Bonds Required on Federal Construction Projects Even if Contract is Silent

The Federal Circuit Court of Appeals very recently issued an important decision in K-Con, Inc. v. Secretary of the Armywhich requires a construction contractor to provide performance and payment bonds, even though the contract does not expressly require it. The Court relied on the Christian Doctrine to incorporate into the contract, as a matter of law, bond requirements from the Federal Miller Act that were not physically written in.

In K-Con, the Army awarded two contracts for pre-engineered metal buildings for an Army base in Massachusetts. After the contracts were awarded, the Army told the contractor that it was holding the notices to proceed until bonds were provided. It took two years for K-Con to give the bonds; the Army then issued the notices to proceed. Shortly thereafter, the contractor submitted delay claims for the two years of delay.

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