requires two-thirds majority vote (§ 29)                                                                                        

                                                                                                  

 

Senate Bill No. 261–Senator Schneider

 

February 28, 2001

____________

 

Referred to Committee on Judiciary

 

SUMMARY—Makes various changes to provisions governing time shares. (BDR 10‑819)

 

FISCAL NOTE:            Effect on Local Government: Yes.

                                    Effect on the State: No.

 

~

 

EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.

 

AN ACT relating to time shares; limiting the applicability of provisions governing common-interest communities to the sale or transfer of time shares; requiring a manager of a time-share plan or a project, or both, to register with the real estate division of the department of business and industry; eliminating the requirement that a representative of a developer register with the division; revising the requirements for a time-share instrument; eliminating the requirement that an advertisement for a time share or an offer of sale be approved by the division; providing a penalty; and providing other matters properly relating thereto.

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

1-1    Section 1. NRS 116.1201 is hereby amended to read as follows:

1-2    116.1201  1.  Except as otherwise provided in this section and NRS

1-3  116.1203, this chapter applies to all common-interest communities created

1-4  within this state.

1-5    2.  This chapter does not apply to:

1-6    (a) Associations created for the limited purpose of maintaining:

1-7       (1) The landscape of the common elements of a common-interest

1-8  community;

1-9       (2) Facilities for flood control; or

1-10      (3) A rural agricultural residential common-interest community.

1-11    (b) A planned community in which all units are restricted exclusively to

1-12  nonresidential use unless the declaration provides that the chapter does

1-13  apply to that planned community. This chapter applies to a planned

1-14  community containing both units that are restricted exclusively to

1-15  nonresidential use and other units that are not so restricted, only if the

1-16  declaration so provides or the real estate comprising the units that may be

1-17  used for residential purposes would be a planned community in the absence

1-18  of the units that may not be used for residential purposes.

2-1    (c) Common-interest communities or units located outside of this state,

2-2  but the provisions of NRS 116.4102 to 116.4108, inclusive, apply to all

2-3  contracts for the disposition thereof signed in this state by any party unless

2-4  exempt under subsection 2 of NRS 116.4101.

2-5    (d) Except as otherwise provided in this chapter, time shares governed

2-6  by the provisions of chapter 119A of NRS.

2-7    3.  The provisions of this chapter do not:

2-8    (a) Prohibit a common-interest community created before January 1,

2-9  1992, from providing for separate classes of voting for the units’ owners of

2-10  the association;

2-11    (b) Require a common-interest community created before January 1,

2-12  1992, to comply with the provisions of NRS 116.2101 to 116.2122,

2-13  inclusive;

2-14    (c) Invalidate any assessments that were imposed on or before
October 1, 1999, by a common-interest community created before
January 1, 1992; or

2-15    (d) Prohibit a common-interest community created before January 1,

2-16  1992, from providing for a representative form of government.

2-17    4.  The provisions of chapters 117 and 278A of NRS do not apply to

2-18  common-interest communities.

2-19    5.  For the purposes of this section, the administrator shall establish, by

2-20  regulation, the criteria for determining whether an association is created for

2-21  the limited purpose of maintaining the landscape of the common elements

2-22  of a common-interest community, maintaining facilities for flood control or

2-23  maintaining a rural agricultural residential common-interest community.

2-24    Sec. 2.  NRS 116.212 is hereby amended to read as follows:

2-25    116.212  1.  If the declaration provides that any of the powers

2-26  described in NRS 116.3102, are to be exercised by or may be delegated to

2-27  a profit or nonprofit corporation that exercises those or other powers on

2-28  behalf of one or more common-interest communities or for the benefit of

2-29  the units’ owners of one or more common-interest communities, or on

2-30  behalf of a common-interest community and a time-share plan created

2-31  pursuant to chapter 119A of NRS, all provisions of this chapter applicable

2-32  to unit-owners’ associations apply to any such corporation, except as

2-33  modified by this section.

2-34    2.  Unless it is acting in the capacity of an association described in NRS

2-35  116.3101, a master association may exercise the powers set forth in

2-36  paragraph (b) of subsection 1 of NRS 116.3102 only to the extent expressly

2-37  permitted in [the] :

2-38    (a) The declarations of common-interest communities which are part of

2-39  the master association or expressly described in the delegations of power

2-40  from those common-interest communities to the master association[.] ; or

2-41    (b) The declaration of the common-interest community which is a part

2-42  of the master association and the time-share instrument creating the

2-43  time-share plan governed by the master association.

2-44    3.  If the declaration of any common-interest community provides that

2-45  the executive board may delegate certain powers to a master association,

2-46  the members of the executive board have no liability for the acts or

3-1  omissions of the master association with respect to those powers following

3-2  delegation.

3-3    4.  The rights and responsibilities of units’ owners with respect to the

3-4  unit-owners’ association set forth in NRS 116.3103 to 116.31038,

3-5  inclusive, 116.3108, 116.3109, 116.311 and 116.3112 apply in the conduct

3-6  of the affairs of a master association only to persons who elect the board of

3-7  a master association, whether or not those persons are otherwise units’

3-8  owners within the meaning of this chapter.

