RS 2241 - Written contract and bond
A.(1) Whenever a public entity enters into a contract in excess of five thousand dollars for the construction, alteration, or repair of any public works, the official representative of the public entity shall reduce the contract to writing and have it signed by the parties. When an emergency as provided in R.S. 38:2212(D) is deemed to exist for the construction, alteration, or repair of any public works and the contract for such emergency work is less than fifty thousand dollars, there shall be no requirement to reduce the contract to writing.
(2) For each contract in excess of twenty-five thousand dollars per project, the public entity shall require of the contractor a bond with good, solvent, and sufficient surety in a sum of not less than fifty percent of the contract price for the payment by the contractor or subcontractor to claimants as defined in R.S. 38:2242. The bond furnished shall be a statutory bond and no modification, omissions, additions in or to the terms of the contract, in the plans or specifications, or in the manner and mode of payment shall in any manner diminish, enlarge, or otherwise modify the obligations of the bond. The bond shall be executed by the contractor with surety or sureties approved by the public entity and shall be recorded with the contract in the office of the recorder of mortgages in the parish where the work is to be done not later than thirty days after the work has begun.
B. All requirements and obligations of this Section, except the requirement to furnish a bond, shall be applicable to any contractor or subcontractor for whom bond requirements are waived under the provisions of R.S. 38:2216(C) or (D).
C. The payment provisions of all bonds furnished for public work contracts described in this Part, regardless of form or content, shall be construed as and deemed statutory bond provisions. Any such bond which fails to contain any of the requirements set forth in this Part shall be deemed to incorporate all of the requirements set forth in this Section. Language in any such bond containing any obligations beyond the requirements set forth in this Part shall be deemed surplusage and read out of such bond. Sureties and contractors executing payment bonds for public works contracts under this Part shall be immune from liability for or payment of any claims not required by this Part.
D. A bond issued pursuant to this Section shall not create, nor shall such bond be construed to create, any cause of action in favor of the public entity, or any third party, for personal injury or property damages sustained by any third party during the effective period of the bond. Nothing contained herein shall in any way limit the liability on the bond for the performance of the work pursuant to the contract in question; however, to the extent that the public contract in question should contain any provisions for a hold harmless or indemnity agreement, or both, by the contractor, in favor of the public entity, for personal injury or property damages sustained by third parties, the hold harmless or indemnity agreement, or both, shall not be deemed or construed to be secured by the bond, conditioned upon the concurrence of the contractor and the surety.
E. Any provisions of a bond issued pursuant to this Section which are contrary to Subsection D hereof are hereby declared to be contrary to the public policy of the state of Louisiana and are null and void.
F. The provisions of this Section shall not be subject to waiver by contract.
Amended by Acts 1975, No. 344, §1; Acts 1979, No. 389, §1; Acts 1980, No. 615, §1; Acts 1985, No. 244, §1; Acts 1986, No. 248, §1; Acts 1986, No. 888, §1; Acts 1991, No. 749, §1, eff. July 18, 1991; Acts 1995, No. 540, §1; Acts 1997, No. 119, §1; Acts 1999, No. 673, §1.