4.3.4.3.2 Private Bid Bonds

• Jurisdiction: Arizona

The liability of the surety for damages on a private bid bond is determined from the express terms of the bid bond. Some bid bonds provide the penal sum of the bid bond constitutes liquidated damages so that, upon default, the bond penalty is forfeited in its entirety regardless of actual damages suffered by the owner.^[40] In most cases, bid bonds restrict the liability of the surety to those damages actually suffered or sustained as a result of a refusal or failure of the successful bidder to enter into a...