How to Put a Lien on a Business in Ontario

If you are trying to figure out how to put a lien on a business in Ontario, the first thing to know is that there is no single procedure. It refers to four distinct legal tools: a PPSA security interest for secured lenders and suppliers, a construction lien under the Construction Act for those who improve real property, a writ of seizure and sale after a court judgment, and a repair and storage lien under the RSLA. Each has different requirements and deadlines.

If you are owed money by an Ontario business and someone told you to "just put a lien on it," that advice skips the most important question: which lien? The right answer depends entirely on how the debt arose. Was there a signed security agreement? Was the work done on a building or on land? Do you already have a court judgment? Were you repairing or storing the debtor's goods when you went unpaid?

Choosing the wrong mechanism, or missing a statutory deadline under the right one, can wipe out your enforcement rights completely. This guide walks through all four tools, who each one is for, how to use it, and the deadlines that matter. It covers Ontario law only. Other provinces have their own personal property security and construction lien statutes, so do not assume Ontario rules apply outside the province.

What Types of Liens Can You Put on a Business in Ontario?

Before getting into procedure, it helps to see the four tools side by side. They are governed by four different statutes, they attach to different kinds of property, and they are triggered by different events.

The rest of this guide takes each mechanism in turn.

How to Put a PPSA Lien on a Business: Secured Lenders and Suppliers

This is the tool for creditors who arranged security before things went wrong. It covers banks and private lenders advancing credit against business assets, equipment vendors and inventory suppliers who keep a security interest in what they sell, and any business extending trade credit under a security agreement.

What the PPSA covers

The Personal Property Security Act, R.S.O. 1990, c. P.10 governs security interests in personal property, which means essentially everything except land. A security interest is a contractual arrangement where a creditor takes an interest in the debtor's personal property as collateral for payment.

A security interest only protects you against third parties, such as other creditors or a trustee in bankruptcy, if it is "perfected." For most business creditors, perfection happens by registering a financing statement in the Ontario Personal Property Security Registration System (PPSR).

How to register a financing statement

1. The parties sign a security agreement describing the collateral.
2. The creditor, or its lawyer, logs in to the Ontario PPSR portal.
3. File a financing statement identifying the debtor (legal name and address are critical, because errors can invalidate the registration), the secured party, and a description of the collateral.
4. Pay the registration fee, which is modest and varies with the registration term.
5. Choose your term. Commercial registrations can run for a long fixed period or be registered as perpetual; consumer registrations are more limited.
6. Keep the registration current with a financing change statement if the debtor's name, address, or collateral changes, or to extend the term before it expires.

Priority: first to register usually wins

The general rule under the PPSA is "first in time, first in right." A creditor who registers on Monday can beat a creditor who signed a security agreement the previous Friday but did not register. This is why timing matters so much.

There is an important exception. A Purchase-Money Security Interest (PMSI) lets a creditor who financed the debtor's acquisition of specific collateral jump ahead of earlier registrants. A classic example is an equipment seller who keeps a security interest in the very equipment it sold on credit. To get PMSI super-priority over non-inventory collateral such as equipment, the security interest generally must be perfected within a short window after the debtor takes possession (the PPSA sets this out in section 33, and your lawyer should confirm the exact timing for your situation). For inventory, the rules are stricter: the PMSI holder must perfect before the debtor receives the goods and give written notice to earlier registrants covering the same inventory.

A practical habit protects you here. Search the PPSR before you advance funds or deliver goods on credit, so you know who has already registered against the debtor.

What can be reached, and the key risk

A PPSA registration can reach accounts receivable, inventory, equipment, motor vehicles, intellectual property rights, and other personal property described in the financing statement. It does not reach land. For real property you need a writ of seizure and sale of land, covered further below.

The single biggest risk is failing to register before you part with money or goods. An unperfected security interest is treated as unsecured in a bankruptcy, which means you stand in line with everyone else. Register first, advance second.

