Bonds matter The goal of the suretyship is to provide (conditional and necessary) financial support to owners and contractors (as well as lenders and equity investors) in the event of a default in order to keep a project moving forward. While there are certainly advantages and disadvan- tages to any construction risk man- agement method, suretyship is an excellent fiscal tool to provide con- fidence to the key stakeholders of a construction project that the project will be completed and will be free from encumbrances. No matter the type of surety bond, these are contracts, and these con- tracts require careful review so that all parties – owners, contractors, sub-contractors, lenders, investors, and public officials – understand their respective rights and obliga- tions. Parties also need to follow state and federal laws governing the bonding of public and private projects. A review of these issues, including suretyship obligations and protocols, defenses, claims, the form agreements and recent case law in suretyship is beyond the scope of this article. Nonetheless, such issues must be carefully considered before a bond should be issued. Daniel A. Dorfman is Chair of the Construction Law Practice at Fox, Swibel, Levin & Carroll LLP, a full-service boutique business law firm based in Chicago, Ill. and has a national practice representing own- ers/developers, design profession- als, general contractors, subcontrac- tors, specialty trades, and construc- tion suppliers on their most impor- tant construction projects.Daniel, a LEED® Green Associate, also has a focus in sustainable (“green”) building and the renewable energy markets. Daniel can be reached by email at ddorfman@foxswibel.com. BUSINESS TIP ––––––––––––––––––––––––––––––––––––––––––––––––––––––– 36 TileLetter | December 2018