EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted. Green numbers along left margin indicate location on the printed bill (e.g., 5-15 indicates page 5, line 15).

1-1 Section 1. NRS 690B.100 is hereby amended to read as follows:

1-2 690B.100 As used in NRS 690B.100 to 690B.180, inclusive, unless the

1-10 defined in NRS 116.110318, and any appurtenance thereto.

2-1 2. "Insurance for home protection" means a contract of insurance,

2-2 which affords coverage over a specified term for a predetermined fee,

2-3 under which a person, other than the manufacturer, builder, seller or lessor

2-4 of the home, agrees to repair, replace or indemnify from the cost of repair

2-5 or replacement based upon the failure of any structure, component, system

2-6 or appliance of the home. The term does not include a contract which

2-7 insures against any consequential losses caused by the defects or failures.

2-8 Sec. 2. NRS 690B.140 is hereby amended to read as follows:

2-9 690B.140 An insurer who issues policies of insurance for home

2-16 regulation.

2-17 Sec. 3. NRS 690B.160 is hereby amended to read as follows:

2-18 690B.160 1. A contract of insurance for home protection must

2-42 commissioner.

3-1 2. Insurance for home protection may not be canceled during the term

3-2 for which it is issued, except:

3-3 (a) For nonpayment of the fee for the contract.

3-4 (b) For fraud or misrepresentation of facts material to the issuance or

3-5 renewal of the contract.

3-6 (c) Insurance which provides coverage before the home is sold if the

3-7 sale is not made. The cancellation must be made in accordance with the

3-8 contract provisions.

3-9 3. Insurance for home protection is not renewable unless its terms

3-10 provide otherwise.

3-11 Sec. 4. NRS 690B.180 is hereby amended to read as follows:

3-12 690B.180 An insurer who issues policies of insurance for home

3-16 2. Assume] assume reinsurance from any other insurer.

3-17 Sec. 5. NRS 11.202 is hereby amended to read as follows:

3-18 11.202 1. [An] Except as otherwise provided in NRS 40.695, an

3-35 (b) Any person on account of a defect in a product.

3-36 Sec. 6. NRS 11.203 is hereby amended to read as follows:

3-37 11.203 1. Except as otherwise provided in NRS 11.202 [,] and

3-42 improvement, for the recovery of damages for:

4-1 (a) Any deficiency in the design, planning, supervision or observation of

4-2 construction or the construction of such an improvement which is [known

4-3 or through the use of reasonable diligence should have been known to him;]

4-4 the result of his gross negligence;

4-5 (b) Injury to real or personal property caused by any such deficiency; or

4-6 (c) Injury to or the wrongful death of a person caused by any such

4-7 deficiency.

4-8 2. Notwithstanding the provisions of NRS 11.190 and subsection 1 of

4-9 this section, where injury occurs in the tenth year after the substantial

4-10 completion of such an improvement, an action for damages for injury to

4-11 property or person, damages for wrongful death resulting from such injury

4-12 or damages for breach of contract may be commenced within 2 years after

4-13 the date of such injury, irrespective of the date of death, but in no event

4-14 may an action be commenced more than 12 years after the substantial

4-15 completion of the improvement.

4-16 Sec. 7. NRS 11.204 is hereby amended to read as follows:

4-17 11.204 1. Except as otherwise provided in NRS 11.202 [and 11.203,]

4-37 deficiency which is not apparent by reasonable inspection.

4-38 Sec. 8. NRS 11.205 is hereby amended to read as follows:

4-39 11.205 1. Except as otherwise provided in NRS 11.202 [and 11.203,]

4-42 supervision or observation of construction, or the construction of an

5-1 improvement to real property more than 6 years after the substantial

5-2 completion of such an improvement, for the recovery of damages for:

5-3 (a) Any patent deficiency in the design, planning, supervision or

5-4 observation of construction or the construction of such an improvement;

5-5 (b) Injury to real or personal property caused by any such deficiency; or

5-6 (c) Injury to or the wrongful death of a person caused by any such

5-7 deficiency.