3-9    5.  Even if a master association is also an association described in NRS

3-10  116.3101, the certificate of incorporation or other instrument creating the

3-11  master association and the declaration of each common-interest

3-12  community, the powers of which are assigned by the declaration or

3-13  delegated to the master association, may provide that the executive board

3-14  of the master association must be elected after the period of the declarant’s

3-15  control in any of the following ways:

3-16    (a) All units’ owners of all common-interest communities subject to the

3-17  master association may elect all members of the master association’s

3-18  executive board.

3-19    (b) All members of the executive boards of all common-interest

3-20  communities subject to the master association may elect all members of the

3-21  master association’s executive board.

3-22    (c) All units’ owners of each common-interest community subject to the

3-23  master association may elect specified members of the master association’s

3-24  executive board.

3-25    (d) All members of the executive board of each common-interest

3-26  community subject to the master association may elect specified members

3-27  of the master association’s executive board.

3-28    Sec. 3.  NRS 116.31032 is hereby amended to read as follows:

3-29    116.31032  1.  Except as otherwise provided in [subsection 2,] this

3-30  section, the declaration may provide for a period of declarant’s control of

3-31  the association, during which a declarant, or persons designated by him,

3-32  may appoint and remove the officers of the association and members of the

3-33  executive board. Regardless of the period provided in the declaration, a

3-34  period of declarant’s control terminates no later than : [the earlier of:]

3-35    (a) Sixty days after conveyance of 75 percent of the units that may be

3-36  created to units’ owners other than a declarant[, except that if a majority of

3-37  the units are divided into time shares, the percentage is 80 percent;] or, if

3-38  the association exercises powers over a common-interest community

3-39  pursuant to this chapter and a time-share plan pursuant to chapter 119A

3-40  of NRS, 120 days after conveyance of 80 percent of the units that may be

3-41  created to units’ owners other than a declarant;

3-42    (b) Five years after all declarants have ceased to offer units for sale in

3-43  the ordinary course of business; or

3-44    (c) Five years after any right to add new units was last exercised
[.] ,

3-45  whichever occurs earlier.

3-46    2.  A declarant may voluntarily surrender the right to appoint and

3-47  remove officers and members of the executive board before termination of

3-48  that period, but in that event the declarant may require, for the duration of

4-1  the period of declarant’s control, that specified actions of the association or

4-2  executive board, as described in a recorded instrument executed by the

4-3  declarant, be approved by the declarant before they become effective.

4-4    [2.] 3. Not later than 60 days after conveyance of 25 percent of the

4-5  units that may be created to units’ owners other than a declarant, at least

4-6  one member and not less than 25 percent of the members of the executive

4-7  board must be elected by units’ owners other than the declarant. Not later

4-8  than 60 days after conveyance of 50 percent of the units that may be

4-9  created to units’ owners other than a declarant, not less than 33 1/3 percent

4-10  of the members of the executive board must be elected by units’ owners

4-11  other than the declarant.

4-12    Sec. 4.  NRS 116.31038 is hereby amended to read as follows:

4-13    116.31038  Within 30 days after units’ owners other than the declarant

4-14  may elect a majority of the members of the executive board, the declarant

4-15  shall deliver to the association all property of the units’ owners and of the

4-16  association held by or controlled by him, including:

4-17    1.  The original or a certified copy of the recorded declaration as

4-18  amended, the association’s articles of incorporation if the association is

4-19  incorporated, bylaws, minute books and other books and records of the

4-20  association and any rules or regulations which may have been adopted.

4-21    2.  An accounting for money of the association and financial statements

4-22  from the date the association received money to the date the period of the

4-23  declarant’s control ends. The financial statements must fairly and

4-24  accurately report the association’s financial condition prepared in

4-25  accordance with generally accepted accounting principles.

4-26    3.  A complete study of the reserves of the association, conducted by a

4-27  person qualified by training and experience to conduct such a study. At the

4-28  time the control of the declarant ends, he shall:

4-29    (a) Except as otherwise provided in this paragraph, deliver to the

4-30  association a reserve account that contains the declarant’s share of the

4-31  amounts then due, and control of the account. If the declaration was

4-32  recorded before October 1, 1999, and, at the time the control of the

4-33  declarant ends, he has failed to pay his share of the amounts due, the

4-34  executive board shall authorize the declarant to pay the deficiency in

4-35  installments for a period of 3 years, unless the declarant and the executive

4-36  board agree to a shorter period.

4-37    (b) Disclose, in writing, the amount by which he has subsidized the

4-38  association’s dues on a per unit or per lot basis.

4-39  [The provisions of this subsection do not apply to a time share or time-

4-40  share project governed by the provisions of chapter 119A of NRS.]

4-41    4.  The association’s money or control thereof.

4-42    5.  All of the declarant’s tangible personal property that has been

4-43  represented by the declarant as property of the association or, unless the

4-44  declarant has disclosed in the public offering statement that all such

4-45  personal property used in the common-interest community will remain the

4-46  declarant’s property, all of the declarant’s tangible personal property that is

4-47  necessary for, and has been used exclusively in, the operation and

4-48  enjoyment of the common elements, and inventories of these properties.

