Payment Bond

A payment bond is a surety bond posted by a contractor to guarantee that his subcontractors and material suppliers on the project will be paid. They are required in contracts over $30,000 with the Federal Government and must be 100% of the contract value. They are often required in conjunction with performance bonds. There is no high-risk market available for performance and payment bonds. Up to the turn of the century bonding companies were approving everyone, even those who did not qualify for the bond type or size. During this time record loses occurred throughout the industry as many companies closed their doors.
Posts about Payment Bond
    • SUBCONTRACTOR’S MILLER ACT PAYMENT BOND CLAIM

      Since I wrote my ebook on the application of federal Miller Act payment bonds, I have not discussed a case applying the Miller Act. Until now! Below is a case that reinforces two important points applicable to Miller Act payment bond claims. First, the case reinforces what a claimant needs to prove to establish a Miller Act payment bond claim. Very important.

      Florida Construction Legal Updates- 14 readers -
  • VENUE FOR SUING PUBLIC PAYMENT BOND

    …, what if the general contractor is located in Lee County and the subcontract contains a venue provision for Lee County, the project is located in Collier County, the subcontractor is located in Miami-Dade County, and the surety issues bonds in Miami-Dade County? Does venue have to be in Lee County per the mandatory venue provision? According…

    Florida Construction Legal Updates- 14 readers -
  • MILLER ACT AND “PUBLIC WORK OF THE FEDERAL GOVERNMENT”

    … Oak, LLC, 2017 WL 190099 (N.D.Ok. 2017). If the project is not a public works project of the Federal Government, the Miller Act does not apply. In this case, the Department of Transportation entered into an agreement with the Cherokee Nation where the Department would provide lump sum funding and the Nation would use the money to fund…

    Florida Construction Legal Updates- 15 readers -
  • QUICK NOTE: SUBCONTRACT PAYMENT BOND = COMMON LAW PAYMENT BOND

    … What is a common law payment bond? A common law payment bond is a bond not required or governed by a statute. For example, if a prime contractor provides the owner a payment bond, that bond will be a statutory payment bond. On the other hand, if a subcontractor provides the general contractor with a payment bond, that bond will be a common law…

    Florida Construction Legal Updates- 13 readers -
  • MILLER ACT PAYMENT BONDS

    … Do you do work on federal construction projects? Are you familiar with the Miller Act? Below is a portion of a recent presentation on Miller Act payment bonds. Download (PPTX, 120KB) Please contact David Adelstein at dma@katzbarron.com or (954) 522-3636 if you have questions or would like more information regarding this article. You can…

    Florida Construction Legal Updates- 9 readers -
  • INDUSTRY FORM CONTRACTS SERVE AS A TEMPLATE FOR YOUR CONSTRUCTION CONTRACT

    …, but they still require modifications based on the objectives of the parties and the preferred project delivery method. Download (PDF, 196KB) Please contact David Adelstein at dma@katzbarron.com or (954) 522-3636 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1. This entry was posted in Contract Drafting and tagged AIA, ConsensusDocs, construction contract, DBIA, EJCDC, industry form contract by David Adelstein. Bookmark the permalink.…

    Florida Construction Legal Updates- 11 readers -
  • DURATION OF PUBLIC PAYMENT BOND = FULL TERM OF PUBLIC CONTRACT

    … Florida Statute s. 255.05 governs public payment bond rights on Florida public construction projects (other than Florida Department of Transportation projects). This is an important statute for all that perform Florida public construction work! (Check out this article for more information on s. 255.05 and this chart summarizing steps required…

    Florida Construction Legal Updates- 12 readers -
  • DRAFTING THE BOND FORM, PARTICULARLY THE PERFORMANCE BOND FORM

    … Oftentimes, when it comes to payment and performance bonds (in particular) the bond forms are drafted by the obligee. For example, an owner (as the obligee) may draft the bond forms that it wants its general contractor’s surety to execute. And, a general contractor (as the obligee) may draft the bond form that it wants its subcontractors…

    Florida Construction Legal Updates- 11 readers -
  • MILLER ACT CLAIM FOR UNSIGNED CHANGE ORDERS

    … through its course of conduct / actions). This is exemplified in U.S. f/u/b/o Agate Steel, Inc. v. Jaynes Corp., Case No. 2:13-CV001907-APG-NJK (D. Nev. June 17, 2016), where a sub-subcontractor asserted a Miller Act payment bond claim for non-payment largely dealing with change order work that was never signed by the subcontractor that hired…

    Florida Construction Legal Updates- 12 readers -
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