A paralegal plays an important role in helping to obtain a surety bond. Surety bonds are a type of contract used to guarantee that an individual or entity will fulfill their obligations. This guide aims to provide an overview of what role a paralegal may play in obtaining a surety bond.
It is important to note that the degree of involvement that a paralegal has in obtaining a surety bond will vary greatly depending on the amount and complexity of the bond type, as well as the size of the firm they are working for. In all cases, however, they will play an integral role in ensuring that all parties involved have fulfilled their obligations and have provided the proper documentation required for their portion of the process.
The role of a paralegal in obtaining a surety bond includes:
- Ensuring that all parties involved have fulfilled their obligations.
- Providing the proper documentation required for their portion of the process.
- Monitoring the progress of the bond application.
- Assisting with any disputes that may arise.
- Finding a bond company to issue the bond
- Creating a relationship with the bond company for a smoother bond approval process for future cases
What is a Paralegal?
A paralegal is a legal professional who assists in the delivery of legal services under the direct supervision of an attorney. A paralegal, who may also be known as a legal assistant, has knowledge about the law and its practices. They are trained to assist lawyers, who can then use their expertise to build a strong case for their client.
A paralegal also plays an important role in obtaining surety bonds. A surety bond is an agreement between three parties – the obligee, principal, and surety – that ensures that if one party fails to perform duties as specified in a contract or obligation they will be held liable to fulfill them. When approachable by a client certain companies or individuals may require that they obtain surety bonds prior to engaging in the particular business needed by their clients – such as construction projects or financial investments.
When dealing with such bonds, it is important for those involved to ensure all criteria for obtaining it is fulfilled and that all necessary steps have been taken correctly. In this step of litigation process, where required compounds are not properly fulfilled, it falls on the shoulders of skilled paralegals:
- To put forth enough effort
- To conduct themselves with complete professionalism and meticulousness
- To research applicable laws
- To attain all appropriate information for filing for accurate bonds
- To serve their clients positively
What is a Surety Bond?
A surety bond is an agreement between three parties in which one party, the surety, agrees to act as a guarantor on behalf of the second party, the principal, and ensure that they uphold certain specified obligations to a third party known as the obligee. In most cases, surety bonds are issued by insurance companies to protect obligees against loss or damages due to unfulfilled contractual obligations or other legally binding issues that may arise between two parties.
Paralegals play an important role in obtaining surety bonds as they are often entrusted to handle administrative duty and paperwork necessary in order for insurers to issue them. Paralegals should be familiar with all relevant documents such as contracts and agreements required by the insurer before they can proceed with the process of obtaining surety bonds. Additionally, they may need to contact relevant government agencies in order to obtain application forms and reports that could aid in determining if both parties meet pre-set eligibility criteria. Throughout this process, paralegals should demonstrate their expertise in:
- trust-deed law
- specialty contract laws
- contract interpretation
while also exhibiting strong communication skills when liaising with external bodies such as government departments.
What is the Role of a Paralegal in Obtaining a Surety Bond?
A paralegal plays an important role in obtaining a surety bond. This task often falls to them and they are usually very knowledgeable and help to expedite the process.
Gather Necessary Documentation
A paralegal’s role in the process of obtaining a surety bond usually involves the gathering of the necessary documentation that must be presented to the surety company. This may involve presenting information such as:
- Personal financial statements
- Consents of lien holders
- Irrevocable letters of credit
- Financial statements on any lenders to whom money is owed
- Statements of paid debts if any exist
- Copies of any court orders
- A complete explanation as to why a bond is needed.
- A completed and signed application form filled out by the client sent by the surety bond company
- Signed waivers from any interested parties/ beneficiaries
The paralegal also ensures that all required forms are completed accurately, and all relevant information is included.
Additionally, it is important for the obligee (the individual or entity who proposes or initiates the obtaining of a surety bond) to disclose all material information regarding the underlying transaction or agreement for which a certain bond is needed so that there are no surprises at the end when trying to obtain bonding from surety companies.
Prepare the Bond Application
The role of the paralegal in obtaining a surety bond will vary depending on the nature of the bond. Generally, though, the paralegal’s primary duty is to prepare the bond application for filing with the Surety company.
In preparing the bond application, the paralegal must review applicable county, state and federal laws governing bonds and ensure that all forms are completed accurately. Additionally, they may be required to provide research as it relates to other relevant laws. The paralegal may also be responsible for conducting a background check and collecting information necessary for completing all required documents associated with obtaining a surety bond.
It is vital for a paralegal to review court records or other documents relating to past legal proceedings involving their client in order to properly assess all risks associated with procuring a surety bond. Depending on the size of their firm or assigned division within their organization, corporate paralegals may also be responsible for drafting and submitting motions related to compliance issues related to obtaining bonds. After assembling all relevant information in order to complete bond applications, they must securely submit them on behalf of their client(s) through an authorized Surety Bond provider.
Submit the Bond Application
Paralegals prepare, review and submit the bond application package. This may include working with the attorney and client to gather all of the necessary supporting documents, such as financial statements, court orders, court documents, corporate resolutions, etc., when required.
Once all this is assembled, the Paralegal needs to review it for accuracy before submitting it to the surety company. The application should include a comprehensive breakdown of who is responsible for the bond and why it matters, what assets are available to secure it and any additional information needed by the bonding company assessment team. It will be important to ensure that all items needed by the surety company are included in order to expedite their evaluation process.
Once submitted, a Paralegal often remains available to obtain any additional documents which may be requested by the surety company during their assessment process.
In conclusion, the role of a paralegal in obtaining a surety bond is vital and important. They are responsible for understanding the bond that must be obtained, preparing any necessary documentation, providing research and other support to the law firm, and communicating with all parties. By ensuring an accurate and timely completion of these tasks, the paralegal helps to ensure that clients receive their surety bond as quickly as possible.
Madden & Bergstrom recognizes the vital role that paralegals play in the surety bond process. We are proud members of the Chicago and Illinois Paralegal Associations and appreciate their hard work.