The Minnesota Supreme Court has ruled that the state's Uniform Commercial Code gives priority to a surety's equitable right of subrogation over the interests of secured creditors. The decision clarifies that sureties have a superior claim to bonded contract funds after fulfilling bond obligations, even if a lender has a perfected security interest in a party's accounts receivable.

The Canada Mortgage and Housing Corporation, or CMHC, recently expanded enforcement of the surety bonding requirement on projects under its MLI Select program, typically for developments of over 25 units or at CMHC's discretion. The requirement previously was not enforced for CMHC-backed projects. The shift in enforcement affects developers, general contractors and subcontractors alike.

A federal court case highlights the importance of clear definitions of the terms "project" and "complete" in contractor-controlled liability insurance program policies. The case arose after Tropical Storm Eta caused $3.3 million in damage to a nearly completed project, and an insurer denied the claim, citing the CCIP policy's course of construction exclusion. Industry groups have supported the contractor involved in the case, arguing that the exclusion should not be applicable to the substantially complete phases of a project.

An Ohio appellate court held that an insurer cannot sue two New York construction firms in Ohio over a warehouse accident in New York. The court said the construction firms lack sufficient business presence in Ohio, and the contracts specify New York courts as the venue for disputes. The decision underscores the importance of understanding jurisdictional limits of insurance claims in multistate projects.

Difficult conversations can be handled with grace by preparing beforehand, sticking to facts and asking questions, writes an executive coach, who also recommends staying calm and focusing on desired outcomes. The coach writes that "approaching tough conversations with intention and skill can strengthen relationships, build trust and drive meaningful progress."

Help contractor clients learn more about properly accounting for tariff-fueled cost increases by sharing this NASBP Blog post, from NASBP CPA Advisory Council firm Carr, Riggs & Ingram. The author describes how the generally accepted accounting principles require some costs to be included in inventory accounting, such as purchase price, shipping and handling, import duties, and tariffs. He goes on to share practical steps construction contractors can take to ensure tariffs are properly accounted for and to mitigate cost increases. The author also includes tips and strategies for passing on tariff-related costs while maintaining good relationships with project stakeholders. Read more.

Join us for the next NASBP Virtual Seminar, at 2 p.m. Eastern on Tuesday, Aug. 26. "Beyond the Four Corners: What's In, and What's Out, of Your Statutory Bonds?" will be presented by Jerry Carozza, Senior Counsel, Commercial Surety Claims with NASBP Affiliate Liberty Mutual Surety, and Greg Veal, NASBP Attorney Advisory Council participant and Partner with Bovis, Kyle, Burch & Medlin LLC. They will examine the differences between common law and statutory surety bonds, both contract and commercial, and review the varied rules for construing these bonds. They will also provide examples of the outcomes derived from those rules. Consider reading Veal's recent NASBP Surety Bond Quarterly article on this subject. Register for this stand-alone NASBP Virtual Seminar or save by registering for the 2025 NASBP Virtual Seminar Annual Subscription, which includes the entire set of Virtual Seminars for 2025 and access to the complete library of Virtual Seminars. This NASBP Virtual Seminar is sponsored by Old Republic Surety. Register.