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What is the deadline for filing a bond claim?

We were working on a project for a local county owned fire station and completed our scope of work. Our last invoice was for around $10,000 that is about 3 months past due. I found out from another sub that the GC was kicked off the project and a new GC took over to complete the building. I filed a claim against the GC's bond but I am just outside of the 90 day window from our last day worked on site. I read through our contract with the GC and it says they must let us know in writing if they are removed from the project. They never told us, which is why I never thought there would be any problem and didn't file a claim sooner. Currently, the county won't tell me if they paid the GC for our scope of work and the GC won't tell me if they were paid for it. So, I am not sure who technically has the money at this point, but our job was completed. What do you suggest at this point?

2 replies

Oct 11, 2019

Bond claim deadlines tend to be strict. So, if the deadline to file that bond claim passed before a claim was made, then some other option for recovery may be necessary. But, to be sure, let's explore Virginia's bond claim deadlines. Also, it sounds like this may be the same project as this prior Expert Center question. While that answer explored what type of work might reset the clock for the last furnishing date, it didn't quite get into whether a bond claim would be required or whether an enforcement action directly against the bond might be available. More on that below. Virginia's bond claim deadlines for subcontractors Note that Virginia has separate bond claim deadlines, depending on who's making the claim. For parties hired by someone other than the project's general contractor - the deadline to file a claim on the project's payment bond will be 90 days from the last furnishing labor or materials. And, if that claim ultimately ends up going unpaid, then the claimant may need to later enforce their claim against the payment bond by filing a lawsuit. Note, though, that subcontractors hired by general contractors have a much more relaxed bond claim timeframe. For first-tier subcontractors hired by the GC, a "bond claim", in the traditional sense, isn't actually required. Rather, a sub hired by a GC can proceed directly to filing a lawsuit against the project's payment bond without first having to make a claim. So, the 90-day bond claim deadline is inapplicable. And, this suit must be filed at least 90 days after work was last performed, but also within 1 year of that date. Other options for recovery Making claims/ filing suit against a project's payment bond is a great way to recover payment on a publicly owned construction project. Of course, it's not the only way to recover payment. Sending demand letters to the customer can help speed things along. If they're aware of the potential for future claims and/or lawsuits, they may be more amenable to talking payment. Further, legal claims - such as breach of contract - may be available, too. And, just like with threatening lien claims or bond claims, threatening legal claims may be enough to compel payment, too. But, in a situation where a traditional bond claim isn't on the table, and where recovery options tend to drift into a more legal-centric territory, it'd probably be wise to consult with a local construction attorney. They'd be able to review your contract and the other details of your situation and advise on how to proceed. I hope this was helpful!

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Oct 22, 2019

To follow up on the above, because this is a Virginia state public project, the notice of claim for those that are not in direct contract with the GC is 90 days from last contract work (with nuances as to what work qualifies to set this last date). The claimant then must wait 90 days from this last work before filing in court and must do so within a year of the last date of work. If the claimant is in direct contractual privity with the GC (i. e. has a contract directly with GC), then no notice is necessary though it is a best practice to do so in order to give the bonding company a chance to help you get paid. These are all general guidelines and the analysis depends on the facts of your case as to what the deadlines are.

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