When a claim is filed under Alberta’s Public Works Act, payments on a public project (where the Province of Alberta is the owner) can be frozen with very little recourse for the contractor. Despite recent amendments, Alberta contractors performing work on a construction project that constitutes a “public work” under the Public Works Act[1]will continue to be challenged by the Act’s simplified claims process as it provides almost no opportunity to challenge claims submitted against a public project. This is consistently an issue as the provincial government will almost certainly withhold payments from the contractor where there are outstanding Public Works claims.
In a noteworthy decision, Opabin Sand and Gravel Inc. v Tsuu T’ina Contracting Limited Partnership,[2] the court found that common law remedies, including claims in tort, may be available as against parties to a construction project who commence claims under the Public Works Act that fall outside that statute’s provisions in respect to eligible claims and the timing of such claims.
This decision is of importance to general contractors on public works because it suggests there may be a route to recovery when wrongful claims under the Act lead to withholding of funds.
Background: How a Public Works Act claim led to a $9 million payment holdback
In Opabin Sand,the appellant corporation, Vinci Geoinfrastructure Canada Limited (“Vinci”), was retained by His Majesty the King in Right of Alberta (the “Crown”) as the general contractor for construction work on the Springbank Off-Stream Reservoir (the “SR1 Project”), a project undertaken by the Government of Alberta to protect the City of Calgary and its surrounding areas from flooding.[3] Pursuant to Section 1(g) of the Public Works Act (the “Act”), the SR1 Project constituted a “public work”.[4]
As part of its work on the SR1 Project, Vinci was required to work with subcontractors that were selected by the Crown, including Sarcee Sand and Gravel Products Limited Partnership (“Sarcee”).[5]
In Summer 2022, after Sarcee encountered difficulty in fulfilling its aggregate supply obligations, Vinci directed Sarcee to implement a recovery plan to address Sarcee’s delivery delays.[6] Sarcee subsequently retained the Respondent, Opabin Sand and Gravel Inc (“Opabin”), as sub-subcontractor to assist Sarcee in fulfilling its supply obligations.[7] Between August and September 2022, Opabin delivered materials to Sarcee for the SR1 Project, for which Opabin was paid in full.[8]
In July 2023, Opabin submitted a Notice of Claim pursuant to Section 14 of the Act, in the amount of approximately $9 million, “for ‘costs related to material processing, site setup, mobilization, permitting, agreements, royalties, labour, equipment, financing, management, and damages that are extra and are currently unrecoverable’” (the “PWA Claim”).[9]
The Crown subsequently withheld payments from Vinci in the amount of the PWA Claim.[10] However, Vinci investigated the PWA Claim and found that:
1. Opabin was not a recognized claimant under the Act;
2. Opabin submitted the PWA Claim late; and
3. the PWA Claim claimed for damages that were not permitted under the Act.[11]
Opabin commenced an action as against Vinci and other entities, claiming it had incurred damages in the amount of the PWA Claim after relying on representations that further work would be assigned for the SR1 Project.[12] Vinci filed a statement of defence and counterclaim, “asserting … it had no contractual relationship with Opabin”.[13] Vinci subsequently filed an amended counterclaim, alleging that, among other things, the PWA Claim and the action were an abuse of process, brought for the purpose of applying pressure on Sarcee “to acquiesce to Opabin’s claims for compensation or, alternatively, to obtain further supply agreements, for the SR1 Project or otherwise”.[14]
The amended counterclaim also alleged that:[15]
- Opabin abused the Act’s procedures “by creating economic hardship for Vinci, in the form of the withheld progress payments, investigation costs and financing costs”; and
- The PWA Claim amounted to conversion by interfering “with Vinci’s right to receive progress payments from the Crown”.
Opabin applied to strike Vinci’s amended counterclaim on the basis that it disclosed no reasonable cause of action, pursuant to Rule 3.68(2)(b) of the Alberta Rules of Court.[16] An Applications Judge granted Opabin’s application, which was appealed to a Justice of the Court of King’s Bench of Alberta.[17]
When will courts strike a claim under Rule 3.68?
