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Surety Bonds in Florida Construction Projects


Regardless of your role in the Florida construction industry, it is a given that you will need to deal with surety bonds on an almost-daily basis. A bond is required by Florida’s Little Miller Act any time you are working on a public project in excess of $200,000, and it may be a condition in many other contexts. In general, these bonds are a type of insurance policy protecting the property owner from financial loss if the contractor fails to perform, does not pay subcontractors, or otherwise does not uphold its end of the bargain regarding a construction contract.

Because they are an integral component of the construction process, it is essential that all involved parties be aware of how surety bonds work – including contractors, subcontractors, laborers, material supplies, and sureties. A Florida bond claims lawyer can assist with disputes, but you may also find some background information to be useful. 

Overview of Surety Laws and Legal Concepts 

There are multiple types of surety bonds, but the arrangement generally involves:

  • The property owner who requests or requires surety on the project;
  • The contractor as principal – i.e., the party who needs the bond upon request of the owner or developer; and,
  • The company that provides insurance that the principal procures.

The objective of a surety bond is to protect the property owner from the financial losses that may result from the contractor’s misconduct. In the event of issues, the owner or developer can cover these losses through the proceeds of the bond.

Types of Surety Bonds in Florida 

The basic surety relationship remains the same, but the specifics vary according to the form of bond being used in conjunction with the construction project. There are three surety bonds that are common in the industry:

  1. Performance bonds protect the owner if the contractor does not complete the project according to the agreement, specifications, and related documents.
  2. A payment bond is used to avoid a situation where subcontractors, laborers, or supplies are not paid amounts due to them by the contractor.
  3. Bid bonds may be required when contractors are competing to take on a construction project. Property owners often seek assurance that the bid was submitted in good faith and the contractor is prepared to perform in accordance with the plans and related documentation. 

When disputes arise over a surety arrangement, the remedy for the aggrieved party is making a bond claim. It is beneficial to negotiate a workout whenever possible and get the construction project back on track, but litigation may be necessary – whether you are prosecuting or defending a bond claim. 

Our Florida Bond Claims Attorneys Can Advise You on Your Options

Surety bond disputes are just one of the many challenges you may encounter in a Florida construction project, so protect your interests by working with experienced legal counsel. For more information, please contact the Jupiter, FL offices of Linkhorst Law Firm, P.A. We can set up a consultation with a knowledgeable lawyer who can review your circumstances and determine how to proceed.




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