Conditional bond meaning

This checklist highlights the main points to weigh up before making a call (claim) on a conditional bond, also referred to as a default bond. Any call is directed to the surety, typically an insurer or surety firm. Here, we assume a contractor has furnished the bond to its employer; the same approach generally applies where, for instance, a contractor seeks to call a performance bond issued by its sub-contractor. Is the bond on demand or conditional? The drafting of the bond ought to clarify this, though the label it uses is not conclusive. Consider: Who stands as surety? On demand bonds are commonly supported by banks, while conditional bonds are typically supported by an insurer or surety company. Is the contractor named as a party? For an on demand bond, the contractor need not be a party; for a conditional bond, they may well be. What is the extent of the surety’s liability? Where the surety’s duties under the bond operate independently...

How are section 278 and section 38 agreements revealed? Check the outcome of the local search and the seller’s replies to enquiries. A section 278 agreement will only be registrable as local land charges if: it has been entered into pursuant to an obligation in a s 106 agreement; or the highway authority (HA) has declared that there has been a financial default under the agreement. Section 278 agreements Section 278 agreements are used where a developer requires off-site work (other than simple access) to be carried out to a highway. The HA may design and construct the highway works at the developer’s expense. Alternatively, the agreement can appoint the developer as the HA’s agent to undertake the works, in which case a bond must support the agreement. If the developer carries out the works, a certificate of practical completion is issued once the HA engineer is satisfied that the works are complete. Following successful completion of a 12-month maintenance period,...

TPR confirmed that, under the terms of the new agreement, ITV will bring the 2,800 Box Clever scheme members into its own pension arrangement. This move guarantees members their full entitlements, including back payments owed to them, replacing the reduced-level payments they had been receiving since 2014 under the Pension Protection Fund (PPF). 'Today's announcement shows how we deploy our powers to safeguard savers and, if required, vigorously pursue matters through the courts to secure an acceptable outcome,' said Mel Charles, the regulator's interim executive director of regulatory compliance. Box Clever was created in 2000 as a joint venture between Granada (now part of ITV) and Thorn Finance Ltd, which has since been renamed Carmelite Capital Ltd. When the venture failed in 2003, the pension fund was left underfunded and, as a result, prompted TPR to examine whether ITV had potential financial responsibilities to the scheme. In 2011 TPR warned ITV of its intention to issue financial support directions to five companies that were within its group, on the basis...

Introduction This Practice Note aims to: analyse the character and features of the on demand performance bond; outline the principal indicators and key factors for deciding whether a performance bond should be treated as an on demand instrument rather than a 'conditional' guarantee or bond For an overview of performance bonds, see Practice Note: Performance bonds—construction projects. For guidance on making a call under a bond, see Checklist: Calling on an on demand bond—checklist...

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Call-off The method, within a framework agreement, of directing particular works to be undertaken when needed, as appropriate. According to the arrangement's format and conditions, a call-off might demand that a separate contract is concluded, or it may simply need the instructing party to issue a call off notice. Refer to Practice Note: Framework agreements in construction—call-off procedures. CAR insurance Consult Contractor's all risk (CAR) insurance below. Category A fit out Interior fit out provided to a fundamental standard for landlords/developers, typically. Pinning down the scope is challenging, as it can differ quite widely in practice. Nevertheless, guidance does exist, such as authoritative publications issued by the British Council for Offices. Category B fit out Interior fit out delivered to an exact specified design for occupiers/owners...

Introduction The ABI Model Form of Guarantee Bond first appeared in 1995, with a revision in 2002 to add a reference to the Contracts (Rights of Third Parties) Act 1999. A copy can be found here: ABI Model Form of Guarantee Bond. An explanatory guide accompanies the form. According to the ABI’s explanatory guide, the Model Form emerged after an extensive consultation with government and local authority advisers, commercial users, bodies from the construction and engineering sectors, leading construction firms and insurers, in order to address the House of Lords’ criticism of outdated bond wordings in the Trafalgar House case. The guide also sets out the objectives of the Model Form in greater depth and includes commentary on the drafting. In essence, the objective was to deliver a concise, short-form conditional bond wording, written in plain, contemporary language, intended to achieve a fair equilibrium between protecting the employer’s interests and those of the contractor. The aspiration and intention were that the ABI Model Form would be adopted as an...