FACULTY OF BUILT ENVIRONMENT

DEPARTMENT OF CONSTRUCTION MANAGEMENT

GROUP : 5

COURSE : CONSTRUCTION LAW

COURSE CODE: BCS 2103

LECTURER: W. MANDHLAZI

KUDA SHURO N02423399C

FELISTICIOUS N BHASOPO N02421751K
MAXWELL MANGUNDU N02419022Y
TAVONGA DZIMIRI N02423108K
RODNEY MUNAKIRA N02419726B
TADIWANASHE A CHINWADA N02420932Q
FAIRSON MPOFU
TINOMUVONGA J CHITSIKA N02419306N
QUESTION

Explain the types of certificates used in construction projects highlighting

significances when used on a project.

DEFINITION

A Construction Certificate is defined as the expression in a definite form of the

exercise of the judgement, opinion of skill of the engineer, architect or surveyor
in relation to some matter provided by the terms of the contract. However, this
does not mean that every expression of opinion or decision given by the
contract administrator will amount to a certificate. It will only be a certificate if
it is so described in the contract.

TYPES OF CONSTRUCTION CERTIFICATES

1) Interim Payment Certificates

2) Final certificates
3) Certificates of Recording events
a) Non-Completion Certificate
b) Practical Completion Certificate
c) Certificate of making good
4) Certificate of Completion

1) INTERIM PAYMENT CERTIFICATES

Interim Payment Certificates are documents issued by a project architect,
engineer, or quantity surveyor during the course of a construction project. These
certificates are used to authorize partial payments to contractors for work that
has been completed up to a certain stage of the project. The payments are made
progressively, allowing contractors to manage cash flow and continue work
without waiting until the entire project is completed.

Interim Payment Certificates are simply a mechanism for confirming that an

instalment of the contract sum is due to the contractor. Whichever method used
to calculate the amount of money due, an interim certificate is not conclusive
about anything. It says nothing about the quality of materials or workmanship
nor does it indicate satisfaction with the work done to date.

It is only the final certificate that is ever conclusive. As a result, the only
obligation arising from an interim certificate is an obligation on the employer to
make that payment within the stated time. Failure to make that payment is a
serious breach of the contract.

Significance of Interim Payment Certificates

 Cash Flow Management: IPCs ensure that contractors receive payments

throughout the project as work is completed. This helps them cover
operational costs such as labour, materials, and overheads without having
to wait until the project’s completion.
 Transparency and Control: These certificates provide a clear record of the
work completed and the corresponding payments made. They help both
the contractor and the client maintain transparency regarding the financial
progress of the project.
 Risk Mitigation: For clients or project owners, IPCs reduce the risk of
paying for unfinished work. Payments are made based on the actual
 progress of the project, which ensures that the contractor is incentivized
to complete the work according to schedule.
 Performance Monitoring: By issuing IPCs, the project team can regularly
monitor the progress of construction work, ensuring that the project is on
schedule and within budget.

When is it used in Construction Projects ?

 Milestone Payments: Interim Payment Certificates are typically issued

after specific stages or milestones of the project are completed. These
milestones could be based on a percentage of the total work completed,
like the completion of foundations, structural work, or electrical
installation.
 Progress Payments: IPCs are generally used when the contractor
completes a certain amount of work, and the client agrees to make a
payment based on that progress. These payments may not be 100% of the
value of the completed work but are based on a pre-agreed formula or
valuation.
 Contract Terms: The use of IPCs is typically outlined in the contract
between the project owner and the contractor. The payment schedule and
conditions under which IPCs will be issued (e.g., monthly or at specified
stages) are specified in the contract.

Process of Issuing Interim Payment Certificates

 Work Completed: The contractor submits a claim or request for payment

based on the work completed to date.
  Valuation: A quantity surveyor or project manager evaluates the work
completed and calculates the value of the work done.
 Certificate Issuance: If the value of work completed matches the criteria
for payment, an IPC is issued, detailing the amount payable.
 Payment: The client or project owner then makes the payment based on
the IPC, which is typically a percentage of the total value of the contract.

