Update to COVID-19 Emergency Regulation
Since our March 26, 2020 bulletin, the Ontario Government has made multiple Regulations under the Emergency Management and Civil Protection Act that impact the construction industry.
On April 9, 2020, the Ontario Government amended O. Reg 73/20 to exempt Ontario’s Construction Act and any regulations made under the Act from the suspension of limitation periods and procedural steps in a proceeding or intended proceeding. The previous version of O. Reg. 73/20 applied broadly to any statute, regulation, rule, by-law or order of the Government of Ontario. While it was unclear to what extent O. Reg 73/20 affected the various timelines imposed by the Act, with this amendment the Government has made it clear that beginning on April 16, 2020, the suspension of limitation periods and procedural steps will not apply to the Construction Act and its regulations. Parties will have the same time to meet a deadline that was remaining before March 16, 2020 when the suspension began.
In addition to clarifying the application of O. Reg 73/20 to the Construction Act, the Ontario Government has amended the list of essential businesses that are permitted to operate during the COVID emergency declared on March 17, 2020. As of April 3, 2020, the list of construction businesses deemed essential pursuant to O. Reg. 82/20 include projects associated with the healthcare sector, critical provincial infrastructure including transit, transportation, energy and justice sectors, certain critical industrial construction activities and residential construction projects where a footing permit or above grade structural permit has been granted or for projects involving renovations to residential properties where construction work was started before April 4, 2020.
On March 23, 2020, the Ontario Government originally declared a number of construction activities across healthcare, infrastructure, and critical industrial sectors, along with certain residential projects, to be essential services, thus permitting them to continue. On April 3, 2020, the government amended the list of essential services to reduce the types of projects that were allowed to stay open. However, on April 9, O. Reg. 136/20, changed the list once again, this time adding projects that are due to be completed before October 4, 2020 and that would provide additional capacity in the production, processing, manufacturing or distribution of food, beverages or agricultural products to those permitted to continue.
While the list of essential businesses is now shorter than the initial list released by the Government, a number of questions remain as to its application. For example, while “critical provincial infrastructure, including transit, transportation, energy and justice sectors” is listed as essential, there is no similar provision for municipal infrastructure projects, suggesting infrastructure projects undertaken by regional municipalities are not permitted to continue. In addition, it is unclear what sectors beyond “transit, transportation, energy and justice sectors” could qualify as “critical provincial infrastructure” projects permitted to remain operational. To the extent contractors and owners cannot agree on whether a project is considered essential or whether it has been ordered to close, there will likely be time and cost implications and such disputes may find its way to a court hearing, potentially many months after the Court resumes its normal operation.
It should also be noted that maintenance and repair services strictly necessary to maintain the safety, security, sanitation and essential operation of institutional, commercial, industrial and residential buildings is also listed as essential.
On April 8, 2020, the Government announced it would temporarily limit local noise bylaws from applying to construction projects in the health care sector, including new hospital projects, expansions, and COVID-19 assessment centers so that work can take place up to 24 hours a day. The purpose of this Regulation (O. Reg. 141/20) was twofold: to help accelerate the construction of critical projects and allow workers to properly practice physical distancing on construction sites.
On April 14, 2020, the Government extended the state of emergency for another 28 days.
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