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Shore Up A Cry Of Bad Faith By Putting Money Where Your Claim Is

Thursday, September 04, 2008 03:42 pm

 
Shore Up A Cry Of Bad Faith By Putting Money Where Your Claim Is

A principal on a surety bond unsuccessfully attempted to argue its way out of a $2.8 million bill by pointing to the surety's misconduct.

The Fidelity and Deposit Company of Maryland (F&D) executed surety bonds naming D.M. Ward Construction Co., Inc. (Ward) as principal for nine construction projects. Subsequently, subcontractors and suppliers sought payment under the bonds for problems that arose on those projects. F&D set a reserve in the amount of $2.8 million for pending bond claims and then demanded that Ward honor the parties' indemnification agreement and post collateral security for the amount. Ward did not post any security money.

F&D then moved for summary judgment on its claim, but Ward alleged [...]

 
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