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Section D-2
Final Acceptance of Contract Work

It is recommended that the following procedures be observed:

1. As the work nears completion, the Contractor shall review the requirements of the Contract Documents, shall inspect the work, and shall inform all parties involved of work to be corrected or completed deeming the project is substantially complete. "Substantial Completion" should be established as the date the Owner can occupy and utilize the work or a designated portion for its intended use.

2. Upon receipt of a written statement from the Contractor signifying that work is substantially complete and containing a list of items to be corrected or completed, the Architect will visit the site to verify. If the Architect agrees that the work is substantially complete in accordance with the Contract Documents, he will make a pre-final inspection in the presence of a representative of the Contractor and will prepare a "Certificate of Substantial Completion."

3. The Architect will confirm the list of required corrections and attach the punch list to the Certificate of Substantial Completion. This document shall establish (a) the date of Substantial Completion; (b) the responsibilities of the Owner and Contractor for security, maintenance, temporary utilities, damage to the existing building, and insurance; and (c) the timeframe in which the Contractor shall finish all items on the punch list. The Certificate of Substantial Completion shall be submitted to the Owner and Contractor for their written acceptance of responsibilities assigned to them in such Certificate. Upon such acceptance and consent of surety, if any, the Owner shall make payment of retainage applying to such Work or designated portion thereof. Such payment shall be adjusted for Work that is incomplete or not in accordance with the requirements of the Contract Documents. A sum equal to one and one-half times the value as estimated by the contractor and the architect will be withheld until the punch list work is complete. Warranties required by the Contract Documents shall commence on the date of Substantial Completion of the Work or designated portion thereof unless otherwise provided in the Certificate of Substantial Completion. (See also section D-5: "Retained Percentage" for related information regarding retained percentage and substantial completion.)

4. The Contractor shall divide the list into each trade, with provision on the list for indicating satisfactory completion by a mutually agreed upon date. When the Contractor has satisfied all items on the list have been satisfactorily corrected or completed, the Contractor shall notify the Architect in writing and make Application for Final Payment.

5. The Architect will make the final inspection to confirm the Contractor's statement and, based upon the condition of work inspected, the Architect will take appropriate action.

6. Punch list work should not delay normal approval of Contractor request for payment, including Certificates for reduction and/or elimination of retained percentage due the Contractor provided a sum sufficient to complete remaining work is withheld.

7. It is the Contractor's responsibility to notify the Architect of "Substantial Completion," in order to minimize the punch list being prepared by the Architect. The Architect/Engineer shares a responsibility to make the Contractor aware, throughout the course of the work, of conditions known that would eventually become punch list items if not promptly corrected, thus minimizing corrective work and reducing the number of final punch list items.

8. Whenever possible, there should only be one punch list developed and the items on the list should be corrected or completed by the Contractor within a reasonable and stipulated number of days after issuance.

9. When the Contract Documents are satisfied and the punch list is completed, the Architect will promptly issue a final Certificate for Payment representing his acceptance of the work.

TAGS: Certificate of Substantial Completion, Punch List, Retainage, and Section D-5.

Glossary Terms for the Best Practices Guide

History of Recommendation:
Revised October, 2009
Revised October, 2008
Revised April, 1987
Reviewed January, 1987
Approved April, 1976

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