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RSNL1990 CHAPTER M-3

MECHANICS' LIEN ACT

Amended:

1991 c49; 1997 c22; 1999 c22 s17; 2004 cL-3.1 s47; 2013 c16 s25

CHAPTER M-3

AN ACT RESPECTING THE LIENS OF
MECHANICS AND OTHERS

Analysis


       
1.   Short title

       
2.   Interpretation

     
2.1   Labrador Inuit rights

       
3.   Agreements waiving application of Act are void

       
4.   Effect upon 3rd party of agreement waiving lien

       
5.   Exception of public streets, roads or highways

       
6.   General right to a lien

       
7.   Lien for rented equipment

       
8.   Where estate charged is leasehold

       
9.   Application of insurance on that property

     
10.   Limit of amount of owner's liability

     
11.   Limit of lien when claimed by other than contractor

     
12.   Holdback

   
12.1   Holdback on large contracts

   
12.2   Notice

   
12.3   Expiry date of lien

   
12.4   Court proceedings

     
13.   Payments made directly by owner to persons entitled to lien

     
14.   Rights of subcontractor

     
15.   Priority of lien

     
16.   Priority of wages

     
17.   Registration

     
18.   What may be included in claim

     
19.   Informality in registering liens

     
20.   Duplicate to be filed

     
21.   Status of lien claimant

     
22.   Limit of time for registration

     
23.   Expiry and discharge

     
24.   When lien stops

     
25.   Assignment or death of lien claimant

     
26.   Discharge of lien

     
27.   Effect of taking security

     
28.   Proving claim in action by another party

     
29.   Statement of mortgagee or unpaid vendor

     
30.   How claim enforceable

     
31.   Where contract covers several buildings

     
32.   Power to appoint receiver of rents and profits

     
33.   Order for preservation of property

     
34.   Consolidation of actions

     
35.   Transferring carriage of proceedings

     
36.   Appointing day for trial

     
37.   Report on sale

     
38.   Where lien not established

     
39.   Right of lienholder whose claims are not payable to share in proceeds

     
40.   Appeal

     
41.   Certain judgments final

     
42.   Fees and costs

     
43.   Rules

     
44.   Service of documents

     
45.   Right of chattel lienholder to sell chattel

     
46.   Persons before whom affidavits may be taken

     
47.   Regulations

     
48.   Fees


Short title

        1. This Act may be cited as the Mechanics' Lien Act.

RSN1970 c229 s1

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Interpretation

        2. (1) In this Act

             (a)  "approved claim" means a pending claim for a lien which has been approved by the registrar;

         (a.1)  "completion of the contract" means substantial performance, not necessarily total performance of the contract;

             (b)  "contractor" means a person contracting with, or employed directly by, the owner or his or her agent for the doing of work or the placing or providing of materials for any of the purposes mentioned in this Act;

             (c)  "corporation" includes a municipal authority and a railway company;

             (d)  "court" means the Trial Division;

             (e)  "doing of work" includes the performance of a service, and corresponding expressions have corresponding meanings;

             (f)  "judge" means a judge of the court;

             (g)  "materials" includes every kind of movable property;

             (h)  "municipal authority" includes

                      (i)  the City of St. John's ,

                     (ii)  the Corner Brook City Council,

                    (iii)  the Mount Pearl City Council,

                    (iv)  The St. John's Metropolitan Area Board, and

                     (v)  the council of a town, community, region or local service district committee established or continued under the Municipalities Act;

              (i)  "owner" includes a person having an estate or interest in the land upon which or in respect of which work is done or materials are placed or provided, at whose request, and

                      (i)  upon whose credit,

                     (ii)  on whose behalf,

                    (iii)  with whose privity or consent, or

                    (iv)  for whose direct benefit

work is done or materials are placed or provided and persons claiming under him or her whose rights are acquired after the work in respect of which the lien is claimed is begun or the materials placed or provided have started to be placed or provided;

           (i.1)  "pending claim" means a claim for a lien which has been received by the registry but which has not yet been approved by the registrar;

              (j)  "person" includes a corporation;

             (k)  "registrar" means the Registrar of Deeds referred to in the Registration of Deeds Act and includes the Deputy Registrar of Deeds;

              (l)  "registry" means the Registry of Deeds referred to in the Registration of Deeds Act;

           (m)  "subcontractor" means a person not contracting with or employed directly by the owner or his or her agent for a purpose mentioned in this Act, but contracting with or employed by a contractor or, under him or her, by another subcontractor and "subcontract" has a corresponding meaning;

             (n)  "wages" means the money earned by a worker for work done by time or as piece-work, and includes all monetary supplementary benefits, whether by statute, contract or collective bargaining agreement; and

             (o)  "worker" means a person employed for wages whether employed under a contract of service or not.

             (2)  For the purposes of this Act, a contract shall be considered to be substantially performed

             (a)  when the work or a substantial part of the work is ready for use or is being used for the purpose intended; and

             (b)  when the work to be done under the contract is capable of completion or correction at a cost of not more than

                      (i)  3% of the lst $250,000 of the contract price,

                     (ii)  2% of the next $250,000 of the contract price, and

                    (iii)  1% of the balance of the contract price.

             (3)  For the purposes of this Act, where the work or a substantial part of the work is ready for use or is being used for the purpose intended and where the work cannot be completed expeditiously for reasons beyond the control of the contractor, the value of the work to be completed shall be deducted from the contract price in determining substantial performance.

RSN1970 c229 s2; 1971 No14 s2; 1971 No47 s2; 1979 c33 Sch C; 1986 c42 Sch B; 1988 c35 s443; 1997 c22 s1

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Labrador Inuit rights

      2.1 This Act shall be read and applied in conjunction with the Labrador Inuit Agreement Act and, where a provision of this Act is inconsistent or conflicts with a provision, term or condition of the Labrador Inuit Land Claims Agreement Act, the provision, term or condition of the Labrador Inuit Land Claims Agreement Act shall have precedence over the provision of this Act.

