10-7-30. Bad faith refusal of corporate surety to perform suretyship contract.

For the purposes of this Code section, the term “obligee” shall include any obligee or beneficiary pursuant to the terms of the contract of suretyship.#

In the event of the refusal of a corporate surety to commence the remedy of a default covered by, to make payment to an obligee under, or otherwise to commence performance in accordance with the terms of a contract of suretyship within 60 days after receipt from the obligee of a notice of default or demand for payment, and upon a finding that such refusal was in bad faith, the surety shall be liable to pay such obligee, in addition to the loss, not more than 25 percent of the liability of the surety for the loss and all reasonable attorney’s fees for the prosecution of the case against the surety. The amount of such reasonable attorney’s fees shall be determined by the trial jury and shall be included in any judgment rendered in such action; provided, however, that such attorney’s fees shall be fixed on the basis of competent expert evidence as to the reasonable value of such services, based on the time spent and legal and factual issues involved, in accordance with prevailing fees in the locality where the action is pending; provided, further, that the trial court shall have the discretion, if it finds such jury verdict fixing attorney’s fees to be greatly excessive or inadequate, to review and amend such portion of the verdict fixing attorney’s fees without the necessity of disapproving the entire verdict. The limitations contained in this Code section in reference to the amount of attorney’s fees are not controlling as to the fees which may be agreed upon by the plaintiff and his attorney for the services of such attorney in the action against the surety.#