Pennsylvania § 8262 - Failure to pay principal or interest.

§ 8262. Failure to pay principal or interest.

(a) General rule.--If a local government unit fails or neglects to pay the interest or principal on any of its general obligation bonds or notes or tax anticipation notes as the same becomes due and payable, whether at the stated maturity date or upon an unrevoked call for prior redemption, or to perform its payment obligations with respect to any lease rental debt or guaranteed revenue bonds or notes, and the failure continues for 30 days, the holder thereof may, subject to priorities created under sections 8125 (relating to security for tax anticipation notes and sinking fund), 8261 (relating to failure to budget debt service) and 8263 (relating to trustee for bondholders) and to any limitations upon individual rights of action properly provided in the bond ordinance or any indenture, recover the amount due in an action in the court of common pleas. The judgment recovered shall have an appropriate priority upon the moneys next coming into the treasury of the local government unit and shall be a judgment upon which funding bonds may be issued pursuant to Subchapter B of Chapter 81 (relating to tax anticipation notes and funding debt).

(b) Revenue bonds and notes.--If a local government unit fails or neglects to pay or cause to be paid the principal of or the interest upon any revenue bond or note as the same shall become due, whether at the stated maturity or upon call for prior redemption, the holder thereof may, subject to priorities created under sections 8125, 8262 (relating to failure to pay principal or interest) and 8263 and to any limitations upon individual rights of action properly provided in the bond ordinance or any indenture, recover the amount due in an action in the court of common pleas, but the judgment shall be limited to payment out of the assessments, revenues, rates, rents, tolls and charges from the project which are pledged for the payment of the bonds or notes.