Construction Law/Issuing completion certificate
Dear Mr. Dowse,
I am working as a project manager of a sewerage project. We have already commissioned the project and found only minor defects. all the works and commisioning has been completed there is a small issue whereby the contractor has not bring in the spare parts required under the project.
I would like to know if a completion certificate could be issued in this case. also, is a formal take over of all the facilities necessary before issuing completion certificate? Our contract is based on FIDIC 1999 yellow book.
Thank you for this question.
I assume for the time being that the FIDIC 1999 Yellow Book form of contract has not been amended in respect of any of the clauses I will refer to below.
You have indicated that you have commissioned the plant. This suggests to me that you are at the point of taking-over. You have, however, used the term "completion certificate" which is not recognised under the Yellow Book form of contract and I was left a little unsure of whether you were referring to a Taking-Over certificate (as in accordance with Clause 10) of a Performance Certificate (refer to Clause 11.9).
It is preferable to follow the FIDIC process for taking over if you agree that the Works are suitable to be taken over. If you do not then the Employer should avoid any action which would be deemed as a taking-over. Depending upon the legal jurisdiction and the law governing the contract, a taking-over certificate is not necessary for the works to be deemed to have been taken over.
The matter of a supply of parts does not at this time seem to be an issue which ought to prevent taking-over by the Employer. The taking-over certificate can be annotated to show that the parts are yet to be delivered and state a date, within the defects notification period, by which they are required.
In respect of the failure to supply parts after the end of the defects notification period, if this is of relatively minor value and can be set off for the time being by a withholding of payment then I think that sub-clause 11.10 (Unfulfilled Obligations) can be useful in circumstances where the defects notification period has expired and there is a willingness on the part of the Engineer to issue the Performance Certificate.
You have asked also whether a formal take-over of all facilities is necessary before issuing a completion certificate. If we are speaking of a taking-over certificate, then pursuant to sub-clause 10.2 of the FIDIC form taking-over can be of a part of the Works even if that was not specified at the original tender or contract execution stage. If, however, we are speaking of a completion certificate then the entirety of the Works should be complete at that time.
I hope that this assists you.
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