2004 cL-3.1 s47

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Agreements waiving application of Act are void

        3. (1) An agreement, oral or written, expressed or implied, on the part of a worker, that this Act, or a part of it, shall not apply to, or that a remedy provided by it shall not be available for the benefit of, that worker, or which in a way limits or abrogates or in effect limits, modifies or abrogates that remedy, is void and of no effect.

             (2)  Subsection (1) does not apply to

             (a)  a manager, officer or supervisor; or

             (b)  a person whose wages are more than $50 a day.

RSN1970 c229 s4

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Effect upon 3rd party of agreement waiving lien

        4. An agreement does not deprive a person, otherwise entitled to a lien under this Act and who is not a party to the agreement, of the benefit of the lien, but the lien attaches, notwithstanding that agreement.

RSN1970 c229 s5

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Exception of public streets, roads or highways

        5. (1) Except for the purpose of section 12, the lien given by subsection 6(1) does not attach to a public street, road or highway or to a work or improvement done on, in or to a public street, road or highway.

             (2)  The expression "street", "road" or "highway" includes all land lying between the boundaries of the street, road or highway whether designed or intended for vehicular or pedestrian traffic or not.

RSN1970 c229 s6

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General right to a lien

        6. (1) Unless a person signs an express agreement to the contrary, where he or she does work upon or in respect of, or places or provides materials to be used in, the making, constructing, erecting, fitting, altering, improving or repairing of land, a building, structure or works or the appurtenances to that land, building, structure or works for an owner, contractor or subcontractor, that person has, by doing that work or placing or providing those materials, a lien for the price of the work or materials upon the estate or interest of the owner in the land, building, structure or works and appurtenances and the land occupied or enjoyed, or upon or in respect of which the work is done, or upon which the materials are placed or provided to be used, limited, however, in amount to the sum due to the person entitled to the lien and to the sum owing, except as provided here, by the owner.

             (2)  The placing or providing of the materials to be used upon the land or other place in the immediate vicinity of the land designated by the owner or the owner's agent is sufficient delivery for the purpose of this Act, but delivery on the designated land does not make that land subject to a lien.

             (3)  The lien given by subsection (1) attaches as set out in that subsection where the materials delivered to be used are incorporated into the land, building, structure or works, notwithstanding that the materials may not have been delivered in strict accordance with subsection (1).

             (4)  For the purposes of subsection (1), "agent" includes the contractor or subcontractor for whom the materials are placed or provided, unless the person placing or providing the materials has had actual notice from the owner to the contrary.

RSN1970 c229 s7

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Lien for rented equipment

        7. A person who rents equipment to an owner, contractor or subcontractor for use on a contract site is considered, for the purposes of this Act, to have performed a service for which he or she has a lien for the price of the rental of the equipment used on the contract site, limited, however, in amount to the sum owed to the person entitled to the lien from the owner, builder, contractor or subcontractor in respect of the rental of the equipment.

RSN1970 c229 s8

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Where estate charged is leasehold

        8. (1) Where the estate or interest upon which the lien attaches is leasehold, the fee simple is also subject to the lien if the person doing the work or placing or providing the material gives written notice, by personal service, to the owner in fee simple or his or her agent of the work to be done or material to be placed or provided unless the owner in fee simple or his or her agent within 15 days after the service on him or her of the notice, gives written notice, by personal service, to that person that he or she will not be responsible for the lien.

             (2)  A forfeiture or attempted forfeiture of the lease on the part of the landlord, or cancellation or attempted cancellation of the lease except for non-payment of rent, does not deprive a person otherwise entitled to a lien of the benefit of the lien, but the person entitled to the lien may pay rent arising after he or she becomes entitled, and the amount paid may be added to his or her claim.

             (3)  Where the land and premises upon or in respect of which work is done or materials are placed or provided are encumbered by a mortgage or other charge that was registered in the registry before a lien under this Act arose, the mortgage or other charge has priority over all liens under this Act to the extent of the actual value of the land and premises at the time the 1st lien arose, which value is to be ascertained by the judge.

             (4)  The time at which the 1st lien arose shall be considered to be the time at which the 1st work was done or the 1st materials placed or provided, irrespective of whether a claim for lien in respect of those materials or that work is registered or enforced and whether or not that lien is before the court.

             (5)  A mortgage existing as a valid security, notwithstanding that it is a prior mortgage within the meaning of subsection (3), may also secure future advances.

             (6)  A registered agreement for the sale and purchase of land, and money in good faith secured or payable under that agreement, has the same priority over a lien as is provided for a mortgage and mortgage money in subsections (3) and (5) and, for the purposes of this Act, the seller shall be considered to be a mortgagee, and money paid in good faith secured and payable under that agreement shall be considered to be mortgage money secured or advanced in good faith.

RSN1970 c229 s9

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Application of insurance on that property

        9. Where property upon which a lien attaches is wholly or partly destroyed by fire, money received because of insurance by an owner or prior mortgagee or charge shall take the place of the property destroyed and is, after satisfying a prior mortgage or charge in the manner and to the extent set out in subsection 8(3), subject to the claims of all persons for liens to the same extent as if the money had been realized by a sale of the property in an action to enforce the lien.

RSN1970 c229 s10

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Limit of amount of owner's liability

      10. Except as provided in this Act, the lien does not attach so as to make the owner liable for a greater sum than the sum payable by the owner to the contractor.

RSN1970 c229 s11

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Limit of lien when claimed by other than contractor

      11. Except as provided in this Act, where the lien is claimed by a person other than the contractor, the amount that may be claimed in respect of the lien is limited to the amount owing to the contractor or subcontractor or other person for whom the work has been done or the materials were placed or provided.

RSN1970 c229 s12

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Holdback

      12. (1) In all cases, the person primarily liable upon a contract under and by virtue of which a lien may arise shall, as the work is done or the materials are provided under the contract, retain for a period of 30 days after the completion or abandonment of the work done or to be done under the contract 10% of the value of the work and materials actually done, placed or provided, as referred to in section 6, irrespective of whether the contract or subcontract provides for partial payments or payment on completion of the work, and the value shall be calculated, upon evidence given in that regard, on the basis of the contract price or, where there is no specific contract price, on the basis of the actual value of the work or materials.

