MI STATEMichigan Court of Appeals
2000

Leonard C. Carnaghi, Inc. v. Amwest Surety Ins. Co.

617 N.W.2d 49Michigan Court of Appeals • Decided 2000Remanded
Pay-When-PaidCited 3 times

HOLDING

A subcontractor performed work and submitted completion documentation before a payment bond was issued by the surety. The subcontractor was never paid. The court ruled that payment bonds cover work performed before the bond's execution date, and that default occurs when payment is not made—not when work is completed. The case was remanded for trial, meaning the subcontractor has a viable claim against the surety even though the bond was issued after work began.

KEY FINDINGS

Pay-When-Paid

Payment bonds can cover work performed before the bond is issued—timing of bond execution doesn't eliminate coverage for prior labor and materials

FULL COURT OPINION