Colin H. Cassedy

In H.C. Pody v. International Fidelity Insurance, the U.S. District Court for the Eastern District of Pennsylvania sided with International Fidelity Insurance Co., represented by Stradley Ronon, denying a contractor’s demand for the full penal sum on a mechanics lien discharge bond. The contractor argued that the bond issued with a $2 million penal limit entitled it to the full penal sum even though that amount was $601,975 beyond the underlying lien judgment.

The court disagreed, holding that the bond covered only the actual judgment amount —not the entire bond limit — and granted our client’s motion for judgment on the pleadings. In its opinion, the court noted the contractor was “stretch[ing] the language of the surety bond beyond its agreed scope to claim hundreds of thousands of dollars that no court awarded it.”