A General Contractor Agreement is a legally binding contract between a property owner (or developer) and a general contractor that governs a construction or renovation project in Canada. It defines the full scope of work, establishes a payment schedule, allocates risk between the parties, and sets out the procedures for handling changes, delays, and disputes throughout the project lifecycle.

Canadian construction law is heavily regulated at the provincial level. Each province has its own construction lien legislation — Ontario's Construction Act (formerly the Construction Lien Act), British Columbia's Builders Lien Act, and Alberta's Prompt Payment and Construction Lien Act — that imposes mandatory holdback requirements, typically 10% of each progress payment. These statutory holdbacks exist to protect subcontractors and material suppliers, and property owners who fail to retain them can face lien claims even after paying the general contractor in full.

Beyond lien legislation, the agreement must address workplace safety insurance. In Ontario, the Workplace Safety and Insurance Act requires all construction employers to carry WSIB coverage. British Columbia mandates WorkSafeBC registration, while Alberta requires WCB coverage. A properly drafted agreement requires the contractor to provide proof of active coverage before work begins, shielding the owner from vicarious liability for workplace injuries.

This agreement also establishes whether the contractor relationship is fixed-price, cost-plus, or time-and-materials, each carrying different risk profiles for both parties under Canadian contract law.

When hiring a general contractor for a home renovation exceeding $10,000, where multiple trades (electrical, plumbing, framing) will be coordinated under one project manager.

When building a new residential or commercial structure that requires municipal building permits, inspections, and compliance with the National Building Code of Canada.

When a property owner needs to formalize the contractor's obligation to carry WSIB/WCB coverage, provide certificates of insurance, and maintain workplace safety standards under provincial occupational health legislation.

When the project involves subcontractors, and the owner needs contractual assurance that the general contractor will manage statutory holdback obligations under provincial construction lien acts and pay subcontractors on time.

When converting or renovating a commercial space where the lease requires landlord approval and the contractor must comply with specific building standards or restoration obligations.

Skipping a written general contractor agreement exposes the property owner to uncontrolled costs, lien claims from unpaid subcontractors, liability for workplace injuries, and the absence of any enforceable warranty on completed work.

Scope of Work and Specifications — A detailed description of all work to be performed, materials to be used, and applicable building codes. Vague scope descriptions are the leading cause of construction disputes in Canadian courts.

Payment Schedule and Statutory Holdback — Progress payment milestones tied to completion stages, with the mandatory provincial holdback (10% in Ontario under Construction Act s. 22, 10% in BC under Builders Lien Act s. 4) clearly identified and held until the lien period expires.

Change Order Procedures — A formal process requiring written approval before any changes to scope, timeline, or cost. Without this, contractors may claim additional compensation for work the owner considered included in the original price.

Insurance and WSIB/WCB Requirements — The contractor must maintain comprehensive general liability insurance (typically $2 million minimum) and provide a valid WSIB/WCB clearance certificate. Owners who fail to verify coverage may be held personally liable.

Project Timeline and Delay Penalties — Start date, milestone dates, and substantial completion date, with liquidated damages for unjustified delays. Force majeure provisions should address weather, supply chain disruptions, and government-ordered shutdowns.

Warranty and Deficiency Provisions — A minimum one-year warranty on workmanship with a clear deficiency correction process. Provincial new home warranty programs (Tarion in Ontario, BC Housing's 2-5-10 warranty) may impose additional obligations.

Dispute Resolution — Specify mediation or arbitration before litigation, which is standard practice in Canadian construction contracts and can save tens of thousands in legal fees.

Termination Clauses — Conditions under which either party may terminate, including contractor default, owner insolvency, or mutual agreement, with procedures for paying for completed work and returning materials.