In our recent article, we looked at the High Court’s decision in the case of Mears Limited v Costplan Services (South East) Limited and others . Hot on the heels of that decision the parties have made their way to the Court of Appeal to battle it out again. Although the appeal was not successful, Lord Justice Coulson reviewed the authorities on practical completion. Given that the topic rarely comes before the Court of Appeal, his summary provides useful guidance on the approach to be taken when certifying practical completion.
As a starting point he acknowledged (as referred to in Keating on construction Contracts) that practical completion is easier to recognise than to define. There are no hard and fast rules.
He confirmed that latent defects cannot prevent practical completion. This should be an obvious point really as a latent defect is one that has not been identified and so the certifier will not be aware of it when making their decision.
As far as patent defects are concerned, there is no difference for the purposes of practical completion between work which has not been done at all and work which is defective.
Some previous case law suggested that any patent defect could prevent practical completion from being certified. Coulson LJ preferred a more practical approach and described instead “a state of affairs in which the works have been completed free from patent defects, other than ones to be ignored as trifling.”
What would amount to a “trifling” defect is a matter of fact and degree, again leaving much to the certifier’s discretion. This should be measured against “the purpose of allowing the employers to take possession of the works and to use them as intended.” However, contrary to what had been suggested previously, he did not consider this should be adopted as a principle that a house was practically complete if it was capable of being lived in, regardless of what remained to be finished/put right.
There was no authority to support the proposition that because a defect was irremediable it automatically meant that practical completion could not be certified.
Although providing helpful guidance it remains the case that whether practical completion should be certified is going to depend on the certifier’s professional judgment taking into account the facts and circumstances of the particular case, including the purpose of the building and the nature and extent of the defects.
Consistent with our policy when giving comment and advice on a non-specific basis, we cannot assume legal responsibility for the accuracy of any particular statement. In the case of specific problems we recommend that professional advice be sought.