             (2)  In the case of a contract that is under the supervision of an architect, engineer or other person upon whose certificate, in this section referred to as the "certificate", payments are to be made, where 30 days have elapsed after a certificate issued by that architect, engineer or other person to the effect that the subcontract has been completed to his or her satisfaction has been given to the person primarily liable upon that contract and to the person who became a subcontractor by a subcontract made directly under that contract, the amount to be retained by the person primarily liable upon that contract shall be reduced by 10% of the subcontract price or, where there is no specific subcontract price, by 10% of the actual value of the work done or materials placed or provided under that subcontract, but this subsection does not operate if and so long as a lien derived under the subcontract is preserved by anything done under this Act.

             (3)  Where a certificate issued by an architect, engineer or other person to the effect that a subcontract by which a subcontractor became a subcontractor has been completed to the satisfaction of that architect, engineer or other person has been given to that subcontractor, then for the purposes of subsections 22(1), (2) and (3) and for the purposes of section 24, that subcontract and materials placed or provided or to be placed or provided under that subcontract and work done or to be done under that subcontract shall, so far as concerns a lien under that subcontract of that subcontractor, be considered to have been completed or placed or provided not later than the time at which the certificate was given.

             (4)  Where an architect, engineer or other person neglects or refuses to issue and deliver a certificate upon which payments are to be made under a contract or subcontract, the court, upon application and upon being satisfied that the certificate should have been issued and delivered, may, upon terms and conditions as to costs and otherwise that it considers just, make an order that the work or materials to which the certificate would have related has been done or placed or provided and that order has the same effect as if the certificate had been issued and delivered by the architect, engineer or other person.

             (5)  Where there is a lien under section 6, the lien is a charge upon the amount directed to be retained by this section in favour of lien claimants whose liens are derived under persons to whom the money required to be retained are respectively payable and where there is no lien on the land by virtue of section 5, a claim for work done or materials placed or furnished is a charge upon the amount directed to be retained by this section.

             (6)  All payments up to 90% as fixed by subsection (1) and payments permitted as a result of the operation of subsections (2) and (3) and sections 13.1 and 13.4 made in good faith by an owner to a contractor, or by a contractor to a subcontractor, or by 1 subcontractor to another subcontractor, before written notice of the lien given by the person claiming the lien to the owner, contractor or subcontractor operate as a discharge to the extent of the lien.

             (7)  Payment of the percentage required to be retained under this section may be validly made so as to discharge all claims in respect of that percentage after the expiration of the period of 30 days mentioned in subsection (1) unless in the meantime proceedings have been started to enforce a lien or charge against the percentage as provided by sections 23 and 24, in which case the owner may pay the percentage into court in the proceedings, and that payment constitutes valid payment in discharge of the owner to the amount paid into court.

             (8)  A contract shall be considered to be amended where necessary to be in conformity with this section.

             (9)  Where the contractor or subcontractor defaults in completing his or her contract, the percentage required to be retained shall not, as against a lien claimant who by subsection (5) has a charge, be applied by the owner, contractor or subcontractor to the completion of the contract or for another purpose nor to the payment of damages for the non-completion of the contract by the contractor or subcontractor nor in payment or satisfaction of a claim against the contractor or subcontractor.

RSN1970 c229 s13; 1991 c49 s1

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Holdback on large contracts

   12.1 (1) Notwithstanding subsections 12(2), (3) and (4), where

             (a)  a contract price is in excess of $20,000,000 or a greater amount that may be prescribed by the regulations;

             (b)  the contract provides for a completion schedule longer than 1 year;

             (c)  no proceedings have been commenced to enforce a lien or charge against the percentage required to be withheld under subsection 12(1) in accordance with sections 24 and 25; and

             (d)  notice of early release of holdback is given and posted in the manner provided for the giving and posting of notice under section 12.2,

the person primarily liable upon the contract or a subcontract shall, following each anniversary date of the day services or materials were first provided under the contract or subcontract, if the amount is otherwise owing to the contractor or subcontractor under the contract or subcontract, make payment of the amount that has been required to be retained under subsection 12(1), calculated as of the last anniversary date of the day services or materials were first provided under the contract or subcontract, 30 days after the day notice of early release is completed in accordance with section 12.2.

             (2)  Whether a contract price is in excess of $20,000,000 or a greater amount that may be prescribed, shall be determined on the day of the execution of the contract and not as a result of an amendment to the contract.

             (3)  Notwithstanding subsection (1), where the unexpired term of the contract is less than 1 year from the last anniversary date of the contract, subsections 12(2), (3) and (4) apply with the necessary changes to the contract.

1991 c49 s2

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Notice

   12.2 Where an anniversary date of the day services or materials were first provided under a contract or subcontract which meets the requirements of section 12.1 has passed, the person primarily liable on the contract or subcontract shall within 10 days after that anniversary date

             (a)  by personal service or by prepaid registered mail, give notice in writing to all persons providing services or materials in the performance of the contract or subcontract that the person primarily liable on the contract or subcontract intends to release the holdback under section 12.1;

             (b)  post a copy of the notice in a prominent place on the main job site; and

             (c)  publish the notice in the Gazette.

             (2)  Where a notice required by this section is given by prepaid registered mail, it is considered to be given when the addressee actually receives it or 2 days after the day of registration, whichever is earlier, which time shall be included in the days allotted for giving the notice.

1991 c49 s2

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Expiry date of lien

   12.3 (1) The lien of a contractor or subcontractor for services or materials provided on or before the annual anniversary date of the day services or materials were first provided under a contract or subcontract which meets the requirements of section 12.1 expires 30 days after the day on which notice of release of the holdback is completed in accordance with section 12.2.

             (2)  The lien of a person other than a contractor or subcontractor for services or materials provided on or before the annual anniversary date of the day services or materials were first provided under a contract or subcontract which meets the requirements of section 12.1 expires 30 days after the day on which notice of release of the holdback is completed in accordance with section 12.2.

             (3)  Notwithstanding subsections (1) and (2), where a person has provided services or materials on or before the annual anniversary date of the day services or materials were first provided under a contract or subcontract which meets the requirements of section 12.1 and has also provided or is to provide, services or materials after those days, his or her lien in respect of the services or materials provided on or before any of those days expires without affecting a lien that he or she may have for the provision of services or materials after the applicable day.