FINAL CERTIFICATES

A Final Certificate in a construction project is a formal document issued by the

architect, project manager, or quantity surveyor once all the work under the
contract has been completed. It signifies the successful completion of the
project, confirming that all contractual obligations have been met, and it
authorizes the release of the final payment.

Significance of Final Certificates

 Completion of the Project: The final certificate marks the official end of
the project, confirming that the contractor has completed the construction
works to the satisfaction of the client and in accordance with the terms of
the contract.
 Release of Retention Funds: Often, during the course of the project, a
portion of the payment is withheld as retention, ensuring that the
contractor fixes any defects or incomplete work. The final certificate
allows for the release of the retention money once all work has been
completed satisfactorily and any defects have been rectified.
 Defects Liability Period: The issuance of a final certificate may also
signify the end of the defects liability period, where the contractor is
 responsible for fixing any issues or defects that arise after project
completion but within a specified period.
 Legal Closure of Contract: The final certificate is crucial for legal
reasons, as it formally closes out the contract between the contractor and
the client. This document ensures that both parties have fulfilled their
obligations under the contract.
 Settlement of Final Payments: After the final certificate is issued, the
contractor is entitled to receive any outstanding amounts, including any
balances of the contract sum or previously withheld amounts. This
provides a final financial settlement to the contractor.
 Confirmation of Compliance: It also confirms that the contractor has
adhered to building codes, standards, and contractual requirements,
ensuring that the project complies with all legal and regulatory
obligations.

When is it used in a Construction Project?

 Completion of Work: The final certificate is typically issued after all

construction work has been finished, including the rectification of any
defects identified during inspections or within the defects liability period.
It can be issued only once the project is considered to be 100% complete
and in accordance with the contract.
 Client Approval: The client or project owner must formally accept the
work as complete, which is typically preceded by a final inspection of
the construction site and a review of any remaining items or defects that
need to be addressed.
 Defects Rectification: If there were any defects or unfinished work at the
time of the practical completion (when the work is considered
substantially complete), the contractor must correct these before the final
 certificate is issued. Once this work is done, the final certificate is issued,
confirming that the contractor has rectified any issues.
 Retention and Payments: The final certificate often triggers the release of
any retention money held during the course of the project. In some cases,
the final certificate also authorizes the final payment to the contractor,
which may include additional costs like interest or variations that were
agreed upon during the project.

Process of Issuing the Final Certificate

 Completion of Work: The contractor notifies the client or project manager

that the construction work is complete.
 Inspection: A thorough inspection of the site is conducted by the architect,
engineer, or project manager to verify that all work has been completed as
per the contract and to identify any remaining defects.
 Defects Rectification: If defects or incomplete work are identified, the
contractor is required to address them before the final certificate can be
issued.
 Issuance of Final Certificate: Once all work is completed to satisfaction,
and any defects are rectified, the project manager or architect issues the
final certificate, which confirms the completion of the project.
 Final Payment: The final payment is made to the contractor, including the
release of any retention amounts and any other outstanding payments.

NON-COMPLETION CERTIFICATE

A Non-Completion Certificate in construction is a document issued when a

contractor has not completed a construction project within the agreed-upon
timeline or has failed to meet specific contract terms. It is issued by the project
owner, architect, or project manager and officially acknowledges that the work
has not been completed as scheduled or required.

