Bond Claims

Question 1

Does a material supply have to prove its materials were delivered to the project site to have a bond claim?

Answer 1

No.

Question 2

Can a lien satisfy the bond claim requirements?

Answer 2

Yes, a perfected lien will constitute a claim against a bond on a private project.

Question 3

Requirements for a Property Code Payment Bond

Answer 3

1) Issued by company authorized and admitted to execute bonds in Texas;
2) must be in penal sum equal to at least the amount of the original contract;
3) must be signed by both the original contractor and bonding company;
4) conditioned on prompt payment for all labor and materials used on the project and payment for natural extras not to exceed 15%;
5) Owner must endorse the bond with his written approval;
6) must be filed with the contract with county clerk’s office.

Question 4

Requirements for “Bonding Around” a Lien

Answer 4

1) bond must identify each lien it covers;
2) penal sum of not less than 1-1 1/2 or 2 times the aggregate amount of all the claims covered;
3) payable to the lien holder;
4) filed with the county clerk’s office;
5) issued by authorized and admitted surety