5-8 2. Notwithstanding the provisions of NRS 11.190 and subsection 1 of

5-9 this section, where injury occurs in the sixth year after the substantial

5-10 completion of such an improvement, an action for damages for injury to

5-11 property or person, damages for wrongful death resulting from such injury

5-12 or damages for breach of contract may be commenced within 2 years after

5-13 the date of such injury, irrespective of the date of death, but in no event

5-14 may an action be commenced more than 8 years after the substantial

5-15 completion of the improvement.

5-16 3. For the purposes of this section, "patent deficiency" means a

5-17 deficiency which is apparent by reasonable inspection.

5-18 Sec. 9. NRS 11.206 is hereby amended to read as follows:

5-19 11.206 The limitations respectively prescribed by NRS 11.203, 11.204

5-24 2. Any person on account of a defect in a product.

5-25 Sec. 10. Chapter 40 of NRS is hereby amended by adding thereto the

5-26 provisions set forth as sections 11 and 12 of this act.

5-27 Sec. 11. "Commence an action" means to file a complaint in a court

5-28 of competent jurisdiction to recover damages resulting from a

5-29 construction defect.

5-30 Sec. 12. 1. If a claimant attempts to sell property that is or was the

5-31 subject of a claim governed by NRS 40.600 to 40.695, inclusive, he shall

5-32 disclose, in writing, to any prospective purchaser of the property, not less

5-33 than 30 days before the close of escrow for the sale of the property or, if

5-34 the claim is initiated less than 30 days before the close of escrow, within

5-35 24 hours after giving written notice to the contractor pursuant to

5-36 subsection 1 of NRS 40.645:

5-37 (a) All notices required to be given by the claimant to the contractor

5-38 pursuant to NRS 40.600 to 40.695, inclusive;

5-39 (b) All opinions the claimant has obtained from experts regarding the

5-40 construction defects that are the subject of the claim, which must include

5-41 any disclosures made pursuant to subsection 5 of NRS 40.640;

5-42 (c) The terms of any settlement, order or judgment relating to the

5-43 claim; and

6-1 (d) A detailed report of all repairs made to the property by or on

6-2 behalf of the claimant as a result of the construction defects that are the

6-3 subject of the claim.

6-4 2. If a claim is initiated pursuant to NRS 40.600 to 40.695, inclusive,

6-5 the claimant shall disclose, in writing, to each holder of record of a

6-6 security interest in the property:

6-7 (a) Any notice required to be given by the claimant to the contractor

6-8 pursuant to NRS 40.600 to 40.695, inclusive, within 30 days after the

6-9 notice is given to the contractor;

6-10 (b) Any opinion the claimant has obtained from experts regarding the

6-11 construction defects that are the subject of the claim, which must include

6-12 any disclosures made pursuant to subsection 5 of NRS 40.640, within 30

6-13 days after the date on which the opinion is received by the claimant or his

6-14 attorney;

6-15 (c) The terms of any settlement, order or judgment relating to the

6-16 claim, within 10 days after the date on which a copy of the settlement,

6-17 order or judgment is received by the claimant or his attorney; and

6-18 (d) A detailed report of all repairs made to the property by or on

6-19 behalf of the claimant as a result of the construction defects that are the

6-20 subject of the claim, within 10 days after the completion of those repairs.

6-21 3. Before taking any action on a claim that has been or will be

6-22 initiated pursuant to NRS 40.600 to 40.695, inclusive, the attorney for the

6-23 claimant shall give notice, in writing, to the claimant of the provisions of

6-24 this section.

6-25 Sec. 13. NRS 40.600 is hereby amended to read as follows:

6-26 40.600 As used in NRS 40.600 to 40.695, inclusive, and sections 11

6-29 act, have the meanings ascribed to them in those sections.

6-30 Sec. 14. NRS 40.605 is hereby amended to read as follows:

6-31 40.605 "Appurtenance" means a structure, installation, facility , [or]

6-37 residence.] or benefiting one or more residences.