5-1    6.  A copy of any plans and specifications used in the construction of

5-2  the improvements in the common-interest community which were

5-3  completed within 2 years before the declaration was recorded.

5-4    7.  All insurance policies then in force, in which the units’ owners, the

5-5  association, or its directors and officers are named as insured persons.

5-6    8.  Copies of any certificates of occupancy that may have been issued

5-7  with respect to any improvements comprising the common-interest

5-8  community other than units in a planned community.

5-9    9.  Any renewable permits and approvals issued by governmental

5-10  bodies applicable to the common-interest community which are in force

5-11  and any other permits and approvals so issued and applicable which are

5-12  required by law to be kept on the premises of the community.

5-13    10.  Written warranties of the contractor, subcontractors, suppliers and

5-14  manufacturers that are still effective.

5-15    11.  A roster of owners and mortgagees of units and their addresses and

5-16  telephone numbers, if known, as shown on the declarant’s records.

5-17    12.  Contracts of employment in which the association is a contracting

5-18  party.

5-19    13.  Any contract for service in which the association is a contracting

5-20  party or in which the association or the units’ owners have any obligation

5-21  to pay a fee to the persons performing the services.

5-22    Sec. 5.  NRS 116.3115 is hereby amended to read as follows:

5-23    116.3115  1.  Until the association makes an assessment for common

5-24  expenses, the declarant shall pay all common expenses. After an

5-25  assessment has been made by the association, assessments must be made at

5-26  least annually, based on a budget adopted at least annually by the

5-27  association in accordance with the requirements set forth in NRS

5-28  116.31151. [Except for an association for a time-share project governed by

5-29  the provisions of chapter 119A of NRS, and unless] Unless the declaration

5-30  imposes more stringent standards, the budget must include a budget for the

5-31  daily operation of the association and the money for the reserve required by

5-32  paragraph (b) of subsection 2.

5-33    2.  Except for assessments under subsections 4 to 7, inclusive:

5-34    (a) All common expenses, including a reserve, must be assessed against

5-35  all the units in accordance with the allocations set forth in the declaration

5-36  pursuant to subsections 1 and 2 of NRS 116.2107.

5-37    (b) The association shall establish an adequate reserve, funded on a

5-38  reasonable basis, for the repair, replacement and restoration of the major

5-39  components of the common elements. The reserve may be used only for

5-40  those purposes, including, without limitation, repairing, replacing and

5-41  restoring roofs, roads and sidewalks, and must not be used for daily

5-42  maintenance.

5-43    3.  Any past due assessment for common expenses or installment

5-44  thereof bears interest at the rate established by the association not

5-45  exceeding 18 percent per year.

5-46    4.  To the extent required by the declaration:

5-47    (a) Any common expense associated with the maintenance, repair,

5-48  restoration or replacement of a limited common element must be assessed

6-1  against the units to which that limited common element is assigned,

6-2  equally, or in any other proportion the declaration provides;

6-3    (b) Any common expense or portion thereof benefiting fewer than all of

6-4  the units must be assessed exclusively against the units benefited; and

6-5    (c) The costs of insurance must be assessed in proportion to risk and the

6-6  costs of utilities must be assessed in proportion to usage.

6-7    5.  Assessments to pay a judgment against the association may be made

6-8  only against the units in the common-interest community at the time the

6-9  judgment was entered, in proportion to their liabilities for common

6-10  expenses.

6-11    6.  If any common expense is caused by the misconduct of any unit’s

6-12  owner, the association may assess that expense exclusively against his unit.

6-13    7.  The association of a common-interest community created before

6-14  January 1, 1992, is not required to make an assessment against a vacant lot

6-15  located within the community that is owned by the declarant.

6-16    8.  If liabilities for common expenses are reallocated, assessments for

6-17  common expenses and any installment thereof not yet due must be

6-18  recalculated in accordance with the reallocated liabilities.

6-19    9.  The association shall provide written notice to the owner of each

6-20  unit of a meeting at which an assessment for a capital improvement or the

6-21  commencement of a civil action is to be considered or action is to be taken

6-22  on such an assessment at least 21 calendar days before the meeting. Except

6-23  as otherwise provided in this subsection, the association may commence a

6-24  civil action only upon a vote or written agreement of the owners of units to

6-25  which at least a majority of the votes of the members of the association are

6-26  allocated. The provisions of this subsection do not apply to a civil action

6-27  that is commenced:

6-28    (a) [By an association for a time-share project governed by the

6-29  provisions of chapter 119A of NRS;

6-30    (b)] To enforce the payment of an assessment;

6-31    [(c)] (b) To enforce the declaration, bylaws or rules of the association;

6-32    [(d)] (c) To proceed with a counterclaim; or

6-33    [(e)] (d) To protect the health, safety and welfare of the members of the

6-34  association. If a civil action is commenced pursuant to this paragraph

6-35  without the required vote or agreement, the action must be ratified within

6-36  90 days after the commencement of the action by a vote or written

6-37  agreement of the owners of the units to which at least a majority of votes of

6-38  the members of the association are allocated. If the association, after

6-39  making a good faith effort, cannot obtain the required vote or agreement to

6-40  commence or ratify such a civil action, the association may thereafter seek

6-41  to dismiss the action without prejudice for that reason only if a vote or

6-42  written agreement of the owners of the units to which at least a majority of

6-43  votes of the members of the association are allocated was obtained at the

6-44  time the approval to commence or ratify the action was sought.

