4.3.3.1 Statutory Bonds

• Jurisdiction: Arizona

The courts measure the liability of a surety on a statutory bond by the terms of the statute. The Arizona Supreme Court has explained that when a surety furnishes a bond required by a statute, the law enters into, and becomes a part of, the agreement. In giving effect to the bond, the court noted:

“Such a bond must be given the effect which in reason must have been intended by the statute. Whatever is included in the bond, and is not required by the law, must be read out of it, and whatever is not expressed, and ought to have been incorporated, must be read as if inserted into it ***”^[4]

Arizona courts continue to reaffirm the rule that they will determine the surety’s obligation as created by the language of the statute and not by the words of the bond.^[5]

The...