Page 44 - Interactive report Ar Site Practice

There is no absolute definition of practical completion and case law is very complex.
There is some debate about when practical completion can be certified and whether

it can be certified where there are very minor (de minimis) items 'not affecting
beneficial occupancy' that remain incomplete. A draft building owner's manual.

It is important to note however, that the defects liability period, which follows
certification of practical completion, is not a chance to correct problems apparent at
practical completion, it is the period during which the contractor may be recalled to
rectify defects which appear following practical completion. If there are defects
apparent before practical completion, then these should be rectified before a
certificate of practical completion is issued.

This can put the contract administrator in a difficult position, as both the contractor
and the client may be keen to issue the certificate (so the building can be handed
over), and yet defects (more than a deminimis) are still apparent in the works.
Issuing the certificate could render the contract administrator liable for problems
that this causes, for example in the

1. Calculation of liquidated damages,
2. The position in relation to performance bonds
3. The release of retention when it is not certain that the works will be completed

On construction management contracts, a separate certificate of practical completion
must be issued for each trade contract. Once all trade contracts (or all trade contracts
for a particular section of the works) have been issued, the construction manager issues
a certificate or project completion (or sectional completion). The same is true on
management contracts, where each works contract must be certified individually.

Practical completion is not a term recognized in some recently developed contracts
such as PPC 2000 and other partnering contracts which simply refer to 'completion'.
This can put the contract administrator in a difficult position as to when the project
becomes 'useable' by the client.