6-45    10.  At least 10 days before an association commences or seeks to

6-46  ratify the commencement of a civil action, the association shall provide a

6-47  written statement to all units’ owners that includes:

6-48    (a) A reasonable estimate of the costs of the civil action, including

6-49  reasonable attorney’s fees;

7-1    (b) An explanation of the potential benefits of the civil action and the

7-2  potential adverse consequences if the association does not commence the

7-3  action or if the outcome of the action is not favorable to the association;

7-4  and

7-5    (c) All disclosures that are required to be made upon the sale of the

7-6  property.

7-7    11.  No person other than a unit’s owner may request the dismissal of a

7-8  civil action commenced by the association on the ground that the

7-9  association failed to comply with any provision of this section.

7-10    Sec. 6.  NRS 116.4102 is hereby amended to read as follows:

7-11    116.4102  1.  Except as otherwise provided in subsection 2, a

7-12  declarant, before offering any interest in a unit to the public, shall prepare a

7-13  public offering statement conforming to the requirements of NRS 116.4103

7-14  to 116.4106, inclusive.

7-15    2.  A declarant may transfer responsibility for the preparation of all or a

7-16  part of the public offering statement to a successor declarant [(] pursuant

7-17  to NRS 116.3104 and 116.31043 , [)] or to a dealer who intends to offer

7-18  units in the common-interest community. In the event of any such transfer,

7-19  the transferor shall provide the transferee with any information necessary

7-20  to enable the transferee to fulfill the requirements of subsection 1.

7-21    3.  Any declarant or dealer who offers a unit to a purchaser shall deliver

7-22  a public offering statement in the manner prescribed in subsection 1 of

7-23  NRS 116.4108. The declarant or his transferee under subsection 2 is liable

7-24  under NRS 116.4108 and 116.4117 for any false or misleading statement

7-25  set forth therein or for any omission of a material fact therefrom with

7-26  respect to that portion of the public offering statement which he prepared.

7-27  If a declarant or dealer did not prepare any part of a public offering

7-28  statement that he delivers, he is not liable for any false or misleading

7-29  statement set forth therein or for any omission of a material fact therefrom

7-30  unless he had actual knowledge of the statement or omission or, in the

7-31  exercise of reasonable care, should have known of the statement or

7-32  omission.

7-33    4.  If a unit is part of a common-interest community and is part of any

7-34  other real estate in connection with the sale of which the delivery of a

7-35  public offering statement is required under the laws of this state, a single

7-36  public offering statement conforming to the requirements of NRS 116.4103

7-37  to 116.4106, inclusive, as those requirements relate to the real estate in

7-38  which the unit is located, and to any other requirements imposed under the

7-39  laws of this state, may be prepared and delivered in lieu of providing two

7-40  or more public offering statements. [Except as otherwise provided in NRS

7-41  119A.165, if] If the requirements of this chapter conflict with those of

7-42  another law of this state, the requirements of this chapter prevail.

7-43    Sec. 7.  NRS 116.4109 is hereby amended to read as follows:

7-44    116.4109  1.  Except in the case of a sale in which delivery of a public

7-45  offering statement is required, or unless exempt under subsection 2 of NRS

7-46  116.4101, a unit’s owner shall furnish to a purchaser before execution of

7-47  any contract for sale of a unit, or otherwise before conveyance:

7-48    (a) A copy of the declaration, other than any plats and plans, the bylaws,

7-49  the rules or regulations of the association and[, except for a time share

8-1  governed by the provisions of chapter 119A of NRS,] the information

8-2  statement required by NRS 116.41095;

8-3    (b) A statement setting forth the amount of the monthly assessment for

8-4  common expenses and any unpaid assessment of any kind currently due

8-5  from the selling unit’s owner;

8-6    (c) The current operating budget of the association and a financial

8-7  statement for the association; and

8-8    (d) A statement of any unsatisfied judgments or pending legal actions

8-9  against the association and the status of any pending legal actions relating

8-10  to the common-interest community of which the unit’s owner has actual

8-11  knowledge.

8-12    2.  The association, within 10 days after a request by a unit’s owner,

8-13  shall furnish a certificate containing the information necessary to enable

8-14  the unit’s owner to comply with this section. A unit’s owner providing a

8-15  certificate pursuant to subsection 1 is not liable to the purchaser for any

8-16  erroneous information provided by the association and included in the

8-17  certificate.

8-18    3.  Neither a purchaser nor the purchaser’s interest in a unit is liable for

8-19  any unpaid assessment or fee greater than the amount set forth in the

8-20  certificate prepared by the association. If the association fails to furnish the

8-21  certificate within the 10 days allowed by subsection 2, the seller is not

8-22  liable for the delinquent assessment.

