The attorneys in the GRSM Surety Practice Group represent surety clients in all aspects of suretyship, from when an account first goes into claims, through addressing performance and payment bond claims, the pursuit of affirmative claims both upstream and downstream, and the enforcement of indemnity obligations.
Our dedicated surety attorneys have successfully advocated for our clients in matters involving unpaid change orders, owner-caused delays, wrongful terminations, the recovery of home office overhead costs, total cost claims, prosecuting productivity/ inefficiency claims, differing site conditions, defective work, the defense of false claims assertions by owners, bad faith claims, prompt payment act penalties, among other construction-related claims and subdivision bond claims, on public works, residential, commercial and federal projects.
The attorneys in the Surety Practice Group have successfully handled numerous complex and/or contentious disputes in various forums, including alternative dispute resolution forums, state and federal court, arbitration, and appeals. Our attorneys have also provided legal consult to our clients in connection with pre-litigation disputes, surety financing, setting reserves, claim preservation and contract compliance on live construction projects, compliance with applicable regulations, indemnity and other surety-related issues.
Our attorneys are active in the American Bar Association’s Tort Trial & Insurance Section and Construction Industry Section, The Surety Claims Institute and other industry organizations. Our attorneys have also authorized numerous publications and conducted presentations on issues applicable to sureties.
Surety Practice Group Successes and Experience
The Surety Practice Group attorneys have had numerous successes, including but not limited to:
Bond Claims
- Represented numerous sureties in multi-project defaults and defense and completion efforts on accounts with more than $200 million in payment and performance bond claim exposure.
- The largest commercial contractor in Indiana defaulted on more than a dozen bonded projects. We assisted the surety in completing the projects and paying hundreds of material suppliers and subcontractors. We litigated claims against a bankruptcy trustee concerning payments made by the debtor prior to bankruptcy and concerning the surety’s right to receive contract funds held by project owners.
- Successfully defended against numerous payment bond claims made by subcontractors on construction projects.
- Obtained judgments, discharges and favorable settlements for numerous performance bond sureties based upon lack of proper notice.
- Represented the payment and performance bond surety through the collapse of a regional commercial contractor, including settling over one hundred claims, taking over and financing the operations of the contractor in ongoing projects, and securing assets from the indemnitors in order to achieve a zero-loss outcome for the surety.
- Successfully defeated a performance bond claim at the pleading stage based upon proper notice and opportunity to cure.
- Represented the performance bond surety for a design-build project that suffered a catastrophic mid-construction collapse resulting in multiple fatalities, and worked with the other project participants to resolve resultant claims in a way that resulted in no payments by, or losses to, the surety.
- Represented surety in state Supreme Court case involving “pay if paid” and “pay when paid” clauses.
- Represented surety in dozens of cases involving tax-deferred investments in wind-mill farms, greenhouses and other investment vehicles.
- Defeated motions for judgment against appellate bond surety.
- Defended warranty claims under a subcontract performance bond in connection with claims by the owner of a professional baseball stadium.
Subdivision Bonds
- Obtained finding after argument in state Supreme Court that resulted in no liability on subdivision bond.
- Obtained decision in state Supreme Court on behalf of a surety limiting scope of coverage of a subdivision development surety bond in a case of first impression.
- Represented surety in published opinion wherein court found that subdivision bond surety had no liability to foreclosing lender.
Affirmative Claims
- Obtained eight-figure settlement of extensive and complex affirmative claims against public works owner, including recovering claims. based upon delay, productivity and differing site conditions and defeating owner’s False Claims Act, delay and other counterclaims.
- Successfully obtained arbitration award against public works owner for delays, change orders and home office overhead and defeating the owner’s counterclaims.
- Obtained eight-figure settlement for surety client in complex, multi-party dispute on public project involving extensive damages and defects, breach of contract claims and tort-based claims against contractors and design professionals.
- Successfully resolved numerous pass-through claims by subcontractors.
- Active involvement in development and prosecution of all types of construction related claims on public, federal and private projects.
Counseling, Drafting and Negotiating
- Drafted and negotiated numerous takeover, tender and ratification agreements in connection with performance bond claims.
- Drafted and negotiated numerous pass through agreements.
- Negotiated to obtain a termination for convenience on a troubled public works project, saving the client millions of dollars.
- Assisted with setting serves for surety clients.
- Provided legal counsel to address contract compliance and claim preservation on numerous live construction projects.
- Counseled client on surety indemnity for international surety market.
Indemnity
- Successfully defended a bad faith claim arising from a surety’s handling of a payment bond claim, creating new law regarding interpretation of Little Miller Act requirements.
- Successfully defended against bad faith claims by indemnitors seeking to extinguish $100 million indemnity obligations.
- Represented surety in appeal involving right to attach indemnitors’ assets.
- Represented surety trade association in connection with statutes of limitations to surety’s claims under general indemnity agreements.
- Obtained summary judgment against bond principal and indemnitors under general indemnity agreement, including defeating claims of bad faith.