Legal Blog:
Mar
01
2000
Bonds & Sureties
Bonds are used for a variety of reasons. Before we go further, we will give you a description of the players in the bond game. The surety is the bonding company. The principal is the entity that is promising to do something, a promise that is being upheld by the surety. The obligee is the entity that is to receive the benefit of the promise. A claimant is also to receive the benefit of the promise. The construction industry deals with three types of bonds: labour and material payment bonds, performance bonds, and bid bonds.
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