8-23    Sec. 8.  Chapter 119A of NRS is hereby amended by adding thereto

8-24  the provisions set forth as sections 9 to 31, inclusive, of this act.

8-25    Sec. 9.  “Affiliate of the manager” means any person who controls,

8-26  is controlled by or is under common control with a manager, including a

8-27  person who:

8-28    1.  Is a general partner, officer, director or employer of the manager;

8-29    2.  Directly or indirectly or acting in concert with one or more

8-30  persons, or through one or more subsidiaries, owns, controls, or holds

8-31  with the power to vote more than 20 percent of the voting interest in the

8-32  manager;

8-33    3.  Controls the election of a majority of the directors of the manager;

8-34  or

8-35    4.  Has contributed more than 20 percent of the capital of the

8-36  manager.

8-37    Sec. 10.  “Association” means an association of owners established

8-38  pursuant to NRS 119A.520.

8-39    Sec. 11.  “Board” means the governing body designated in a time-

8-40  share instrument to act on behalf of an association.

8-41    Sec. 12.  “Common area” means those portions of a project other

8-42  than the units. The term includes any easement which benefits the

8-43  project.

8-44    Sec. 13.  “Developer’s reserved rights” means any right reserved in a

8-45  time-share instrument for the benefit of the developer, the exercise of

8-46  which does not require a vote of the other owners.

8-47    Sec. 14.  “Limited common area” means a portion of the common

8-48  area allocated by a time-share instrument for the exclusive use of at least

8-49  one, but not all, of the units in a project.

9-1    Sec. 15.  “Manager” means a person who undertakes, directly or

9-2  indirectly, the duties, responsibilities and obligations of managing, in

9-3  whole or in part, a time-share plan or a project, or both, in accordance

9-4  with an agreement entered into pursuant to NRS 119A.530.

9-5    Sec. 16.  “Permanent identifying number” means a series of

9-6  numbers or letters, or any combination thereof, which identifies, for the

9-7  duration of a time-share plan, one time share in the plan.

9-8    Sec. 17.  “Time-share plan” means the rights to time shares and the

9-9  obligations and interests appurtenant thereto created by a time-share

9-10  instrument.

9-11    Sec. 18.  1.  A building code may not impose any requirements upon

9-12  any structure in a project which it would not impose upon a physically

9-13  identical development under a different form of ownership.

9-14    2.  Except as otherwise provided in subsection 1, the provisions of this

9-15  chapter do not invalidate or modify any provision of any building code or

9-16  zoning, subdivision or other law, ordinance, rule or regulation governing

9-17  the use of real estate.

9-18    Sec. 19.  1.  Except as otherwise provided in subsection 2 and

9-19  subject to the provisions of the time-share instrument and other

9-20  provisions of law, a developer may, with the prior approval of the

9-21  division, relocate the boundaries between adjoining units by amending

9-22  the provisions of the time-share instrument and any recorded map or plat

9-23  relating thereto.

9-24    2.  A developer may relocate the boundaries between adjoining units

9-25  without the prior approval of the division if:

9-26    (a) The relocation is necessary to comply with the law; or

9-27    (b) No time share attributable to either of the adjoining units is owned

9-28  by a purchaser.

9-29    Sec. 20.  The provisions of this chapter and chapter 645 of NRS

9-30  relating to real estate brokers and sales agents do not apply to an owner,

9-31  other than a developer, who, for compensation, refers prospective

9-32  purchasers to a developer or an employee or agent of the developer, if the

9-33  owner:

9-34    1.  Refers to the developer or an employee or agent of the developer,

9-35  or any combination thereof, not more than 20 prospective purchasers

9-36  within any 1 calendar year; and

9-37    2.  Does not show a unit to the prospective purchaser, discuss with the

9-38  prospective purchaser the terms and conditions of the purchase or

9-39  otherwise participate in negotiations relating to the sale of the time

9-40  share.

9-41    Sec. 21.  If a time-share instrument authorizes the developer to

9-42  withdraw units from the time-share plan, any unit that is subject to

9-43  withdrawal may not be withdrawn if a time share attributable to that unit

9-44  is owned by a purchaser.

9-45    Sec. 22.  A description of a time share is a legally sufficient

9-46  description of the time share and all rights, obligations and interests

9-47  appurtenant to that time share that were created by the time-share plan if

9-48  the description includes, without limitation:

10-1    1.  The name under which the time-share plan is registered with the

10-2  division;

10-3    2.  The county in which the project is located;

10-4    3.  Information which indicates where the time-share instruments are

10-5  recorded; and

10-6    4.  The permanent identifying number of the time share as set forth

10-7  in the time-share instruments.

