The Making Good Certificate Explained: Releasing Final Retention in Your Building Contract

Introduction

The Making Good Certificate — sometimes called the Defects Liability Certificate or the Certificate of Making Good — is the final formal certification in a residential building contract. It is issued at the end of the Defects Liability Period, after all defects notified during that period have been satisfactorily remedied. Its issue triggers the release of the final retention payment to the contractor. Understanding what the Making Good Certificate is, when it should be issued, and what must be in place before it is issued helps homeowners manage the final stages of their building project correctly.

The Defects Liability Period

The Defects Liability Period (DLP) begins when the Practical Completion Certificate is issued and typically lasts 12 months (though this is a contractual term and can be varied). During the DLP:

• The contractor remains contractually obligated to return to the site and remedy any defects that arise from defective materials or workmanship
• The Contract Administrator notifies the contractor of defects as they are discovered
• The contractor remedies defects within a reasonable time after notification
• The remaining retention (typically 2.5% of the final contract value) is withheld during this period as security for defect rectification

The End-of-DLP Inspection

At or near the end of the Defects Liability Period, the Contract Administrator carries out a final inspection of the completed works to identify any remaining or newly discovered defects that have not yet been notified and remedied. This inspection produces a final schedule of outstanding defects.

The schedule is notified to the contractor, who must then make good all the listed items within a reasonable time. The Making Good Certificate is only issued once all items on the defects schedule have been satisfactorily remedied.

What the Making Good Certificate Triggers

When the Making Good Certificate is issued:

• The final retention (typically 2.5% of the contract sum) is released to the contractor
• The contractor's obligation to remedy defects under the building contract effectively ends (for defects that were or should have been discovered during the DLP)
• The Final Certificate process is initiated — the CA prepares the Final Certificate confirming the final contract sum, taking account of all variations, loss and expense claims, and adjustments agreed during and after the project

What Happens to Defects Discovered After the DLP

The Making Good Certificate does not extinguish all contractor liability for defects — it ends the contractual obligation to return under the DLP mechanism. However, the contractor may still be liable in contract and in negligence for defects that arise or are discovered after the DLP ends, provided the limitation period (typically 6 or 12 years depending on whether the contract was executed as a deed) has not expired.

Structural defects, waterproofing failures, and other building defects with long latency periods (arising years after construction) can still be pursued after the DLP, though the practical position of recovering from a contractor some years later is often more difficult than during the DLP when the relationship is current and the contractor has a contractual obligation to return.

Practical Advice for the End of the DLP

• Carry out a thorough inspection at approximately 11 months into the DLP — before the period ends — to ensure you have identified all defects in time to notify them within the DLP
• Maintain a defects log throughout the DLP, recording each defect as it arises with photographs and the date of notification to the contractor
• Do not allow the DLP to expire before all notified defects have been remedied — keep the pressure on the contractor if defects are not being addressed promptly
• Do not release the final retention until the Making Good Certificate is properly issued — the retained amount is leverage for getting defects remedied

The Final Account

Alongside the Making Good Certificate, the Final Certificate resolves the final financial account — the total amount due to the contractor taking account of all variations, instructions, prime cost and provisional sums, and any loss and expense claims. The Final Certificate is typically issued within 28 days of the Making Good Certificate (or within 28 days of the submission of all final account information, whichever is later). Payment of the Final Certificate balance completes the financial aspects of the contract.

Conclusion

The Making Good Certificate is the final safeguard for the homeowner in a residential building contract — it prevents the release of the remaining retention until the contractor has fulfilled their obligation to remedy defects notified during the Defects Liability Period. For north London homeowners who have invested significantly in a high-quality extension or renovation, the final retention is the last piece of leverage in ensuring the contractor takes the DLP remediation obligation seriously. An architect managing the contract through to completion will conduct the end-of-DLP inspection, compile the defects schedule, monitor remediation, and issue the Making Good Certificate only when genuinely satisfied that all outstanding defects have been properly remedied.