Significance of Non-Completion Certificates

 Indicates Delay or Non-Completion of Work: A Non-Completion

Certificate highlights that the contractor has not met the contractual
obligations regarding the completion of the project. This serves as a
formal acknowledgment that the project has not been finished within the
specified time frame, or certain milestones or quality standards have not
been met.
 Triggers Penalties: Many construction contracts include clauses that
impose penalties or liquidated damages if the project is not completed on
time. The issuance of a Non-Completion Certificate often triggers these
penalties, which are typically calculated on a daily or weekly basis for
each day the project is delayed beyond the completion date.
 Legal Documentation: The certificate serves as an official document that
may be used in future legal proceedings or disputes. It provides proof of
non-completion and can be used by the project owner to take corrective
action or pursue legal remedies, such as withholding payments or
claiming damages.
 Contractual Breach Acknowledgment: By issuing a Non-Completion
Certificate, the project owner formally recognizes that the contractor has
breached the terms of the contract. This breach could be due to delays,
failure to meet quality standards, incomplete work, or non-performance
of specific contract conditions.
 Clarifies Project Status:The Non-Completion Certificate helps to clarify
the status of the project and provides the contractor and client with a
written acknowledgment that the work is still incomplete. It can also
 specify the reasons for non-completion, whether they are due to the
contractor’s failure, external factors, or other conditions.
 Helps Resolve Disputes: If there are disagreements between the
contractor and the client over why the project was not completed, the
Non-Completion Certificate helps clarify the situation. It outlines the
unfulfilled obligations and can act as a reference point in resolving the
dispute, either through negotiations or legal means.
 Assists in Contract Termination: If the project is not completed within
the specified timeframe, a Non-Completion Certificate can be a
precursor to contract termination. It may allow the client to formally end
the relationship with the contractor if non-completion is significant
enough to warrant such a step, based on the terms in the contract.
 Security for Remaining Payments: A Non-Completion Certificate may
also affect the release of remaining payments due to the contractor.
Often, clients are entitled to withhold payments until completion is
achieved or rectification of the issues that led to the delay occurs.

When Used in a Construction Project

 Delay in Completion: The Non-Completion Certificate is typically issued

when the contractor fails to finish the project on time or does not meet
the project’s specifications. This could happen due to various reasons,
including poor workmanship, lack of materials, or other delays beyond
the contractor's control (e.g., weather, labour strikes).
 Failure to Meet Milestones: In some cases, construction contracts are
structured with specific milestones. If the contractor fails to meet one or
more of these milestones, the project manager or client may issue a Non-
Completion Certificate to formally acknowledge the contractor’s
inability to deliver on time.
  Non-Performance of Contract Terms: If the contractor is not adhering to
the conditions of the contract, such as failing to deliver the required
quality of work, not adhering to safety standards, or neglecting to fulfil
other obligations (e.g., site cleanliness, compliance with local
regulations), the Non-Completion Certificate may be used as a formal
statement of non-performance.
 Substantial Completion Delays: The Non-Completion Certificate may be
issued if the project has reached a state of substantial completion, but
certain elements are still missing, or the project is not fully functional.
This typically occurs when the building or structure is usable, but minor
details or final inspections remain incomplete.
 Legal and Financial Implications: Non-Completion Certificates can have
serious legal and financial consequences. If delays or non-completion are
deemed excessive, the client may be entitled to claim compensation or
liquidated damages. Additionally, the contractor could face difficulties in
receiving the final payment or might have their contract terminated.

PRACTICAL COMPLETION CERTIFICATE

A Practical Completion Certificate is a formal document issued by the project

architect, engineer, or contract administrator when the contractor has completed
the construction work to a stage where the project is considered substantially
complete, but there may still be minor work or defects that need to be
addressed. It signifies that the project can be handed over to the client, and the
building or structure is ready for use, even though some final touch-ups or
adjustments might still be needed.
Significance of Practical Completion Certificates

