The issue of a surety's rights in a client's Chapter 7 bankruptcy is at the center of a legal battle involving a credit union. The surety issued payment and performance bonds for the contractor and argued that, under the general indemnity agreement and the intercreditor collateral agreement, it was entitled to funds in the contractor's credit union accounts if those funds were related to bonded contracts. A bankruptcy court ruled against the surety, but an appeals panel overturned that decision, ruling that the lower court failed to examine the parties' priority positions under the intercreditor collateral agreement. The panel remanded the case for further consideration.

Officials of Florida's Leon County relied on a performance bond to ensure that cleanup commenced at a project site after the developer missed a 60-day deadline to restore sidewalks and rights of way. A county commissioner noted that requiring such bonds is now standard for local development projects, and the work is expected to be completed by the end of next month.

Contractors and sureties must be aware of challenges that tend to arise from onerous contract language in construction projects, which can shift risk heavily toward subcontractors. Frequently misunderstood terms include the right to setoff, waiver of consequential damages, pay-if-paid and pay-when-paid clauses, days to cure, release of retention, and the general contractor's ability to use supplemental forces. Contractors should read contracts carefully, consult with legal and surety professionals, and negotiate terms to mitigate risks.

Minnesota's new contractor law requires a more rigorous 14-part checklist for classifying independent contractors in the construction industry, replacing the state's previous nine-part test. The law includes requirements for written contracts and payment processing via business entities, and it mandates that contractors assume responsibility for significant expenses, aiming for a clearer distinction between employees and contractors. The new classifications heighten construction firms' risks with regard to misclassification.

What you say to yourself -- those critical voices in your head that keep you in doubt and prevent you from becoming the bold, resilient and innovative leader you want to be -- don't stay in your head, but instead show up in your work and undermine team cohesion and performance, three leadership authors write. They recommend a three-step method -- catch, confront and change -- to reframe negative self-talk.

Have contractor clients considering joining a joint venture? These are great opportunities for collaboration and to work on new kinds of projects, but JVs do come with some risks. Share this NASBP Blog post, from CPA Advisory Council firm CBIZ, with clients to highlight important considerations they should make before joining a JV. Clients need to understand that a JV agreement is a significant commitment and needs to be reviewed carefully. The author suggests that contractors include their team of experts in the discussion. The surety team, attorneys and accountants can help the contractor understand the agreement and mitigate risks. Read more.