Disputes and ending a contract: mediation, arbitration, tribunal, court and liens in BC

First steps inside the contract

Before any outside process, read the dispute clause and the notice clause. A contract can require written notice of a claim within a set number of days, and a missed deadline can cost a claim. Write to the builder, describe the problem, refer to the clause, and ask for a meeting. Keep the site records: dated photos, the daily log if the builder keeps one, emails, change orders and payment records.

Check the contract before stopping all payment. A missed payment can be a default under the contract's own terms, and a default can give the builder a right to suspend work or end the contract. Paying the undisputed amounts, while keeping back the disputed amount and the statutory holdback, limits the argument to the disputed amount.

Time limits keep running while the two sides talk. Under section 6 of the Limitation Act, a court proceeding must start within 2 years of the day the claim is discovered, and section 21 sets an ultimate limit of 15 years from the act or omission the claim is based on. Section 8 says a claim is discovered on the first day the person knew, or reasonably ought to have known, that loss occurred, that an act or omission caused it, that the other party was responsible, and that a court proceeding would be an appropriate way to fix it.

Mediation

Mediation is a meeting in which a mediator helps the people in a dispute talk and work toward an agreement. The province's page on mediation, last updated 16 December 2025, lists real property and construction among the civil disputes it is used for, and says the dispute is resolved only if all the people involved agree.

Once a lawsuit about a home is in the Supreme Court, mediation can be required. The Notice to Mediate (Residential Construction) Regulation applies to an action about the construction, renovation or repair of a building, or part of one, intended for people to live in. Under section 2, any party may serve a Notice to Mediate at any time after the action starts and no later than 180 days before trial. The parties then have 21 days to appoint a mediator together (section 3). The mediator holds a pre-mediation conference within 60 days of appointment unless all parties waive it in writing (section 5), and the mediation session must take place within 150 days of appointment unless the parties agree on a later date or a court orders one (section 9). Each party must attend (section 6). The regulation describes the mediator as a neutral and impartial facilitator with no decision-making power, so a settlement happens only if the parties reach one.

A contract can also require mediation before arbitration or court. If yours does, follow the steps in order and in writing.

Arbitration

Arbitration is a private hearing before an arbitrator who decides the dispute. It applies when the parties have agreed to it, which on a building project means a clause in the construction contract. BC's Arbitration Act applies when the place of arbitration is in British Columbia (section 2) and sets the rules where the contract is silent. If the parties do not agree on the number of arbitrators, there is one (section 13).

An arbitration clause changes where a dispute goes. If one side sues in court on a matter the clause covers, section 7 says the court must stay the court case on application, unless the arbitration agreement is void, inoperative or incapable of being performed. The application must be made before the applicant's first response on the substance of the dispute. Section 54 makes an award final and binding on the parties. An appeal to the Court of Appeal on a question of law needs the consent of all parties or leave of a justice of that court, and leave can be sought unless the arbitration agreement expressly rules out such appeals (section 59). Section 61 lets the Supreme Court recognise and enforce an award.

Before signing a contract with an arbitration clause, ask a lawyer how the clause fits the size of your project, and whether claims under $35,000 should be left out of it so they can still go to the tribunal or small claims court.

Tribunal and courts, by amount

Without an arbitration clause, the amount claimed decides where a money claim goes. The Civil Resolution Tribunal has jurisdiction over most small claims up to $5,000, and lists construction and renovations among its issue categories. Provincial Court small claims hears claims from $5,001 to $35,000. A judge there cannot award more than $35,000 plus interest and expenses, so a claimant above that amount must give up the excess or go to the Supreme Court (limits as of 24 October 2026). Section 3 of the Small Claims Act gives the Provincial Court jurisdiction over claims for debt or damages, personal property and services up to the amount set by regulation.

Builders liens follow a separate path. The Builders Lien Act defines court as the Supreme Court, and section 26 says a claim of lien may be enforced by an action under the Supreme Court Civil Rules. So a contractor's lien on a house in Vancouver or Coquitlam is enforced in the Supreme Court, whatever the amount of the lien.

Liens during a dispute

A builder or trade that believes it is owed money can file a claim of lien against the property. Under section 20 of the Builders Lien Act, it must be filed within 45 days after a certificate of completion is issued, or after the head contract is completed, abandoned or terminated. Once filed in the land title office, the lien is registered against the title of the property.

The owner has tools under the Act. Section 23 lets the owner pay into court the lesser of the total claims and the amount owing, provided it is at least the required holdback; the claims are then removed from title and the owner is discharged. Section 24 lets the owner apply to court to cancel a lien by giving security, which the court may set below the claimed amount. Section 33 (2) lets the owner serve a notice to commence action, after which the claimant has 21 days to start an action and register a certificate of pending litigation, or the lien is extinguished.

The Act also guards against wrongful liens. Under section 19, a person who files a claim against land to which the lien does not attach is liable for the owner's costs and damages. Section 45 makes it an offence to knowingly file a claim of lien containing a false statement, with a fine of up to the greater of $2,000 and the amount by which the claim was overstated (as of 24 October 2026).

When a builder stops work, or the contract ends

Ending a contract is a legal step with consequences, and the termination clause decides how it works. A useful clause states the grounds on which each side may end the contract, the written notice needed, a period to fix the problem before termination takes effect, what the builder is paid for work done, who owns materials on site, and how the holdback and warranties are handled.

If a builder stops coming to site, record it with dates. Under section 1 (5) of the Builders Lien Act, a contract is deemed abandoned after 30 days with no work, unless the stop had a listed cause. Abandonment and termination start the 45-day lien filing period and the 55-day holdback period, so keep the holdback until that period ends. Secure the site, check that the insurance still applies, confirm who is now the prime contractor for WorkSafeBC, and get a lawyer's advice before you end the contract in writing or hire a replacement builder.

Then take stock. List the work done against the schedule of values, the payments made, the holdback kept, any liens filed, and the trades still owed. A lawyer will need all of it, and so will the next builder pricing the rest of the job.