The NASBP document titled "Frequently Asked Questions from Bond Producers About Their Role in the Contract Bond Claims Process" is formatted into FAQs and general guidance responses for bond producers when they are faced with the inevitable and various questions from obligees, principals, claimants, attorneys, and the press. These questions and answers do not provide legal advice, but they do provide illustrative guidance to bond producers.
If you haven’t yet read this new resource, you can find it on the NASBP website in the Producer’s Toolbox or you can access it by clicking here.
In order to highlight this new educational tool, NASBP has been featuring in each issue of Pipeline one of the FAQs and the general guidance response to that question. Below is the third FAQ and response:
Is making a claim on a bond on a private project different from making a claim on a public works project?
Bond producers fielding this question should recommend that potential claimants seek legal counsel. Bonds issued for private projects may contain notice requirements, generally delineated in the bond form itself, and time limits for filing suit. These notice and suit limitation requirements are strictly enforced, and, if a bond claimant is not in compliance, he/she may lose rights under the bond. Bonds issued for public projects also may contain notice and limitation requirements, but the requirements written into these bonds may be superseded by statutes that apply to public works projects.
Statutes requiring bonds on public works projects often include notice requirements and time limits for filing suit. On a public project it is essential to understand these
statutory provisions as well as any set forth in the bond. That is one reason a potential claimant should be advised to consult immediately with legal counsel.
|
Be on the lookout for a highlighted FAQ and response from this NASBP document in the next issue of Pipeline. NASBP welcomes comments on these FAQs and suggestions for other FAQs to include in a future version of the FAQs. Share your thoughts about this document at
info@nasbp.org.