Notice of Completion
What is a Notice of Completion?
A notice of completion, also known as a notice of cessation, is a document stating that the construction project has reached actual completion. Once filed in the county clerk’s office and sent to the appropriate parties, a notice of completion establishes the official “date of completion” for the project.
Who needs to use a Notice of Completion?
A notice of completion is not always necessary. However, owners and contractors can choose to use this notice to signal the end of actual construction. Establishing an official date of completion accomplishes a few things, including (but not limited to): a date for the release of retainage, triggering the deadline clock for warranty periods, and deadlines for lien claims.
In what circumstances is a Notice of Completion normally used?
A notice of completion is used when the project, or some distinct phase of a project, has been completed. Although there is no specific definition of actual completion, this can be triggered by any of the following: no more work or punch list items remain, occupation or use by the owner along with cessation of labor, cessation of labor, or acceptance by a public entity (if the project is subject to acceptance).
Does a Notice of Completion change according to the project location?
Yes, only a handful of states use a notice of completion; while most others use the “last day of furnishing” as the triggering event for deadlines to start running. Plus, each state that uses notices of completion have their own unique rules regarding timing and what rights might be limited by a notice of completion.
Does a Notice of Completion change according to the project type?
Notices of completion can be used on both private and public projects. The timing and requirements vary depending on the jurisdiction.
What happens if I make a mistake with a Notice of Completion? What if I don’t send a Notice of Completion?
The use of a notice of completion is optional. Mistakes in a notice of completions are pretty rare, and they will only affect the validity of the notice. Failure to send or file a notice of completion will generally not affect the project itself either. The only real penalty for failure to send/mistakes in a notice of completion is the continued period of liability for owners and contractors for claims against them or the property. So, where a mistake is made with a notice of completion, typically, the only real consequence is that life goes on as if the notice of completion was never sent.
Is a Notice of Completion usually paired with anything else?
Since notices of completion are filed when the project has reached actual completion, many times these are filed when the owner has received a certificate of occupancy from building officials.