Milestone payments: what actually triggers them
A milestone payment falls due when the contract says the stage is complete, which is usually when somebody engaged by the developer certifies it, not when the work is finished to your satisfaction. The certificate and the reality are separate things, and only one of them is checkable.
Who decides a stage is complete
In most off-plan contracts, an architect, engineer or supervising consultant issues a certificate, and the payment follows from the certificate rather than from the building. That person is normally engaged and paid by the developer.
This is not necessarily improper. The same arrangement exists in construction contracts everywhere, and most certifiers are professionals with a licence to lose. But the incentive is one-directional, and a stage signed off generously moves money faster than a stage signed off strictly.
Where escrow does and does not help
In markets with statutory unit accounts, money is released against the same certificate. Escrow stops funds being spent on another unit; it does not test whether the stage happened. Buyers routinely read one as the other.
So a fully compliant escrow release and a stage that is two months from actually being complete are entirely compatible facts.
What to establish before the invoice arrives
- 01The exact contractual definition of each stage, in the words of your contract.
- 02Who certifies, and whether you are entitled to a copy of the certificate.
- 03How long you have to raise an objection after an invoice, and in what form.
- 04What evidence, if any, the developer is obliged to supply alongside the invoice.
- 05Whether interest or penalties accrue while a payment is disputed.
When the invoice does arrive
The question is narrow and answerable: does the state of the building satisfy the definition in the contract. Not whether the building looks impressive, not whether progress has been made, and not whether the developer is trying hard.
Answering it requires somebody to look at the site against that definition, and to record what they saw with dates and photographs. That record is what turns a disagreement into a position.
Questions on this
Can I ask for the certificate?
Ask, in writing. Whether you are entitled to it depends on your contract, but the request itself is informative: a developer who will not show the document their invoice rests on has told you something.
The certifier is independent. Isn't that enough?
Independent of the contractor, usually. Engaged by the developer, almost always. Those are different kinds of independence and only the first is normally guaranteed.
What if the stage is nearly complete?
Then the contract decides, and most contracts do not have a 'nearly' provision. This is exactly why the definition matters more than the photograph.
Read one before you buy one
The specimen shows the whole structure: status, what each payment was meant to buy, the forecast with its range, the photographic record and the limits of what was checked.