Substantial Completion is Important Because of all the Provisions it can Trigger
It’s a term widely used throughout the industry and is commonly found throughout various construction documents. It’s a term that can be defined between the parties as they see fit to meet their needs.
A typical definition of what a substantial completion is from the AIA is that it’s a state in the progress of work when the work or designated part thereof is sufficiently complete in accordance with the contract documents so that the owner can occupy or utilize the work for its intended purpose.
Why defining substantial completion is so important is because of all the other provisions it can trigger, such as statutes of limitations, statutes of repose.
It can trigger when a owner becomes responsible for the project versus the contractor.
It can trigger warranty periods, other payment provisions, and that’s why it’s important that it needs to be clearly defined because of all the other things that stem from it.
Another way substantial completion can be typically achieved simply through the contract documents is when an owner, for instance, gets a certificate of occupancy.
That’s a good hard from date there that can be used by all parties involved. It’s also important that an owner acknowledge when substantial completion is met so that there’s no confusion between the parties to the contract as when that date is established. Again, Brian Carter with TulsaConstructionLawyer.com.