On July 6, 2017, the Washington Supreme Court confirmed that the equitable rule announced in Olympic Steamship—providing for attorney fees where the insurer compels the insured to take legal action—applies to performance bond sureties on public projects.^[1]  In King County v. Vinci Construction Grands Projects/Parsons RCI/Frontier-Kemper, the Court affirmed the trial court’s award of over $14 million in attorney fees and costs against sureties of a public works contract.^[2]

In 2006, King County contracted with a joint venture of three construction companies to build the piping/conveyance system for the new Brightwater wastewater treatment project.  The joint venture contractor submitted a performance bond from five surety companies.  Under the contract, if the contractor was in default, the sureties were obligated to step in and remedy the default.  When the project was delayed, King County declared the contractor in default and asked the sureties to cure.  They refused, claiming that the contractor was not in default.