6-38 Sec. 15. NRS 40.615 is hereby amended to read as follows:

6-39 40.615 ["Constructional]

6-42 addition to an existing residence, or of an appurtenance [.] , that is

7-1 described in accordance with paragraph (a) of subsection 1 of NRS

7-2 40.645.

7-3 2. The term includes physical damage to the residence, an

7-4 appurtenance or the real property to which the residence or appurtenance is

7-5 affixed that is proximately caused by a [constructional] construction

7-6 defect.

7-7 3. The term does not include any construction, alteration, repair or

7-8 improvement of a residence or appurtenance that:

7-9 (a) Is in substantial compliance with any applicable building code in

7-10 effect at the time the building permit for the construction, alteration,

7-11 repair or improvement was issued; and

7-12 (b) Has not caused damage or injury.

7-13 Approval of any portion of the construction, alteration, repair or

7-14 improvement by a building inspector employed by a governmental body

7-15 with jurisdiction is prima facie evidence that the residence or

7-16 appurtenance was constructed, altered, repaired or improved in

7-17 compliance with applicable building codes.

7-18 Sec. 16. NRS 40.620 is hereby amended to read as follows:

7-19 40.620 "Contractor" means a person who, with or without a license

7-28 landscaped.

7-29 Sec. 17. NRS 40.625 is hereby amended to read as follows:

7-30 40.625 "Homeowner’s warranty" means a warranty or policy of

7-39 construction defect in a residence.

7-40 Sec. 18. NRS 40.635 is hereby amended to read as follows:

7-41 40.635 NRS 40.600 to 40.695, inclusive:

7-43 result of a [constructional] construction defect, except a claim for personal

8-1 injury or wrongful death, if the claim is the subject of an action commenced

8-2 on or after July 1, 1995.

8-3 2. Prevail over any conflicting law otherwise applicable to the claim or

8-4 cause of action.

8-5 3. Do not bar or limit any defense otherwise available except as

8-6 otherwise provided in those sections.

8-7 4. Do not create a new theory upon which liability may be based.

8-8 Sec. 19. NRS 40.640 is hereby amended to read as follows:

8-9 40.640 In a claim to recover damages resulting from a [constructional]

8-23 boldfaced type with capital letters.

8-24 Sec. 20. NRS 40.645 is hereby amended to read as follows:

8-25 40.645 Except as otherwise provided in this section and NRS 40.670:

8-42 extent of the damage or injury resulting therefrom, to the extent known;

9-1 (b) Be accompanied by a written opinion of an expert or experts which

9-2 contains details of the existence, extent and causes of each defect, if such

9-3 an opinion has been rendered; and

9-4 (c) Be recorded at the office of the county recorder in the county in

9-5 which the property is situated.

9-6 2. During the [35-day] 60-day period after the contractor receives the

9-7 notice, on his written request, the contractor [is entitled to inspect] may

9-8 cause to be conducted:

9-9 (a) Independent inspections of the property that is the subject of the

9-10 [claim to determine the nature and cause of the defect,] complaint in order

9-11 to evaluate the defects described in the written notice; and

9-12 (b) Such tests as are reasonably necessary to determine the nature and

9-13 causes of the defects, damage or injury and the nature and extent of repairs

9-14 necessary to remedy the [defect.] defects. The contractor shall, before

9-15 [making the inspection,] conducting such tests, provide reasonable notice

9-16 of the [inspection and must make the inspection] tests to the claimant and

9-17 conduct the tests at a reasonable time. [The contractor may take reasonable

9-18 steps to establish the existence of the defect.

9-19 2.] 3. If the residence is covered by a homeowner’s warranty [, a] that

9-20 is purchased by a claimant pursuant to NRS 690B.110 to 690B.180,

9-21 inclusive, the claimant must first diligently pursue a claim under the

9-22 warranty . [or contract.

9-23 3.] 4. Within 45 days after the [contractor receives the notice,] 60-day

9-24 period for inspections and testing set forth in subsection 2, the contractor

9-25 may make a written offer of settlement to the claimant. The offer:

9-26 (a) Must be served [to] upon the claimant by certified mail, return

9-27 receipt requested, at the claimant’s last known address.

