Can Money Paid Into Court Be Used To Discharge Other Liens?

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When a contractor pays money into court to discharge a lien of a sub-contractor, can that money only be used to discharge that lien holder's claim? Or is it available to pay the liens of all eventual lien holders? In Canadian Western Bank v. 702348 Alberta Ltd., the Alberta Court of Queen's Bench recently decided that all lien holders have a claim to that money uner the Alberta Builders Lien Act. This may depend on the specific wording of the Alberta Act. Indeed the Alberta Court recognized that the result is not the same in Saskatchewan.

As a result, when a lien holder's claim is discharged by payment of monies into court, the lien holder's claim to those monies will remain precarious depending on the provincial jurisdiction of the claim and, possibly, the terms upon which the monies are paid into court.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Thomas Heintzman, Arbitration Place | Attorney Advertising

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