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Pursuing or Defending a Bond Claim? Construction Executive Risk Management Lays Out Critical Information

In the world of surety bonds, payment bonds are often the overlooked siblings of performance bonds. As explored in a previous frequently asked questions post — The Difference Between Payment and Performance Bonds — performance bonds are placed to protect those up the contracting chain against non-performance by those below the chain, while payment bonds […]

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Assignment of Bond Claim Rights – Can You Contract Around Bond Limitations?

Payment bonds exist to secure payment rights for parties on a construction project in the event that the contractor defaults on its payment obligations. While any project can be bonded, bonds are generally found on public works, where a bond is normally required for all projects over a certain value. This is because public property […]

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Payment Bond: South Carolina Supreme Courts Rules on New Case

The Lien Blog is not just focused on mechanics liens; another topic we routinely cover is payment bonds. As we’ve discussed in many other posts, general contractors on public works projects are generally required to secure a bond on the project to ensure payment of subs – and not at the expense of public entity double payment. These bonds […]

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Payment Bonds: Connecticut Court Rules on Deadline to Foreclose Case

If you’ve ever looked at Zlien’s state-by-state resource page, you’ll see that each state has deadlines that must be complied with.  One deadline common to every state is the time in which a party must sue to foreclose on a mechanic’s lien.  Connecticut is fairly generous in this regard; a party has up to one year […]

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Public Contract Bonds and Contract Price Increases

One of the basic differences between contracts for public projects and contracts for private projects are the claims that unpaid parties can file.  Specifically, while unpaid subcontractors and suppliers on private projects can file mechanics liens, on public projects those unpaid parties must file claims on a general contractor’s payment bond.  General contractors on public […]

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Miller Act Claims: 11th Circuit Dismisses Suit for Procedural Error

We here at the Lien blog devote a lot of our time to writing about mechanics liens, and all the issues and laws surrounding them in each and every state.  Another major area of interest, however, is the Miller Act, a piece of federal legislation which permits unpaid subcontractors and material suppliers on federal government […]

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Risk Management – Bonds and Liens

In a recent publication of Construction Executive there is a nice article written by J. Craig Rusk on alternatives to both payment and performance bonds in the construction industry. These types of bonds are usually great places for contractors to make claims when not paid. Performance bonds secure that the contract will be performed and […]

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Mechanics Lien Claim or Bond Claim? Which Should You File?

Some people get confused about the differences between a bond claim and a mechanics lien claim, and this can result in causing decision paralysis. As this post will explain, however, the question of “which should you file” is usually a trick question. On most occasions, you only have the opportunity to file one or the other. You […]

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ALERT: Credit Demotion for Newport Bonding & Surety Company

A.M. Best Co. announced last week the demotion of Newport Bonding & Surety Company, decreasing their credit rating to a “B.”  The lower rating is the apparent result of “significant uncertainty regarding Newport’s overall financial condition as it has not yet filed its year-end 2011 annual statement” (Quote from Yahoo Finance Story). What does this mean? […]

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Roundup of State Bond Claim Series Blog Posts

This February, we focused a lot of attention on state bond claims, authoring a series of blog posts that discussed state bond claim issues that ranged from basic to technical. Through the years of consulting with companies about lien rights, I’ve learned that a lot of folks are confused about bond claims. This is especially […]

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FAQ: The Difference Between Payment and Performance Bonds

Short Answer: Performance bonds are issued to the benefit of the owner and guarantee the prime contractor will finish performance of the contract. Payment bonds are issued to the benefit of subs and suppliers, guaranteeing they will be paid for materials and labor they furnish. Long Answer:  Whenever bonds are required on a construction project, there […]

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