Commercial, and sometimes residential, construction requires a contractor to obtain a surety bond to guarantee performance leading to the successful conclusion of a project. Upon that occasion, a general contractor will obtain a surety bond from an authorized underwriter.

The New Jersey Appellate Division recently ruled in Vollers Excavating and Construction, Inc. v. Citizens Bank of Pennsylvania, Docket No.

In today’s economy, we continue to see bankruptcies occurring in the construction sector. An owner, contractor, or subcontractor in financial distress can easily delay a project — or worse, jeopardize the project in its entirety. Contractors need to understand their rights in order to minimize their exposure in bankruptcy-related situations.

Protecting Contractors — Frequently Asked Questions

Imagine this scenario: your client is a contractor, subcontractor or materialman on a construction project. Having completed the work, your client is promptly paid in full. Because of this, your client doesn’t bother to file a mechanic’s lien on the project. However, within 90 days after the payment, the payor, usually the contractor or general contractor (or the owner), files for bankruptcy.

The U.S. Court of Appeals for the Eleventh Circuit has held that the bankruptcy court’s exclusive jurisdiction to dispose of estate property did not preclude the enforcement of an arbitration provision.

Effective March 31, 2009 (not April 1), Georgia lien law is officially set to undergo a series of substantial changes, as a result of Governor Sonny Purdue signing Senate Bill 374 into law. These changes are significant and exist throughout the lien statutes. Many of the revisions require new, very specific procedures and forms that must be precisely followed in order to prevent waiving lien rights. Although the new lien law is not technically retroactive, it appears that several of the requirements could pertain to liens filed prior to March 31.  

In an opinion issued May 12, 2009, the Sixth Circuit Court of Appeals determined that a Michigan contractor’s obligations to a subcontractor would not be discharged. Sameer Patel v. Shamrock Floorcovering Services, Inc. No. 08-1265.

In a decision entered July 30, 2009, the Bankruptcy Court for the Eastern District of North Carolina held that a bankruptcy trustee can avoid the lien claim of a subcontractor whose claim derives from a claim of lien on funds asserted under North Carolina state law. The case is In re: Harrelson Utilities, Inc.

Legal Background

Why are bankruptcy laws needed?

Over the past couple of years, there have been a wave of new insolvency and bankruptcy laws introduced in the GCC. With the exception of Qatar and Kuwait, all other GCC countries have now introduced new bankruptcy laws. As for Oman, its new bankruptcy law is due to come into effect on 1 July 2020.

With respect to the dynamic course of events regarding the coronavirus disease 2019 (COVID-19), commonly known as the "coronavirus", we address the threat of insolvency of Polish companies and related liability of the statutory bodies (management board members), and provide a list of practical mitigating steps.

Insolvency Test of Your Company

Pursuant to the Polish bankruptcy law, the company is insolvent if: a. It is not able to pay its liabilities when they fall due and if the