When Does Warranty Begin?

A closer look at one of the most debated topics at the end of a project

Most of us have been at the end of a project when the owner/ client asks the popular question: “When does the one-year warranty begin?” The answer becomes one of the most debated topics, only second to the end-of-project, door-locking hardware debacle.

So, when does warranty begin?

In more than 90 percent of the specifications that I have either written or read, the warranty is a 12-month period from the end of the project. The conversation of the duration of 12 months is seldom in question. It is the conversation of what triggers the beginning of a warranty that really sparks the debate.

As a consultant, it is my fiduciary duty in representing my client—typically the end user—to make sure that the start date of the warranty is at the appropriate time: at the end of construction when the security integrator has completed the install. After all, why should my client’s 12-month period, when parts and labor are provided free of charge, start any earlier than at the end of the construction period?

As integrators have continually asked me, though, “Why should we start a warranty at a time after our 12-month manufacturers’ warranty has already begun?” I don’t disagree.

The most common terminology used to define the trigger of the beginning of a warranty period is “substantial completion,” the particular time toward the end of a project when the installation period is complete and only smaller items typically found on a punch list are left to install. In some cases, there is no issue with this: a substantial completion form is completed in a reasonable amount of time and the 12-month warranty begins.

However, in my experience, substantial completion ends up being possibly six to 12 months later than the time when the system(s) actually began being used and incurring wear and tear. The end result in these circumstances is that the integrator loses the manufacturer’s warranty period and becomes responsible for the entire cost of any defective equipment. (There are a few examples where the manufacturer chipped in and restarted the warranty period for the integrator, but those are rare and not the norm.)

I offer that there is another acceptable but seldom used term to trigger the beginning of the warranty period, which is “beneficial use,” the period of time at which the system is able to be used by the client. This is typically before substantial completion but indicates that the system is fully functional and incurring wear and tear. I have suggested that this term be acceptable to my clients and have suggested to integrators that they set the stage at the onset of a project by requesting that the beginning of the warranty period start at the beginning of beneficial use.

So, does a warranty begin at substantial completion, beneficial use or with the close out documentation? The answer will vary by project and client. As integrators, if you don’t suggest at the beginning of a project your preference and produce a document that can be signed by both parties, a warranty will be no earlier than substantial completion, regardless of when the system(s) start getting used.

This article originally appeared in the September 2014 issue of Security Today.

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