How to File a Construction Lien in Ontario

If you supplied labour or materials to a construction, renovation, or demolition project and were not paid, your tool is a construction lien, not a PPSA registration.

Statutory basis and scope

Construction liens are governed by the Construction Act, R.S.O. 1990, c. C.30 (formerly the Construction Lien Act, renamed and substantially amended in 2018, with further changes under Bill 60 arriving in 2026). Under section 14, any person who supplies services or materials to an improvement for an owner, contractor, or subcontractor has a lien on the owner's interest in the premises for the price of those services or materials.

Two features make this remedy different from the others. First, the work has to relate to an "improvement," meaning the construction, alteration, repair, or demolition of a structure, or the preparation of land for a structure. Second, the lien attaches to the owner's interest in the land, not to the business's bank account or equipment. It is registered against the title to the property being improved.

The deadlines that decide everything

Construction lien rights are governed by hard deadlines, and the courts have no power to extend them. There are two stages.

To preserve a lien, you register a claim for lien on the title within 60 days of the applicable triggering event. The trigger depends on who you are. For most claimants it runs from the last supply of services or materials. For a prime contractor and owner, publication of a certificate of substantial performance, or completion, abandonment, or termination of the contract, can start the clock. Because the trigger varies, calculate your specific deadline carefully, and ideally confirm it with a lawyer before you rely on it.

To perfect the lien, you then commence a court action in the Superior Court of Justice and register a certificate of action on the title, generally within 90 days after the last day the lien could have been preserved. Miss either window and the rights are gone.

A note on recent change: under Bill 60, the release of annual holdback is now handled separately from lien expiry timelines, so contractors no longer have to register liens annually simply to protect their position against annual holdback release. The base preservation and perfection deadlines still run from the triggers above, so do not treat the holdback change as extra time to file.

How to preserve a construction lien

1. Confirm the triggering event that applies to you and calculate the 60-day deadline.
2. Prepare a Claim for Lien using the prescribed form under the Construction Act.
3. Register the Claim for Lien at the land registry office for the area where the property is located.
4. Serve a copy on the owner, and on the general contractor if you are a subcontractor.
5. Track the 90-day perfection deadline that follows.

Holdback and priority

Ontario law requires the owner to hold back a percentage of the price of all services and materials supplied to the improvement, commonly 10%. This holdback is a statutory trust fund that lien claimants can look to, and an unpaid contractor can claim against it without proving the owner is insolvent. A construction lien also enjoys strong priority: it generally ranks ahead of mortgages and encumbrances registered after the first supply of services or materials, and that priority relates back to when work first began, not when the lien was registered.

Judgment-Based Enforcement: After You Win in Court

This is the path for a trade creditor or service provider who has no security agreement and no construction project to point to. You cannot register a writ of seizure and sale or obtain a garnishment order out of thin air. You need a court judgment first, which means suing the business and winning (or settling on terms that become enforceable).

Because this route runs through litigation, it overlaps heavily with the broader debt recovery process in Ontario, which covers demand letters, choosing a court, and the strategic decisions that come before enforcement. Once you have a judgment, several enforcement tools open up.

Writ of seizure and sale: personal property

File the writ with the enforcement office (the sheriff) in the county where the debtor owns property. This allows the sheriff to seize and sell the debtor's personal property, such as vehicles, equipment, and inventory, at public auction, with the proceeds applied to your judgment. The process is governed by the Execution Act, R.S.O. 1990, c. E.24. Some property is exempt from seizure, including certain clothing, household necessities, and tools of the debtor's trade up to statutory limits.

Writ of seizure and sale: land

File the writ with the enforcement office in any county where the debtor owns land. It acts as a charge against all land the debtor owns in that jurisdiction, present and future, and it stops the debtor from selling or refinancing without dealing with your judgment. Actual sale of land is subject to waiting periods after the writ is filed, and the writ itself expires after several years unless renewed. This is the closest thing in Ontario to the "judgment lien on a business" that people often imagine, because it ties up the debtor's real estate.