10-8    Sec. 23.  1.  Except as otherwise provided in this section, a time-

10-9  share instrument may provide for a period of the developer’s control of

10-10  an association during which the developer, or a person designated by

10-11  him, may appoint and remove the officers of the association and the

10-12  members of the board. Regardless of the period provided in the time-

10-13  share instrument, the period of the developer’s control of the association

10-14  terminates no later than:

10-15  (a) One hundred and twenty days after conveyance of 80 percent of

10-16  the time shares that may be created by the time-share instrument to

10-17  owners other than the developer;

10-18  (b) Five years after the developer has ceased to offer time shares for

10-19  sale in the ordinary course of business; or

10-20  (c) Five years after any right to add new time shares was last

10-21  exercised,

10-22  whichever occurs earlier.

10-23  2.  A developer may voluntarily surrender the right to appoint and

10-24  remove officers and members of the board before the end of the period

10-25  provided for in subsection 1 by executing and recording with the time-

10-26  share instrument a written instrument declaring the surrender. If such

10-27  an instrument is recorded, the developer may require that, for the

10-28  duration of the period of the developer’s control, specified actions of the

10-29  association or board, as described in the recorded instrument, be

10-30  approved by the developer before they become effective.

10-31  3.  Not later than 60 days after conveyance of 25 percent of the time

10-32  shares that may be created pursuant to the time-share instrument to

10-33  owners other than the developer, at least one member and not less than

10-34  25 percent of the members of the board must be elected by owners other

10-35  than the developer. Not later than 60 days after conveyance of 50 percent

10-36  of the time shares that may be created pursuant to the time-share

10-37  instrument to owners other than the developer, not less than 33 1/3

10-38  percent of the members of the board must be elected by owners other

10-39  than the developer.

10-40  Sec. 24.  1.  Notwithstanding any provision of a time-share

10-41  instrument or the bylaws of an association to the contrary, the owners, by

10-42  a two-thirds vote of all persons present, in person or by proxy, who are

10-43  entitled to vote at any meeting of the owners at which a quorum is

10-44  present, may remove any member of the board, with or without cause,

10-45  other than a member appointed by the developer.

10-46  2.  If a member of the board is sued for liability for actions

10-47  undertaken in his role as a member of the board, the association shall

10-48  indemnify him for his losses or claims, and undertake all costs of

10-49  defense, unless it is proven that he acted with willful or wanton

11-1  misfeasance or with gross negligence. After such proof, the association is

11-2  no longer liable for the costs of defense, and may recover from the

11-3  member of the board who so acted, costs already expended. Members of

11-4  the board are not personally liable to the victims of crimes occurring on

11-5  the project. Punitive damages may not be recovered against the

11-6  association, but may be recovered from persons whose activity gave rise

11-7  to the damages.

11-8    Sec. 25.  1.  Unless the bylaws of an association specify a larger

11-9  percentage, a quorum is present throughout any meeting of the

11-10  association if persons entitled to cast 10 percent of the votes that may be

11-11  cast are present in person or by proxy at the beginning of the meeting.

11-12  2.  Unless the bylaws of an association provide otherwise, a quorum

11-13  shall be deemed to be present throughout a meeting of the board if

11-14  persons entitled to cast a majority of the votes on that board are present

11-15  at the beginning of the meeting.

11-16  Sec. 26.  1.  The board of an association shall:

11-17  (a) Cause to be conducted at least once every 5 years, a study of the

11-18  reserves required to repair, replace and restore the major components of

11-19  the project;

11-20  (b) Review the results of that study at least annually to determine if

11-21  those reserves are sufficient; and

11-22  (c) Make any adjustments it deems necessary to maintain the required

11-23  reserves.

11-24  2.  The study required by subsection 1 must be conducted by a person

11-25  qualified by training and experience to conduct such a study, including a

11-26  member of the board or the manager of the time-share plan or the

11-27  project, or both, who is so qualified. The study must include, without

11-28  limitation:

11-29  (a) A summary of an inspection of the major components of the

11-30  project;

11-31  (b) An identification of the major components of the project which

11-32  have a remaining useful life of less than 30 years;

11-33  (c) An estimate of the remaining useful life of each major component

11-34  identified pursuant to paragraph (b);

11-35  (d) An estimate of the cost of repair, replacement or restoration of

11-36  each major component identified pursuant to paragraph (b) during and

11-37  at the end of its useful life; and

11-38  (e) An estimate of the total annual assessment that may be required to

11-39  cover the cost of repairing, replacing or restoring the major components

11-40  identified pursuant to paragraph (b), after subtracting the reserves of the

11-41  association as of the date of the study.

11-42  3.  The administrator shall adopt by regulation the qualifications

11-43  required for conducting a study required by subsection 1.

11-44  Sec. 27.  An association, upon the receipt of a written request, shall

11-45  furnish to an owner or any lender who has a security interest in a time

11-46  share or the project, a statement setting forth the amount of unpaid

11-47  assessments made against the owner’s time share. The statement must be

11-48  furnished within 10 business days after receipt of the request and is

11-49  binding on the association, the board and every owner.

12-1    Sec. 28.  A developer’s reserved rights may include, without

12-2  limitation, the right to:

12-3    1.  Add units or real estate to, and withdraw units or real estate from,

12-4  a time-share plan.

12-5    2.  Create units, a common area or a limited common area within the

12-6  project.

