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Surety Bond Quarterly Article | AIA A312 Performance Bond; This form lays out conditions and responsibilities for the obligee and surety.

By Gregory R. Veal January 25, 2023 Articles

Originally posted in the Winter 2022 Surety Bond Quarterly NewsletterThe 2010 version of the AIA A312 performance bond is an effort to balance the rights and duties of the obligee and the surety. It replaces the 1984 version, with a few tweaks and one major shift of risk, in Section 4. As with almost all bonds, those rights and duties are subject to certain conditions. Even the most rudimentary performance bond usually begins, "NOW, THEREFORE, the condition of this bond is … ." The A312 bond, though, sets out perhaps the most developed set of conditions of any form.

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Incorporated Indemnity Language Doesn't Shoehorn Other Contracts Into Bond

By Gregory R. Veal October 19, 2022 Articles

A recent decision from the Northern District of Georgia confirmed important suretyship principles in granting partial summary judgment against an obligee’s attempt to expand the performance bond scope.  IHI E&C Int’l Corp. v. Robinson Mech. Contrs., Inc. and Fidelity & Deposit Co. of Md., 2022 U.S. Dist. LEXIS 180174 (Sept. 30, 2022).  The court carefully examined the terms of the bond, the language of the incorporated subcontract, and the context of the parties’ dealings in ruling that the bond covered only the $24 million installation subcontract, not an additional $40 million in fabrication purchase orders by the same principal on the same project.

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