For those of you working in Iowa, beware of the time limits by which you must make bond claims. On public works projects in Iowa, you have a very limited window to make your claim and the process can get even more complicated if the contractor abandons the project.
Iowa’s statute on public works bonds provides that general contractors must pay subcontractors within seven days of payment for the subcontractor’s work. If you are not paid timely, you should file a claim within thirty days immediately following completion and final acceptance of the improvement. But, there is an exception to this thirty day period in that claims may be filed any time if no lawsuit is pending to adjudicate the unpaid portion of the contract price.
The Iowa Code then provides a 30-day “window” for the filing of a lawsuit on a public works bond. The “window” opens 30 days after the completion and final acceptance of the project and closes 60 days after the completion and final acceptance date. So, once notice of completion and final acceptance is issued, you have to wait 30 days to file your lawsuit in support of your claim, but you can’t wait more than 60 days.
But, if the contractor defaults, there is another set of deadlines that applies. Under another section of the Iowa Code, if the contractor abandons the project, it is deemed completed at that moment. So, the clock starts to run for filing claims at that moment.
Bond claims on public projects in Iowa can be very complicated. So, make sure you know the status of the project and the completion dates so that you can make timely bond claims.
If you would like to learn more about bond claims, please attend our Bond Claim Lunch & Learn on March 30, 2012. You can see the invitation here. If you would like to attend, please RSVP via e-mail to firstname.lastname@example.org.