Builders Lien Rights in BC When There Is No Written Contract

The BC Builders Lien Act grants lien rights to every contractor, subcontractor, worker, and material supplier who provides labour or materials for an improvement on land, regardless of whether a written contract exists between any of the parties. Section 2 of the Builders Lien Act, SBC 1997, c. 45, creates the lien right based on the performance of work or supply of materials, not on the form of the agreement. An oral agreement, a handshake deal, or an implied contract formed by conduct all establish a sufficient legal basis for filing a builders lien in BC. The Act goes further: Section 42 declares that any agreement purporting to waive or exclude the Act’s protections is void. This article explains the legal framework that protects lien claimants who work without a written contract, the evidence courts accept to establish the agreement, and how to preserve lien rights in the absence of formal documentation.

The Builders Lien Act Does Not Require a Written Contract

Section 2 of the Builders Lien Act creates the lien right based on a single statutory condition: the claimant performed work or supplied materials that improved land in BC, and the price for that work or material remains unpaid.

The statute does not reference a written contract. The Builders Lien Act establishes a lien right for every person who performs or provides work or material for an improvement. The Act defines “improvement” broadly to include any alteration, addition, construction, erection, installation, repair, or demolition of a building, fixture, structure, or land. A contractor who pours a foundation based on a verbal agreement has the same statutory lien right as a contractor who signed a 40-page construction contract. The lien is a creature of statute, not a creature of contract.

This principle has direct consequences for property owners. A homeowner who hires a contractor through a verbal agreement is exposed to lien claims from the contractor, from any subcontractors the contractor hires, and from any material suppliers who deliver to the project. The absence of a written contract does not shield the property from encumbrance. For a full analysis of homeowner exposure in these situations, see our article on whether a contractor can lien your house without a written contract.

Oral Agreements and Implied Contracts in BC Construction Law

BC law recognizes oral contracts and implied contracts as legally enforceable agreements that create the same rights and obligations as written contracts, including the right to file a builders lien for unpaid work or materials.

An oral contract exists when the parties agree on essential terms through conversation: the scope of work, the price (or a method for calculating it), and the timeline. A homeowner who tells a contractor “replace the deck for $15,000, and I will pay you when the work is done” has formed an oral contract. The contractor performs the work. The homeowner fails to pay. The contractor has a valid lien right under the Builders Lien Act because the work was performed for the improvement of land and payment remains outstanding.

An implied contract arises from conduct rather than express words. A supplier delivers lumber to a construction site at the contractor’s request, sends invoices, and the contractor accepts delivery without objection. No one signed a supply agreement. No one wrote down the terms. The conduct of the parties establishes an implied contract for the supply of materials. Under the Builders Lien Act as published on CanLII, the supplier’s lien right is identical to that of a supplier with a signed purchase order. BC courts consistently hold that the existence of a contract, not its written form, is the threshold question in lien disputes.

What Evidence Courts Accept When No Written Contract Exists

Courts evaluating builders lien claims without a written contract accept text messages, emails, invoices, receipts, photographs of work performed, testimony from witnesses, and any other evidence that demonstrates the existence of an agreement and the performance of work on the property.

The evidentiary burden falls on the lien claimant to establish three facts: that an agreement existed (oral, written, or implied), that work was performed or materials were supplied for an improvement on the property, and that payment remains outstanding. A written contract proves the first element automatically. Without one, the claimant must assemble documentary and testimonial evidence. For the procedural requirements of filing the lien itself, including the Form 5 and LTSA submission process, see the complete guide on how to file a builders lien in BC.

Text messages and emails carry significant weight. A message from the property owner saying “go ahead and start the work, we agreed on $25,000” is direct evidence of an oral contract. Invoices sent during the project and not disputed by the recipient demonstrate the ongoing commercial relationship. Photographs of the work in progress, timestamped and geotagged, establish that the claimant was physically present and performing work on the specific property.

Subcontractor Lien Rights When Only the Head Contractor Has a Written Contract

A subcontractor’s builders lien right exists independently of the head contract between the owner and the general contractor, meaning a subcontractor who has no written agreement with anyone on the project retains full statutory lien rights against the property title.

The Builders Lien Act creates a direct statutory relationship between the lien claimant and the property, bypassing the contractual chain. A subcontractor hired verbally by the general contractor has the same lien right as a subcontractor with a signed subcontract agreement. The property owner’s written agreement with the general contractor does not extinguish or limit the subcontractor’s statutory lien right. The subcontractor’s lien attaches to the property owner’s land, even though the property owner never agreed to hire the subcontractor directly.

This structure creates a specific risk for property owners. The owner signs a written contract with the general contractor, pays the general contractor in full, and assumes the project is financially settled. The general contractor fails to pay a subcontractor. The subcontractor files a builders lien against the owner’s property. The owner now has a registered encumbrance on title despite having paid the full contract price to the general contractor. The 45-day filing deadline and its triggering events determine how long the subcontractor has to file. For the complete analysis of these timing rules, see our article on when to file a builders lien in BC.

How Courts Determine Amount Owing Without a Written Contract

When no written contract specifies the price, BC courts determine the amount owing based on the principle of quantum meruit: the reasonable value of the work performed and materials supplied, assessed by reference to industry rates, comparable projects, and expert evidence.

Quantum meruit, meaning “as much as is deserved,” applies when work is performed under an agreement that does not specify a fixed price, or when the agreed price is disputed. The court examines what a reasonable person in the same industry would charge for the same work in the same geographic area. Expert testimony from construction estimators, trade-specific cost databases, and comparable project invoices all serve as evidence of reasonable value. The BC Construction Association’s builders lien guide provides context on how industry pricing standards inform these assessments.

The lien claimant bears the burden of proving the value of the work. A contractor who files a builders lien claiming $50,000 for work performed under an oral agreement must demonstrate that $50,000 represents the reasonable value of the labour and materials provided. Courts reject inflated claims. Section 25(2)(b) of the Builders Lien Act authorizes the court to cancel a lien that is “vexatious, frivolous or an abuse of process,” and a grossly inflated claim can meet that threshold. Filing an accurate claim is essential. An exaggerated lien filed against property title exposes the claimant to cancellation of the lien, an adverse cost award, and potential liability for damages caused by the wrongful registration.

Protecting Your Lien Rights When Working Without a Written Contract

Contractors, subcontractors, and suppliers who work without a written contract protect their lien rights by documenting every communication, photographing all work performed, retaining copies of all invoices and delivery receipts, and filing the lien promptly when a payment dispute arises.

Documentation is the substitute for a written contract. Every text message, email, voicemail, and handwritten note becomes potential evidence in a lien enforcement proceeding. The claimant who keeps a daily log of work performed, photographs each stage of progress, and retains copies of every invoice has a strong evidentiary foundation. The claimant who relies on memory alone faces an uphill battle in court.

Filing the lien early in the 45-day window is critical for claimants without written contracts. Disputes over the existence or terms of an oral agreement take time to resolve. Filing the lien preserves the statutory right while negotiations continue. The lien can be discharged at any time if the payment dispute is resolved. Waiting to file, in contrast, risks miscalculating the triggering event date and permanently losing the lien right. The Linley Welwood analysis of lien rights without a written contract reinforces this principle: the absence of a written contract makes early filing more important, not less, because the factual disputes that accompany oral agreements are resolved in court, not at the Land Title Office.