9-28 (b) Must respond to each [constructional] construction defect set forth

9-29 in the claimant’s notice, and [describe in reasonable detail] include an

9-30 initial review of the cause of the defect, if known, and the nature and extent

9-31 of the damage or injury resulting from the defect . [, and, unless the offer is

9-32 limited to a proposal for monetary compensation, the method, adequacy

9-33 and estimated cost of the proposed repair.]

9-34 (c) May include:

9-35 (1) A proposal for monetary compensation [.] to repair the defects;

9-36 or

9-37 (2) A proposal to repair the defects. If the contractor is licensed to

9-38 make the repairs, the proposal may include an agreement by the contractor

9-39 to make the repairs.

9-40 [(3) An] In the alternative, the proposal may include an agreement

9-41 by the contractor to cause the repairs to be made, at the contractor’s

9-42 expense, by another contractor who is licensed to make the repairs, bonded

9-43 and insured. The proposal must include, in reasonable detail, the method

10-1 by which the repairs will be made and the adequacy of the proposed

10-2 repairs. The repairs must be [made] commenced within 45 days after the

10-3 contractor receives written notice of acceptance of the offer, unless

10-4 [completion] the commencement of the repairs is delayed by the claimant

10-5 or by other events beyond the control of the contractor. The claimant and

10-6 the contractor may agree in writing to extend the periods prescribed by this

10-7 section.

10-8 [4.] 5. The periods provided in subsections 1 , 2 and [3 must be] 4 are

10-9 hereby extended by [60] 90 days if the claim is a complex matter. The

10-10 parties may stipulate to [a further extension.

10-11 5. Not later than 15 days before the mediation required pursuant to

10-12 NRS 40.680 and upon providing 15 days’ notice, each party shall provide

10-13 the other party, or shall make a reasonable effort to assist the other party to

10-14 obtain, all relevant reports, photos, correspondence, plans, specifications,

10-15 warranties, contracts, subcontracts, work orders for repair, videotapes and

10-16 soil and other engineering reports that are not privileged.] any further

10-17 extensions, if necessary.

10-18 6. If the claimant is a representative of a homeowner’s association, the

10-19 [association shall] contractor may submit any offer of settlement made by

10-20 the contractor , in writing, to each member of the association.

10-21 7. The claimant shall respond to any offer of settlement made by the

10-22 contractor within 30 days after the offer is mailed to the claimant

10-23 pursuant to paragraph (a) of subsection 4.

10-24 8. Money that a claimant recovers by accepting an offer of settlement

10-25 made pursuant to subparagraph (1) of paragraph (c) of subsection 4:

10-26 (a) Must be placed in an escrow that is administered by a person

10-27 designated in the settlement agreement; and

10-28 (b) May be disbursed only to pay for the repair of the construction

10-29 defect.

10-30 Sec. 21. NRS 40.655 is hereby amended to read as follows:

10-31 40.655 1. Except as otherwise provided in NRS 40.645 and 40.650,

10-32 in a claim governed by NRS 40.600 to 40.695, inclusive, the claimant may

10-33 recover only the following damages to the extent proximately caused by a

10-34 [constructional] construction defect:

10-35 (a) [Any reasonable attorney’s fees;

10-36 (b)] The reasonable cost of any repairs [already made that were

10-37 necessary and of any repairs yet to be made] that are necessary to cure any

10-38 [constructional] construction defect that the contractor failed to cure [and

10-39 the reasonable expenses of temporary housing reasonably necessary during

10-40 the repair;

10-41 (c) The] or the reduction in market value of the residence or [accessory

10-42 structure,] appurtenance, if any, [to the extent the reduction is because of

10-43 structural failure;

11-1 (d) The loss of the use of all or any part of the residence;

11-2 (e)] resulting from a construction defect that has not been repaired by

11-3 the contractor, whichever is less;

11-4 (b) The reasonable value of any other property damaged by the

11-5 [constructional defect;

11-6 (f) Any additional costs reasonably incurred by the claimant, including,

11-7 but not limited to, any costs and fees incurred for the retention of experts

11-8 to:

11-9 (1) Ascertain the nature and extent of the constructional defects;

11-10 (2) Evaluate appropriate corrective measures to estimate the value of

11-11 loss of use; and

11-12 (3) Estimate the value of loss of use, the cost of temporary housing

11-13 and the reduction of market value of the residence; and

11-14 (g)] construction defect;

11-15 (c) Any interest provided by statute [.