1991 c49 s2

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Court proceedings

   12.4 (1) Where proceedings have been commenced to enforce a lien, and where the person primarily liable under a contract or subcontract which meets the requirements of section 12.1 would otherwise be entitled under section 12.1 to pay out the holdback, the person primarily liable under the contract or subcontract may apply to the court for an order vacating the registration of the claim for lien on notice to the contractor or subcontractor otherwise entitled to payment under section 12.1 and to the persons who have filed claims for the lien in accordance with this Act.

             (2)  On an application under subsection (1) the court shall

             (a)  determine the amount then retained by the person primarily liable under the contract or subcontract under this Act;

             (b)  allow security for or payment into court of an amount equal to the total of the sums claimed as due or to become due under the claims for lien registered in respect of the contract or subcontract be paid into court together with security for costs in an amount equal to $50,000 for each claim for lien registered in respect of the contract or subcontract or 25% of the total of the sums claimed as due or to become due under the claims for lien registered in respect of the contract or subcontract, whichever is less; and

             (c)  order that the registration of the claim for lien be vacated;

and the court may

             (d)  make the order vacating the claim for lien on the condition that the person making the application provides security for or pays into court the amount referred to in paragraph (b);

             (e)  give directions respecting payment into court under paragraph (b); and

             (f)  have regard to an agreement between the parties as to the amount retained, in determining the amount retained under paragraph (a).

             (3)  Where it is proven at trial that a lien claimant unreasonably withheld his or her agreement as to the amount then retained by the person primarily liable under the contract or subcontract under this Act, the court may award costs against the lien claimant whether or not he or she has proven his or her lien.

             (4)  Where an order is made under subsection (2)

             (a)  the lien

                      (i)  ceases to attach to the amounts subject to a charge under subsection 12(5),

                     (ii)  in the case of a claim for lien registered under section 18, ceases to attach to the land, and

                    (iii)  becomes instead a charge on the amount paid into court or security posted; and

             (b)  the person primarily liable under the contract or subcontract shall be, in respect of the operation of section 13, in the same position as if the claim of lien had not been registered and the person primarily liable under the contract or subcontract shall release to the contractor or subcontractor the amount of the holdback which would otherwise have been released to the contractor or subcontractor under section 12.1 less the aggregate of the amounts paid into court or in respect of which security is posted under paragraph (2)(b),

and the person primarily liable under the contract or subcontract under which payment is made under this section shall be discharged from all liability under this Act with respect to the amounts so paid except to the extent of the aggregate of the amounts paid into court or in respect of which security is posted under paragraph (2)(b).

             (5)  Where an order is made under subsection (2), the lien claimant whose registered claim for lien has been vacated may proceed with an action to enforce his or her claim against the amount paid into court or security posted in accordance with the procedures set out in section 25 or the court may make an order to facilitate the resolution of all claims, but no certificate of action shall be registered against the land.

1991 c49 s2

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Payments made directly by owner to persons entitled to lien

      13. Where an owner, contractor or subcontractor makes a payment to a person entitled to a lien under section 6, or to a person who but for section 5 would be entitled to a lien under section 7, for or on account of a debt, due to him or her for work done or for materials placed or provided, for which he or she is not primarily liable, and within 3 days afterwards gives written notice of the payment to the person primarily liable, or his or her agent, the payment shall be considered to be a payment on his or her contract generally to the contractor or subcontractor primarily liable but not so as to affect the percentage to be retained by the owner as provided by section 12.

RSN1970 c229 s14

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Rights of subcontractor

      14. A subcontractor is entitled to enforce his or her lien, notwithstanding the non-completion or abandonment of the contract by a contractor or subcontractor under whom he or she claims.

RSN1970 c229 s15

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Priority of lien

      15. (1) Notwithstanding subsection 8(5), the lien has priority over all judgments, executions, assignments, attachments, garnishments and receiving orders recovered, issued or made after the lien arises, and over all payments or advances made on account of a conveyance or mortgage after written notice of the lien has been given to the person making those payments or after registration of a claim for the lien as provided here, and, in the absence of that written notice or the registration of a claim for lien, all payments or advances have priority over that lien.

             (2)  Except where it is otherwise provided by this Act, a person entitled to a lien on a property or money is not entitled to a priority or preference over another person of the same class entitled to a lien on that property or money, and each class of lienholders ranks equally for their several amounts, and the proceeds of a sale shall be distributed among them proportionally, without preference according to their several classes and rights.

             (3)  A conveyance, mortgage or charge of or on land given to a person entitled to a lien under this Act in payment of or as security for that claim, whether given before or after that lien claim has arisen, shall, as against other parties entitled to liens under this Act, on that land be considered to be fraudulent and void.

RSN1970 c229 s16

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Priority of wages

      16. (1) A worker whose lien is for wages has priority to the extent of 30 days' wages over all other liens derived through the same contractor or subcontractor to the extent of and on the percentage directed to be retained by section 12 to which the contractor or subcontractor through whom the lien is derived is entitled, and those workers rank equally.

             (2)  A worker is entitled to enforce a lien in respect of a contract or subcontract that has not been completed, and, notwithstanding anything to the contrary in this Act, may serve a notice of motion on the appropriate persons, returnable in 4 days after service before the court, that the applicant will, on the return of the motion, ask for judgment on his or her claim for lien, registered particulars of which shall accompany the notice of motion verified by affidavit.

             (3)  Where the contract has not been completed when the lien is claimed by a worker, the percentage shall be calculated on the value of the work done or materials placed or provided by the contractor or subcontractor by whom the worker is employed, having regard to the contract price.

             (4)  A device by an owner, contractor or subcontractor to defeat the priority given to a worker for his or her wages and a payment made for the purpose of defeating or impairing a lien is void and of no effect.

