Not all these funding sources will come into play in every distribution. In some cases, all the lien claimants may have been engaged by one subcontractor, and their liens cleared by payment into court by the head contractor under section 23 . In other cases, various liens may have been discharged through a payment into court by the owner with no sale of the improvement being necessary. Only rarely will all three sources be involved. It will be observed that section 37 parallels section 38 in creating three categories of claims and establishing priority among them.
Top priority is given to claims in relation to costs and six weeks of worker wages.
Within those two categories of claims, the rule is a simple pro rata distribution where there are insufficient funds to satisfy all claims. The basis of calculating the pro rata is the amount of the lien claims of the individual claimants. Here, simply pro rating the claims will not operate fairly. The unfairness would arise when there are two different insolvencies within the pyramid and lien claims arising under both insolvencies must be satisfied. The approach taken in section 38 is to pro rate the available holdback fund in two stages.