Sectional completion in construction contracts
Sectional completion refers to a provision within construction contracts allowing different completion dates for different sections of the works. This is common on large projects that are completed in sections, allowing the client to take possession of the completed parts whilst construction continues on others.
If sectional completion is required, it must be an express term of the contract, and reflected by the fact that there are multiple completion dates rather than just one. The extent of each section must be clearly defined and liquidated damages, and the amount of retention that will be released must be specified for each section. There may also need to be clarification of how extension of time provisions will be applied, if for example delays to one section of the works have a knock-on effect on other sections.
In procedural terms, sectional completion is similar to normal completion and follows the usual handover procedures (see handover to client). However, some work within the section may remain outstanding, such as the completion of commissioning, operation and maintenance manuals and as built drawngs, which will cross all sections. It may exclude mechanical and electrical service systems which are reliant on total completion before they can be properly tested and commissioned. This means that their needs to be an agreed protocol for re-entry into completed sections for the contractors to complete outstanding work.
Sectional completion requires particular care to be taken regarding:
- Difficulties with logistics on site when different sections are in the possession of different parties.
- The protection of completed sections from ongoing work.
- The provision of appropriate insurance at all times for all sections.
- The adoption of appropriate health and safety measures to deal with risks resulting from occupation of areas adjacent to, or only accessible through ongoing construction works.
- The provision of appropriate security measures.
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