There are three types of contract bonds that are commonly used in construction: bid, performance, and payment bonds. Disputes arise in the competitive bidding process with a bid bond when a bidder is awarded a contract bid but does not sign the contract or provide the required performance and payment bonds.
Disputes also occur when the obligee declares a default, and performance payment bond claims are made. When a conflict arises with a bond, MKC Law attorneys will help our clients investigate and respond to defaults, we negotiate with bond obligors and claimants, and draft release and settlement documents. When negotiations do not resolve an issue, our surety attorneys will represent the surety in litigation and in indemnity actions.
When a surety receives a valid claim under a performance bond, it can decrease its exposure by asserting a defense available to its principal. These defenses include actions of the obligee which may constitute a breach of the construction contract—relieving the principal and, thus, the surety from liability. Examples include the following:
In addition, these defenses may be available:
The expertise of MKC Law surety attorneys goes beyond working with bonds in construction projects. Our attorneys strive to recover client funds and in assisting with limiting costs to convert property into cash, along with pursuing indemnity claims against those who had a part in the underlying loss.
The skilled attorneys at MKC Law have the experience and resources to defend you against construction claims of all kinds. Call us today at 602-274-9000 to discuss the details of your situation.