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Practical Completion

• Introduction
• Commentary

Introduction

Although the term 'Practical Completion' has been used in the complete JCT suite of contracts for over forty years it is remarkable that it still has no firm legally defined meaning. Many legal minds have written extensively on the subject but the matter has still not been definitively settled in court.

Commentary

These are two recent comments from authoritative sources:

Source #1

Practical Completion occurs when the Works are at such a stage that they are capable of being used by the Employer for the purpose for which they are apparently required, such that liquidated damages (if the works were to be, or are, in delay) are no longer justifiable.

Source #2

The certificate can be issued with minor outstanding defects or minor incomplete works, provided that these minor items do not prevent possession and do not prevent the building being used for its intended purpose.

There are also possible "work-arounds", if the above criteria cannot be met, but these require amendment to the contract with the agreement of both client and contractor:

• If major items are outstanding the parties may be able to make use of the partial possession provisions.
• It is possible to make outstanding major items the subject of a new building contract, amending the original one to exclude them and then issuing the certificate of practical completion in respect of the (amended) original contract.
• The parties can agree to practical completion being certified, subject to any major items being completed within a specified time.

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