Bond of Contractor

What is the Bond of Contractor?

The Bond of Contractor are usually entered into when public projects are to be performed. Though some private projects too may require the same. This ensures that the job is completed properly. The reason why Bond Of Contractor is needed is either it is needed by the owner or the contractor who has hired you as the subcontractor.

There are different types of Bond Of Contractor:

  1. The bid bond which gives you the permission to bid on bonded jobs and this is in the protection of the public.
  2. The performance bond ensures that whatever is to be paid to the laborers, sub contractors as well as suppliers, will be paid out
  3. The Maintenance Bond gives you the permission to work on jobs which require warranty on the workmanship
  4. The Supply bond us used as permission to allow you to work on those projects where material is to be delivered by you.

If the owner requires a bond from the general contractor, you as a general contractor in turn need to get bonds signed with your sub contractors to ensure their work as well as to ensure payments made to their workers and suppliers.

A contractor’s license bond is needed when you have to get a license on where the work is being performed. It makes sure that the rules and regulations of the license are being adhered to. This depends and varies from state to state.

The cost of the Bond Of Contractor depends on various factors. It depends on the type of bond, the rate and the size of the bond.

Bond Of Contractor

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Sample Template Preview

Bond of contractor.

Know all people by these presents that we, _________[contractor] of _________[address], called principal, and _________[surety or sureties] of _________[address], as surety [or “sureties”], called surety [or “sureties”] are held and firmly bound to _________[owner] of _________[address], called the owner, in the sum [or “penal sum”] of _________ dollars ($_____), to be paid to _________, or to his [her] executors, administrators or assigns, for the payment of which we bind ourselves, our heirs, executors, administrators, successors and assigns, jointly and severally, firmly by these presents.
The principal has, by a written agreement, dated _________[date], entered into a contract with the owner for the building and construction of a _________ building, in _________, according to the plans and specifications prepared by _________, architect, which is more fully set out in the contract, and a copy of which agreement is attached to and made a part of this instrument.
The condition of this obligation is such that if the principal shall faithfully perform the contract on his [her] part, complete the building free and clear of all liens and/or claims for labor, incumbrances, material claims or otherwise, and satisfy all claims and demands incurred for the same, and shall fully indemnify and save harmless the owner from all cost and damages, of every kind and character, which he [she] or it may suffer by reason of a failure to do so, and shall fully reimburse and pay the owner all outlay and expenses, of every kind and character, which the owner may incur in making good any such default, and shall pay all persons for labor and/or material, then this obligation shall be null and void, otherwise it shall remain in full force and effect.
[Insert any provisions desired as to time limit for suing on bond, what shall or shall not release the obligors or the surety, etc.]
Signed and sealed _________[date].
                                                                                                                                       [Signature]