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CA Practice question

PostPosted: Tue Oct 01, 2019 3:30 pm
by Yohai
Hi,

If a contractor has a performance bond for 100% of the contract documents = 500,000 but the project costs is 1,000,000 , the contractor defaulted and no where to be seen. who pays the difference?

Re: CA Practice question

PostPosted: Tue Oct 01, 2019 4:33 pm
by Coach
Why the discrepancy? If contract was executed and then COs increased the cost, bond should have also increased along the way.

Re: CA Practice question

PostPosted: Sun Oct 06, 2019 4:13 pm
by Yohai
So the surety will pay the difference?

Re: CA Practice question

PostPosted: Mon Oct 07, 2019 2:11 am
by Coach
If additional premium was paid, yes. If not, no.