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What does the term "bond around" refer to?

CaliforniaBonding Off Lien

We filed a claim against the payment bond for a public works job. The GC called and threatened to "Bond Around" the job.

1 reply

Nov 14, 2018
That's interesting. Typically, when someone threatens to "bond around" or "bond off" a claim, they're referring to the fact that they intend to file a surety bond which will release a filed mechanics lien claim. Assuming a payment bond claim was made against the GC's bond, threatening to "bond around" a bond claim does not make an awful lot of sense - that'd be filing one bond to replace another. However, if a Stop Payment Notice (commonly called "stop notice") was also made, that claim may be "bonded around" under § 9364 of the California Civil Code. As a little background, when a Stop Payment Notice is sent, the public entity withholds payment from their general contractor in the amount of the claim made on that notice. In order to have those funds released, under § 9364, a general contractor may submit a bond. Just like when a mechanics lien is bonded off, if the claimant (who sent a stop payment notice) remains unpaid, that claimant can make a claim for payment against the bond - and such a claim would require legal action. For more info on the basics of liens being bonded around, this article should help: Primer on Mechanics Lien Bonds and Bonding Off A Mechanics Lien.
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