Practical Completion

Practical completion (PC) is one of the most significant milestones in a construction contract. It's the point at which the works are complete — or complete enough — for the building to be used for its intended purpose, even if minor defects remain. When PC is reached, several critical things happen simultaneously.

First, the risk of loss or damage typically transfers from the contractor to the developer. Second, the defects liability period begins — usually 12 months during which the contractor must return to fix any defects that emerge. Third, the contractor is entitled to release of the first half of retention monies. And fourth, the clock stops on liquidated damages.

Getting PC right matters because it triggers real financial consequences. If you certify PC too early, you lose your leverage to get the contractor to finish properly. If you delay PC unreasonably, the contractor can claim additional costs. The superintendent's role in assessing PC is critical — they need to inspect the works, identify any outstanding items, and make a judgment call on whether what's left is genuinely minor.

For developers selling off-the-plan, practical completion also triggers settlement timelines with purchasers. Miss PC and your buyers start getting nervous — or worse, start exercising sunset clauses. This is why PC tracking isn't just a contract admin task; it's a commercial imperative.