CANADA – QUÉBEC Law and Practice Contributed by: Eleonora Eusepi, Sabrina Guillot, Janie Chaloux and Nicolas Gosselin, BCF Business Law LLP
6.22 Termination by a Third Party Through expropriation (ie, when the property is appro - priated by the government) a commercial lease can be terminated because of such appropriation. The pro - cess is governed by the Expropriation Act and requires the expropriating authority to notify all affected par - ties, including tenants, and to register the expropria - tion notice in the land register. Where the expropria - tion is not challenged, the process from initial notice to the tenant having to vacate the premises typically takes anywhere from several months to two years, depending on the scope and urgency of the intended use by the government. Importantly, a tenant who is forced out as a result of an expropriation is entitled to financial compensation by the expropriating authority. 6.23 Remedies/Damages for Breach A breach of the lease by tenant which leads to the termination of the lease by the landlord, entitles the latter to claim damages. The extent of such damages is typically outlined in the lease and is always subject to the landlord’s obligation to mitigate its damages. Under Article 1883 of the Civil Code, the landlord may also seek the authorisation (if not expressly provided for in the lease) to perform any obligation the tenant has failed to perform (such as with respect to main - tenance and repair obligations), the whole at the ten - ant’s expense and typically with an administration fee on top of such costs. Security deposits are typically provided in commercial leases and most commonly by: (i) cash advances; or (ii) an irrevocable letter of credit issued. 7. Construction 7.1 Common Structures Used to Price Construction Projects Construction pricing in Québec typically follows one of several models. A fixed‑price contract establishes an all‑inclusive price for the project, placing most financial risk on the contractor and incentivising careful evaluation of costs. A unit‑price contract sets predetermined prices per unit of work or materials,
with the final price based on actual quantities installed or supplied. Under a cost‑plus contract, the owner reimburses actual labour and material costs plus an agreed fee or percentage for overhead and profit; the parties may set a Guaranteed Maximum Price, sometimes paired with a shared‑savings mechanism if costs come in below the ceiling. Québec’s Civil Code also governs cost‑estimate con - tracts, requiring contractors to justify price increases where additional work, services or expenses were not reasonably foreseeable at signing. These struc - tures allow parties to allocate risk based on project complexity, desired price certainty, and the degree of control each party wishes to maintain. 7.2 Assigning Responsibility for the Design and Construction of a Project Responsibility for design and construction can be allocated through several delivery methods. In the traditional model, the owner retains professionals to prepare plans and specifications, then hires a gen - eral contractor through a tender process to execute the work, following a linear sequence from design to construction. In a design‑build model, the owner contracts with a single entity responsible for both design and con - struction, simplifying coordination and risk allocation. Under a construction management model, the owner appoints a construction manager early in the process to provide advisory and, in some cases, construction services; the owner may contract directly with trade contractors, or the construction manager may act as both manager and general contractor. Integrated project delivery (IPD) involves a multiparty agreement among the owner, key professionals, and the contractor, with shared decision‑making, risks, and rewards. Public‑private partnerships (P3s) are used for major public infrastructures, with a private consortium responsible for design, construction, financing, and often long‑term operation.
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