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There are three types of bonds that afford financial protection in connection with a construction project: payment bonds, Cranesperformance bonds, and bid bonds. Below is a primer on the differences between these bonds and who is protected by them.

Construction Bonds

Construction bonds may be required by contract or by statute. Although often issued by an insurance company, these bonds are not insurance. Instead, the surety guarantees to the obligee (the entity to which the bond is issued) that the principal (the party who is supposed to perform) will meet its obligations. Most construction bonds require the principal to sign a guarantee. Thus, if an obligation is not met and the surety is required to pay a claim, the surety generally has the right to seek recovery from the principal.

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In FedRAMP Accelerates the Process for Federal Contractors to Obtain Cloud Service Provider Authorizations and DoD Revises its Cloud Computing Security Requirements Guide for FedRAMP+, Cloudmy colleague Selena Brady and I discuss cloud computing requirements for contractors in the federal market place. For those providing cloud services, it is a time of landmark changes.

Photo:  Daniel Boyd, Clouds, Taken June 29, 2010 – Creative Commons

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On June 10, 2016, the Supreme Court of North Carolina, in Kirby, et al., v. North Carolina Department of Transportation, Highwayissued a unanimous ruling affirming the decision of the intermediate Court of Appeals that the North Carolina Department of Transportation’s (NCDOT) use of the state’s Roadway Corridor Official Map Act (Map Act) amounted to a taking of the plaintiff’s property without just compensation. On remand, the Supreme Court directed the lower court to determine the value of the loss of these fundamental rights in their property.

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In A New Day in Chemical Regulation, Pillsbury attorneys Matt Morrison, Sheila McCafferty Harvey, Reza Zarghamee, and Brendan J. Hennessey discuss what you need to know about the “Frank R. Lautenberg Chemical Safety for the 21st Century Act”. The Act makes sweeping amendments to the Toxic Substances Control Act (TSCA). The long-awaited changes significantly strengthen EPA’s authority to take action to ban or restrict the manufacturing, processing, or use of chemicals that may pose an unreasonable risk of injury to human health or  the environment.

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On June 6, the Supreme Judicial Court of Massachusetts released an opinion of considerable importance to petroleum retailers in Massachusetts. In Peterborough Oil Company, LLC v. Department of Environmental Protection, the Court interpreted the term “Oil” as used in the Massachusetts Department of Environmental Protection’s (DEP) regulation (the “Oil exemption”) implementing the Massachusetts Oil and Hazardous Materials Release Prevention Act. The Act is in many ways the state’s counterpart to the federal Superfund or Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA). The Court ruled that the term “Oil,” as defined in Section 2 of the Act and interpreted by the DEP, is not subject to the kind of “petroleum exclusion” that is part of CERCLA. Indeed, under CERCLA, leaded gasoline, the substance at issue here, would likely have been exempted by CERCLA from most cleanup requirements.

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On June 3, 2016, the U.S. Court of Appeals for the DC Circuit, in Rhea Lana, Inc., et al., v. Department of Labor, reversed the district court’s holding that a warning letter sent to the plaintiff by the Wage and Hour Division of the Department of Labor (DOL) was not a “final action” for purposes of review under the Administrative Procedure Act (APA). The decision is significant because it appears to presage the use of “final agency action” as a means of seeking pre-enforcement judicial review in the federal courts for a host of governmental communications (orders, letters, formal notifications, etc.).

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On June 1, 2016, the U.S. Court of Appeals for the Seventh Circuit issued an interesting ruling in Beatrice Boyer, et al., v. BNSF Railway Company dba Burlington Northern and Santa Fe Railway Company. It ordered plaintiffs’ counsel to compensate BNSF almost $35,000. The Court of Appeals’ ruling was premised on it concluding:

“We believe the record makes clear that the plaintiffs’ counsel unreasonably and vexatiously multiplied the proceedings by filing [a second] suit in Arkansas, which had absolutely no connection to this case” after its initial complaint filed in Wisconsin was dismissed.

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On June 2, 2016, the U.S. Court of Appeals for the Fifth Circuit addressed another matter of alleged attorney misconduct in a Deepwater Horizon claims case and the District Court’s authority to impose sanctions for misconduct. This controversy also involves former FBI Director Louis Freeh, who was designated a Special Master by the court when allegations of impropriety surfaced involving Andry Lerner, LLC, a firm that represents claimants in the “Court-Supervised Settlement Program” (CSSP). The Fifth Circuit was asked to review the District Court’s sanction of attorneys after determining that the lawyers violated the Louisiana Rules of Professional Conduct (LRPC).

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In 2014, the NRC promulgated a “Continued Storage Rule” followed by the Nuclear Regulatory Commission’s (NRC) issuance of a Generic Environmental Impact Statement on Decommissioning of Nuclear Facilities (NUREG-0586) to support the Rule. On June 3, 2016, the U.S. Court of Appeals for the DC Circuit, in State of New York, et al., v. Nuclear Regulatory Commission, et al., rejected the arguments made by “several states, a Native American Community, and numerous environmental organizations” objecting to the Rule and generic EIS concerning the “continued, and possibly indefinite storage” of spent nuclear fuel generated by nuclear power plants operating in the United States.

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On May 27, 2016, Vermont’s Supreme Court, in State of Vermont v. Atlantic Richfield Company, et al., ruled that the State of Vermont’s “generalized injury” claims “to state waters as a whole due to groundwater contamination from gasoline additives” are not exempted from Vermont’s six-year statute of limitations for civil claims. The Court affirmed the trial courts dismissal of the State’s claims as time-barred, and confirmed that “the trial court properly interpreted [12 Vt. Stat. Ann.] § 462 as limited to claims of adverse possession” and, in addition, recently enacted 10 Vt. Stat. Ann. § 1390 did not “create a new cause of action that was retroactively enforceable, [empowering] the State to apply the statute to injuries discovered more than six years prior to its complaint.”

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