Loss and/or expense - Construction Contracts - page 303

185 Is there such a thing as 'beneficial occupation', and is the
architect obliged to certify practical completion if the employer
takes possession of the Works?
If the employer takes possession of a project before the architect certifies practical comple-
tion, a contractor may argue that the employer cannot recover liquidated damages for the
subsequent period until practical completion is certified. It is said that the employer has the
benefit of occupying the premises (hence 'beneficial occupation'), and the whole purpose
of liquidated damages is to compensate the employer if occupation cannot be achieved by
the due date. There appears to be no basis in law for that view. Where there is no express
provision for partial possession, there is case law to suggest that liquidated damages may be
recovered even though the employer has occupied the Works, provided that practical com-
pletion has not been certified. 13
Some standard form contracts (for example SBC clause 2.6) permit an employer to use
and/or occupy part or all of the Works if the contractor consents, but this occupation does
not affect the contractor's exclusive possession of the Works, nor does it affect the contract-
or's obligations or entitlements with regard to liquidated damages. 14 The position is likely
to be different if there is provision for partial possession in the contract, and the employer,
with the contractor's consent, has taken partial possession of the whole of the Works.