Certificate of substantial completion

From CEOpedia | Management online

A Certificate of Substantial completion is in accordance with the general conditions of AIA 201 and other terms of the contract, when the work on the project is essentially completed, the architect or the owner's representative passes the "certificate of significant implementation", which shows that the contractor "essentially" completed the work with minor exceptions. Often, such a document signals the end of exposure to contractual penalties and indicates the date of favorable seizure by the owner. When the document is handed over, the owner becomes responsible for maintenance and the warranty begins (Marilyn Klinger, Marianne Susong 2006, p. 151).

What do you need to do to get Certificate of substantial completion ?

Steps of getting Certificate of substantial completion (members of the Institution of Civil Engineers (Great Britain) and Institution of Civil Engineers Staff 2002, p. 28):

  • When the contractor determines that all the work specified in the contract will be essentially completed and the positively passes the final tests (usually specified in the contract), he may notify the Engineers in writing. Upon written notification, there must be an obligation to liquidate the outstanding work in accordance with the provisions of clause 49 .
  • Within 21 days from the date of receipt of such notification, the Engineer must: issue to the Contractor (together with a copy for the Employer) a Certificate of Significant Completion specifying the date on which the work specified in the contract was substantially completed in accordance with the Contract or provides the Contractor with written instructions specifying all work, which, according to the Engineer, still require execution by the Contractor before issuing the certificate. If the Engineer provides such instructions, the Contractor will be able to obtain Certificates of Substantial Completion within 21 days of its completion, in accordance with the Engineer's requirements for the work specified in those instructions.
  • If any part of the project has been occupied / used by the contracting authority in a different way than planned in the Contract, the contractor may ask for it in writing, then the Engineer shall issue certificates of definitive completion. This certificate begins to begin when the contractor's application is served. After issuing such a certificate, it is considered that the Contractor undertook to perform all outstanding works in this part of the Works.

When the work is almost completed, this form is prepared by the contractor and owner. A list of items needed to be corrected is attached to the form (Dennis J. Hall, Nina M. Giglio 2013, p. 129).

Examples of Certificate of substantial completion

  • A Certificate of Substantial Completion can be issued to a contractor after the successful completion of a project. This document serves as proof that the contractor, the architect and the owner have reached an agreement that the project is finished, with minor exceptions. It also serves to provide the contractor with a financial incentive to finish the project, as the contractor will receive payment for the project after the certificate is issued.
  • A Certificate of Substantial Completion can also be used in a construction project. This document serves to declare that the project is essentially finished and that the contractor has completed all the work as specified in the contract. It also serves to indicate the date of favorable possession by the owner.
  • A Certificate of Substantial Completion can be issued to a contractor in a renovation project. This document serves to declare that the project is essentially finished and that the contractor has completed all the work as specified in the contract. The certificate serves to provide the contractor with a financial incentive to finish the project, as the contractor will receive payment for the project after the certificate is issued.

Advantages of Certificate of substantial completion

A Certificate of Substantial Completion is an important document for both contractors and owners. It certifies that a project is essentially finished and includes the following advantages:

  • It allows payment to the contractor for work completed, as it shows that the contractor has met all the terms and conditions of the contract.
  • It signals to the owner that the contractor has completed the project and that they can now take possession of the property, free from contractual penalties.
  • It starts the warranty period for the project, so that any defects in the work become the responsibility of the contractor.
  • It allows the owner to begin using and enjoying the property, as the project is now essentially completed.
  • It serves as evidence of completion of the project, which is important if there are any disputes over the work that was done.

Limitations of Certificate of substantial completion

A Certificate of Substantial Completion has certain limitations:

  • It does not signify the completion of all work on the project. The contractor may have incomplete items that do not impact the use and occupancy of the building.
  • The certificate does not constitute a final inspection. Final inspections are needed to identify any remaining deficiencies that need to be corrected by the contractor.
  • The certificate does not release the contractor from contractual obligations. The contractor may still be responsible for warranty work, repair of latent defects, and other obligations.
  • The certificate does not signify the release of payment to the contractor. Payment is typically not released until all the work is complete and any remaining contractual obligations are fulfilled.
  • The certificate does not signify the acceptance of the work. Acceptance of the work is typically done at the final inspection.

Other approaches related to Certificate of substantial completion

The following are other approaches related to Certificate of Substantial Completion:

  • A certificate of substantial completion can also be used to document that the contractor has fulfilled its contractual obligations and that the project has been satisfactorily completed. This allows the contractor to be paid for their work.
  • A certificate of substantial completion can also be used to document the completion of any inspections or tests that are required by a governing body, such as a building inspector or fire marshal. This ensures that the project meets all of the necessary safety and code requirements.
  • A certificate of substantial completion can also be used to document the completion of any environmental impact studies that may be required. This ensures that the project is not damaging the environment in any way.

In summary, a Certificate of Substantial Completion is a document that is used to document that the work on a project is essentially completed and that the contractor has fulfilled its obligations. It can also be used to document the completion of any inspections or tests that are required, as well as any environmental impact studies that may be required.


Certificate of substantial completion — recommended articles
Consent order — Certificate of acceptance — Interim certificate — Certificate for payment — Reliance letter — Certificate of satisfaction — Inchoate instrument — Substantial completion — Occupancy permit

References

Author: Dominika Duda

Retrieved from "https://ceopedia.org/index.php?title=Certificate_of_substantial_completion&oldid=90241"