A. After perfection of a lien pursuant to this article, an owner, including any person who has a legal or equitable interest in the land that is subject to the misdemeanor, a mortgagee or any other lien creditor may, either before or after the commencement of an action to foreclose the lien, cause to be recorded in the office of the county recorder in the county in which the land is located a surety bond in the form described in subsection B of this section, together with a power of attorney disclosing the authority of the person executing the bond on behalf of the surety. On the recordation of the bond, the property shall be discharged of the lien whether or not a copy of the bond is served on the claimant or the claimant perfects the claimant’s rights against the bond.
B. A surety bond to discharge a lien perfected under this article shall be executed by the person seeking to discharge the lien, as principal, and by a surety company or companies holding a certificate of authority to transact surety business in this state that is issued by the director of the department of insurance pursuant to title 20, chapter 2, article 1. The bond is for the sole protection of the claimant who perfected the lien. Notwithstanding any other statute, the surety bond shall not be executed by individual surety or sureties, even if the requirements of section 7-101 are satisfied. The bond shall be in an amount equal to one and one-half times the claim secured by the lien and shall be conditioned for the payment of the judgment that would have been rendered against the property for the enforcement of the lien. The legal description of the property and the docket and page of the lien sought to be discharged shall be set forth in the bond.
C. On recordation of the bond with the county recorder, the principal on the bond shall cause a copy of the bond to be served within a reasonable time on the lien claimant, and if a suit is then pending to foreclose the lien, the claimant, within ninety days after receipt of the bond, shall cause proceedings to be instituted to add the surety and the principal as parties to the lien foreclosure suit.
D. The bond shall be discharged and the principal and sureties shall be released on any of the following:
1. The failure of the lien claimant to commence a suit within the time allowed pursuant to section 33-1074.
2. Failure of the lien claimant to name the principal and sureties as parties to the action seeking foreclosure of the lien if a copy of the bond has been served on the claimant. If the bond is served on the claimant fewer than ninety days after the date the claimant would be required to commence an action pursuant to section 33-1074, the claimant has ninety days from the date of receiving a copy of the bond to add the principal and the sureties as parties to the lien foreclosure suit.
3. The dismissal of the foreclosure suit with prejudice as to the claimant or the entry of judgment in a suit against the claimant.
E. In an action to foreclose a lien under this article, if a bond has been filed and served as prescribed by this section a judgment for the claimant on the bond shall be against the principal and the principal’s sureties and shall not be against the property.
F. If a copy of the bond is not served on the claimant as provided in subsection C of this section, the claimant has six months after the discovery of the bond to commence an action on the bond, except that no action may be commenced on the bond after two years from the date it was recorded as provided in this section.
G. The county recorder of the county in which the bond and contract are recorded shall index the bond and contract under the index classification in which commercial real estate broker liens are recorded.