AB 2677: Sureties: liability.

Existing law authorizes a beneficiary to enforce the liability on a bond against both the principal and sureties by civil action. Under existing law, a judgment of liability on a bond, except as specified, is in favor of the beneficiary and against the principal and sureties, and obligates each of them jointly and severally. Existing law provides that except as specified, the aggregate liability of a surety to all persons for all breaches of the condition of a bond is limited to the amount of the bond, and that the liability of the principal is not limited to the amount of the bond.

This bill would define aggregate liability, for purposes of the provisions above, to include all liability for damages, costs, and attorneys fees, including any attorneys fees that may be assessed as costs, if recoverable. The bill would define surety for these purposes as a corporate insurer or interinsurance exchange to which the Insurance Commissioner has issued a certificate of authority to transact surety insurance in the state.