Guide to Using the RIBA Plan of Work 2013 - Other - Page 87
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Handing over a building is becoming an increasingly complex process. In the
period prior to handover, duties have historically been limited to administrating the
Building Contract. Post handover, duties have included assisting the building user
during the initial occupation period or undertaking a review of Project Performance
as well as the conclusion of contract administration tasks.
The introduction of a number of new initiatives and procedures means that the
post-handover period and related duties have to be considered and managed
differently and acknowledged earlier in the design process. Before looking at
these, it is essential to consider the importance of Practical Completion and to
address some of the issues that arise from the completion of a building and its
handover to the client.
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Practical Completion is an important point in a project for two reasons. From the
client’s perspective, it is the point when possession of the completed building
can take place and the building can be occupied for use. From the contractor’s
perspective, the granting of Practical Completion triggers a number of aspects
of the contract, including the release of retention and the transfer of insurance
obligations and it is the date beyond which certain damages cannot be claimed.
These issues are covered in greater detail in publications such as Law in Practice:
The RIBA Legal Handbook.
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Why is Practical Completion important?
While the handover process should theoretically be straightforward, in practice it can
be fraught. For example, if the contractor is running late, a request to hand over the
building before the contract administrator is satisfied that it is ‘practically complete’
might be made in order to limit any damages. Conversely, a client may have to
move from one building to another or may have other reasons why the completion
date in the Building Contract is a business imperative, or partial posession and
a phased handover may create contractual and operational complexities. While
programme contingencies should have been allocated in the Project Programme,
these may already have been utilised, creating pressure all round.
There is no firm definition of ‘practically complete’. Case law suggests that it
means not 100 per cent complete and, while many contractors aim for ‘zero
defects’ at handover, it is inevitable that a number of defects, or snagging, will
remain. This is particularly the case on design and build projects where the
transfer of risk makes it difficult for the contractor to apply for extensions of time.
A project must certainly have a certificate of completion granted before it can be
handed over and compliance with health and safety requirements would form a
necessary part of this process. Otherwise, the acceptable degree of incomplete
work or snagging may depend on how crucial handover is to the client. Put another
way, the client’s need to have beneficial occupation can blur the Practical
Completion process.
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