RS 48:255.2

268 words·~1 min read·/la/title-48/48-373

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RS 48:255.2

§255.2. Liability of surety in case of default of contractor

Within thirty days after default by a contractor on a public works project, the department shall notify the surety company with whom the contractor acquired a performance bond. Such notification shall be in writing by certified mail or overnight delivery. Within thirty days of receipt of such notification, the surety company shall present to the department either a plan assuming performance on the contract and procuring, or tendering completion of the project, the bond penal sum, or provide the public entity in writing with a reasonable response for the contractor's alleged default.

If no plan is presented by the surety company and the public entity completes the project, the surety company shall then be responsible for payment to the public entity of the costs of completion of the project and stipulated damages assessed by the public entity up to the total amount of the bond purchased by the contractor. In addition, if the surety company has not timely completed the project and a court of competent jurisdiction has determined that the surety company has in bad faith refused to take over the project as provided in this Section, the surety company shall be responsible for the payment of any stipulated damages for any delay in the completion of the project as specified in the original contract and any reasonable attorney fees and court costs incurred by the public entity in collection of the payments required by this Section.

Acts 1995, No. 1146, §1, eff. June 29, 1995; Acts 2003, No. 863, §1, eff. July 1, 2003.