 Formal Recognition of Substantial Completion: The Practical Completion

Certificate signifies that the construction work has reached a stage where
it is sufficiently completed to allow the client to take possession of the
building or space. It marks the point at which the project is functionally
complete, even if minor items or defects remain.
 Transition to Client’s Responsibility: Once a Practical Completion
Certificate is issued, the responsibility for the building shifts from the
contractor to the client or project owner. The client can take occupation or
use the space, while the contractor is expected to complete any
outstanding or defect rectification work.
 Trigger for Final Payment: Practical completion often triggers the release
of the final payment to the contractor, minus any retention amounts. The
contractor may receive most of the remaining payment once the project
reaches practical completion, with the final portion typically held back
until all defects or remaining tasks are resolved.
 Start of Defects Liability Period: The issuance of the Practical
Completion Certificate marks the beginning of the defects liability period
(DLP), which is usually a specified period (e.g., 12 months) during which
the contractor is responsible for fixing any defects or issues that arise
after the handover. This provides the client with assurance that the
contractor will address any problems that emerge post-completion.
 Completion of Contractual Obligations: Practical completion confirms
that the contractor has met their contractual obligations to the extent that
the building or structure is usable and functional. However, it does not
necessarily mean that every single item is finished. Some minor defects
or items may still need attention, but these will not hinder the building’s
use.
  Increases Legal and Financial Certainty: The Practical Completion
Certificate reduces uncertainty for both parties involved. For the client, it
marks the point at which they can start using the building. For the
contractor, it provides an official acknowledgment that their major
contractual responsibilities have been fulfilled, protecting them from
further claims related to completion.
 Contractor's Final Responsibility for Minor Defects: Even after practical
completion, the contractor remains responsible for addressing any minor
defects or incomplete work. The Practical Completion Certificate does
not absolve the contractor of fixing minor issues identified during the
defects liability period, which could involve finishing touches, repairs, or
adjustments.
 Client Acceptance of Work: The certificate signifies that the client has
accepted the work as being substantially completed. However, the client
can request further action or negotiations regarding minor defects or the
scope of work that has not been fully completed.

When Used in a Construction Project

 Completion of Major Works: The Practical Completion Certificate is

issued when the main works of the project are substantially complete,
and the building is safe and suitable for use, even though minor works
remain. This could include structural elements, electrical and plumbing
systems, and other key parts of the building.
 Before Final Handover: It's a milestone that usually occurs before the
final handover of the project. The contractor and project owner agree that
the building is ready for use, even though some minor snagging tasks or
corrections are still pending.
  Resolving Defects: Any defects found during inspections before the
certificate is issued will be listed as snagging items, which need to be
addressed before or shortly after the certificate is issued. However, these
do not prevent the certificate from being issued as long as they do not
affect the building's ability to be occupied or used.
 Legal Handover of Risk and Responsibility: Once the Practical
Completion Certificate is issued, the legal and financial responsibility for
the property may pass to the client, even if the contractor remains
responsible for addressing defects during the defects liability period.
 Completion of Milestones in Phased Construction: In large, phased
construction projects, a Practical Completion Certificate may be issued
for each phase. This signifies that each phase of the project is
functionally complete and ready for occupation, even if other phases are
still in progress.

Process of Issuing a Practical Completion Certificate

1. Inspection: Before issuing the certificate, a thorough inspection of the

completed work is conducted by the architect, engineer, or contract
administrator to assess whether the work is sufficiently complete and whether
any defects need to be addressed.

2. Resolution of Snags: The contractor is typically asked to address any

snagging items, minor defects or incomplete works that do not affect the overall
functionality or use of the building. These items must be resolved before the
certificate is issued or within a specified time after practical completion.

3. Client’s Approval: Once the inspection and resolution of defects have taken
place, the client or project owner is usually asked to formally accept the
building’s practical completion. This can involve reviewing the condition of the
building and agreeing to take possession of the space.

4. Issuance of the Certificate: After the inspection and resolution of any minor
issues, the project manager, architect, or engineer issues the Practical
Completion Certificate. This confirms the project’s substantial completion, the
start of the defects liability period, and the client's ability to use the property.

CERTIFICATE OF MAKING GOOD

A Certificate of Making Good is a formal document issued during or at the end

of a construction project to confirm that the contractor has addressed and
rectified any defects or incomplete work identified during the defects liability
period or following the completion of the project. This certificate serves as
evidence that all items that were identified as defects (or "snags") during the
inspection process have been properly fixed or completed to the satisfaction of
the client or project owner.

