WHEN MUST RETENTION SUM BE RELEASED AND PAID?
Most if not all construction contracts used around the world usually have provisions for the retention of a certain amount of monies due to the Contractor by the Employer. This retention sum is normally retained by the Employer throughout the contract period and usually beyond the construction period up to the expiry of the defects liability period.
Release of the retention sum is usually done in two portions. The first, called the one moiety, where half the retention sum is usually released with the issuance of the Certificate of Practical Completion and the remainder is usually released after expiry of the defects liability period and the issuance of Certificate of Making Good Defects by the Architect/Engineer/SO.
Retention sums however, may be subjected to set-off by the Employer in accordance with the provisions in the contract.
Read more in PDF