Construction Lien Due Diligence for Alberta Commercial Property

1. Establish the acquisition and title perimeter

Identify every parcel, unit, leasehold interest, easement, improvement and entity in the purchase. Order current titles and all lien, certificate of lis pendens, mortgage, caveat, writ, postponement, discharge and court-order documents.

Do not assume one registered lien affects every parcel or that a clean title on one unit clears the larger project. Counsel should map each registration to the affected estate or interest.

• Purchased interest
• Affected registrations
• Claimants
• Contract chain
• Project status
• Proposed closing treatment

2. Reconstruct the project parties and authority

Index owner, developer, landlord, tenant, contractor, subcontractors, consultants, suppliers, lenders, sureties and insurers. Obtain corporate names, contracts, assignments, guarantees and authority for each material project decision.

The party occupying the site, paying invoices or directing work may not be the title owner or contracting owner. A broker, property manager or tenant statement does not establish legal authority to settle or discharge a lien.

3. Trace the registered lien lifecycle

Record the claim, affidavit, work category, last-work or supply allegation, registration, notices, court action, certificate of lis pendens and amendments. Have counsel determine which dates and statutory route apply.

Land Registry's public 60-day, 90-day and 180-day summaries are useful orientation only. The buyer should not calculate expiry from a tour comment, invoice date or unverified last-work date.

4. Reconcile the complete project account

Obtain prime and subcontract schedules, approved and pending changes, progress billings, proper invoices, certificates, non-payment notices, payments, holdbacks, trust records, disputed amounts, claims and cost-to-complete. Reconcile totals by contract and claimant.

The registered amount is not necessarily the final project liability, the amount required at closing or the cost to complete. Avoid adding liens and unpaid invoices without identifying overlap.

5. Review adjudication, litigation and settlement status

Ask counsel to identify any adjudication notice, determination, arbitration, court claim, certificate, security posting, settlement, appeal or enforcement step. Preserve operative documents and current counsel status rather than relying on summaries.

Alberta's prompt-payment adjudication pathway addresses defined disputes. Commencement, determination, court proceedings and title registration are distinct events; Commercially does not predict or interpret them.

6. Inspect the physical work and deficiencies

Coordinate qualified review of structure, envelope, roof, mechanical, electrical, plumbing, fire systems, site work, tenant improvements, equipment and commissioning. Compare installed work with drawings, specifications, changes, permits, consultant reports and payment claims.

Payment certification, substantial performance, occupancy and a visually complete space do not guarantee compliant, defect-free or fully paid construction. A property-condition review is not a lien opinion.

7. Verify permits, inspections and occupancy

Obtain municipal permit records, approved drawings, inspection results, deficiency notices, stop-work orders, verification documents, occupancy permission and closed-file status. Determine whether any permit is held by a party that will not continue after closing.

Edmonton states that occupancy permission follows successful mandatory inspections and that occupying before an occupancy permit is prohibited. Occupancy does not prove every construction account, warranty or lien issue is resolved.

8. Audit warranties, manuals and contractor status

Index warranties, bonds, insurance, WCB clearances, commissioning, as-builts, operations manuals, keys, software, spare parts and service contacts. Verify assignment and remaining term rather than assuming documents transfer automatically.

WCB-Alberta recommends clearance before releasing payment and describes what its clearance confirms. A WCB clearance is not a lien waiver, completion certificate, warranty or proof that every subcontractor is paid.

9. Underwrite the legal and physical closing solution

Separate amounts needed for title treatment, disputed claims, unfinished work, deficiencies, permits, warranty gaps and stabilization. Define price adjustments, escrows, holdbacks, security, covenants, access rights and post-closing work with counsel and lender approval.

A proposed holdback or seller promise is not automatically sufficient security or acceptable to a lender. Do not waive a title or construction condition until the actual documents and funding path are verified.

10. Preserve a coverage-adjusted decision

Record verified, disputed, missing and post-closing items; the professional responsible; financial range; required evidence; deadline; and walk-away trigger. Update the record immediately before waiver and closing.

Commercially can coordinate brokerage diligence and qualified referrals. It does not validate liens, calculate statutory periods, advise on lien funds, certify permit or construction status, perform engineering or accounting review, provide legal advice or guarantee title treatment.