“That Can’t Be Right”: Illinois Contractors Must Be Aware of Sureties’ Rights Upon Default Under Payment and Performance Bonds
By Frank M. Swanson
Construction Law,
January 2025
Upon receiving notice of a potential declaration of default under a Payment and Performance Bond, we often receive questions from clients about what measure of control they can properly assert over a surety’s selection of a substitute contractor. The answer to some is surprising: almost none. Yet, the risk of the surety selecting an improper surety, or risking contractual relationships, can be minimized at the contracting stage through simple, clear modifications of the standard A312 Payment and Performance Bond and standard contractual provisions.
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