Question: Explain why, if there is a performance bond on a project, the bonding company needs to be notified when change orders are being considered. The

Explain why, if there is a performance bond on a project, the bonding company needs to be notified when change orders are being considered.

The following are reasons the bonding company must be notified when a change order is considered.

1 .

Common law does not allow two contracting parties to bind a third without its consent.

2 .

The premium a contractor pays is a function of the face amount of a bond.

3 .

The surety is not obligated to provide bond guarantees for any additional or modified work unless the surety has expressly waived the right of notice.

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