Every Project’s Endgame: Substantial Completion and the Punchlist
As a licensed Connecticut architect based in Wethersfield, I provide residential and light commercial architectural services throughout Hartford County and across Connecticut. My work also includes expert witness services for construction disputes throughout the Northeast.
Avoiding Construction Disputes at the Final Stage
Most construction disputes arise near the end of a project; when expectations, timelines, and payments collide. A bad-faith contractor may offer vague reassurances as the work progresses, then suddenly declare the job complete and request the Final Draw payment, promising to take care of outstanding issues later.
But is the job truly finished and ready for final payment? And how can you accurately calculate how much to hold back for remaining items?
Let’s explore two key concepts every homeowner or building owner should understand: Substantial Completion and the Punch List.
What Is Substantial Completion?
If your architect helped negotiate a solid contract, the final payment (also known as the Final Draw) should be substantial—big enough to motivate proper completion of the job. Typically, this payment is triggered by substantial completion.
But what does that actually mean?
The American Institute of Architects (AIA) defines substantial completion as:
“The stage in the progress of the Work when the Work… is sufficiently complete in accordance with the Contract Documents so that the Owner can occupy or utilize the Work for its intended use.”
I’ve been a long-time AIA member—but I’ll be honest: this definition can lead to problems if not clarified. It says nothing about quality of work.
Why the Definition of Substantial Completion Isn’t Enough
A slipshod contractor may lean on that vague definition. Crooked tile, poor paint, uneven floors—these don’t always stop occupancy, but they’re unacceptable. That’s why I add this phrase directly into my architectural plans:
“All work shall be executed in a skilled and workmanlike manner as certified by the Architect.”
This small addition is powerful: if the work isn’t done properly, then by definition, the project isn’t substantially complete. And that means the contractor isn’t entitled to the final payment yet.
Bottom line: Don’t release final payment until your architect certifies that the project meets the contract and has been completed to a professional standard.
What Belongs on the Punch List?
The punch list is a set of finishing tasks that can’t be completed before you move in. It includes specific items with agreed-upon dollar amounts to be held back until those items are done.
Legitimate punch list items include:
Items waiting for delivery (e.g., a cabinet door that’s backordered)
Weather-dependent tasks (e.g., exterior painting in winter)
But here’s the key:
Punch list items do not include work that was done poorly or incompletely. If something wasn’t executed correctly, it needs to be fixed before the punch list is finalized or any final payment is made.
How Much Should You Hold Back for Punch List Items?
Always hold back enough that you can hire someone else to finish the task if needed. A good rule of thumb? Hold back three times the cost of completing the item.
This protects you, motivates the contractor to follow through, and ensures you have leverage if the contractor bails.
Your architect can help determine fair holdbacks and confirm that the quality of work aligns with the contract standards.
Final Thoughts: Protecting Your Project from Start to Finish
A little tough negotiation before signing a construction contract can prevent major headaches at the end. If you’re not comfortable being the “tough cop,” your architect can step in and handle that role; while you maintain a cordial relationship with your contractor.
Ready to bring your vision to life? Contact Roger Greenwald to begin your custom design journey today.
Good luck!
Roger Greenwald, AIA
Licensed Architect, Connecticut