Garnishment

A garnishment intercepts money owed to the debtor by third parties, such as bank balances and accounts receivable from the debtor's own customers. You serve a Notice of Garnishment on the garnishee, the third party who owes money to the debtor. Garnishment is often the most direct way to reach a business debtor's cash flow.

Examination in aid of execution

Before committing to any single method, you can compel the debtor to attend an examination under oath about their assets, income, and recent transfers, under Rule 60.18 of the Rules of Civil Procedure. This helps you target enforcement at assets that actually exist.

A reality check belongs here. Run a PPSR search, a land title search, and a corporate search before you sue. A judgment against a company with no assets, or one whose assets are already fully encumbered by prior PPSA registrations, may be uncollectable, and litigation costs money you may never recover.

Repair and Storage Liens: For Repairers and Storers

The fourth tool is the most specialized. It is for vehicle repair shops, equipment repairers, warehouse operators, and any business that repaired or stored someone else's goods and was not paid. It comes from the Repair and Storage Liens Act, R.S.O. 1990, c. R.25, and it provides two distinct liens.

Possessory lien

A possessory lien arises automatically when a repairer or storer keeps possession of the goods after the work or storage is done. No registration is required while you hold the goods. The trade-off is total: this lien is one of the strongest in Ontario, ranking ahead of other secured creditors, but it disappears the instant you voluntarily hand the goods back. Once returned, a possessory lien cannot be revived.

Non-possessory lien

If the goods have already been released to the owner but money is still owed, a non-possessory lien may be available. It requires two things: a signed acknowledgement of indebtedness from the debtor, such as a signed invoice confirming the amount owing, and registration of a claim for lien in the Ontario PPSR. Its priority is strong, but a registration gap can let an intervening secured creditor leapfrog you, so register promptly after releasing the goods. Once registered, you can apply to court for an order to seize and sell the goods.

The practical lesson for repairers is simple. If at all possible, do not release the vehicle or equipment until you are paid, because the possessory lien is your best protection. If you must release goods first, get a signed invoice acknowledging the debt and register a non-possessory lien immediately.

A Note on Bankruptcy

If the debtor business becomes bankrupt, separate rules under the federal Bankruptcy and Insolvency Act take over, and they can change or stay your enforcement options. This is exactly why perfecting a PPSA interest and meeting construction lien deadlines matter so much: those steps determine whether you are a secured or unsecured creditor when insolvency hits. If you learn the debtor is heading into bankruptcy or receivership, speak to a lawyer right away, because timing can be measured in days.

Common Mistakes That Kill Lien Rights

• Missing the 60-day construction lien preservation deadline. There is no judicial discretion to extend it. The rights are simply extinguished.
• Advancing funds or delivering goods before registering a PPSA financing statement. An unperfected interest leaves you unsecured in a bankruptcy.
• Using the wrong legal name for the debtor on a financing statement. A name error can invalidate the registration and defeat your priority.
• Releasing goods from a repair shop without a signed acknowledgement of indebtedness. You lose the possessory lien and the documentary basis for a non-possessory one.
• Confusing construction liens with PPSA interests. They are separate systems. A contractor who both works on land and supplies equipment on credit may need both.
• Letting the 90-day construction lien perfection window lapse. It is just as absolute as the preservation deadline.

When the Situation Does Not Fit Neatly

Many real disputes do not slot cleanly into one box. A creditor may have a partial security agreement, a contractor may also be owed for off-site supplies, or a debt may simply be large enough to need a full litigation and enforcement strategy rather than a single filing. In those cases, the broader debt recovery process in Ontario sets out the wider set of options, and it is worth understanding how enforcement fits within a litigation plan before you spend on either. Business structure can matter too, because the way a company is organized affects which assets are reachable, a point worth reviewing with experienced Toronto commercial lawyers if the amounts are significant.

