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GLOSSARY

ABI Model Form of Guarantee Bond definition

Published by a LexisNexis Construction expert

What does ABI Model Form of Guarantee Bond mean?

Form of performance guarantee bond produced by the association of british insurers (abi) and commonly used in relation to construction projects, although it is often amended.

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Amendments to ABI Model Form of Guarantee Bond

Amendments to ABI Model Form of Guarantee Bond Introduction The ABI Model Form of Guarantee bond was first published in 1995 and was updated (in 2002) to incorporate reference to the Contracts (Rights of Third Parties) Act 1999. A copy is available here: ABI Model Form of Guarantee Bond The ABI explanatory guide states the ABI Model Form was published: 'following a lengthy period of consultation with government and local authority advisors, commercial users, construction and engineering industry bodies, major construction companies and insurers, to respond to the criticisms of archaic bond wordings made by the House of Lords in the case of Trafalgar House…' The explanatory guide also provides more detail of the aims of the Model Form, together with commentary on the text. In short, the aim was to provide a short form conditional bond wording, in clear, modern language that is intended to strike a fair balance between safeguarding the respective interests of the employer and the contractor. The hope and intention was...

Performance bonds—construction projects

Performance bonds—construction projects This Practice Note examines the nature of performance bonds, why they are required and where they fit into the suite of documentation commonly required for any construction project. The Practice Note also addresses practical issues relevant to the negotiation and drafting of bonds. For guidance on making a call under a bond, see Checklists: Calling on a conditional bond—checklist and Calling on an on demand bond—checklist. The basic structure of a performance bond arrangement A performance bond is a contract whereby: • in relation to a building contract entered into by a building contractor and its appointing employer, ie the beneficiary • a third party ('the surety’) accepts liability for the performance of the contractor under the building contract (to the extent of the obligations described in the performance bond) If the surety is required to make a payment to the employer under the performance bond, the surety is likely to have common law rights to reimbursement from the contractor, but this is usually...

Discover our 5 Practice Notes on ABI Model Form of Guarantee Bond

Construction weekly highlights—10 June 2021

This week's edition of Construction weekly highlights includes a Commercial Court case clarifying the distinction between guarantees and indemnities and examining the effect of a claim of equitable set-off (Brown-Forman Beverages Europe v Bacardi UK), a Commercial Court case related to forum non conveniens in relation to contribution proceedings (Samsung Electronics v LG Display Co Ltd), a new procurement policy note on the government’s carbon reduction plans, the publication of five main FIDIC contracts in the Chinese language and a response from the government on changes to the Architects Act 1997.

Construction weekly highlights—5 March 2020

This week's edition of Construction weekly highlights includes a case in which the court construed a bond based on the ABI Model Form (Yuanda v Multiplex), a ruling in which the court gave guidance on the difference between single joint experts and testing houses (Blackpool Borough Council v Volkerfitzpatrick) and the announcement of a new Judge in Charge of the Technology and Construction Court (TCC).

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