Significance of a Certificate of Making Good

 Confirmation of Defect Rectification: The main purpose of the Certificate

of Making Good is to confirm that all defects, issues, or unfinished tasks
identified during the inspection phase (often during the defects liability
period) have been properly addressed by the contractor. It serves as
formal acknowledgment that the contractor has completed all necessary
corrections and remedial work.
 Closure of the Defects Liability Period (DLP): In many construction
contracts, there is a defects liability period (usually 12 months) after
 practical completion, during which the contractor remains responsible for
fixing any defects that arise. The Certificate of Making Good signifies the
end of the DLP, indicating that all defects have been remedied to the
satisfaction of the client.
 Completion of Contractor's Obligations: Once the Certificate of Making
Good is issued, it marks the contractor’s final fulfillment of their
obligations under the contract. It indicates that the contractor has
completed all tasks, including addressing minor defects and ensuring that
the work complies with the contract’s requirements.
 Trigger for Final Payment: The issuance of this certificate often serves as
the final step before releasing the remaining payment to the contractor.
Many construction contracts stipulate that a portion of the final payment
(sometimes held as retention) is only paid after the contractor has "made
good" on all defects. Therefore, the certificate allows the final payment to
be made, assuming all issues have been resolved.
 Formal Closure of the Project: The Certificate of Making Good marks the
formal closure of the project in terms of the contractor's involvement. It
signifies that the contractor has completed the entire scope of work and
that the project is now fully delivered in accordance with the contract
terms, including any outstanding tasks or fixes.
 Legal Protection for Both Parties: This certificate offers legal protection
for both the contractor and the client. For the contractor, it confirms that
all defects and snags have been corrected, thus limiting their liability. For
the client, it confirms that all issues raised during the defects liability
period have been addressed, offering assurance that the project is fully
completed and functional.
 Documentation for Future Reference: The Certificate of Making Good
becomes part of the official project documentation. It serves as a record
that all required actions have been taken to remedy any outstanding
 issues. In case of any future disputes, this document can serve as proof
that the contractor fulfilled their obligations.
 Ensures Long-Term Quality and Compliance: The issuance of this
certificate ensures that the construction work is not only completed but
that the quality and standards of the project meet or exceed the expected
requirements. It assures the client that the work is of the required standard
and will perform as expected over time, reducing the likelihood of future
problems.

When Used in a Construction Project

 After Defects Liability Period (DLP): The Certificate of Making Good is

typically issued after the defects liability period has ended, once all
minor defects or incomplete work have been fixed. During this period,
the contractor is responsible for correcting any defects identified by the
client or project manager.
 Following a Snagging Inspection: Before this certificate is issued, a
snagging inspection is usually carried out, where any outstanding issues
or defects are identified. The contractor is then expected to fix these
issues before the Certificate of Making Good is granted.
 When Work is Fully Completed: It’s issued when all of the outstanding
tasks, defects, and snags have been completed and rectified. This
includes things like correcting poor finishes, replacing damaged
materials, or completing unfinished tasks that were initially left out.
 As the Final Step in the Contractual Process: This certificate is generally
the final step in the construction process, representing the contractor's
completion of all contractual obligations, including the resolution of any
defects or deficiencies. It is issued once the work is in full compliance
with the contract’s terms and quality standards.
CERTIFICATE OF COMPLETION

A Certificate of Completion is a formal document issued by the architect,

engineer, or contract administrator to confirm that a construction project has
been completed in accordance with the contract terms and specifications. It
marks the official conclusion of the contractor’s work on the project, indicating
that the building or structure is complete, fully functional, and ready for
handover to the client or project owner.

