[RPPTL-constructionlaw] Public Project Bond and SOL

Thu Apr 19 08:01:56 PDT 2012

These were 255.05 bonds which were recorded. When we sent our letter to
the surety indicating that we intended to look to the bonds, the surety
responded by telling us that the bonds were withdrawn, with permission
of the public entity. If the bonds are found to be in place, can the
surety rely on the SOL to defeat the subcontractor's claim? 

Tracye K. Solove, Attorney at Law

Certified Civil Circuit Mediator

Tracye at solovelawfirm.com

Kendallwood Office Park One

12002 Southwest 128th Court

Suite 201

Miami, Florida  33186

Phone: (305) 612-0800

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From: constructionlaw-bounces at lists.flabarrpptl.org
[mailto:constructionlaw-bounces at lists.flabarrpptl.org] On Behalf Of Greg
Elliott
Sent: Thursday, April 19, 2012 10:21 AM
To: RPPTL constructionlaw
Subject: Re: [RPPTL-constructionlaw] Public Project Bond and SOL

public work (255.05 or 337.18 bond), or private work (713.23 or 24)?

Gregory T. Elliott
ELLIOTT - BERGER, P. A.
10225 Ulmerton Road, Suite 4A
Largo, Florida 33771
(727) 360-2600 (Phone)
(727) 360-6588 (Fax)
Board Certified In Construction Law

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On 4/19/2012 9:57 AM, Tracye wrote: 

Does anyone know of a case that would estop a surety from relying on the
SOL to defeat a subcontractor claim when it denied (in writing) that a
bond was in place during the SOL period? 

Tracye K. Solove, Attorney at Law

Certified Civil Circuit Mediator

Tracye at solovelawfirm.com

Kendallwood Office Park One

12002 Southwest 128th Court

Suite 201

Miami, Florida  33186

Phone: (305) 612-0800

Facsimile: (305) 612-0801

http://www.solovelawfirm.com <http://www.solovelawfirm.com/> 

Providing Statewide Legal Services in the areas of Commercial
Collections and Recovery, Creditors' Rights, Commercial Landlord/Tenant
and Real Estate Foreclosures

This transmission is intended to be delivered only to the named
addressee(s) and may contain information which is confidential,
proprietary, attorney work-product or attorney-client privileged. If
this notification is received by anyone other than the intended
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Thank you. 

From: constructionlaw-bounces at lists.flabarrpptl.org [
mailto:constructionlaw-bounces at lists.flabarrpptl.org] On Behalf Of Bruce
Partington
Sent: Thursday, April 19, 2012 9:31 AM
To: RPPTL constructionlaw
Subject: [RPPTL-constructionlaw] FW: Bond coverage

From: Gibbons, Michael [mailto:Michael.Gibbons at lowndes-law.com] 
Sent: Wednesday, April 18, 2012 6:36 PM
To: Bruce Partington
Subject: Bond coverage

  Good question Bruce.  My thoughts:

    1.  Take a look at Phoenix Indemnity v. Board of Public Instruction
of Alachua County, 114 So. 2d 478 (Fla. 1st DCA 1959).  The Phoenix
Indemnity court held that the contractor's surety bond was liable for
payment of insurance premiums not paid by contractor despite contractor
having an express contractual obligation to make the premium payments.
Not exactly your claim but close and certainly gets at the obvious issue
that your claim is not for completion of the bricks and mortar (which
every surety lawyer wants to limit the surety bond coverage to).

    2.  Is there an issue of who suffered the damage and the operation
of the mutual waiver of subrogation clauses doubtlessly present in the
contracts at issue?  Could not tell in your summary but I believe this
may be an issue.  If the GC had insurance coverage for the claim (which
it sounds like) and would simply like to have the sub's policy be
primary on the loss, then there may be an issue with actual damages
suffered by GC (given the presence of insurance).  Also, if the loss
falls on the carrier, depending on the operation and breadth of the
mutual waiver of subro language, there may not be any subrogation rights
arising out of the loss (especially a property loss).

   3.  Is there an issue re operation of a mutual waiver of
consequential damages provision in the incorporated subcontract (either
directly or by reference or incorporation of the prime contract
documents)?  Not clear whether the category of damages being claimed
would fall into the "consequential damages" bucket but it sounds like
that might be the case.

   4.  The AIA A 312 bond form is broad in scope and contains some
favorable language for the obligee.  Without knowing all the facts, it
sounds like there may be a colorable claim if some of the above raised
concerns are addressed (as well as others which I have failed to
identify).

  Good luck.

Michael R. Gibbons  (Bio
<http://lowndes-law.com/our-people/michael-r-gibbons> )

Shareholder

Lowndes, Drosdick, Doster, Kantor & Reed, P.A.

450 South Orange Avenue, 8th Floor

Orlando, FL 32801

Phone: 407-418-6378

Fax: 407-843-4444

email: michael.gibbons at lowndes-law.com

website: http://www.lowndes-law.com

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