Lance Surety Bond Associates, Inc.

2008 saw a large increase in the amount of legislation pertaining to mortgage broker bonds and mortgage lender bonds (types of commercial bonds). Most of the legislation focused on tightening regulation on mortgage brokers and lenders, and also on increasing the specific license bond amounts. While a good amount of legislation has been passing, many states are willing to wait and see what the US Congress

The Uniform Trust Code (UTC) was created by the National Conference of Commissioners on Uniform State Laws in order to create a uniform code for common law principles pertaining to trusts for all fifty states (i.e. for commericial transactions, as well as family estate planning). To better understand how a Uniform Trust works, I will briefly define the three parties involved with the creation and administrative duties. The person who created the trust is the “grantor” (or “settler”). The person who agrees to manage and oversee the trust and all of its assets is known as the “trustee”. Lastly, the person that is slated to receive the benefits of a trust is referred to as the “beneficiary”.

Thus far, 20 states have adopted the UTC in some form, and have begun to executed its laws. In 2008, the UTC was introduced in a number of states as well. Under these recent bills, trustees are only required to obtain a surety bond to guarantee the performance of their duties when the court deems such a bond necessary to protect the beneficiaries interests. A surety bond may also be needed if is outlined in the terms of the trust, and court has not done away with the requirement. This act gives courts the authority to set surety bond amounts, as well as the specific terms of a trustee

Similar to last year, the Surety and Fidelity Association of American (SFAA) noticed a trend of amended state bills that change specific requirements pertaining to motor vehicle bonds (type of commercial bond also referred to as “auto dealer bonds”). These new bills are either requiring an increase in the motor vehicle bond amount, or an extension of its application to include additional vehicle types as well. The five states with recent enactments by state legislature are Colorado, Idaho, Pennsylvania, Tennessee and West Virginia.

In Colorado, Senate Bill 144 (SB 144) requires that all motor vehicle repair shops operating in the state must obtain a surety bond twice the amount of the retail value of a vehicle whenever they choose to seek title for any abandoned vehicle.

Idaho has two new requirements pertaining to motor vehicle regulation. House Bill 365 mandates that all dealers of motor-driven cycles comply with the $20,000 surety bond requirement, which currently is in existence for vehicle dealers operating in the state. Additionally, Idaho House Bill 440 requires all dealers of truck campers to obtain a $10,000 license bond.

The enactment of Pennsylvania Senate Bill 1019 (SB 1019), makes it a requirement for all state recreational vehicle dealers to obtain a license bond in the amount of $30,000, in order to act as a security against any possible claims. Specifically, this license bond will protect against claims brought up by an agency of the commonwealth for money past due, such as fees, licenses, unpaid taxes, payment of criminal penalties, civil fines/penalty, etc.

Tennessee