11-16 2. The amount of any attorney’s fees awarded pursuant to this section

11-17 must be approved by] ; and

11-18 (d) Reasonable expenses of temporary housing reasonably necessary

11-19 during the repair.

11-20 2. Attorney’s fees and costs may be awarded to either party as

11-21 provided by rule or statute applicable to the court.

11-22 3. If a contractor complies with the provisions of NRS 40.600 to

11-23 40.695, inclusive, the claimant may not recover from the contractor, as a

11-24 result of the [constructional] construction defect, anything other than that

11-25 which is provided pursuant to NRS 40.600 to 40.695, inclusive.

11-26 [4. As used in this section, "structural failure" means physical damage

11-27 to the load-bearing portion of a residence or appurtenance caused by a

11-28 failure of the load-bearing portion of the residence or appurtenance.]

11-29 Sec. 22. NRS 40.660 is hereby amended to read as follows:

11-30 40.660 An offer of settlement that is not accepted within [25] 30 days

11-35 of settlement under this section may be filed with the court.

11-36 Sec. 23. NRS 40.665 is hereby amended to read as follows:

11-37 40.665 In addition to any other method provided for settling a claim

11-42 claimant for:

12-1 1. The market value of the residence as if no [constructional]

12-2 construction defect existed, except that if a residence is less than 2 years of

12-3 age and was purchased from the contractor against whom the claim is

12-4 brought, the market value is the price at which the residence was sold to the

12-5 claimant;

12-6 2. The value of any improvements made to the property by a person

12-7 other than the contractor;

12-8 3. Reasonable attorney’s fees and fees for experts; and

12-9 4. Any costs, including costs and expenses for moving and costs, points

12-10 and fees for loans.

12-11 Any offer of settlement made that includes the items listed in this section

12-12 shall be deemed reasonable for the purposes of subsection 1 of NRS

12-13 40.650.

12-14 Sec. 24. NRS 40.670 is hereby amended to read as follows:

12-15 40.670 1. A contractor who receives written notice of a

12-34 provisions of subsection 1.

12-35 Sec. 25. NRS 40.685 is hereby amended to read as follows:

12-36 40.685 1. Except as otherwise provided in subsection 2, a written

12-43 settlement agreement described in subsection 1, unless:

13-1 (a) The claimant has obtained the opinion of an expert concerning the

13-2 [constructional] construction defect;

13-3 (b) The claimant has provided the contractor with a written notice of the

13-4 defect pursuant to NRS 40.645 and a copy of the expert’s opinion; and

13-5 (c) The claimant and the contractor have complied with the requirements

13-6 for inspection and repair as provided in NRS 40.600 to 40.695, inclusive.

13-7 3. If a claimant does not prevail in any action which is not barred

13-8 pursuant to this section, the court may:

13-9 (a) Deny the claimant’s [attorney’s fees,] fees for an expert witness or

13-10 costs; and

13-11 (b) Award attorney’s fees and costs to the contractor [.] , including,

13-12 without limitation, fees and costs associated with the retention of any

13-13 expert witnesses.

13-14 Sec. 26. NRS 40.690 is hereby amended to read as follows:

13-15 40.690 1. A claim governed by NRS 40.600 to 40.695, inclusive,

13-31 prior notice of those proceedings from the contractor or the claimant.

13-32 Sec. 27. NRS 40.695 is hereby amended to read as follows:

13-33 40.695 1. [All statutes of limitation or] No action governed by NRS

13-42 concluded or waived in writing pursuant to NRS 40.680.

