                                 CODE OF VIRGINIA

RECOVERY ON BOND (§ 54.1-1120.1)

A. If a contractor who elected continuous bonding under &#xA7; 54.1-1106 or
54.1-1108 fails to satisfy a judgment awarded by a court of competent
jurisdiction for improper or dishonest conduct, the judgment creditor shall have
a claim against the surety bond for such damages. In order to recover the amount
of any unpaid judgment, up to but not exceeding the maximum liability as set
forth in &#xA7; 54.1-1106 or 54.1-1108, the judgment creditor shall meet the
eligibility requirements of subsection A of &#xA7; 54.1-1120 and bring suit
directly on the surety bond no later than 12 months after the judgment becomes
final.

B. The liability of such surety shall be limited to actual monetary loss, court
costs, and attorney fees assessed against the contractor as part of the
underlying judgment. The liability of such surety shall not include any sums
representing interest or punitive damages assessed against the contractor.

C. The surety company shall notify the Board when a claim is made against a
contractor&#8217;s bond, when a claim is paid, and when the bond is cancelled.
Such notification shall include the amount of claim and the circumstances
surrounding the claim. Notification of cancellation shall include the effective
date and reason for cancellation. The bond may be cancelled as to future
liability by the contractor&#8217;s surety upon 30 days&#8217; notice to the
Board.

HISTORY: 2017, c. 572.