RSN1970 c229 s17

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Registration

      17. (1) A claim for a lien may be registered in the registry and shall set out

             (a)  the name and address for service of the person claiming the lien and of the owner or of the person whom the person claiming the lien, or his or her agent, believes to be the owner of the land, and of the person for whom the work was or is to be done, or the materials were or are to be placed or provided, and the time within which the work was or was to be done or the materials were to be placed or provided;

             (b)  a short description of the work done or to be done, or the materials placed or provided or to be placed or provided;

             (c)  the sum claimed as due or to become due; and

             (d)  a description of the land.

             (2)  The claim shall be verified in duplicate by the affidavit of the person claiming the lien, or of his or her agent or assignee who has a personal knowledge of the matters required to be verified, and the affidavit of the agent or assignee shall state that he or she has that knowledge.

             (3)  When registering a claim for lien against a railway, it is sufficient description of the land of the railway company to describe it as the land of the railway company.

             (4)  A claim for a lien shall be registered by entering it into an electronic database, including the names of the parties to the claim and the position, with identifying particulars, of the affected property.

             (5)  The time of registration of a lien shall be electronically determined to the day, hour and minute upon the completion of subsection (4) at which time the claim shall have pending status.

             (6)  A pending claim under subsection (5) may be approved by the registrar, and the date and time of the registration of the approved claim shall be the date and time of the pending claim.

RSN1970 c229 s18; 1974 No84 s12; 1997 c22 s2

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What may be included in claim

      18. (1) A claim for lien may include claims against a number of properties, and a number of persons claiming liens upon the same property may unite in the claim, but, where more than 1 lien is included in 1 claim, each claim for lien shall be verified by affidavit as provided in section 17.

             (2)  The court has jurisdiction equitably to apportion against the respective properties the amounts included in a claim under subsection (1).

RSN1970 c229 s19

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Informality in registering liens

      19. (1) Substantial compliance with sections 17, 18 and 30 is sufficient, and a claim for lien is not invalidated because of failure to comply with the requirements of those sections unless, in the opinion of the judge, the owner, contractor or subcontractor, mortgagee or other person is prejudiced by that claim, and then only to the extent to which he or she is prejudiced.

             (2)  Nothing in this section dispenses with the requirement of registration of the claim for lien.

RSN1970 c229 s20

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Duplicate to be filed

      20. A duplicate of the claim for lien, bearing the registrar's certificate of registration, shall be filed with the court on or before the trial of the action.

2013 c16 s25

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Status of lien claimant

      21. Where a claim is registered, the person entitled to a lien shall be considered to be a purchaser to the extent of the value of the lien and a purchaser for valuable consideration within the provisions of theRegistration of Deeds Act, but, except as otherwise provided here, that Act does not apply to a lien arising under this Act.

RSN1970 c229 s22

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Limit of time for registration

      22. (1) A claim for lien by a contractor or subcontractor in cases not otherwise provided for may be registered before or during the performance of the contract or of the subcontract or within 30 days after the completion or abandonment of the contract or of the subcontract.

             (2)  A claim for lien for materials may be registered before or during the placing or providing of the materials, or within 30 days after the placing or providing of the last material so placed or provided.

             (3)  A claim for lien for services may be registered during the performance of the service or within 30 days after the completion of the service.

             (4)  A claim for lien for wages may be registered during the doing of the work for which the wages are claimed or within 30 days after the last work was done for which the lien is claimed.

             (5)  Where there is no lien on the land by virtue of section 5, a person who is asserting a claim under subsection 12(5) for work done or materials placed or provided shall give written notice of his or her claim to the owner, to every person in whose hands sums are retained under section 12 to which his or her claim may relate and to the municipal authority in whose area of authority the land is situated within 30 days after the completion or abandonment of the work or the placing or providing of the materials.

RSN1970 c229 s23

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Expiry and discharge

      23. (1) A lien for which a claim is not registered stops existing on the expiration of the time limited in section 22 for the registration of the claim.

             (2)  Upon an action under this Act being started, a certificate of action shall be registered in the registry.

             (3)  The certificate referred to in subsection (2) may be granted by the clerk of the court.

             (4)  Where a certificate of action has been registered for 1 year or more in the registry and no appointment has been taken out for the trial of the action, the judge may, upon the unilateral application of an interested person, make an order vacating the certificate of action and discharging all liens depending on the certificate of action.

RSN1970 c229 s24

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When lien stops

      24. (1) A lien for which a claim is registered stops existing on the expiration of 90 days after the work has been completed or the materials have been placed or provided, unless in the meantime an action is started to realize the claim or in which an existing claim may be realized, and a certificate is registered as provided by section 23.

             (2)  A claim asserted under subsection 12(5) for work done or materials placed or provided stops existing on the expiration of 90 days after

             (a)  the work has been completed or abandoned; or

             (b)  the materials have been placed or provided,

unless in the meantime an action under this Act is started to realize the claim or in which an existing claim may be realized.

             (3)  Subsection 23(2) does not apply to an action referred to in subsection (2) of this section, but sections 30, 32, 33, 34, 35 and 36 apply, with the necessary changes, to such an action.

RSN1970 c229 s25; 1974 No84 s3

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Assignment or death of lien claimant

      25. The rights of a lien claimant may be assigned by a written instrument and, if not assigned, upon his or her death those rights pass to his or her personal representative.

RSN1970 c229 s26

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Discharge of lien

      26. (1) A claim for lien may be discharged by the registration of a receipt acknowledging payment

             (a)  where made by a lien claimant that is not a corporation, signed by the lien claimant or his or her agent authorized in writing and verified by affidavit; or

             (b)  where made by a lien claimant that is a corporation, sealed with its corporate seal or signed by an officer of the corporation and verified by affidavit,

and the registrar shall number and index each receipt and enter particulars of the receipt in a memorandum on the margin of the entry in the registry of the claim for lien to which the receipt relates.

             (2)  Upon application, the court may

             (a)  allow security for or payment into court of the amount of the claim of the lien claimant and the amount of the claims of other existing lien claimants, together with costs that it may fix, and order that the registration of the claim for lien and the registration of the certificate of action be vacated;

             (b)  upon another appropriate ground, order that the registration of the claim for lien and the registration of the certificate of action be vacated; or

             (c)  upon appropriate grounds, dismiss the action.