Significance of the Certificate of Completion

 Formal Acknowledgment of Project Completion: The Certificate of

Completion serves as a formal acknowledgment that the contractor has
completed all aspects of the construction project, including all major
works and any minor outstanding items (or "snags") identified during
inspections. It signifies that the contractor has fulfilled their obligations
under the contract.
 Legal and Contractual Closure: This certificate marks the legal closure of
the construction contract. It indicates that the contractor has met the terms
of the agreement and that the project is now complete from a contractual
perspective. It often triggers the final phases of the contractual process,
such as the release of the final payment and the start of the defects
liability period.
 Commencement of Defects Liability Period (DLP): The Certificate of
Completion marks the start of the defects liability period (DLP), a
specified time during which the contractor remains responsible for fixing
any defects or issues that arise after the project has been completed. The
DLP is typically a fixed period, such as 12 months, and allows the client
 to request that the contractor fix any defects discovered after the official
completion of the project.
 Trigger for Final Payments: Once the Certificate of Completion is issued,
it often triggers the release of final payments to the contractor, including
any retention amounts that may have been held back during the course of
the project. This certificate signifies that the contractor has completed
their obligations, and final payments can be made.
 Transfer of Risk and Responsibility: Upon issuing the Certificate of
Completion, the risk and responsibility for the project are transferred
from the contractor to the client. This means that the client takes
ownership of the property or structure and is now responsible for its
maintenance and operation, except for any remaining defects that the
contractor must address during the defects liability period.
 Legal Protection for Both Parties: The Certificate of Completion offers
legal protection to both the contractor and the client. For the contractor, it
provides formal recognition that they have completed the project as per
the contract. For the client, it ensures that the work is complete and
satisfies the terms of the contract, providing a basis for claims related to
any defects that may appear later.
 Documentation of Completion: The Certificate of Completion serves as
official documentation that the construction project has reached its
completion stage. This document is often required for record-keeping,
insurance purposes, and future reference in case of disputes, maintenance
issues, or legal matters.

Final Inspection and Compliance Check: The issuance of the certificate follows
a thorough final inspection by the project manager, architect, or other relevant
professionals. This inspection ensures that the work complies with all safety
standards, building codes, and contractual requirements. The certificate assures
the client that the construction work has been completed to the required
standard.

When Used in a Construction Project

 Completion of Construction Work: The Certificate of Completion is

issued when all the construction work has been finished, and the building
or structure is deemed ready for use or occupancy. It means that the
construction meets all the requirements set out in the contract, including
architectural, structural, electrical, and mechanical elements.
 Post-Construction Inspections: After all the work has been completed, a
final inspection is typically carried out by the architect, project manager,
or engineer. Any minor issues, defects, or uncompleted work (known as
"snags") that do not affect the functionality of the building may be listed,
but if these are minor enough, the Certificate of Completion can still be
issued.
 Handing Over of the Project to the Client: This certificate signifies the
official handover of the project to the client. It indicates that the client
can now take full control of the building or facility and begin using it.
The contractor’s responsibility for the completed project ends, except for
addressing any defects during the defects liability period.
 Completion of Milestones in Phased Construction: In projects that are
phased or have multiple stages, the Certificate of Completion may be
issued for each phase or stage of the project as it is completed. Each
phase of the work must be inspected and formally acknowledged as
complete before moving on to the next stage.
 Legal Significance in Contractual Obligations: The Certificate of
Completion provides the legal basis for finalizing the construction
contract. It confirms that the contractor has completed all the work
 specified in the contract and has met all required standards and codes,
ending the contractor's obligations, except for addressing any defects that
may arise during the defects liability period.

Process of Issuing the Certificate of Completion

 Inspection and Review of Completed Work: The contractor will notify

the project manager or architect that the construction work is complete. A
detailed inspection is then conducted to verify that all work has been
completed in accordance with the contract. This includes ensuring that
the building is functional, all systems (e.g., plumbing, electrical) are
operational, and that all safety standards and regulations are met.
 Identification of Minor Defects (Snagging): During the final inspection,
any minor defects or incomplete work that does not prevent the building
from being occupied or used are identified. The contractor will typically
be given a list of snags to address, but these are not usually an obstacle to
issuing the Certificate of Completion, provided they are minor and do
not impact the overall functionality of the building.
 Issuance of Certificate: Once the inspection confirms that the work is
substantially complete, the Certificate of Completion is issued. This
document confirms that the contractor has completed the construction
and that the project is ready for handover to the client. It marks the
formal completion of the construction process, and the contractor’s
obligations are essentially fulfilled, except for defects identified during
the defects liability period.
 Handover to Client: The client formally accepts the building and takes
ownership of the property. The transfer of responsibility includes
operational aspects like maintenance, utilities, and insurance, with the
 exception of any defects that may need to be addressed during the
defects liability period.
 Final Payment and Release of Retention: The contractor typically
receives the final payment after the Certificate of Completion is issued.
This includes the release of any retention money that had been held back
during the project, contingent on the work being completed satisfactorily.
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