Skip to main content
A Better Partnership
October 18, 2013

Without language to the contrary, suretyship contracts limit liability to amount of performance bond

Because courts have traditionally interpreted performance bonds to limit surety liability to the amount of the bond, the Michigan Court of Appeals held that it will presume liability is limited to the amount of the bond unless plain contractual language to the contrary expresses an intent to expand liability.  In the consolidated case of Northline Excavating, Inc. v. County of Livingston, a public-sector contract required the contractor to obtain a performance bond from a surety under MCL 129.201.  The Court found that because there was no language clearly indicating an intent to expand liability under the bond, the surety’s liability was only limited to the amount of the bond.

NOTICE. Although we would like to hear from you, we cannot represent you until we know that doing so will not create a conflict of interest. Also, we cannot treat unsolicited information as confidential. Accordingly, please do not send us any information about any matter that may involve you until you receive a written statement from us that we represent you.

By clicking the ‘ACCEPT’ button, you agree that we may review any information you transmit to us. You recognize that our review of your information, even if you submitted it in a good faith effort to retain us, and even if you consider it confidential, does not preclude us from representing another client directly adverse to you, even in a matter where that information could and will be used against you.

Please click the ‘ACCEPT’ button if you understand and accept the foregoing statement and wish to proceed.



+ -