Board of Education v. Hartford Accident & Indemnity Co.
Illinois Appellate Court
504 N.E.2d 1000 (1987)
Kiendl Construction contracted with the Board of Education (plaintiff) to build two pool facilities, backed by two bonds from surety Hartford (defendant): a performance bond guaranteeing Kiendl's completion of the work, and a payment bond guaranteeing Kiendl would pay its subcontractors and suppliers. When Kiendl allegedly built the facilities improperly, the Board sued Hartford on both bonds. The trial court granted summary judgment against the Board's performance-bond claim because the bond required suit within two years of final payment and the Board missed that deadline, and it dismissed the payment-bond claim because that bond was meant to benefit subcontractors and materialmen, not the Board. The Board appealed.
Whether a third party has the right to sue on a bond when the circumstances show the bond's parties intended to confer a direct benefit on that third party.