             (3)  Notwithstanding sections 23 and 24, where an order to vacate the registration of a lien is made under paragraph (2)(a) or (b), the lien does not stop existing for the reason that no certificate of action is registered.

             (4)  Money paid into court, or a bond or other security for securing the amount and satisfactory to the court, takes the place of the property discharged and is subject to the claims of every person who has at the time of the application an existing claim for lien or given notice of the claim under subsection 12(6) or under section 15 to the same extent as if the money, bond or other security were realized by a sale of the property in an action to enforce the lien, but the amount that the court finds to be owing to the person whose lien has been so vacated is a 1st charge upon the money, bond or other security.

             (5)  Where the certificate required by section 23 or 24 has not been registered within the prescribed time and an application is made to vacate the registration of a claim for lien after the time for registration of the certificate, the order vacating the lien may be made unilaterally upon production of a certificate of result of search referred to in subsection 37(2) of the Registration of Deeds Act, together with a certified copy of the registered claim for lien, and, for the purposes of subsections 37(4) & (5) of the Registration of Deeds Act, the applicant under this subsection is considered to be a person entitled to a search and certificates or copies of certificates referred to in section 37 of the Registration of Deeds Act.

             (6)  Where money has been paid into court or a bond deposited in court under an order under subsection (2), the court may, upon notice to the parties that the court may require, order the money to be paid out to the persons entitled to the money or the delivery up of the bond for cancellation.

             (7)  An order discharging a claim for lien or vacating a certificate of action shall be registered by registering the order or a certificate, under the seal of the court, that includes a description of the land and a reference to the registration number of every registered claim for lien and certificate of action affected by the order.

             (8)  Subsection 17(4) applies, with the necessary changes, to the registration of a certificate of action.

             (9)  The registrar shall index each order discharging a claim for lien or vacating a certificate of action which is registered under subsection (7) and shall enter particulars of that order in a memorandum on the margin of the entry in the registry of the claim for lien to which the order relates.

RSN1970 c229 s27

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Effect of taking security

      27. (1) The taking of security for, or the acceptance of a promissory note or bill of exchange for, or the taking of an acknowledgment of the claim, or the giving of time for the payment of the claim, or the taking of a proceeding for the recovery, or the recovery of a personal judgment for the claim, does not merge, waive, pay, satisfy, prejudice or destroy the lien, unless the claimant agrees in writing that it has that effect.

             (2)  Where a promissory note or bill of exchange has been negotiated, the lien claimant does not as a result lose his or her right to claim for lien, if, at the time of bringing his or her action to enforce it, or where an action is brought by another lien claimant, he or she is, at the time of proving his or her claim in the action, the holder of a promissory note or bill of exchange.

             (3)  Nothing in subsection (2) extends the time limited by this Act for bringing an action to enforce a claim for lien.

             (4)  A person who has extended the time for payment of a claim for which he or she has a claim for lien, in order to obtain the benefit of this section, shall start an action to enforce the claim within the time prescribed by this Act and shall register a certificate as required by sections 23 and 24, but further proceedings shall not be taken in the action until the expiration of that extension of time.

RSN1970 c229 s28

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Proving claim in action by another party

      28. Where the period of credit in respect of a claim has not expired or there has been an extension of time for payment of the claim, the lien claimant may, nevertheless, if an action is started by another person to enforce a claim for lien against the same property, prove and obtain payment for his or her claim in the action as if the period of credit or the extended time had expired.

RSN1970 c229 s29

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Statement of mortgagee or unpaid vendor

      29. (1) A lien claimant may in writing, at any time, demand of a mortgagee or unpaid vendor or his or her agent the terms of a mortgage on the land or of an agreement for the purchase of the land in respect of which the work was or is to be done or the materials were or are to be placed or provided and a statement showing the amount advanced on the mortgage or the amount owing on the agreement and, if the mortgagee or vendor or his or her agent fails to inform the lien claimant at the time of the demand, or within a reasonable time after the demand, of the terms of the mortgage or agreement and the amount advanced or owing or if he or she knowingly falsely states the terms of the mortgage or agreement and the amount owing and the lien claimant sustains loss by the refusal or neglect or misstatement, the mortgagee or vendor is liable to him or her for the amount of the loss in an action for it or in an action for the enforcement of a lien under this Act, and subsection 36(4) applies.

             (2)  The court may, on a summary application at any time before or after an action is started for the enforcement of the claim for lien, make an order requiring the mortgagee or his or her agent or the unpaid vendor or his or her agent to produce and permit a lien claimant to inspect a mortgage or agreement for sale referred to in subsection (1) upon the terms as to costs that the court considers just.

RSN1970 c229 s30

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How claim enforceable

      30. (1) A claim for lien is enforceable in a proceeding in the Trial Division.

             (2)  A proceeding under this section shall be started by filing a statement of claim with the court.

             (3)  The statement of claim shall be served within 30 days after it is filed, but the court may extend the time for service.

             (4)  The statement of defence in the action shall be delivered within 10 days after the statement of claim has been served, but the court may extend the time for delivery.

             (5)  It is not necessary to make any lien claimants parties defendant to the action, but all lien claimants served with the notice of trial shall for all purposes be considered to be parties to the action.

             (6)  After the start of the action, a lien claimant or other person interested may apply to the court to speed the trial of the action.

             (7)  Lien claimants claiming liens on the same land may join in an action, and an action brought by a lien claimant shall be considered to be brought on behalf of himself or herself and all other lien claimants.

RSN1970 c229 s31; 1986 c42 Sch B; 2013 c16 s25

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Where contract covers several buildings

      31. Where an owner enters into an entire contract for the supply of materials to be used in several buildings, the person supplying the materials may ask to have his or her lien follow the form of the contract and that it be for an entire sum upon all the buildings, but, where the owner has sold 1 or more of the buildings, the court has jurisdiction equitably to apportion against the respective buildings the amount included in the claim for lien under the entire contract.

RSN1970 c229 s33

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Power to appoint receiver of rents and profits

      32. (1) At any time after the delivery of the statement of claim, the court may, on the application of a lien claimant, mortgagee or other interested person, appoint a receiver of the rents and profits of the property against which the claim for lien is registered, upon terms and upon the giving of security or without security that the court considers just.

