Substantial Completion/ Practical Completion in Construction Contracts

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The British University in Dubai (BUiD)
This dissertation examines the issue of Substantial Completion/Practical Completion (SC/PC) which is considered to be one of the most important Project Milestone provisions that is contained in most Forms of Construction Contracts invoking tangible benefits to both contracting parties notwithstanding the ambiguous nature of the term that often give rise to disputes. The purpose of this dissertation is to bring about an awareness of the significance and important nature of SC/PC as contained in Standard forms of construction contract and due to its importance, how such a provision is misinterpreted by the contracting parties and the party on which decision making powers are conferred. The source of misinterpretation stems from lack of clearly defined terms. This has led to judicial processes at all levels, and numerous discussions amongst Industry Professionals. The matter has long been debated in the Construction Industry and the Law in certain jurisdictions has attempted to define the terms but with a mixed approach as will be seen later on in this Paper. Decisions of the Courts, in some circumstances, have been such that have given rise to discussions and mixed arguments amongst many commentators. The evidence indicate that there is widespread perception amongst Industry Professionals of injustice arising out of ambiguities that exist in Construction contracts concerning SC/PC and the need for clearly defining its meaning becomes more and more pronounced. This research paper therefore encompasses reasoned arguments regarding the need for contracting parties to be aware of the risks involved with unclear defined terms. It also highlights the texts within the contract that is prone to misinterpretation and provides an insight for further research for enhancement of Standard Forms of Contract commonly in use within the industry. It is hoped that this dissertation will provide Industry Professionals a deeper awareness towards the importance of SC/PC as applied in Construction Contracts and perhaps provoke a need for further dialogue and research with the aim of eliminating ambiguities by providing clarity of the term when entering into contracts which otherwise has proved to have an adversarial effect amongst the contracting parties both in contract and the Law.
substantial completion/, practical completion, construction contracts, construction industry, law