2006 Code of Virginia § 46.2-2122 - Bond and letter of credit requirements of applicants for license and certificate

46.2-2122. Bond and letter of credit requirements of applicants for licenseand certificate.

A. Every applicant for an original, second-year renewal, third-year renewal,fourth-year renewal, and fifth-year renewal of a certificate of publicconvenience and necessity under this chapter shall obtain and file with theDepartment a surety bond or an irrevocable letter of credit, in addition toany other bond or letter of credit required by law, in the amount of $50,000.The bond or letter of credit shall be in a form and content acceptable to theDepartment. The bond or letter of credit shall be conditioned on a statementby the applicant that the applicant will not practice fraud, make anyfraudulent representation, or violate any provision of this chapter in theconduct of the applicant's business. The Department may, without holding ahearing, suspend the certificate of public convenience and necessity duringthe period that the certificate holder does not have a sufficient bond orletter of credit on file.

B. Every applicant for an original and subsequent renewal license pursuant toArticle 5 of this chapter shall obtain and file with the Department a suretybond or an irrevocable letter of credit, in addition to any other bond orletter of credit required by law, in the amount of $25,000. The bond orletter of credit shall be in a form and content acceptable to the Department.The bond or letter of credit shall be conditioned on a statement by theapplicant that the applicant will not practice fraud, make any fraudulentrepresentation, or violate any provision of this chapter in the conduct ofthe applicant's business. The Department may, without holding a hearing,suspend the license during the period that the licensee does not have asufficient bond or letter of credit on file.

C. If a person suffers any of the following: (i) loss or damage in connectionwith the transportation service by reason of fraud practiced on him orfraudulent representation made to him by a licensee or certificate holder orhis agent or employee acting within the scope of employment; (ii) loss ordamage by reason of a violation by a licensee or certificate holder or hisagent or employee of any provision of this chapter in connection with thetransportation service; or (iii) loss or damage resulting from a breach of acontract entered into on or after the effective date of this act, that personshall have a claim against the licensee or certificate holder's bond orletter of credit, and may recover from such bond or letter of credit theamount awarded to such person by final judgment of a court of competentjurisdiction against the licensee or certificate holder as a result of suchloss or damage up to, but not exceeding, the amount of the bond or letter ofcredit.

D. The licensee or certificate holder's surety shall notify the Departmentwhen a claim is made against a licensee or certificate holder's bond, when aclaim is paid and/or when the bond is canceled. Such notification shallinclude the amount of a claim and the circumstances surrounding the claim.Notification of cancellation shall include the effective date and reason forcancellation.

E. The surety on any bond filed by a licensee or certificate holder shall bereleased and discharged from all liability accruing on such bond after theexpiration of sixty days from the date on which the surety files with theDepartment a written request to be released and discharged. Such requestshall not operate to relieve, release, or discharge the surety from anyliability already accrued or that shall accrue before the expiration of thesixty-day period.

(2001, c. 596.)

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