Wind farm liens evidence of serious liability for property owners

Wind power agreements are very detailed and complex: not everyone knew what they were getting into, says lawyer Eric Gillespie
Wind power agreements are very detailed and complex: not everyone knew what they were getting into, says lawyer Eric Gillespie

A story out of Illinois recently revealed that when furniture giant IKEA (which is engaged in a PR campaign to offset its “carbon footprint” by investing in wind power) and an associated wind power developer failed to pay one of their suppliers, liens were placed on title of the land owned by the farm owners/property owners who had leased their land for the wind power project.

When Wind Concerns Ontario published this story, we received news that this is happening in Ontario, too. In fact, documents were filed in court last year to place liens on property owned by 24 people on Manitoulin Island; the property owners had leased land or received payments for transmission lines on their properties. The sub-contractor, R.M. Belanger, had not been paid $2.03 million owing to the company by another sub-contractor, which was hired by the wind developer for the McLean’s Mountain project, Northland Power.

Northland Power has been approved by the Independent Electricity Systems Operator/IESO as a Qualified Applicant for new renewable power contracts to be let during 2015.

The liability for the $2+ million debt for the Manitoulin Island project is now shared by the 24 property owners, which works out to more than $83,000 liability per owner.

Toronto-based environmental lawyer Eric Gillespie, who has represented community groups fighting wind power projects and private land owners seeking to get out of wind power options and contracts, commented to WCO on the Manitoulin Island situation: “One of the major problems for landowners is the detail and complexity of agreements. Often, people don’t know what they are really getting into. What seems to be happening in Manitoulin right now highlights the fact that what seemed like a ‘good deal’ at the time, can potentially end up being a very bad deal.”

“This is yet another example of how wind power as it is being implemented in Ontario is having a negative impact on farming communities,” said Jane Wilson, president, Wind Concerns Ontario. “All the benefits go to a few corporate wind developers, while the property owners, their neighbours, and Ontario’s rural and small-town communities have to live with side effects.”

Ontario is launching a new Request for Proposal process for renewable power projects on March 2. Emphasis will be on new development in Eastern and Northern Ontario.

“We hope that property owners make sure they know the full range of potential results from signing any type of agreement, including liability for legal actions from developer sub-contractors, and for property value loss and health problems experienced by others in their communities,” Wilson said.

Thanks to Wind Concerns Ontario community group member Manitoulin Coalition for Safe Energy Alternatives (MCSEA) for linking us to the court documents, which may be found here: ManitoulinLienCourtDocs

windconcerns@gmail.com

 

Comments

Bert Zegers
Reply

I wonder if the lease holders that got a lien on their property had a turbine erected on their property, or that even lease holders without a turbine erected got a lien?

Barbara
Reply

Don’t sign an option to lease unless you have the right to get out of the signed option without restrictions as to why you want out of the option.

An option that can be cancelled by any of the parties to the option without penalty.

Barbara
Reply

Have heard that even if a contractor is paid off you still have to get the lien removed from your own property records. Not the money just the record off from your property.

Does anyone have information on this issue?

Barbara
Reply

SCHWARZ LAW LLP

Construction liens: A primer

“Construction liens encumber title to the property; effectively preventing the owner from mortgaging or selling it.”

“The lien can be removed from the title after either; its expiring for failure to perfect, a settlement in some fashion, payment into Court by way of cash or bond, or final judgement.”

http://www.schwarzlaw.ca/corporate-commercial/construction-liens-a-primer.html

Barbara
Reply

MONDAQ, April 30, 2012

Construction Lien Act (the Act)

Scroll down to:
Dealing with Registered Liens

“Fortunately the Act provides for an expeditious procedure whereby the registered construction liens can be removed from the title by posting security with the court. The procedure is outlined in section 44 of the Act and requires security equal to the face value of the lien, together with the lesser of 25% of the lien claim and $50,000 for costs, before the court. the security can be in the form of lien bond, letter of credit or certified cheque. An attendance in court is required, …”

http://www.mondaq.com/canada/x/175032/Building+Construction/Mortgages+and+Construction+Liens

Serious affair to have a construction lien placed on your property.

Paul
Reply

Not sure but i know my neighbour Bruce Wood is receiving 98000.00 a year for his lime stone property. Wish it was mine.

Paul
Reply

OLd news the liens were removed.

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