NASBP Comments on Warranty Provisions in University of Central Florida Contracts

I am contacting you on behalf of the National Association of Surety Bond Producers (NASBP), a national trade association of agencies employing surety bond producers, including licensed resident and nonresident producers placing bid, performance, payment, and maintenance bonds in the State of Florida and all other jurisdictions. It has recently come to our attention that the University of Central Florida (UCF) is including in its contracts lengthy and excessive warranty periods. Specifically, in Article 10, Warranty Against Water Intrusion & Mold, includes a contractor warranty provision of ten (10) years for “improper construction or installation of defective materials,” including “substandard or improperly installed materials or construction work …. ” This language not only requires the contractor to warranty construction work for ten years but also appears to require the contractor to warrant defective materials and substandard materials for ten years. This Article at 10.2 also places liability on the contractor for a design flaw, if the contractor becomes aware of it. This risk-shifting language takes the responsibility for design flaws away from the owner and its design agent and places it improperly in the hands of the contractor.

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