Guidance > Commercial > Retention > Bond for Directly Employed Specialist

RETENTION BOND FOR USE BY A SPECIALIST
IN DIRECT CONTRACT WITH THE CLIENT

Download a Word version of this document

THIS DEED is made the                 day of                 200
BETWEEN:
(1)       <                           > whose registered office is at  <                                           >
(hereinafter called "the Principal"); and
(2)       <                             > whose registered office is at <                                          >
(hereinafter called "the Surety"); and
(3)       <                             > whose registered office is at <                                          >
(hereinafter  called "the Obligee").

WHEREAS
The Principal has entered into a written contract with the Obligee dated the                 day of                                             200    (hereinafter called "the Contract") for the construction, completion and maintenance of <                    >  (hereinafter called  "the Works") and pursuant to the Contract the Obligee has agreed with the Principal that the Obligee shall not deduct retention monies from payments made or to be made to the Principal under the Contract.

NOW IT IS HEREBY agreed as follows:
1.         If the Principal shall well truly and faithfully comply with all the terms and conditions of the Contract (which terms and conditions are hereby incorporated into this Bond) on its part to be performed so far as the same are legally enforceable against it or if on default by the Principal the Surety shall satisfy and discharge the established and ascertained damages sustained by the Obligee thereby up to the maximum aggregate sum of <             > (hereinafter called "The Bonded Sum") then this Bond shall automatically be null and void notwithstanding that it may not have been returned for cancellation, but otherwise shall remain in full force and effect subject always to the provisions of Clause 2 hereof.

2.         Notwithstanding the provisions of Clause 1 hereof the Bonded Sum and the liability of the Principal and the Surety hereunder shall automatically be reduced by an amount equivalent to 50% of the Bonded Sum on the         day of
199    (being the date of practical completion of the Works anticipated by the Principal at the time of submission of his tender for the Works and hereinafter called  "the First Date") and thereafter reduced to nil by an amount equivalent to the remaining 50% of the Bonded Sum on the      day of                199    (being the date six months after the First Date) whereupon the liability of the Principal and the Surety hereunder shall automatically cease and determine notwithstanding that this Bond may not have been returned for cancellation.

3.         The Principal and the Surety for themselves and their successors and assigns hereby respectively bind themselves jointly and severally hereunder.

4.         The Obligee shall not assign or transfer any benefit under this Bond or any part thereof or any interest therein.

5.         This Bond shall be governed by and construed in accordance with English Law and be subject to the exclusive jurisdiction of the English Courts.

IN WITNESS whereof this Bond has been executed as a Deed delivered the day and year first before written.

The Common Seal of <  the Principal  >
was hereunto affixed in the presence of:

Director

Secretary

The Common Seal of   <  the Surety   >
was hereunto affixed in the presence of:

Authorised Signatory
 

Authorised Signatory

Download a Word version of this document