amounts, unbilled changes, and future claims

7. Certification: Declaration of authority to execute the waiver and truth of statements made

8. Execution: Signature block with date and title of signing authority

What sections are optional to include in a Conditional Lien Waiver?

1. Prior Rights Preservation: Section preserving rights from prior projects or unrelated work - include when the waiving party has multiple ongoing projects with the same party

2. Through-Date Statement: Specific statement of the date through which the waiver applies - include when dealing with progress payments

3. Notarization Block: Space for notary acknowledgment - include when required by jurisdiction or specified in the primary contract

4. Additional Beneficiaries: List of additional parties benefiting from the waiver - include when there are multiple beneficiaries such as lenders or sureties

What schedules should be included in a Conditional Lien Waiver?

1. Schedule A - Payment Details: Detailed breakdown of payment amounts, including any specific invoices or payment applications covered

2. Schedule B - Project Scope: Description of work or materials covered by the waiver, particularly important for partial waivers

3. Schedule C - Outstanding Claims: List of any preserved claims or disputed amounts not covered by the waiver

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Canada

Publisher

Ƶ

Document Type

Release of Lien

Cost

Free to use
Relevant legal definitions

























Clauses


















Relevant Industries

Construction

Real Estate Development

Infrastructure

Commercial Property

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Residential Development

Mining

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Relevant Teams

Legal

Finance

Operations

Project Management

Contract Administration

Risk Management

Procurement

Accounts Payable

Commercial

Development

Relevant Roles

Project Manager

Construction Manager

Contract Administrator

Legal Counsel

Finance Manager

Accounts Payable Manager

Procurement Manager

Site Superintendent

Development Manager

Risk Manager

Claims Manager

Commercial Manager

Project Controller

Operations Director

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