Utah Bond Claim Laws
Between the deadlines, paperwork, and notices, making sure you’re filing your bond claim with all the correct information can be a bit of a hassle. Throw on top of that each state having its own laws and the whole process can quickly become confusing.
Like all other states, Utah has its own set of legal rules that dictate who can benefit from a construction bond claim and how they have to go about filing it. Regardless of how much experience you have on Utah construction projects, it’s important you understand the intricacies of Utah’s bond claim process and the laws laid out in its Little Miller Act.
Who Can Benefit From a Bond Claim in Utah?
A construction surety bond in Utah acts as a sort of guarantee between three parties that the project will be completed in accordance with all the necessary specifications and that those who work on the project will be compensated for their work. The three parties involved in the surety bond are the principal (the contractor), the surety (the company who issued the bond), and the obligee (laborers and material suppliers).
When it comes to making a claim against a construction surety bond, Utah obligees are the ones who benefit. Under Utah construction law, the obligee can be almost any person who assisted on the project below the prime contractor who committed a Utah code breach of contract by not paying. Utah payment bond laws state that this includes subcontractors and material suppliers of any tier – including suppliers to suppliers for the job, who in many states are not permitted to make a claim.
It should be noted that those who can benefit is slightly different when that claim is made against a public body in Utah. When this is the case, only those who supplied labor or materials directly to the contractor or a first-tier subcontractor are entitled to make a claim.
Important Deadlines for a Bond Claim in Utah
One aspect of the bond claim process that can easily trip up claimants is the deadlines that have to be closely followed. If you forget to send out one important notice on time then you may have lost your chance at receiving your due compensation for a project.
One such deadline that you should pay especially close attention to is the preliminary notice. The Utah payment bond statute of limitations for this particular notice is 20 days in Utah, but when these 20 days start being counted isn’t always the same. In many situations, the 20-day deadline will start running on the first day that someone supplies labor or materials to a project.
However, in order for a bond to go into effect, the prime contractor must post a notice of commencement within 15 days of the project’s start. Think of it as a contractor preliminary notice that has to be sent before laborers and subcontractors can file their own. If this notice hasn’t been posted before you begin work, then the 20-day preliminary notice deadline will start from the date that the notice of commencement is officially filed.
In addition to the preliminary notice claimant’s must send, the deadline for filing the actual claim itself should be closely followed. Utah law states that claims cannot be filed before 90 days after a claimant’s work has begun, but also no later than one year after their last day supplying labor or materials.
Frequently Asked Questions About Utah Bond Claims
How Do I File a Construction Lien in Utah?
Where a bond claim can protect those below a contractor for not being paid, a construction or mechanics lien in Utah can be used by a contractor, or mechanic, for the same purpose. A contractor who supplied either preconstruction services or construction labor has a right to file a Utah mechanics lien, for a reasonable value. In order to file a mechanics lien, Utah construction lien laws state you must first fill out the proper form, then file the lien claim, and then serve the notice. Only under Utah lien laws, the notice would be delivered to the property title owner and not the surety or prime contractor. If the contractor is not paid, the construction lien can lead to foreclosure in Utah.
What is a Utah Contractors License Bond?
A Utah contractors license bond is a bond that’s required by the State of Utah Department of Commerce Division of Occupational and Professional Licensing in order to do business as a contractor. Obtaining this, in addition to one of several Utah contractor license classifications, means that a contractor is licensed and bonded.
How Construction Dispute Can Help
Our streamlined bond claim process and online communications hub provide our users with communication and document tracking and several tools, including form generation, to help make filing quick and easy. Sign up today and let us help you more effectively handle all the steps and finer details, and ensure that your claim is in accordance with all the necessary laws, regulations, and requirements!