Berks Products Corp. v. Arch Ins. Co.
72 A.3d 315 (Pa. Commw. Ct. 2013)
Note: A petition for allowance of appeal from this decision has been filed with the Pennsylvania Supreme Court, but has not been acted upon as of January14, 2014.
This action arose from a payment bond secured by a general contractor for work performed on a public school building. Skepton Construction, Inc. (“Skepton”) entered into an agreement with the Wilson Area School District (the “District”) to be the general contractor for the construction of a new intermediate school (the “Project”). Under its agreement with the District, Skepton was required to secure a payment bond in order to guarantee its payment obligations. Skepton secured its payment bond through Arch Insurance Company (“Arch”). The payment bond (the “Bond”), in relevant part, stated: “[I]f the Principal and any subcontractor of the Principal to whom any portion of the work under the Agreement shall be subcontracted,…promptly shall pay or cause to be paid, in full, all money which may be due any claimant supplying labor or materials…, then this Bond shall be void; otherwise this Bond shall be and shall remain in force and effect.”