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McDonald v. Fidelity & Deposit Co. of Maryland, 2020 UT 11 (Feb. 28, 2020)

Feb 28, 2020

When a subcontractor failed to make contributions to various trust funds for its employees’ work on a state construction project and then declared bankruptcy, the trusts sued to recover the unpaid contributions from a public payment bond associated with the project.  On appeal from summary judgment in favor of the trusts, the supreme court adopted the reasoning of Forsberg v. Bovis Lend Lease, Inc., 2008 UT App 146, to conclude that the trusts had a general right to sue on behalf of beneficiary employees under Utah’s public payment bond statute, Utah Code § 63G-6-505(4) (2010).  The court also held that the trusts (and individual employees) could pursue only those “traceable amounts that are ultimately ‘due’ an individual employee” under the statute.  Thus, individual wages or contributions to a 401(k) are recoverable under the statute, but other contributions that benefit employees only as a collective are not.