14-1 [2.] 3. Tolling under this section applies to a third party regardless of

14-2 whether the party is required to appear in the proceeding.

14-3 Sec. 28. NRS 624.300 is hereby amended to read as follows:

14-4 624.300 1. Except as otherwise provided in subsection 6, the board

14-5 may:

14-6 (a) Suspend or revoke licenses already issued;

14-7 (b) Refuse renewals of licenses;

14-8 (c) Impose limits on the field, scope and monetary limit of the license;

14-9 (d) Impose an administrative fine of not more than $10,000;

14-10 (e) Order the licensee to take action to correct a condition resulting from

14-11 an act which constitutes a cause for disciplinary action, at the licensee’s

14-12 cost; or

14-13 (f) Reprimand or take other less severe disciplinary action, including,
14-14 without limitation, increasing the amount of the surety bond or cash deposit

14-15 of the licensee,

14-16 if the licensee commits any act which constitutes a cause for disciplinary

14-17 action.

14-18 2. If the board suspends or revokes the license of a contractor for

14-19 failure to establish financial responsibility, the board may, in addition to

14-20 any other conditions for reinstating or renewing the license, require that

14-21 each contract undertaken by the licensee for a period to be designated by

14-22 the board, not to exceed 12 months, be separately covered by a bond or

14-23 bonds approved by the board and conditioned upon the performance of and

14-24 the payment of labor and materials required by the contract.

14-25 3. If a licensee commits a fraudulent act which is a cause for

14-26 disciplinary action under NRS 624.3016, the correction of any condition

14-27 resulting from the act does not preclude the board from taking disciplinary

14-28 action.

14-29 4. If the board finds that a licensee has engaged in repeated acts that

14-30 would be cause for disciplinary action, the correction of any resulting

14-31 conditions does not preclude the board from taking disciplinary action

14-32 pursuant to this section.

14-33 5. The expiration of a license by operation of law or by order or

14-34 decision of the board or a court, or the voluntary surrender of a license by a

14-35 licensee, does not deprive the board of jurisdiction to proceed with any

14-36 investigation of, or action or disciplinary proceeding against, the licensee

14-37 or to render a decision suspending or revoking the license.

14-38 6. The board shall not take any disciplinary action pursuant to this

14-39 section regarding a [constructional] construction defect, as that term is

14-40 defined in NRS 40.615, during the period in which any claim arising out of

14-41 that defect is being settled, mediated or otherwise resolved pursuant to NRS

14-42 40.600 to 40.695, inclusive, unless the disciplinary action is necessary to

14-43 protect the public health or safety.

15-1 7. If discipline is imposed pursuant to this section, the costs of the

15-2 proceeding, including investigative costs and attorney’s fees, may be

15-3 recovered by the board.

15-4 Sec. 29. NRS 624.3011 is hereby amended to read as follows:

15-5 624.3011 1. The following acts, among others, constitute cause for

15-6 disciplinary action under NRS 624.300:

15-7 (a) Willful and prejudicial departure from or disregard of plans or

15-8 specifications in any material respect without the consent of the owner or

15-9 his authorized representative and the person entitled to have the particular

15-10 construction project or operation completed in accordance with the plans

15-11 and specifications.

15-12 (b) Failure to respond to a claim arising out of a [constructional]

15-13 construction defect, as that term is defined in NRS 40.615.

15-14 (c) Willful or deliberate disregard and violation of:

15-15 (1) The building laws of the state or of any political subdivision

15-16 thereof.

15-17 (2) The safety laws or labor laws of the state.

15-18 (3) Any provision of the Nevada health and safety laws or the

15-19 regulations adopted thereunder relating to the digging, boring or drilling of

15-20 water wells.

15-21 (4) The laws of this state regarding industrial insurance.

15-22 2. If a contractor performs construction without obtaining any

15-23 necessary building permit, there is a rebuttable presumption that the

15-24 contractor willfully and deliberately violated the building laws of this state

15-25 or of its political subdivisions. The board shall not require the contractor to

15-26 obtain that permit more than 90 days after the construction is completed.