When a job goes sideways you have a ladder of options, and the trick is to climb it in order rather than jumping to court. The rungs are negotiation, mediation, prompt-payment adjudication, arbitration, and finally small claims or the superior court. Each is faster and cheaper the further down this list you stay, so start with a direct conversation and a demand letter, and escalate only as far as you need to. The one thing you cannot let slip while you negotiate is a hard deadline: your lien clock and your limitation period keep running no matter how the talks go.
Negotiation and the demand letter
Most disputes should start, and many will end, with a direct conversation followed by a written demand letter (in Quebec, a mise en demeure). The letter sets out the amount owed with invoice numbers and dates, gives a firm deadline to pay (usually 10 to 14 days), references any interest you are owed, and states that you will escalate if it is not paid. Beyond nudging the money loose, the letter builds your evidence trail and shows any later tribunal that you tried to resolve things first. In Quebec it has extra bite: interest generally runs from the date of formal notice. The detailed step-by-step for an unpaid invoice is in Chasing an Unpaid Invoice.
Mediation
Mediation brings in a neutral third party to help both sides reach their own agreement. The mediator does not decide anything; they steer the conversation toward a settlement. It is private, relatively cheap, and it can preserve a working relationship, which matters if you want repeat business from the other party. Many contracts and several courts require or strongly encourage mediation before trial. Its limitation is that it only works if both sides genuinely want to settle: a mediator cannot impose an outcome, so a determined non-payer can simply refuse to budge.
Prompt-payment adjudication
In the prompt-payment provinces (Ontario, federal projects, Saskatchewan, Alberta, Manitoba on new contracts, and the Northwest Territories for payment rules), a payment dispute can go to a neutral adjudicator who issues a binding interim decision in roughly 30 days, enforceable like a court order. It is the fastest way to free up disputed money. The decision is interim, so either party can still go to court for a final ruling later, but in the meantime you get paid. It is ideal when the other side is solvent and you simply need the cash moving. The full mechanics, including how it runs alongside a lien, are in Adjudication and Your Dispute Routes.
Arbitration
Arbitration is a private process where a chosen arbitrator hears the case and makes a binding decision, much like a private judge. It usually applies only where your contract contains an arbitration clause, and it generally replaces a court trial for that dispute. It can be faster and more confidential than court and lets you pick a decision-maker who understands construction. The downsides are real: it can be expensive, the right to appeal is usually narrow, and an arbitration clause can shut you out of the cheaper small-claims route. Read the dispute clause in your contract before you sign so you know whether arbitration is mandatory (see Reading a Construction Contract).
Small claims and the superior court
Court is the final, binding route, and small claims is its cheap end, designed to be used without a lawyer. The monetary limits vary widely: Ontario is now $50,000 (raised from $35,000 on 1 October 2025), Alberta is $100,000, Saskatchewan is $50,000, while Quebec is the lowest at $15,000, and the others sit in between (Nova Scotia, Newfoundland and Labrador and Yukon at $25,000; Manitoba, New Brunswick and Nunavut at $20,000; the Northwest Territories at $35,000; Prince Edward Island at $16,000; British Columbia uses the Civil Resolution Tribunal up to $5,000 then Provincial Court to $35,000). Above your province's limit you are into the superior court, which is slower and pricier and where you should have a lawyer. Quebec is doubly distinct: the limit is $15,000 and lawyers are barred from representing parties at the small-claims trial itself (Code of Civil Procedure art 542), so you present your own case. The filing-and-default-judgment detail is in Small Claims Court: A Trade's Guide.
Mind the clocks while you talk
The single biggest mistake is letting a deadline pass while a dispute drags on. Two clocks run independently of any negotiation:
- The lien clock is the shortest. Preservation deadlines run from your last day of supply, from 30 days up to 90, depending on the province, and nothing pauses them (see Lien Deadlines by Province). If a lien deadline is near, preserve it now and keep negotiating afterwards. In Quebec the equivalent legal hypothec must be published within 30 days.
- The limitation clock is the long-stop. It is the deadline to sue at all: 2 years from discovery in most provinces, 3 in Quebec under its own Civil Code regime, and 6 years in the Atlantic provinces and territories. A written acknowledgement or part-payment from the debtor before it expires resets it (see Limitation Periods Explained).
Which rung first
Start low and climb only as far as you must: a direct conversation, then a demand letter, then mediation if the relationship is worth saving. Use adjudication for speed where it is available and the other side is solvent, arbitration only if your contract forces it, and small claims or the superior court as the binding backstop. Throughout, protect the lien deadline first, because it is the one clock you cannot get back.
Common mistakes
- Jumping straight to court. It is the slowest and dearest rung; the lower ones often settle the matter.
- Negotiating past a deadline. The lien clock and limitation period do not stop while you talk.
- Assuming adjudication exists everywhere. It is in force in only some provinces; confirm before you rely on it.
- Missing an arbitration clause in your own contract. It can be mandatory and can bar the cheaper small-claims route.
Know someone who needs this?
Keep reading
Was this guide useful?
Didn't find what you were looking for?
Spotted something wrong or out of date? Email us at hello@kilnguides.co.uk.
In crisis? 988 Suicide Crisis Helpline (call or text 988) ·