Podcast
Questions and Answers
Which document should be provided to the Surety as part of a demand under the Bid Bond?
Which document should be provided to the Surety as part of a demand under the Bid Bond?
- The formal contract
- The signed contract with another party
- The list of bid results (correct)
- The bid bond
Which of the following is NOT a common problem to avoid in the bidding process?
Which of the following is NOT a common problem to avoid in the bidding process?
- Entering into a contract with another party (correct)
- Failing to mitigate damages
- Failing to follow the prescribed bid process
- Accepting an informal or non-compliant bid
What is the purpose of the Performance Bond?
What is the purpose of the Performance Bond?
- To enforce the bond in case of default
- To provide security for the formal contract
- To investigate the circumstances surrounding a demand
- To guarantee that the Principal will perform the contract (correct)
When should a demand be made to the Surety under the Bid Bond?
When should a demand be made to the Surety under the Bid Bond?
What should be included in a demand made to the Surety under the Bid Bond?
What should be included in a demand made to the Surety under the Bid Bond?
Which of the following is the fundamental characteristic of a surety bond?
Which of the following is the fundamental characteristic of a surety bond?
What is the role of the Surety in the event of a defaulted contract?
What is the role of the Surety in the event of a defaulted contract?
How does a Performance Bond protect the Obligee financially?
How does a Performance Bond protect the Obligee financially?
What settlement option does the Surety have if the Principal defaults?
What settlement option does the Surety have if the Principal defaults?
What is the role of the Surety when completing the contract under a Performance Bond?
What is the role of the Surety when completing the contract under a Performance Bond?
According to the text, what should the Obligee do if a default occurs and they intend to look to the Surety?
According to the text, what should the Obligee do if a default occurs and they intend to look to the Surety?
What action is the Surety likely to take when a default occurs?
What action is the Surety likely to take when a default occurs?
What should the Obligee provide to assist the Surety in its investigation?
What should the Obligee provide to assist the Surety in its investigation?
What is the Surety's financial responsibility limited to?
What is the Surety's financial responsibility limited to?
What is typically part of the completion agreement between the Obligee and Surety?
What is typically part of the completion agreement between the Obligee and Surety?
Which of the following is important to record in relation to the Principal's default or abandonment?
Which of the following is important to record in relation to the Principal's default or abandonment?
What should be done if completion of the contract or financial settlement with the Surety extends over a long period?
What should be done if completion of the contract or financial settlement with the Surety extends over a long period?
When must a suit against the Surety under the bond commence?
When must a suit against the Surety under the bond commence?
What is the recommended practice immediately after the Principal's default?
What is the recommended practice immediately after the Principal's default?
What is the timeframe for commencing a suit against the Surety under the bond?
What is the timeframe for commencing a suit against the Surety under the bond?
Which form of contract surety bond is designed to provide assurance that the contractor submitting the bid has been examined by the surety company and found qualified to perform the work?
Which form of contract surety bond is designed to provide assurance that the contractor submitting the bid has been examined by the surety company and found qualified to perform the work?
What is the primary prequalification instrument issued by a surety company to ensure that construction purchasers receive a bid from a qualified contractor?
What is the primary prequalification instrument issued by a surety company to ensure that construction purchasers receive a bid from a qualified contractor?
What is the condition of the form 220 Bid Bond?
What is the condition of the form 220 Bid Bond?
What does a bid bond offer to the Obligee?
What does a bid bond offer to the Obligee?
What is the maximum bond amount for a bid bond?
What is the maximum bond amount for a bid bond?
According to the text, when the amount payable to the completion contractor exceeds the amount the Obligee would have otherwise been required to pay to the defaulted Principal had there been no default, what does the Surety do?
According to the text, when the amount payable to the completion contractor exceeds the amount the Obligee would have otherwise been required to pay to the defaulted Principal had there been no default, what does the Surety do?
According to the text, when the completion costs for which the Surety is liable are less than the bond amount, how does the Surety satisfy its obligation under the bond?
According to the text, when the completion costs for which the Surety is liable are less than the bond amount, how does the Surety satisfy its obligation under the bond?
According to the text, what happens if there is a disputed default and a determination is ultimately made in favor of the Obligee?
According to the text, what happens if there is a disputed default and a determination is ultimately made in favor of the Obligee?
According to the text, in a disputed default, what approach do the parties often agree to?
According to the text, in a disputed default, what approach do the parties often agree to?
According to the text, what does the Obligee need to do to ensure the Performance Bond remains in effect in the event of material changes in the contract?
According to the text, what does the Obligee need to do to ensure the Performance Bond remains in effect in the event of material changes in the contract?
