The Owner of the House Had Contracted with a General

question 98

Multiple Choice

The owner of the house had contracted with a general contractor, Mr. Hadrian, for a greenhouse addition to the house at a cost of $20,000. In accordance with legislation, the owner withheld 10% and waited the legislated period of time within which any liens were to be filed. Which of the following correctly describes the owner's liability?

• A) The owner is liable to any unpaid subcontractors, whether or not a lien was filed, but can use the holdback money to reduce his liability a certain extent.
• B) Whether or not there are liens registered, the owner is free to pay out the retained holdback once the legislated time period has expired.
• C) Unpaid subcontractors can no longer place liens on the owner's property because of the doctrine of privity of contract.
• D) If the owner checks the registry and there are no liens registered, he is free to pay out the retained holdback.
• E) Lien holders would have no claim against the property but would be entitled to the 10% holdback, in addition to being able to sue the owner for the amount not satisfied by the holdback.

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