Frequently Asked Questions

Can you put a lien on a business in Ontario without going to court?

Yes, in some cases. A PPSA financing statement, a construction lien, and a repair and storage lien are all registered without first obtaining a court judgment. A writ of seizure and sale or a garnishment is different: those judgment-based remedies require a court judgment first, which means you have to sue the business and win before you can use them.

How long does a construction lien last in Ontario?

A construction lien must be preserved by registration on title within 60 days of the applicable triggering event, then perfected within roughly 90 days after the last day for preservation by starting a court action and registering a certificate of action. These deadlines are strict and cannot be extended by a court, so calculate your specific trigger date carefully.

What happens to a lien if the business goes bankrupt?

Bankruptcy brings in the federal Bankruptcy and Insolvency Act, which can stay enforcement and reorder priorities. Whether you recover often turns on whether your interest was properly perfected or your lien properly preserved before the bankruptcy. An unperfected PPSA interest is treated as unsecured. If bankruptcy is looming, get legal advice immediately, because deadlines can be very short.

Can a supplier put a lien on a business that owes them money?

It depends on how the debt arose. A supplier with a signed security agreement can register a PPSA financing statement against the business's personal property. A supplier of materials to a construction improvement can register a construction lien against the land. A supplier with neither, just an unpaid invoice, generally must sue first and then enforce the resulting judgment.

How much does it cost to register a lien in Ontario?

The government registration fees are modest and vary with the type of registration and, for PPSA financing statements, the chosen term. The larger cost is usually professional fees if you retain a lawyer to prepare and register the lien correctly, which is often money well spent given how easily a procedural error can defeat the lien.

What is the difference between a construction lien and a judgment lien?

A construction lien arises from supplying services or materials to an improvement and attaches to the owner's interest in the land, with no court judgment required to register it. A judgment "lien" comes from enforcing a court judgment, typically a writ of seizure and sale that charges the debtor's land or allows seizure of personal property. One is a statutory right tied to construction work; the other is the product of winning a lawsuit.

Sources and Official Resources

Ontario Statutes Cited

1. Construction Act, R.S.O. 1990, c. C.30 - Section 14 (lien right), Section 22 (10% holdback), Section 31 (60-day preservation deadline), Section 36 (90-day perfection deadline)
2. Personal Property Security Act, R.S.O. 1990, c. P.10 - Financing statement registration, perfection, Section 33 (PMSI super-priority)
3. Repair and Storage Liens Act, R.S.O. 1990, c. R.25 - Possessory and non-possessory lien mechanics
4. Execution Act, R.S.O. 1990, c. E.24 - Writ of seizure and sale, exemptions, enforcement procedures
5. Rules of Civil Procedure, O. Reg. 194 - Rule 60.18 (Examination in Aid of Execution)

Federal Statutes Cited

6. Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3 - Priority and stay of enforcement on insolvency

Ontario Government Registry Resources

7. Ontario Personal Property Security Registration System (PPSR) - Register a Security Interest

Contact Hadri Law

If an Ontario business owes you money and you are weighing your enforcement options, the time to act may be shorter than you think, especially where construction lien deadlines or PPSA priority are in play. The right move depends on how your debt arose, and the wrong move can cost you the remedy entirely.

Hadri Law is a Toronto corporate and commercial firm with experience in secured lending, PPSA registrations and searches, debt recovery, and enforcement. We can review your situation, identify which mechanism applies, and help you act before a deadline closes. Nassira El Hadri, our founder, spent years in secured and unsecured debt recovery across Canada before founding the firm, and our team works in English, French, Spanish, and Catalan.

Book a free initial consultation at calendly.com/hadrilaw/free-consultation or call us at +1 (437) 974-2374. Learn more about how our Toronto commercial lawyers help creditors protect and recover what they are owed.

This article is for general information only and does not constitute legal advice or create a solicitor-client relationship. Lien deadlines and procedures are strict and fact-specific. Consult a lawyer about your particular situation.