Complete Waiver Of Defenses: When is the notice the surety never received good enough?
This paper examines recent cases construing the AIA − A312 Payment Bond requirement that a surety “answer” a claim within 45 days of receipt. A copy of the AIA − A312
Payment Bond (1984) is annexed as Exhibit A. Essentially, an AIA − A312 Payment Bond provides for the following series of bond claim events: (1) A Claimant gives notice to the
Surety; (2) the Surety “answers” the Claimant within 45 days; (3) the Surety pays the Claimant any portion of the claim the Surety does not dispute.
A. MARYLAND & VIRGINIA DECISIONS FOCUS ON § 6.1 OF THE AIA − A312 PAYMENT BOND
Recent cases from mid-Atlantic states hold that a Surety’s failure to strictly follow the AIA − A312 Payment Bond language and “answer” the Claimant’s notice within 45 days is a
complete waiver of the Surety’s defenses. The cases hinge on what constitutes an “answer.”…
They strictly construe the AIA − A312 Payment Bond language.
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