As most of you know, a new version of the AIA A312 performance bond came out in 2010 “replacing” the 1983 version of the A312. As we enter year two of the A312-2010 I thought it was a good time to point out some of the “key features” of the A312.
Time to Sue
If you plan to bring an action to enforce your rights under the AIA A312-2010, Section 11 of the bond provides that you must do so:
- Within two (2) years after a declaration of contractor’s default; or
- Within two (2) years after the contractor stopped working; or
- Within two (2) years after the surety refuses or fails to perform its obligations under the bond
- Complete the contract;
- With the Owner’s consent, arrange for the original contractor to complete the contract;
- Obtain bids and arrange for others to complete the contract and pay the Owner any additional costs above the original contract amount that it incurs in completing the contract through others;
- Waive its right to perform and complete, notify the Owner of its liability under the bond and pay the Owner; or
- Deny liability to act, in whole or in part, notifying the Owner of the reasons for such decision.