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No Damages Without Declaration Of Default Bonds performance; Termination default

Thursday, January 02, 2003 12:08 pm

 
No Damages Without Declaration Of Default Bonds-performance; Termination-default

The Alabama Supreme Court has ruled that a project owner could not recover delay damages from a contractor's performance surety without formally declaring the contractor to be in default.

The Bank of Brewton awarded a contract to Akers Group International, Inc. to renovate a bank building in Brewton. Akers furnished payment and performance bonds issued by International Fidelity Insurance Co. (IFIC).

The performance bond was on a standard form published by the American Institute of Architects. The bond stated that the surety's obligation to complete the work would arise only after the project owne [...]

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