Putting a lien on a house in Ontario is a way to stake a legal claim when a dispute involving payment arises. You can file a lien through the Ontario provincial government using Service Ontario and, in most cases, Small Claims Court. Members of the general public and contractors or suppliers of work have protections under the Construction Lien Act and other regulations. For example, if you did construction work on a house, or lent someone money who used their home as collateral, putting a lien on that house acts as a form of collateral for the money you are owed. Any property that carries a lien can be forced into sale by the lender if, for example, the loan is in default.
Do a Lien Search
Do a property title or lien search on the house through Service Ontario (see Resources). Find out if there are any other claims on the property and the nature of these claims. This information might influence the strategy or amount of your claim.
Verify Home Ownership
Make sure the owner of the house is the individual that you want to issue the claim against. The search will provide you with the necessary information to include in your claim. Keep a record of all relevant information, claims forms and the actions you took in case you need to refer to them in the future.
File a Claim With the Court
Use Small Claims Court of Ontario to file your lien claim if the amount is $25,000 or less. For larger claims, consult a lawyer. You can file a Small Claims Court claim on line, by mail, or in person at the closest courthouse. If you have a clear contract that shows you are owed the money, you can ask for a default judgement from the court. The cost of filing a claim with Small Claims Court is $95. If you can't get a default judgement, there will be additional fees for filing a notice of motion for a hearing, or summoning witnesses to that hearing. Make sure to complete all details of the form, including owner’s full name, date of birth and current address. The courts are very particular about information on legal documents. Take the time to provide all relevant information and rationale about why you are filing the lien.
Register a Lien
Register your lien with the same Service Ontario website you used to search for liens. Pay any necessary fees required with the filing online with a major credit card. The cost of registering to impose a lien on a property is $8 per year.
Serve the Home Owner
Serve the forms to the owner of the house, who is the defendant, by registered mail. This creates the need for the defendant to file a defense in a reasonable time frame, or you can apply to the court for judgment.
Collect, or Negotiate if Needed
Wait for the defense to respond before determining your next course of action. If the dispute does not seem to be heading down a path of resolution, seek legal advice from a lawyer who can assist with enforcing a judgment. Be prepared to negotiate the amount and arrive at a new arrangement should the owner be in such poor financial state that recovering some money is better than none.