What is a taking-over certificate in a construction contract?
A taking-over certificate is the document by which the employer, or the engineer acting for it, confirms that the works, or a section of them, are complete enough to be taken over; under FIDIC contracts the date it states is the date of completion that later periods run from.
Also called taking over certificate, TOC.
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Taking-over certificate in plain words
FIDIC contracts use the term in sub-clause 10.1: the certificate can be issued with minor work outstanding, as long as that work does not stop the works being used for their purpose. Other contracts call the same milestone a completion certificate or practical completion. Whatever the name, the date it records is the one later clocks run from, such as the defect liability period and any retention released at completion.
Why does taking-over certificate matter?
A late taking-over certificate moves every later date with it: the start of the defect liability period, any retention release tied to completion and, through them, cash the contractor has already earned.
Where does taking-over certificate mislead?
The name, the conditions for issue, deemed issue and partial taking over differ by contract and by FIDIC edition. Check your contract for the clause that applies to you.
What do people get wrong about taking-over certificate?
- Waiting to be offered the certificate
- Under FIDIC the contractor applies for the certificate, and both the 1999 and the 2017 Red Books provide for it to be deemed issued if the engineer neither issues it nor rejects the application within 28 days. Waiting to be offered one loses days that the later releases depend on.