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Lien Release Bond Template for England and Wales

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Key Requirements PROMPT example:

Lien Release Bond

"Need a Lien Release Bond to replace a construction lien of £500,000 on our London commercial property development, with ABC Insurance Company as surety, to allow the property sale to proceed while we resolve the underlying payment dispute with our contractor."

Document background
A Lien Release Bond is utilized when there is a need to clear a lien from property while ensuring the lien holder's interests remain protected. Under English and Welsh law, this document serves as a financial guarantee, typically issued by a surety company, that replaces the security interest provided by the original lien. The bond amount usually equals or exceeds the value of the disputed lien, providing assurance that the underlying obligation will be satisfied. This instrument is particularly valuable in situations where property transactions need to proceed without delay, such as in construction projects or property sales, while disputed claims are being resolved.
Suggested Sections

1. Parties: Identifies all parties to the bond including principal, surety, and obligee

2. Background: Details the underlying obligation and reason for the lien release bond

3. Definitions: Key terms used throughout the document

4. Bond Amount: Specifies the penal sum of the bond

5. Conditions of the Bond: Sets out the primary obligations and conditions for release

6. Duration: Specifies the term of the bond and any renewal provisions

7. Execution: Signature blocks and attestation requirements

Optional Sections

1. Multiple Obligees: Required when there are multiple beneficiaries of the bond - use when multiple parties have interest in the underlying lien

2. Step-in Rights: Provisions for surety to take over obligations - use when requested by sophisticated parties or high-value transactions

3. Dispute Resolution: Specific procedures for resolving disputes - use for complex transactions or where standard court procedures are not preferred

Suggested Schedules

1. Schedule of Property: Details of the property subject to the original lien

2. Original Lien Documentation: Copies of the original lien being released

3. Corporate Authorizations: Required corporate approvals and resolutions

4. Form of Notice: Template for any required notices under the bond

Authors

Alex Denne

Head of Growth (Open Source Law) @ ¶¶Òõ¶ÌÊÓÆµ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions





























Clauses

























Relevant Industries
Relevant Teams
Relevant Roles
Industries

Law of Property Act 1925: Fundamental legislation governing property rights and interests, including provisions relating to legal charges and liens, and requirements for release of security interests

Companies Act 2006: Governs company-related aspects including execution of documents and corporate authority requirements when any party is a company

Law of Contract (Rights of Third Parties) Act 1999: Fundamental contract law principles governing contract formation, enforcement, and third party rights

Financial Services and Markets Act 2000: Regulates financial activities and sets requirements for security providers in financial transactions

Civil Procedure Rules: Contains enforcement procedures, with Part 73 specifically addressing charging orders and liens

Housing Grants, Construction and Regeneration Act 1996: Also known as the Construction Act, contains provisions relating to construction liens and security

Insolvency Act 1986: Governs the impact on security interests in insolvency situations and determines priority of claims

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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