Written By: T. David Marshall, Barrister & Solicitor
May 5, 2022

While the ODACC tribunal is still in its infancy, a few things are starting to become clear.

One of those things is just how tough overcoming the seemingly simple requirement of having a proper invoice can be. This hurdle should not be underestimated.

Experience Shows Section 6.1 is a Significant Hurdle

Our office is one of a handful in the province to have won multiple hearings before the ODACC tribunal. Most matters never make it to a hearing, and instead settle. But, when claims don’t settle, it pays to read the requirements of the Act carefully.

This is especially the case with Section 6.1 of the Construction Act, R.S.O 1990, c. C30. This Section is the start of the prompt payment process.

The process starts with the seemingly simple requirement that a contractor has already submitted to an owner a “proper invoice”.

The Section is demanding, and in our experience is likely to be read strictly.

As the Act states:

“proper invoice” means a written bill or other request for payment…if it contains the following information…”.

In other words, if it does not contain the following information, it is open to the tribunal to rule the contractor has not supplied a “proper invoice” and is thus ineligible to avail itself of the prompt payment process.

The Section then defines exactly what must be in an invoice to qualify as a proper invoice:

1) The contractor’s name and address

2) The date of the proper invoice and the period during which the services or materials were supplied

3) Information identifying the authority, whether in the contract or otherwise, under which the services or materials were supplied.

4) A description, including quantity where appropriate, of the services or materials that were supplied.

5) The amount payable for the services or materials that were supplied, and the payment terms.

6) The name, title, telephone number and mailing address of the person to whom payment is to be sent.

7) Any other information that may be prescribed.

Based upon our experience, contractors and subcontractors need to take seriously 1-6 (in respect to 7, nothing additional has yet to be prescribed). That means, for example, not simply tallying up their hours and providing an overview or general statement about the services rendered, but instead providing a detailed list and description of the work done, the amount of time and cost of those individual services, etc.

Additionally, for example, contractors and subcontractors must ensure the actual name of the individual person to whom payment must be sent (example: “John Smith at accounting”), his or her direct telephone number and his or her mailing address is included in the invoice.

The bottom line is that cutting corners in crafting invoices puts contractors’ and subcontractors’ access to the Construction Act’s prompt payment process at risk, leaving them with potentially (and only) the more expensive and time-consuming route of liening and making a claim in Superior Court, in order to get paid.