Surety bond requirements safeguard investments in current, planned construction projects | Construction projects restricted in some states; 3 not permitting any work | 2 contractors file suit accusing Minn. city of exceeding authority by halting project
April 15, 2020
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Surety bond requirements offer protection for investments in current and upcoming construction projects, two attorneys write. Owners should closely examine performance bonds that contractors have supplied, both before a project starts and at the initial sign of any problems, they write.
Surety Agents and Sureties Can Help Small Contractors Manage Risk Before bidding on jobs or signing contracts, small contractors should get expert information from surety agents and sureties on how to reduce risk. Working together, they can examine and mitigate possible risks from owners, general contractors, contract language, suppliers, labor issues, materials availability and pricing, weather, thieves and safety practices. Learn more here
Two construction contractors are suing the Minneapolis suburb of Brooklyn Center after the companies' construction projects were placed on hold because of concerns about the coronavirus. The contractors allege that the city is applying "inconsistent rules" because a proclamation from the mayor specifically halts their project and supersedes a directive from the governor.
A surety has been released from its bond liability to a bankrupt contractor that had been working on an erosion-control project in Morristown, Tenn., although the cost of work remaining to be done is in dispute. The city estimates the cost of the remaining work at $750,000, but the surety says the amount should be lower.
Contractors looking to recover increased costs stemming from coronavirus-related delays should consider measures other than invoking force majeure provisions, three attorneys write. Change-in-law provisions, emergency provisions and change order provisions are among other potential remedies, they write.
NASBP Blog: Stop work orders and construction project site abandonment series -- Part 1
Kelley, left, and Rogers (NASBP)
Due to the coronavirus pandemic, some construction project owners have begun issuing stop work orders and closing projects down during an uncertain time period. Inconsistencies in treatment and messaging, however, are leaving many people and businesses confused about how to respond. Michael Kelley and Maureen Rogers of the law firm Shutts & Bowen explain what you -- whether you are an owner, contractor, designer, trade, insurer or finance provider -- need to do to protect yourself and others. Learn about stop work orders in Part 1 and construction project site abandonment in Part 2.
April 21 NASBP Virtual Seminar: Panel discussion on financial repercussions of COVID-19
Before the coronavirus outbreak, 23 states allowed documents to be notarized remotely online, and now at least 19 others have jumped in on an emergency basis. There is also a trend toward permitting e-signatures, but certain sectors, such as real estate, are clinging to the "wet ink" standard of in-person appearances.
Sometimes a wind comes up, blows you off course. You're not ready for it, but if you're lucky, you end up in a more interesting place than you'd planned.
Nora Roberts, writer
Founded in 1942, NASBP is the association of and resource for surety bond producers and allied professionals. NASBP producers specialize in providing surety bonds for construction contracts and other purposes to companies and individuals needing the assurance offered by surety bonds.