Brisbane Municipal Code Ch. 16.28 Improvement Security

Improvement security required of a subdivider pursuant to this title shall be one of the following, as determined by and subject to the approval of the city engineer:

A. A performance bond, substantially in the form set forth in Section 16.28.040 of this chapter, and a labor and material bond, substantially in the form set forth in Section 16.28.050 of this chapter, issued by one (1) or more corporate sureties duly authorized to transact business in the state.

B. A deposit held by the city in cash or, if accepted by the city engineer, negotiable bonds of the kind approved for securing deposits of public moneys.

C. An instrument of credit from one (1) or more financial institutions subject to regulation by the state or federal government and pledging that the funds necessary to carry out the act or agreement are on deposit and guaranteed for payment, or an irrevocable and unconditional letter of credit issued by such a financial institution.

D. A lien upon the property to be divided, created by deed of trust or other security instrument acceptable to the city engineer.

(Ord. 410 § 1, 1997: Ord. 282 § 7.1, 1982).

Any written contract or security interest in real property entered into as security for performance pursuant to Section 16.28.010 shall be recorded with the county recorder.

(Ord. 282 § 7.2, 1982).

The city engineer shall have the authority to release all or any portion of the property subject to any lien or security interest created pursuant to this chapter, or to subordinate such lien or security interest to other liens or encumbrances if he determines that security for performance is sufficiently secured by a lien on other property or that the release or subordination of the lien will not jeopardize the completion of agreed-upon improvements.

(Ord. 282 § 7.3, 1982).

A bond or bonds by one or more duly authorized corporate sureties to secure the faithful performance of any agreement shall be in substantially the following form:

WHEREAS, the City Council of the City of Brisbane, State of California, and ___________, hereinafter designated as "principal", have entered into an agreement whereby principal agrees to install and complete certain designated public improvements, which said agreement, dated ___________, 19_______, and identified as project ___________ , is hereby referred to and made a part hereof; and

WHEREAS, said principal is required under the terms of said agreement to furnish a bond for the faithful performance of said agreement.

NOW, THEREFORE, we, the principal and ___________, as surety, are held and firmly bound unto the city of Brisbane, hereinafter called "City", in the penal sum of ___________DOLLARS ($___________ ), lawful money of the United States, for the payment of which sum well and truly to be made, we bind ourselves, our heirs, successors, executors and administrators, jointly and severally, firmly by these presents.

The condition of this obligation is such that if the above bound principal, his or its heirs, executors, administrators, successors or assigns, shall in all things stand to and abide by, and well and truly keep and perform the covenants, conditions and provisions in the said agreement and any alteration thereof made as therein provided, on his or their part, to be kept and performed at the time and in the manner therein specified, and in all respects according to their true intent and meaning, and shall indemnify and save harmless the City of Brisbane, its officers, agents and employees as therein stipulated, then this obligation shall become null and void; otherwise it shall be and remain in full force and effect.

As a part of the obligation secured hereby and in addition to the face amount specified therefore, there shall be included costs and reasonable expenses and fees, including reasonable attorney's fees, incurred by City in successfully enforcing such obligation, all to be taxed as costs and included in any judgment rendered.

The surety hereby stipulates and agrees that no change, extension of time, alteration or addition to the terms and agreement or to the work to be performed thereunder or the specifications accompanying the same shall in any wise affect its obligations on this bond, and it does hereby waive notice of any such change, extension of time, alteration or addition to the terms of the agreement or to the work or to the specification.

IN WITNESS WHEREOF, this instrument has been duly executed by the principal and surety above named on ___________, 19_______.

Appropriate modifications shall be made in such form if the bond is being furnished for the performance of an act not provided for by this agreement.

(Ord. 282 § 7.4, 1982).

A bond or bonds by one or more duly authorized corporate sureties for the security of laborers and materialmen shall be in substantially the following form:

WHEREAS, the City Council of the City of Brisbane, State of California, and ___________, hereinafter designated as "principal", have entered into an agreement whereby principal agrees to install and complete certain designated public improvements, which said agreement, dated ___________, 19_______, and identified as project ___________ is hereby referred to and made a part hereof; and

WHEREAS, under the terms of said agreement principal is required before entering upon the performance of the work, to file a good and sufficient bond with the

City of Brisbane to secure the claims to which reference is made in Title 15 (commencing with Section 3082) of Part 4 of Division 3 of the Civil Code of the State of California.