Rule 3.68(2)(b) permits Alberta courts “to strike all or part of a pleading if it is plain and obvious it discloses no reasonable cause of action”.[18] The threshold for striking a claim under the Rule “is ‘extremely high’”, such that “[i]t must be ‘beyond doubt’ the claim will fail”.[19]
In considering an application to strike pleadings under Rule 3.68(2)(b), a court will “assume the facts pled are true on their face ‘without resort to evidence and without considering the merits of the claim except to the extent the allegations are based on assumptions or speculations or where they are patently ridiculous or incapable of proof”.[20]
When does a Public Works Act claim becomes an abuse of process?
The tort of abuse of process addresses “situations where the legal process is used ‘to gain an end which the legal process does not entitle the plaintiff to obtain”.[21] To succeed in establishing abuse of process, a plaintiff must establish that:[22]
- The plaintiff is a party to a legal process initiated by the defendant;
- The legal process was initiated for the predominant purpose of furthering some indirect, collateral, and improper purpose;
- The defendant took or made a definite act or threat in furtherance of the improper purpose; and
- Some measure of special damage has resulted.
For a legal process to constitute “an ‘improper purpose’, the proceeding must be brought for a purpose ‘outside the ambit of the litigation’ that the party knew or ought to have known was unfounded”.[23] Here, the court found that:[24]
- As Vinci was a named defendant in the action commenced by Opabin, the first element of the test for abuse of process was established; and
- While commencing a claim to induce settlement, receive compensation, or further supply arrangements “does not per se indicate a purpose outside the litigation process”, Vinci plead that the civil claim was brought “to increase the economic pressure already initiated through the PWA Claim”.
Thus, it was “not plain and obvious … that [Opabin’s claim] was not brought for an improper purpose”.[25]
In considering the third element, Vinci’s amended counterclaim alleged that “the PWA Claim was used to disrupt payment flows and ‘harm Vinci’s financial interests’”.[26] The court found that determining whether the PWA Claim constitutes a “definite act” in furtherance of an improper purpose should be determined on a full evidentiary record.[27] Finally, the court found that the amended counterclaim plead for special damages relating to the PWA Claim, as Vinci incurred costs for investigating and responding to the PWA Claim.[28]
Thus, while the court found that Vinci may ultimately be unsuccessful in its counterclaim, it allowed this ground of appeal and declined to strike the provisions in the amended counterclaim in respect to abuse of process.[29]
When may a Public Works Act claim amount to conversion?
The tort of conversion “involves a wrongful interference with the goods of another, such as taking, using or destroying these goods in a manner inconsistent with the owner’s right of possession”.[30] The elements of conversion include:[31]
- A wrongful act;
- Involving a chattel [including funds or money];
- Consisting of handling, disposing or destruction of the chattel;
- With the intention or effect of denying or negating the title of another person to such chattel.
An owner must establish that, at all relevant times, it had possession or an immediate right of possession to the chattel.[32]
In determining whether the amended counterclaim should be struck for failing to disclose a reasonable cause of action in relation to a claim for conversion, the court found that, under the first element, it was arguable that the filing of the PWA Claim constituted a wrongful act because “Opabin was not in the class of claimants contemplated by the [Act], filed its claim out of time, and the damages sought [did] not fit within the parameters of the [Act]”.[33]
Second, the court found it was “not hopeless that Vinci could show it had a right of possession to the amount withheld by the Minister pursuant to the PWA Claim”, as Section 15 of the Act provides that funds “paid in respect of a claim are deducted from the money’ due and payable to the contractor’”.[34]
In considering the third and fourth elements for the tort of conversion, it was “foreseeable that filing the PWA Claim would have resulted in the progress payments due to Vinci being withheld” as, pursuant to Section 15 of the Act, the Minister has discretion over the administration of progress payments.[35] The filing of the PWA Claim also effectively denied Vinci’s access to the funds, which “which were no longer due and payable at the relevant time”.[36]
Thus, the court allowed this ground of appeal, finding that the provisions in the amended counterclaim in respect to conversion were sufficiently plead and the claim in conversion was not hopeless.
