Prompt Payment Legislation and AFP Projects in Alberta

Geoff Stenger, Jason Roth, Evan Hall and Parker Mckibbon write in Alberta Heavy on the impact of prompt payment and adjudication legislation on alternative financing and procurement (AFP) projects in Alberta.

In Alberta, there are certain requirements in the current version of the Alberta Prompt Payment and Construction Lien Act applicable to AFP projects that are unique compared to projects that do not use AFP delivery models.

Notably, the Alberta Prompt Payment and Construction Lien Act will not apply to:

• public works as defined in the Public Works Act (Alberta); and
• agreements to finance and undertake an improvement in which the Crown or a provincial corporation is a party.

The legislation also includes language to further exempt parties, agreements and undertakings that will be specified in the regulations, which have not been developed at this time.

The applicability of prompt payment legislation on AFP projects in Alberta is currently unclear. Subcontractors and contractors working on AFP projects with the Government of Alberta will likely not benefit from prompt payment protections unless the government provides prompt payment terms in the contract. Therefore, heavy construction companies in Alberta may or may not benefit from prompt payment legislation in the province, depending on the owner of the project.