Specs Quiz #8 Flashcards Preview

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Flashcards in Specs Quiz #8 Deck (15):
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1. What is a Surety?

Surety company qualifies the contractor and issues the bond and takes responsibility for another person/company’s actions

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2. Who are the parties to a bond?

Contractor
Owner
Surety Company

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3. What is the CCDC for a Bid Bond?

CCDC 220 - 2002

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4. What is the CCDC for a Performance Bond?

CCDC 221 - 2002

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5. What is the CCDC for Labour and Materials Payment Bond?

CCDC 222 - 2002

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6. What is a Bid Bond?

Offers an owner financial protection should a successful bidder not enter into formal contract, or not provide the required security. The surety will pay the difference

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7. What is a Performance Bond?

Provide an owner with the protection as described by the bond, ensuring the completion of the contract in the event of default of the contractor. Ie. the surety company will step in and complete the project if necessary

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8. What is a Labour and Materials Payment Bond?

A guarantee that all suppliers and sub trades will be paid. A surety will pay up to the amount specified on the labour and materials bond

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9. What is a Consent of Surety?

Consent of surety is an undertaking by the Surety to provide Performance and Labour and Material Payment Bonds for the Contractor if their tender is accepted by the Owner and a written contract entered into.

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10. When do Labour and materials payment bonds expire?

1 year after the last supply of materials or labour to the site, or 1 year after the lien period expires

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11. When do Bid Bonds expire?

When the contractor, or another contractor enters into contract B. It also expires when the award period expires.

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12. When do performance Bonds expire?

When a certificate of completion is issued or 12 months after substantial performance is published. Whichever takes longest.

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13. Why would an owner want a letter of credit instead of a bond?

It gives the owner access to cash, instead of having to deal with a Surety.

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14. Do bonds offer a guarantee, or a warranty?

Guarantee

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15. What constitutes abandoning a site?

Judgement by court saying so