Building acceptance and final installment due date

Hello dear forum community,

Maybe someone of you has experience / advice regarding the following matter?

We have purchased a semi-detached house from the developer.
The agreed completion date for the house, according to the purchase contract, is 30.04.2020, and for the outdoor facilities - 30.07.2020.
Two installments are outstanding (from the contract):

[*]After completion according to the construction description, payment is due Zug um Zug against transfer of possession (key handover) 8.4%
[*]After full timely completion including the removal of any defects, the retention security of 5% of the total amount according to item 1 as well as the final installment after full completion of 3.5%, thus totaling 8.5%

My first question:

[*]Is the last (i.e. the 8.5% installment) only due after completion of the outdoor facilities or already after the house is ready to move in and the defects have been rectified?

...and the second:

[*]It sounded strange to me, but I got the statement from the site manager (and read similar cases in forums) that the key handover only takes place after the entire final installment has been transferred and received. Then we would practically have to pay for the outdoor facilities in advance.

We always assumed that the keys would be handed over already after paying the second to last installment.

Thank you in advance for your tips and advice!
Valery

Hello Valery,
I'll start from the end: the acceptance is a very crucial point: You receive your house (with defects and remaining work) and also the key authority. That's how it is! Not affected by this are withholdings due to defects and remaining work.
Simply put: there is an acceptance with a protocol, and defects and remaining work are formulated in it. From then on, the key is yours!
This handover protocol also regulates the further procedure: deadlines for elimination, etc.

Hello Valery,
I'll start from the end: The acceptance is a crucial point: You receive your house (with defects and outstanding work) and also the possession of the keys. That's how it is! Not affected by this are withholdings due to defects and outstanding work.
Simply put: there is an acceptance with a protocol, and defects and outstanding work are recorded in it. From then on, the keys are yours!
This handover protocol also regulates the further procedure: deadlines for rectification, etc.

Hello Vicky Pedia,
thank you very much for your reply! Just for my understanding: Do we have to note in the protocol at the handover (hopefully on 30.04!) that the final payment is only due after the completion of the outdoor facilities? Does the later completion date of these have no influence on the final payment? For the rectification of defects (also stated in the contract), a deadline of 3 months is granted. Does that also have to be "emphasized" in the acceptance protocol?
Best regards,
Valery

I don't know your contract setup now. But just to be safe, write everything that is important to you into the protocol. I would definitely include a deadline for remedying defects. 3 months is already very long here! Final payment: as the word implies. When everything is finished. That means if the outdoor facilities are still missing, this is a remaining performance to be provided. Thus, everything can only be paid out once everything is completed. The money you withhold until the end must enable you to finish with other companies yourselves if necessary.

So with my condominium from the developer back then, it was arranged that the "final installment" had to be paid at the handover of the keys (without which there was no key), but there was a bank guarantee at the notary for the last 5% which was held until the actual complete completion. So if defects had not been remedied, I would have had to inform the notary not to return the guarantee. Unfortunately, despite outstanding defects, I did not do that (appointments for rectification had already been scheduled, most of it was also done, but my apartment door with slight moisture damage was not replaced in three years). But the guarantee is also stated like that in the contract. So if nothing like that is in your contract, I would also not pay the last final installment before completion. Best regards Tolentino

Hello, it was the same with us. Final payment before completion of the exterior facilities. We then carried out a separate acceptance.