What type of agreement guarantees that a contractor will perform work according to the contract?

A contract bond, also known as a surety bond, is specifically structured to guarantee that a contractor will fulfill their obligations according to the terms outlined in a contract. This type of bond involves three parties: the obligee (the party requiring the bond), the principal (the contractor), and the surety (the bonding company). If the contractor fails to perform the work satisfactorily or breaches the contract, the surety company is responsible for compensating the obligee for damages or ensuring that the work is completed in accordance with the contract.

The other options do not provide the same level of guarantee regarding performance. A consent decree is typically a legally binding agreement that resolves a dispute, often involving regulatory bodies, rather than ensuring work completion by a contractor. A joint venture refers to a business arrangement where two or more parties collaborate on a project, sharing profits, losses, and control, but does not serve as a guarantee mechanism. A service agreement lays out the terms for services rendered but does not provide the bonded security that ensures performance according to the contract. Therefore, the contract bond is uniquely positioned to assure the performance of obligations in contractor agreements.