April 08, 2014

For your assistance in dealing with home remodelling contractors, the BBB offers the following tips:

When you are thinking of having any home improvement work done it is advisable to obtain at least 3 estimates from contractors who have permanent addresses in your area. These estimates should be in writing. Beware of quick estimates and high pressure tactics. A legitimate contractor needs time to prepare a detailed estimate and won't pressure you into an immediate decision. Ask for the names of at least 2 satisfied clients and check with them. If this is a major job, have your bank call the contractor's bank to clarify his financial standing. The contractor should provide proof that he is in good standing with the Workers' Compensation Board, is bonded and can provide third-party liability insurance. If the estimates vary, find out why. For example, are the materials the same quality? Is the time to accomplish the job the same? etc.

Get a contract written on company letterhead with a complete price quotation including: a description of the work to be done, the start and completion date, the quality of the materials to be used, and any guarantees or warranties, the total cost with a breakdown of labour and material charges and a payment schedule. Put down no more than 10-15% of the total cost as a deposit when the contract is signed. If this contract is for the sale of services or a combination of goods and services and the vendor is a door-to-door (direct) seller, the vendor may not require a down payment of more than $100 or 10% of the purchase price, whichever is lesser. If the contractor is asking for more than 10-15% down ask why and satisfy yourself that the request is reasonable. It is possible to pay for all the materials as required and therefore negotiate the deposit. Custom orders may require a larger deposit.

Be sure the written contract spells out who is responsible for getting building permits and approvals.

Do NOT sign a contract unless you have done all of the above and you know who will be responsible for the actual work done. Never sign a contract with sections left blank.

Because most homeowner's fire and liability insurance does not cover construction - related risks, contact your insurance company before construction begins to inform them about your project and make arrangements for any additional coverage needed. 

You must withhold 10% of the total cost upon completion of the work for 55 days. This will protect you, should liens be placed against your home. In Shimco Metal Erectors Ltd. v. Design Steel Constructors Ltd., Corporation of the District of North Vancouver, the Supreme Court of British Columbia held that contractors, subcontractors and material suppliers have lien rights, not only against the lands in relation to which they supplied labour or materials, but they also have an independent lien against the holdback funds retained by the owner under the Builders Lien Act.

The result of this decision is that a contractor or subcontractor can claim a lien against the holdback funds without the requirement of filing a lien against the lands on which the improvement is constructed. The Court's recognition of a contractor's independent lien against the holdback funds means that an owner can no longer be certain that there are no claims of lien arising out of a construction project simply by conducting a Land Titles search to ensure that no liens have been filed against lands on which the improvement is constructed. In Shimco, the Court stated that an owner can only safely release the holdback funds if the following conditions have been met:

1. the holdback period has expired; and
2. no claim of lien has been filed against the lands on which the improvement is constructed and no legal proceedings have been commenced to enforce a lien against the holdback funds.

Accordingly, in order to avoid the possibility of liability arising for a claim of lien, prior to releasing the holdback funds, an owner must ensure that 55 days have passed since the completion of the work and that no claims of lien have been advanced against either the lands or the holdback funds. Due to the Shimco decision, it is now necessary for an owner to conduct both a Court Registry search to determine if a claim of lien has been advanced against the holdback funds and a Land Title search to confirm that no claim of lien has been advanced against the lands.

Homeowners who act as their own contractors for building or renovation projects must also set up a trust fund for these holdbacks. Contact your financial institution for assistance.

For more information on hold back requirements, obtain a copy of the Builders' Lien Act from the Queen's Printer, 2nd Floor, 563 Superior Street, Victoria, B.C., V8W 4R6 (street address); PO Box 9452 Stn Prov Govt, Victoria, B.C., V8W 9V7 (mailing address); and on their website The telephone number is (250) 387-3309.

Be suspicious of any contractor who approaches you at your home claiming that he can give you a cut-rate price because he has leftover material, or that your roof looks hazardous and needs immediate repairs, or that he will pay you a commission if others agree to the same work, or that, as a factory representative, he can offer you a "good deal."

If you signed the contract in your home with a direct seller, you have 10 days in which to cancel the contract. Notify the contractor of cancellation in writing by using Canada Post registered mail. Be sure to get a signature showing that the mail was received by the contractor. Do NOT allow work to commence until after the 10-day cancellation period has expired.

For your information, the Canadian Home Builders' Association of British Columbia has produced a brochure and contract packages. The intention of the information is to assist consumers in planning their renovation and to address the problem of 'fly-by-night' contractors who do not use contracts. The brochures are complimentary through any of their offices throughout the province. Call 1-800-933-6777 or visit the association's website at for more information. The contract packages are priced as follows: Large projects Package - $24.95 + GST. Small Projects Package - $14.95 + GST.

The Homeowner Protection Office was established in October, 1998 by the B.C. government through legislation in response to the recommendations from the Barrett commission of inquiry into the quality of condominium construction. They have prepared two consumer booklets, "Buying a New Home: A Consumer Protection Guide and Land Use Planning & Weather Protected Buildings." It also has a website at

As of September 30, 2000, regulations under the Homeowner Protection Act require the licensing of contractors who perform building envelope renovations on residential buildings of three units or more. The HPO keeps an up-to-date registry of all Licensed Building Envelope Renovators in the province on its website for consumers to reference. 

Licensed Building Envelope Renovators are also required to arrange for third-party home warranty insurance on their work on multi-unit buildings through an insurance company approved by the British Columbia Financial Institutions Commission. The minimum coverage and standards for this warranty insurance must meet the requirements of the Homeowner Protection Act and as such will always include 2 years on labour and materials for any job that costs more than $2,000 per unit. If 60 percent or more of any wall is replaced, an additional 5-year warranty on water penetration is mandatory. For enquiries regarding building envelope remediation or for information about the regulations governing building envelope repairs, warranty requirements, and for a list of licensed building envelope renovators, please visit the HPO's website

For further information on this subject, contact DIAL-A-LAW at (604) 687-4680.