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Supplier Did Not Misallocate Payments Bonds-payment; Suppliers

Friday, February 03, 2006 05:15 pm

Supplier Did Not Misallocate Payments Bonds-payment; Suppliers

A federal appeals court has ruled that a supplier did not misallocate payments to other projects and could recover against a Miller Act payment bond.

Baugh Skanska, Inc. was the prime contractor for construction of barracks at Fort Lewis, Washington. Baugh furnished a payment bond, issued by National Union Fire Insurance Company of Pittsburgh, in accordance with the requirements of the Miller Act. Baugh then subcontract the structural steel work to Nordahl Metalfab.

Nordahl purchased steel from ISSC, Inc., a company with whom Nordahl regularly did business. ISSC made deliveries to the job site but was not paid [...]

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