             (2)  A lien claimant, mortgagee or other interested person may, before or after judgment, make an application to the court, which may hear oral or affidavit evidence and appoint, upon terms and upon the giving of security or without security that the court considers just, a trustee with power to manage, mortgage, lease and sell, or manage, mortgage, lease or sell, the property against which the claim for lien is registered, and the exercise of those powers shall be under the supervision and direction of the court, and with power, when so directed by the court, to complete or partially complete the property, and, in the event that mortgage money is advanced to the trustee as the result of the powers conferred upon him or her or them under this subsection, that money takes priority over every claim of lien existing as of the date of the appointment.

             (3)  Property directed to be sold under subsection (2) may be offered for sale subject to a mortgage or other charge or encumbrance if the court so directs.

             (4)  The proceeds of a sale made by a trustee under subsection (2) shall be paid into court and are subject to the claims of all lien claimants, mortgagees or other persons interested in the property so sold as their respective rights are determined, and, where applicable, section 37 applies.

             (5)  The court shall make all necessary orders for the completion of a mortgage, lease or sale authorized to be made under subsection (2).

             (6)  A vesting order made of property sold by a trustee appointed under subsection (2) vests the title of the property free from all claims for liens, encumbrances and interests of any kind, except in cases where sale is made subject to a mortgage, charge, encumbrance or interest as provided in this section.

             (7)  The court shall make all necessary orders to enable the trustee referred to in subsection (2) to carry out and implement powers conferred on him or her or them under that subsection.

RSN1970 c229 s34

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Order for preservation of property

      33. At any time after delivery of the statement of claim and before judgment, or after judgment and pending the hearing and determination of an appeal, a lien claimant, mortgagee or other interested persons may make an application to the court having jurisdiction to try the action, which court may hear oral or affidavit evidence and make an order for the preservation of property pending the determination of the action and an appeal.

RSN1970 c229 s35

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Consolidation of actions

      34. Where more than 1 action is brought to realize liens in respect of the same land, the court may, on the application of a party to any of the actions or on the application of another interested person, consolidate all those actions into 1 action and award the conduct of the consolidated action to a plaintiff that the court considers just.

RSN1970 c229 s36

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Transferring carriage of proceedings

      35. A lien claimant entitled to the benefit of an action may apply to the court for the carriage of the proceedings, and the court may make an order awarding that lien claimant the carriage of the proceedings.

RSN1970 c229 s37

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Appointing day for trial

      36. (1) After

             (a)  the delivery of the statement of defence, where the plaintiff's claim is disputed, and upon 4 days' notice to the other party, either party may apply; or

             (b)  the time for delivery of defence in a case not referred to in paragraph (a), either party may apply unilaterally

to a judge to fix a day for the trial, and the judge shall appoint the time and place of the trial, and the order, signed by the judge, shall form part of the record of the proceedings.

             (2)  The party obtaining an appointment for the trial shall, at least 10 clear days before the day appointed, serve notice of trial upon the solicitors for the defendants who appear by solicitors and upon the defendants who appear in person, and upon all the lienholders who have registered their claims as required by this Act or of whose claims he or she has notice, and upon all other persons having a charge, encumbrance or claim on the land subsequent in priority to the lien, who are not parties, and that service shall be personal unless otherwise directed by the judge, who may direct in what manner the notice of trial is to be served.

             (3)  Where a person interested in the land has been served with a statement of claim and defaults in delivering a statement of defence, he or she shall nevertheless be served with notice of trial and is entitled to defend on terms as to costs and otherwise that the court considers just.

             (4)  The court shall

             (a)  try the action, including set-off and counterclaim, and all questions that arise or that are necessary to be tried in order to completely dispose of the action and to adjust the rights and liabilities of the persons appearing before it or upon whom notice of trial has been served;

             (b)  take all accounts, make all inquiries, give all directions and do all other things necessary to finally dispose of the action and of all matters, questions and accounts arising before or at the trial, and to adjust the rights and liabilities of and give all necessary relief to all parties to the action and all persons who have been served with the notice of trial; and

             (c)  embody the results of the trial in a judgment, which judgment may direct payment immediately by the person primarily liable to pay the amount of the claims and costs as ascertained by the judgment, and execution may be issued immediately.

             (5)  The form of the judgment may be varied by the court in order to meet the circumstances of the case so as to give to a party to the proceedings a right or remedy in the judgment to which he or she may be entitled.

             (6)  The court may order that the estate or interest charged with the lien be sold, may refer the conduct of the sale to the clerk of the court, and may direct the sale to take place at a time after judgment allowing, however, a reasonable time for advertising the sale.

             (7)  A lien claimant who did not prove his or her claim at the trial may, on the application to the court, be let in to prove his or her claim, on terms as to costs and otherwise that are considered just, at a time before the amount realized in the action for the satisfaction of liens has been distributed, and, where his or her claim is allowed, the judgment shall be amended so as to include his or her claim.

             (8)  An action may be tried by a judge of the court having jurisdiction to try the action notwithstanding that the time and place for the trial were appointed and fixed by another judge.

             (9)  A party to an action under this Act or another interested person may apply to the court for directions as to pleadings, production or other matters relating to the action, including the cross-examination of a lien claimant or his or her agent or assignee on his or her affidavit verifying the claim.

          (10)  Notwithstanding subsection (6) or another provision of this Act, an order shall not be made for the sale of lands that are Labrador Inuit Lands as defined in the Labrador Inuit Land Claims Agreement Act .

RSN1970 c229 s38; 2004 cL-3.1 s47

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Report on sale

      37. (1) Where there has been a sale, the money arising from the sale shall be paid into court to the credit of the action, and the court shall direct to whom the money in court shall be paid and may add to the claim of the person conducting the action his or her fees and actual disbursements incurred in connection with the sale, and, where sufficient money to satisfy the judgment and costs is not realized from the sale, the court shall certify the amount of the deficiency and the names of the persons who are entitled to recover it, showing the amount that each is entitled to recover and the persons adjudged to pay it, giving credit for payments made under subsection 36(4) and the persons entitled may enforce payment of the amount found to be due by execution or otherwise.

