On March 31, 2022, British Columbia passed new legislation that will reform and consolidate the law on commercial liens in British Columbia. Bill 11 – 2022: Commercial Liens Act (the “CLA”) will modernize this area of the law and establish a framework for commercial liens that aims to be more consistent with other jurisdictions in Canada. While the CLA has received royal assent, the act will be brought into force by regulation at a yet to be determined date (likely 2023 at the earliest).
Generally, liens grant service providers (such as repairers, warehousers and common carriers) a legal right to retain a customer’s property to secure payment or performance of an obligation.
The current commercial lien regime in British Columbia is governed by a collection of outdated legislation and common law principles that are criticized as being difficult to follow, inconsistent, inflexible and inefficient. The CLA will repeal the current legislation and common law liens and replace them with a single comprehensive framework that is integrated with the Personal Property Security Act (the “PPSA”). In particular, the CLA will repeal and replace the Repairers Lien Act, Warehouse Lien Act, Livestock Lien Act, Tugboat Worker Lien Act, Woodworker Lien Act, and the common law possessory liens which establish a lien for services. The CLA will not affect liens under the Builders Lien Act, which is most commonly used in commercial real estate and the Forestry Service Providers Protection Act.