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Final Completion
Practical Law Glossary Item 1-422-4331 (Approx. 3 pages)
Glossary
Final Completion
As used in project finance and construction projects, final completion occurs when all construction and contractual obligations have been completed. This includes:
- The contractor notifies the project owner that all the technical and performance requirements set out in the construction contract have been met.
- The project owner or its representative inspects the work and confirms that all construction including all punch list items have been completed (unless the parties otherwise agree). These items may include:
- government signoffs;
- delivery of as-built drawings, a property survey, manuals, warranties, and other necessary documents;
- delivery of final mechanic's lien waivers; and
- a statement of claims that survive completion.
- The contractor has paid to the project owner any delay or performance liquidated damages that may be payable.
- The contractor has transferred to the project owner title to all materials and equipment used in the construction of the project.
- The contractor submits a final payment application.
- The owner approves the final payment application and makes the final payment to the contractor, including the retainage.
In a project financing, failure to achieve final completion:
- By a specified date, typically results in the payment of delay liquidated damages.
- At all (meaning the project has ongoing performance deficiencies), typically results in the payment of performance or buy-down liquidated damages.
For a discussion of completion targets and liquidated damages in project finance, see Practice Note, Understanding Project Finance Construction Contracts.
For additional guidance on final completion for a real estate project, see Standard Clauses, Final Completion and Final Payment (Construction).