Mich. Comp. Laws » Michigan Compiled Laws / Chapter 129 / Act 213 of 1963
Michigan Compiled Laws

Mich. Comp. Laws § 129.203 (2026)

Payment bond; amount; purpose.

✓ current as of July 2026
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CONTRACTOR'S BOND FOR PUBLIC BUILDINGS OR WORKS


Act 213 of 1963


129.203 Payment bond; amount; purpose.

Sec. 3.

    The payment bond shall be in an amount fixed by the governmental unit but not less than 25% of the contract amount solely for the protection of claimants, as defined in section 6, supplying labor or materials to the principal contractor or his subcontractors in the prosecution of the work provided for in the contract.

History: 1963, Act 213, Eff. Sept. 6, 1963 ;-- Am. 1972, Act 351, Imd. Eff. Jan. 9, 1973

Notes of Decisions
Cited in 13 cases, 1985–2016 · leading case: Wyandotte Elec. Supply Co. v. Elec. Tech. Sys., Inc., 881 N.W.2d 95 (Mich. 2016).
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Wyandotte Elec. Supply Co. v. Elec. Tech. Sys., Inc., 881 N.W.2d 95 (Mich. 2016). · cites it 16× “MCL 129.203. The principal contractor who obtains the bond, as well as the principal’s surety if applicable, is liable to compensate suppliers of labor or materials.”
Kammer Asphalt Paving Co. v. East China Twp. Schs., 504 N.W.2d 635 (Mich. 1993). · cites it 8× “" MCL 129.203; MSA 5.2321(3). [12] The bond, therefore, must be "executed by a surety company authorized to do business in the state.”
Morris Pumps v. Centerline Piping, Inc., 729 N.W.2d 898 (Mich. Ct. App. 2007). · cites it 2× “MCL 129.203; MCL 129.206; see also W T Andrew Co, Inc v Mid-State Surety Corp, 450 Mich 655 , 659; 545 NW2d 351 (1996).”
WT ANDREW Co. v. Mid-State Sur. Corp., 545 N.W.2d 351 (Mich. 1996). · cites it 2× “2321(2) and MCL 129.203; MSA 5.2321(3) go on to enumerate the purpose behind the performance and payment bonds: The performance bond shall be in an amount *659 fixed by the governmental unit but not less than 25% of the contract amount, conditioned upon the faithful performance…”
In RE v. Pangori & Sons, Inc., 53 B.R. 711 (Bankr. E.D. Mich. 1985). · cites it 2× “Mich.Comp.Laws § 129.203; Mich. Stat.Ann.”
Thomas Indus., Inc v. C & L Elec., Inc, 550 N.W.2d 558 (Mich. Ct. App. 1996). · cites it 2× “Pursuant to the requirements of MCL 129.203; MSA 5.2321(3), C & L furnished a payment bond, issued by defendant USF&G as surety, for the protection of certain claimants supplying labor or materials for the project.”
Barnes & Sweeney Enter., Inc v. City of Hazel Park, 425 N.W.2d 572 (Mich. Ct. App. 1988). “MCL 129.203; MSA 5.2321(3) provides that the governmental unit shall specify the amount the payment bond shall be for, but not less than twenty-five percent of the contract amount, and MCL 129.”
Leonard C. Carnaghi, Inc. v. Amwest Sur. Ins. Co., 617 N.W.2d 49 (Mich. Ct. App. 2000). · cites it 2× “MCL 129.203; MSA 5.2321(3). “Claimant” is statutorily defined as “a person having furnished labor, material, or both, used or reasonably required for use in the performance of the contract.”
Trs. for Michigan Laborers' Health Care Fund v. Warranty Builders, Inc., 921 F. Supp. 471 (E.D. Mich. 1996). “§ 129.203. The statute further provides that “[a] claimant who has furnished labor or material in the prosecution of the work provided for in such contract .”
W. T. Andrew Co. v. Mid-State Sur. Corp., 611 N.W.2d 305 (Mich. 2000). “2321(3)], and who has not been paid in full therefor before the expiration of a period of 90 days after the day on which the last of the labor was done or performed by him or material was furnished or supplied by him for which claim is made, may sue on the payment bond for the…”
WT Andrew Co. v. Mid-State Sur. Corp., 450 Mich. 655 (Mich. 1996). · cites it 2× “2321(2) and MCL 129.203; MSA 5.2321(3) go on to enumerate the purpose behind the performance and payment bonds: The performance bond shall be in an amount *659 fixed by the governmental unit but not less than 25% of the contract amount, conditioned upon the faithful performance…”
Tempco Heating & Cooling, Inc v. a Rea Constr., Inc, 443 N.W.2d 486 (Mich. Ct. App. 1989). “A payment bond was obtained pursuant to MCL 129.203; MSA 5.2321(3), naming Rea Construction as principal and defendant American Casualty Company as surety.”
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