Virtually all Public Projects in New Jersey, and some private projects, require the contractor awarded the contract to procure a Performance and Payment Bond as a condition to being awarded the contract. The Performance Bond is for the benefit of the Project Owner, whereas the Payment Bond is for the benefit of Subcontractors and Suppliers. The Bond provides an extra statutory remedy to beneficiaries such as the Owner (on the Performance Bond), and Subcontractors and Suppliers (on the Payment Bond), and gives the claimant a third party to look to for satisfaction of the obligation owed to it by the Contractor.
As an extra statutory remedy, it is imperative that Bond claims be noticed and perfected strictly in accordance with the applicable statute and terms of the individual bond. Failure to do so may result in in the forfeiture of any and all rights to which you otherwise would have been entitled under the Bond.
Our Construction Attorneys routinely counsel and represent our clients in:
- Filing and Perfection of Bond Claims
In some instances, a pre-notice must be provided in advance of commencing work or delivering materials to the Project in order to preserve your right to file a claim against the payment bond. In addition, there are strict time requirements for both filing a notice of claim, and commencing an action against the Surety that issued the Bond. Failure to comply with these notice and time requirements can result in the loss of a bond claim. Our Construction Attorneys are well versed in all of the requirements in perfecting claims against Performance and Payment Bonds, and are prepared to provide you with guidance in protecting this statutory remedy.
- Negotiations with Surety
Whether it is negotiating a “Take Over Agreement” with a Surety, or resolution of a payment bond claim, our Attorneys have the expertise to guide you through the process. We have extensive experience in working directly with Sureties, their claim representatives and Counsel to resolve whatever issues may arise.
- Litigation to enforce your rights under the applicable Bond
Our Construction Attorneys regularly appear in Federal and State Courts in actions to enforce a beneficiary’s rights under Performance and Payment Bonds.