Construction Alert: WHAT YOU NEED TO KNOW - Recent Revisions To The AIA Bond Forms


For the first time in over twenty-five years, the AIA has revised and recently released its A312-2010 Payment and Performance Bonds. All owners, contractors, subcontractors and suppliers should take note that the revisions to both the Payment and Performance Bonds substantially impact the rights, duties and obligations of all parties to the surety relationship.

A312-2010 Payment Bond

Section 1 – Section 1 (i.e. the contractor and surety’s obligation to jointly and severally bind themselves to the owner to pay for labor, materials and equipment furnished for use in the performance of the contract) was ostensibly modified in response to a recent Court decision which held that Section 1 was, in fact, an obligation independent of the rest of the Bond. In attempting to remedy such a ruling, the AIA modified Section 1 to state that the conditions contained therein are, in fact, subject to the remaining provisions and terms of the bond.

Please see full alert below for more information.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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