Key takeaways for parties whose payments are withheld under the Public Works Act
While Opabin Sand merely considered the claims for abuse of process and conversion in relation to an application to strike a counterclaim pursuant to Rule 3.68(2)(b), the decision provides support for permitting contractors to commence tort claims against parties bringing improper claims brought under the Public Works Act, such as those that are ineligible under the Public Works Act or those brought for the purpose of triggering the Minister’s withholding of funds.
Practically speaking, the decision helps fill a gap in the current legislation by permitting a party to seek a common law remedy where payments have been withheld on a “public work” construction project because of an improper claim brought under the Public Works Act.
Such claims often present difficulties as, unlike the Prompt Payment and Construction Lien Act, which provides for a period of 180 days to file a Statement of Claim,[37] the Public Works Act fails to provide a statutory timeline by which a claim must be commenced. Further, the PPCLA provides for remedies where a lien is registered improperly or for an amount grossly in excess of what is owed, including the imposition of legal costs and damages.[38] In contrast, no such remedies are available under the Public Works Act for improper claims.
While the effect of the court’s decision in Opabin Sand remains to be seen, parties to construction projects should be aware of their potential entitlement to common law remedies after payments have been withheld under the Public Works Act. If you require support in navigating claims brought under the Public Works Act, Miller Thomson’s Construction and Infrastructure lawyers are prepared to assist you in obtaining meaningful remedies and in providing practical advice.
[1] RSA 2000, c P-46 [Public Works Act].
[2] 2025 ABKB 623 [Opabin Sand].
[3] Ibid at para 4.
[4] Public Works Act, supra note 1, s. 1(g).
[5] Opabin Sand, supra note 2at para 6.
[6] Ibid at paras 7-8.
[7] Ibid at para 9.
[8] Ibid at paras 9-10.
[9] Ibid at para 11.
[10] Ibid.
[11] Ibid at para 12.
[12] Ibid at para 13.
[13] Ibid at para 14.
[14] Ibid at para 16(a).
[15] Ibid at para 16(c).
[16] Ibid at para 15.
[17] Ibid at para 1.
[18] Ibid at para 37, citing RK v GSG, 2024 ABKB 121 at para 12.
[19] Opabin Sand, ibid at para 61, citing Alberta Adolescent Recovery Centre v Canadian Broadcasting
Corporation, 2012 ABQB 48 at para 29; Clark v Hunka, 2017 ABCA 346 at para 20.
[20] Opabin Sand, ibid at para 62, citing Shodunke v Alberta, 2025 ABKB 250 at para 26.
[21] Opabin Sand, ibid at para 43, citing Hunt Oil Company of Canada, Inc v Galleon Energy Inc, 2010
ABQB 212 at para 18.
[22] Opabin Sand, ibid at para 44, citing 3058354 Nova Scotia Company v On*Site Equipment Ltd., 2011
ABCA 168 at para 57.
[23] Ibid at para 47.
[24] Ibid at paras 63, 65-67, citing Oei v Hui, 2020 BCCA 214 at para 26.
[25] Opabin Sand, ibid at para 67 (emphasis included).
[26] Ibid at para 68.
[27] Ibid.
[28] Ibid at para 69.
[29] Ibid at paras 70-71.
[30] Ibid at para 72, citing Boma Manufacturing Ltd v Canadian Imperial Bank of Commerce, 140 DLR
(4th) 463, [1997] 2 WWR 153 (SCC).
[31] Opabin Sand, ibid at paras 73-74, citing Driving Force Inc v I Spy-Eagle Eyes Safety Inc, 2022 ABCA
25 at paras 30-31.
[32] Ibid at para 74.
[33] Ibid at para 80.
[34] Ibid at para 81.
[35] Ibid at para 82.
[36] Ibid at para 83 (emphasis omitted).
[37] RSA 2000, c P-26.4, s. 43 [PPCLA].
[38] Ibid, s. 40.