             (2)  The court may make all necessary orders for the completion of the sale and for vesting the property in the purchaser.

RSN1970 c229 s39

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Where lien not established

      38. Where a lien claimant fails to establish a lien, he or she may nevertheless recover a personal judgment against a party to the action for a sum that may appear to be due to him or her and which he or she might recover in an action against that party.

RSN1970 c229 s40

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Right of lienholder whose claims are not payable to share in proceeds

      39. Where property subject to a lien is sold in an action to enforce a lien, every lienholder is entitled to share in the proceeds of the sale in respect of the amount then owing to him or her, although the proceeds or part of the proceeds was not payable at the time of the start of the action or is not then presently payable.

RSN1970 c229 s41

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Appeal

      40. An appeal lies from an order or decision under this Act to the Court of Appeal.

1986 c42 Sch B

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Certain judgments final

      41. Notwithstanding section 40, A judgment in respect of a claim or counterclaim for an amount not exceeding $200 is final and without appeal.

RSN1970 c229 s44

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Fees and costs

      42. (1) The fees and costs in all proceedings taken to realize a lien under this Act shall be as are payable in respect of the same or similar matters, according to the ordinary procedure of the court.

             (2)  Notwithstanding subsection (1), where a lien is discharged or vacated under section 26 or where judgment is given in favour of or against a claim for a lien, in addition to the costs of the action, the judge may allow a reasonable amount for the costs of drawing and registering the claim for lien or of vacating the registration of the lien, but this does not apply where the claimant fails to establish a valid lien.

RSN1970 c229 s45

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Rules

      43. (1) The object of this Act being to enforce liens at the least expense, the procedure shall be as far as possible of a summary character, having regard to the amount and nature of the liens in question.

             (2)  Except where otherwise provided by this Act, interlocutory proceedings shall not be permitted without the consent of the court, and then only upon appropriate proof that those proceedings are necessary.

             (3)  The court may, for the purpose of determining a matter of fact in question, obtain the assistance of a merchant, accountant, actuary, building contractor, architect, engineer or other person, and the court may fix the remuneration of that person and direct payment of it by any of the parties.

             (4)  Unless otherwise provided in this Act, the Rules of the Supreme Court apply to proceedings under this Act.

RSN1970 c229 s46; 1986 c42 Sch B

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Service of documents

      44. Except where otherwise directed by the court, all documents relating to an action under this Act, other than statements of claim and notices of trial, are sufficiently served upon the intended recipient if sent by registered mail addressed to him or her at his or her address for service.

RSN1970 c229 s47

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Right of chattel lienholder to sell chattel

      45. (1) A person who has bestowed money, skill or materials upon a chattel or thing in the alteration or improvement of its properties or for the purpose of imparting an additional value to it, so as a result to be entitled to a lien upon the chattel or thing for the amount or value of the money or skill and material bestowed, has, while the lien exists but not afterwards in case the amount to which he or she is entitled remains unpaid for 3 months after it ought to have been paid, the right, in addition to another remedy to which he or she may be entitled, to sell by auction the chattel or thing on giving 1 week's notice by advertisement in the Gazette and in a newspaper circulating in the place in which the work was done, setting out the name of the person indebted, the amount of the debt, a description of the chattel or thing to be sold, the time and place of sale, and the name of the auctioneer, and leaving a similar written notice at the last known place of residence of the owner.

             (2)  A person referred to in subsection (1) shall apply the proceeds of the sale in payment of the amount due to him or her and the costs of advertising and sale and shall, upon application, pay over a surplus to the person entitled to that surplus.

RSN1970 c229 s48

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Persons before whom affidavits may be taken

      46. (1) Affidavits required under this Act may be taken within the province before

             (a)  the registrar;

             (b)  a judge of the Supreme Court;

             (c)  a Provincial Court judge;

             (d)  a commissioner of the Supreme Court;

             (e)  a notary public under his or her official seal;

             (f)  a commissioner for oaths in and for the province, including a barrister referred to and under the conditions specified in section 4 of the Commissioners for Oaths Act; or

             (g)  a justice of the peace.

             (2)  Affidavits required by this Act may be taken outside the province before

             (a)  a judge of a court of record, under the seal of that court;

             (b)  the mayor of a city or town, under the seal of that city or town;

             (c)  Crown's consul or vice-consul;

             (d)  a commissioner of the Supreme Court;

             (e)  a commissioner for oaths outside the province; or

             (f)  a notary public, under his or her official seal.

             (3)  It shall not be necessary for the purpose of registration under this Act to prove or certify the seal or signature of that court, city or town, judge, Provincial Court judge, mayor, consul, vice-consul, justice of the peace, commissioner or notary public on that affidavit.

             (4)  An affidavit made under this Act shall not be held to be defective or void solely on the ground that it was taken before a solicitor for any of the parties to the document or before a partner of that solicitor.

RSN1970 c229 s49; 1979 c38 s7; 1986 c42 Sch B

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Regulations

      47. (1) The Lieutenant-Governor in Council may make regulations

             (a)  prescribing forms for use under or for the purposes of this Act and providing for the use of those forms;

             (b)  [Rep. by 1999 c22 s17]

         (b.1)  increasing the amount of a contract for which there may be early release of the holdback for the purposes of section 12.1;

             (c)  providing for the holding of inquiries into the operation of this Act and into a charge or complaint that a person has contravened this Act or the regulations, or has made a false statement in a form or other document required to be completed or made under this Act or the regulations, or into another matter arising in the administration of this Act, and providing that the person holding that inquiry shall have the powers that are or may be conferred upon a commissioner under the Public Inquiries Act, including the power to take evidence under oath or affirmation; and

             (d)  generally, to give effect to the purpose of this Act.

             (2)  Regulations made under subsection (1) may be made with retroactive effect.

             (3)  The registrar shall pay all fees collected by him or her under this Act through the Department of Justice into the Consolidated Revenue Fund.

RSN1970 c229 s50; 1991 c49 s3; 1999 c22 s17

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Fees

      48. The minister may set fees for the purpose and administration of this Act.

1999 c22 s17