NOW, THEREFORE, said principal and the undersigned as corporate surety, are held firmly bound unto the City of Brisbane and all contractors, subcontractors, laborers, materialmen and other persons employed in the performance of the aforesaid agreement and referred to in the aforesaid Code of Civil Procedure in the sum of DOLLARS ___________ ($___________ ), for materials furnished or labor thereon of any kind, or for amounts due under the Unemployment Insurance Act with respect to such work or labor, that said surety will pay the same in an amount not exceeding the amount hereinabove set forth, and also in case suit is brought upon this bond, will pay, in addition to the face amount thereof, costs and reasonable expenses and fees, including reasonable attorney's fees incurred by City in successfully enforcing such obligation, to be awarded and fixed by the court, and to be taxed as costs and to be included in the judgment therein rendered.

It is hereby expressly stipulated that this bond shall inure to the benefit of any and all persons, companies and corporations entitled to file claims under Title 15 (commencing with Section 3082) of Part 4 of Division 3 of the Civil Code, so as to give a right of action to them or their assigns in any suit brought upon this bond. Should the condition of this bond be fully performed, then this obligation shall become null and void, otherwise it shall remain in full force and effect.

The surety hereby stipulates and agrees that no change, extension of time, alteration or addition to the terms of said agreement or the specifications accompanying the same shall in any manner affect its obligations on this bond, and it does hereby waive notice of any such change, extension, alteration or addition.

IN WITNESS WHEREOF, this instrument has been duly executed by the principal and surety above named, on ___________, 19_______.

(Ord. 282 § 7.5, 1982).

The security to be provided by the subdivider pursuant to this chapter shall be in the following amounts:

A. An amount equal to one hundred percent (100%) of the total estimated cost of the improvement or of the act to be performed, as determined by the city engineer, securing the faithful performance of the act or agreement; and

B. An amount equal to one hundred percent (100%) of the total estimated cost of the improvement or of the act to be performed, as determined by the city engineer, securing payment to the contractor, the subcontractors, and persons furnishing labor, materials, or equipment for the improvement or the performance of the required act.

C. As part of the obligation guaranteed by the security and in addition to the face amount of the security as required under subsections A and B of this section, there shall be included costs and reasonable expenses and fees, including reasonable attorneys' fees, incurred by the city in successfully enforcing the obligations secured.

(Ord. 410 § 2, 1997: Ord. 282 § 7.6, 1982).

A. Upon completion of the improvement or of the act to be performed and acceptance thereof by the city engineer, and provided that no claims against the performance bond have been made by the city or any other party, the city engineer may, in his discretion, permit the subdivider to reduce the amount of the performance bond to an amount not less than ten percent (10%) of the original face amount of such bond to secure the subdivider's obligation to correct any defects in workmanship or materials. Alternatively, the city engineer may accept a replacement bond or other security satisfactory to the city engineer for the reduced amount. The security for correction of defects shall remain in full force and effect for a period of one (1) year from the date the improvement or performance was accepted as complete by the city engineer, and thereafter until all defects in workmanship or materials discovered during the warranty period have been corrected to the satisfaction of the city engineer.

B. Upon completion of the improvement or of the act to be performed and acceptance thereof by the city engineer, and upon expiration of the time provided by law for the recording of claims of lien or the service of stop notices, the labor and material bond may be reduced to an amount equal to one hundred fifty percent (150%) of the total claimed by all persons for whom claims of lien have been properly recorded or stop notices have been properly served upon the city, and if no such claims have been recorded or notices served, the labor and material security shall be released in full.

C. The reduction or release of security authorized by this section shall not apply to any amount deemed by the city engineer to be necessary as security for costs, expenses and fees, including attorneys' fees, that may be incurred by the city as a result of any breach of the improvement agreement by the subdivider.

(Ord. 410 § 3, 1997: Ord. 282 § 7.7, 1982).

Notwithstanding any other provision of this chapter, whenever the performance of the obligation for which the security is required is subject to the approval of another agency, the security shall not be released until the obligation is performed to the satisfaction of such other agency. Such agency shall have two (2) months after completion of the performance of the obligation to register its satisfaction or dissatisfaction, and if the agency has not done so within said period, it shall be conclusively deemed that the performance of the obligation was done to its satisfaction.

(Ord. 282 § 7.8, 1982).