Skip to main content
Find a Lawyer

Minnesota Statutes Trade Regulations, Consumer Protection (Ch. 324-341) § 325K.18. Collection based on suitable guaranty

Current as of January 01, 2025 | Updated by Findlaw Staff

Subdivision 1. Bond or letter of credit. (a) If the suitable guaranty is a surety bond, a person may recover from the surety the full amount of a qualified right to payment against the principal named in the bond.

(b) If the suitable guaranty is a letter of credit, a person may recover from the issuing financial institution the full amount of a qualified right to payment only in accordance with the terms of the letter of credit.

(c) If the suitable guaranty is a policy of insurance, a person may recover under the terms of the policy.

(d) Claimants may recover successively on the same suitable guaranty.

Subd. 2. Attorney fees and court costs. (a) Subject to paragraph (b), in addition to recovering the amount of a qualified right to payment, a claimant may recover from the proceeds of the guaranty, until depleted:

(1) the attorneys' fees, reasonable in amount; and

(2) court costs incurred by the claimant in collecting the claim.

(b) However, the total liability on the suitable guaranty to all persons making qualified rights of payment or recovering attorneys' fees during its term must not exceed the amount of the suitable guaranty.

Subd. 3. Qualified right to payment. (a) To recover a qualified right to payment against a surety or issuer of a suitable guaranty, the claimant must:

(1) file written notice of the claim with the issuer of the suitable guarantee stating the name and address of the claimant, the amount claimed, and the grounds for the qualified right to payment; and

(2) append to the notice a certified copy of the judgment on which the qualified right to payment is based.

(b) Recovery of a qualified right to payment from the proceeds of the suitable guaranty is barred unless the claimant substantially complies with this subdivision.

Subd. 4. Statute of limitations. Recovery of a qualified right to payment from the proceeds of a suitable guaranty are forever barred unless notice of the claim is filed as required in subdivision 3, paragraph (a), clause (1), within three years after the occurrence of the violation of this chapter that is the basis for the claim. Notice under this subdivision need not include the requirement imposed by subdivision 3, paragraph (a), clause (2).

Previous Part of Code Next Part of Code
Back to Chapter List

Cite this article: FindLaw.com - Minnesota Statutes Trade Regulations, Consumer Protection (Ch. 324-341) § 325K.18. Collection based on suitable guaranty - last updated January 01, 2025 | https://codes.findlaw.com/mn/trade-regulations-consumer-protection-ch-324-341/mn-st-sect-325k-18/

FindLaw Codes may not reflect the most recent version of the law in your jurisdiction. Please verify the status of the code you are researching with the state legislature before relying on it for your legal needs.

Was this helpful?

Welcome to FindLaw's Cases & Codes

A free source of state and federal court opinions, state laws, and the United States Code. For more information about the legal concepts addressed by these cases and statutes, visit FindLaw’s Learn About the Law.

Go to Learn About the Law

Latest Blog Posts

For Legal Professionals

Learn About The Law

Get help with your legal needs

FindLaw’s Learn About the Law features thousands of informational articles to help you understand your options. And if you’re ready to hire an attorney, find one in your area who can help.

Go to Learn About the Law

Need to Find an Attorney?

Search our directory by legal issue

Enter information in one or both fields (Required)

Copied to clipboard