What holdback should I keep on a Saint John renovation?

In New Brunswick, you're required to hold back 20% of each progress payment to your contractor under the Construction Remedies Act (SNB 2020, c.29) — and this isn't optional. It's a statutory obligation that protects you as the property owner if subcontractors or suppliers go unpaid.

Here's how it works in practice: every time your contractor submits a progress draw, you pay 80% and retain the remaining 20% in a separate holdback. That holdback must be maintained for a minimum of 60 days after the work is substantially complete, abandoned, or terminated. The 60-day window exists to allow any subcontractors, labourers, or material suppliers to register a lien against your property if they haven't been paid by your general contractor.

Why this matters more than people realize. Say your GC takes your full payment but doesn't pay the framing crew or the lumber yard — those parties have the right to lien your Saint John property under the Construction Remedies Act. The holdback is your financial buffer. If liens are registered, you do NOT release the holdback until those liens are cleared. Releasing early can leave you personally on the hook for those amounts.

On a practical level, let's say you're doing a $80,000 kitchen and bathroom renovation in the South End. Your holdback would be $16,000. You'd pay $64,000 across your progress draws, and only release that final $16,000 after the 60-day lien period expires with no claims registered.

A few Saint John-specific things to keep in mind. If your project involves a heritage property in Uptown Saint John or the South End — both areas with significant Loyalist and Victorian-era housing stock — scope changes mid-project are common when old walls open up. Each change order should be documented in writing, and the 20% holdback applies to change orders as well.

Before releasing your holdback, it's worth doing three things: confirm with the City of Saint John's Growth & Community Services office at (506) 658-2835 that all required inspections have been completed and signed off, ask your contractor for a statutory declaration confirming all subcontractors and suppliers have been paid, and do a final walkthrough with a written deficiency list.

For disputes that can't be resolved directly, the Court of King's Bench of New Brunswick handles construction lien matters. Smaller disputes under $20,000 can go through Small Claims Court (filing fee of $50–$100 depending on claim size).

Browse licensed contractors in our Saint John directory at New Brunswick Construction Network — and when you're ready to sign a contract, having a construction lawyer review it alongside your holdback obligations is money well spent on any renovation over $25,000.