12-7    3.  Subdivide units or convert units into a common area.

12-8    4.  Make and complete improvements to the project.

12-9    5.  Maintain sales offices, management offices and signs for

12-10  advertising the time-share plan, project and models.

12-11  6.  Enter into a subsidy agreement with the association in lieu of

12-12  paying the assessments allocated to the time shares owned by the

12-13  developer.

12-14  7.  Provide for the establishment of a master association, as defined

12-15  in NRS 116.110358.

12-16  8.  Merge or consolidate a time-share plan with another time-share

12-17  plan which has the same form of ownership.

12-18  9.  Relocate boundaries between adjoining units in accordance with

12-19  the provisions of this chapter.

12-20  Sec. 29.  1.  A person who wishes to engage in the business of, act

12-21  in the capacity of, advertise or assume to act as a manager shall register

12-22  with the division on a form prescribed by the division.

12-23  2.  The form for registration must include, without limitation:

12-24  (a) The registered name of the time-share plan or the project, or both,

12-25  that the manager will manage;

12-26  (b) The address and telephone number of the manager’s principal

12-27  place of business;

12-28  (c) The social security number of the manager; and

12-29  (d) The name of the manager’s responsible managing employee.

12-30  3.  The form for registration must be accompanied by:

12-31  (a) Satisfactory evidence, acceptable to the division, that the manager

12-32  and his employees have obtained fidelity bonds in accordance with

12-33  regulations adopted by the division; and

12-34  (b) The statement required pursuant to NRS 119A.263.

12-35  4.  The division may collect a fee for registering a manager in an

12-36  amount not to exceed the administrative costs of registering the manager.

12-37  5.  As used in this section, “responsible managing employee” means

12-38  the person designated by the manager to:

12-39  (a) Make technical and administrative decisions in connection with

12-40  the manager’s business; and

12-41  (b) Hire, superintend, promote, transfer, lay off, discipline or

12-42  discharge other employees or recommend such action on behalf of the

12-43  manager.

12-44  Sec. 30.  1.  A manager who enters into or renews an agreement

12-45  that must comply with the provisions of subsection 3 of NRS 119A.530

12-46  shall submit to the association and to the division a disclosure statement

12-47  that contains a description of any arrangement made by the manager or

12-48  an affiliate of the manager relating to:

13-1    (a) The resale of time shares on behalf of the association or its

13-2  members;

13-3    (b) Actions taken for the collection of assessments and the foreclosure

13-4  of liens on behalf of the association or its members;

13-5    (c) The exchange or rental of time shares owned by the association or

13-6  its members; and

13-7    (d) The use of the names of the members of the association for

13-8  purposes unrelated to the duties of the association as set forth in the

13-9  time-share instrument and this chapter.

13-10  2.  The disclosure statement must be:

13-11  (a) Submitted annually at a time designated by the administrator and

13-12  at least 120 days before any date on which the agreement is

13-13  automatically renewed.

13-14  (b) Signed by the manager or an authorized representative of the

13-15  manager under penalty of perjury.

13-16  3.  The administrator shall adopt regulations prescribing the form

13-17  and contents of the disclosure statements required by this section.

13-18  Sec. 31.  1.  It is unlawful for any person to display or deliver to

13-19  prospective purchasers of time shares promotional material that

13-20  describes or portrays an improvement that has not been made to the

13-21  project unless the improvement is conspicuously labeled or identified

13-22  with the phrase “MUST BE BUILT” or “NEED NOT BE BUILT” or

13-23  with other similar language approved by the division.

13-24  2.  A developer shall construct and complete any improvement to a

13-25  project that is described or portrayed in promotional material for the sale

13-26  of time shares unless the improvement is labeled or identified as “NEED

13-27  NOT BE BUILT” or with other similar language approved by the

13-28  division.

13-29  Sec. 32.  NRS 119A.010 is hereby amended to read as follows:

13-30  119A.010  As used in this chapter, unless the context otherwise

13-31  requires, the words and terms defined in NRS 119A.020 to 119A.160,

13-32  inclusive, and sections 9 to 17, inclusive, of this act, have the meanings

13-33  ascribed to them in those sections.

13-34  Sec. 33.  NRS 119A.030 is hereby amended to read as follows:

13-35  119A.030  [“Affiliate”] “Affiliate of the developer” means any person

13-36  who controls, is controlled by or is under common control with a

13-37  developer, including a person who:

13-38  1.  Is a general partner, officer, director or employer of the developer;

13-39  2.  Directly or indirectly or acting in concert with one or more other

13-40  persons, or through one or more subsidiaries, owns, controls, holds with

13-41  the power to vote, or holds proxies representing more than 20 percent of

13-42  the voting interest in the developer;

13-43  3.  Controls the election of a majority of the directors of the developer;

13-44  or

13-45  4.  Has contributed more than 20 percent of the capital of the

13-46  developer.

13-47  Sec. 34.  NRS 119A.056 is hereby amended to read as follows:

13-48  119A.056  “Owner” means a [purchaser who is the equitable or legal

13-49  owner of a time share.] person, including a developer, who has an

14-1  equitable or legal interest in a time share. The term does not include a

14-2  person who has an interest in a time share solely as security for an

14-3  obligation.

