It’s a familiar twist. The contractor delivers the project—on time, or close to it. Then suddenly, urgency evaporates. 
The project the employer “needed yesterday” is no longer needed today. Deadlines soften. But not for the contractor.
Instead of issuing the Taking-Over Certificate, the employer slowly and deliberately unfurls an ever-growing punch list—often filled with minor, non-critical, or newly alleged defects. Why? To keep the contractor on the hook. To delay taking over. And to preserve the leverage of delay damages, site risk, and unreleased payment.
The Legal Leverage of the TOC
Under most contracts—especially FIDIC—the Taking-Over Certificate (TOC) marks a critical shift in risk:
- Delay damages stop accruing
- Responsibility for care of the works transfers
- Retention release begins
- The contractor can begin demobilising
Until that certificate is issued, the contractor remains exposed. The project may be 99% complete, but in legal and financial terms, the job is still very much alive—and so are the risks.
When Delay Is No Longer a Problem (For the Employer)
During a boom, everyone’s in a rush. But when the market turns, so does the tempo. The same project that was urgent at award becomes far less critical at handover. There’s no tenant yet. No operator ready. No pressure to open.
Suddenly, it’s the contractor who’s ahead of schedule—and that’s a problem.
What does the employer do?
Withhold the TOC. Maintain the pressure. Stretch the punch list. Keep the risk of the site—its cost, its liability, its exposure—with the contractor, i.e. the party least able to recover it.
The result? A completed project… that still isn’t “complete enough.”
The Weaponised Punch List
Punch lists are meant to protect quality and to ensure that minor outstanding work and defects that do not prevent the beneficial use of the Works are recorded as such and completed progressively during the defects period. That is, they are supposed to facilitate the earliest possible handover whilst ensuring that the work is nonetheless 100% completed before the end of the defects period. But in many scenarios, they’re used to protect the employer’s bargaining position.
Contractors find themselves facing:
- Recycled defects already discussed and accepted
- Trivial cosmetic issues
- Shifting standards of “satisfaction”
- Growing lists that expand with every inspection
The goal is no longer completion. The goal is control. The employer knows the contractor has already spent the money. Demobilised resources. Handed over the keys. In that moment the TOC becomes a very powerful tool.
Minimising Your Risks
Contractors can’t stop the market from shifting—but they can reduce their exposure to this final-stage squeeze.
- Define Practical Completion with care. Avoid vague language. Push for objective criteria: functionality, accessibility, commissioning.
- Negotiate TOC triggers. Include provisions that allow partial taking-over or deem TOC issued when only minor defects remain.
- Document relentlessly. Site photos, inspection logs, snagging lists, and correspondence become critical when TOC is withheld.
- Push back on moving targets. If the punch list begins to grow beyond reason, reserve your position clearly and early.
- Know your rights. TOC cannot be withheld for trivial issues under most standard forms. If it’s being used to apply commercial pressure, say so.
The key is to be as meticulous about what determines or defines Completion as you are about the price or the scope itself.
Until contractors assert their position earlier and seek to structure their contracts more tightly, the rules won’t change. Because in this game, heads they win. Tails you lose.
davidbrodiestedman@dispute-iq.com