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Construction: Surety

Helping sureties construct a better California

Surety bonds are an important part of the construction process.  Performance bonds, payment bonds, mechanic's lien release bonds, stop notice release bonds, subdivision bonds, warranty bonds, and contractors' license bonds all play a significant role. 

McDonough Holland & Allen's surety lawyers represent construction sureties in a wide range of construction-related surety matters, including performance bond disputes, negotiation and drafting of takeover agreements, defense of payment bond claims, and enforcement of indemnity rights. Because of our wealth of experience in construction law matters generally, when it comes to construction surety bond claims and disputes we have the breadth and depth necessary to handle almost any construction-related problem that a surety can encounter. 

In order to provide the highest level of expertise for our surety clients, whenever appropriate we team with our bankruptcy attorneys to represent sureties in connection with bankruptcy court claims and litigation.  Bankruptcy court representation often includes enforcement of subrogation rights and other indemnity rights against a debtor in possession, enforcement of rights as a secured creditor, and priority disputes with competing creditors such as the bankrupt principal’s lender.  If a principal/debtor in possession proposes a plan of reorganization, timely and well planned representation of the surety in bankruptcy court is essential in order to maximize the surety’s recovery.

Surety bonds are particularly important in the public works contracting arena, so we often draw upon our broad expertise and experience with public works construction claims and disputes when representing sureties in connection with public works construction bonds.  This expertise and experience is invaluable when on behalf of the surety we end up stepping into the shoes of the bonded principal in order to evaluate and prosecute the principal’s claims against the project owner and/or to defend against counterclaims by the project owner for liquidated damages or other types of alleged backcharges.

In order to ensure the cost effectiveness of our legal services, wherever appropriate we take advantage of mediation and other alternative dispute resolution techniques.   However, when such techniques are not available or prove to be ineffective, we are pleased to represent our surety clients in any State or federal court in California.