Substantial completion is commonly referred to as substantial performance. This is a defense that is put into action when a contract is extremely close to being completed and it would be almost unreasonable for the contractor to not receive full payments on the contract, pending any damages that were incurred from non-performance. However, as Jacksonville construction lawyers, we know that there are a few conditions and factors that must be taken into account for substantial completion to be accepted as a defense against a breach of contract, or to recoup any payments for incomplete services.
For contractors, subcontractors, sub-subcontractors, and material suppliers to use the defense of substantial completion, the use of the property or subject of the contract is required to function as agreed upon, in addition to the following factors.
How Much of the Project Is Completed, Versus What is Promised?
One of the most important factors that courts will look at when deciding that substantial completion is an acceptable defense in a breach of contract case is what percentage of the project is already completed, versus how much of what was promised in the contract is left, including all and any construction defects.
Can Anything be Done With the Partially Finished Project?
What is the use of the product to the owner, in regards to the completion of the project? Can it be used by the owner? Does the owner need to hire another contractor to finish the project?
As Jacksonville construction attorneys, we know that it is important for contractors to remember that if a willful breach of contract can in fact be proven, then substantial completion may not be used as a defense during the litigation process.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.