14-4    Sec. 35.  NRS 119A.080 is hereby amended to read as follows:

14-5    119A.080  “Project” means the real property [in which time shares are

14-6  created by a single instrument or set of instruments.] which, in whole or in

14-7  part, is the subject of a time-share plan.

14-8    Sec. 36.  NRS 119A.090 is hereby amended to read as follows:

14-9    119A.090  “Project broker” means any person who coordinates the sale

14-10  of time shares for a time-share [project] plan and to whom sales agents and

14-11  representatives are responsible.

14-12  Sec. 37.  NRS 119A.100 is hereby amended to read as follows:

14-13  119A.100  “Public offering statement” means a report, issued by the

14-14  administrator pursuant to the provisions of this chapter, which authorizes a

14-15  developer to offer to sell or sell time shares in the [project] time-share plan

14-16  which is the subject of the report.

14-17  Sec. 38.  NRS 119A.140 is hereby amended to read as follows:

14-18  119A.140  “Time share” means the right to use and occupy a unit on a

14-19  recurrent periodic basis according to an arrangement allocating this right

14-20  among various [time-share] owners whether or not there is an additional

14-21  charge to the [time-share] owner for occupying the unit.

14-22  Sec. 39.  NRS 119A.160 is hereby amended to read as follows:

14-23  119A.160  “Unit” means that portion of a project which is designated

14-24  for separate [use.] occupancy.

14-25  Sec. 40.  NRS 119A.170 is hereby amended to read as follows:

14-26  119A.170  1.  The provisions of this chapter, except subsection 4, do

14-27  not apply to:

14-28  (a) The sale of 12 or fewer time shares in a [time-share] project or the

14-29  sale of 12 or fewer time shares in the same subdivision;

14-30  (b) The sale or transfer of a time share by an owner who is not the

14-31  developer, unless the time share is sold in the ordinary course of business

14-32  of that owner;

14-33  (c) Any transfer of a time share [by] :

14-34     (1) By deed in lieu of foreclosure [or as a result of foreclosure of the

14-35  time share;] ;

14-36     (2) At a foreclosure sale; or

14-37     (3) By the resale of a time share that has been acquired by an

14-38  association by deed in lieu of foreclosure or at a foreclosure sale;

14-39  (d) A gratuitous transfer of a time share;

14-40  (e) A transfer by devise or descent or a transfer to an inter vivos trust; or

14-41  (f) The sale or transfer of the right to use and occupy a unit on a

14-42  periodic basis which recurs over a period of less than 5 years,

14-43  unless the method of disposition is adopted [for the purpose of evading] to

14-44  evade the provisions of this chapter[.] or chapter 645 of NRS.

14-45  2.  Any campground or developer [which] who is subject to the

14-46  requirements of chapter 119B of NRS and complies with those provisions

14-47  is not required to comply with the provisions of this chapter.

14-48  3.  The division may [from time to time, pursuant to regulations

14-49  adopted by it, exempt from any of the provisions] waive any provision of

15-1  this chapter [any other sale, transfer or disposition of a time share] if it

15-2  finds that the enforcement of [this chapter with respect to such a

15-3  transaction] that provision is not necessary in the public interest [and] or

15-4  for the protection of purchasers.

15-5    4.  The provisions of chapter 645 of NRS apply to the sale of time

15-6  shares, except any sale of a time share to which this chapter applies, and

15-7  for that purpose the terms “real property” and “real estate” as used in

15-8  chapter 645 of NRS shall be deemed to include a time share, whether it is

15-9  an interest in real property or merely a contractual right to occupancy.

15-10  Sec. 41.  NRS 119A.180 is hereby amended to read as follows:

15-11  119A.180  1.  A [time-share owner] purchaser shall not be deemed to

15-12  hold an investment contract, nor shall his purchase be considered risk

15-13  capital, because income derived from the [time-share] project and any

15-14  personal property available for use by the [time-share owner] purchaser in

15-15  conjunction therewith reduces the assessment for time-share expenses, if

15-16  the income inures directly to the benefit of the association and not to his

15-17  direct benefit.

15-18  2.  An interest in a time share is not a security under the provisions of

15-19  chapter 90 of NRS.

15-20  Sec. 42.  NRS 119A.200 is hereby amended to read as follows:

15-21  119A.200  Time shares , [and] time-share plans and projects to which

15-22  this chapter applies are subject to licensing by local governments for

15-23  revenue but not for regulation.

15-24  Sec. 43.  NRS 119A.260 is hereby amended to read as follows:

15-25  119A.260  1.  A representative shall not negotiate or make

15-26  representations concerning the merits or value of a time-share plan or a

15-27  project. He may only induce and solicit persons to attend promotional

15-28  meetings for the sale of time shares and distribute information [approved

15-29  by the division.] on behalf of a developer.

15-30  2.  The representative’s activities must strictly conform to the methods

15-31  for the procurement of prospective purchasers which have been approved

15-32  by the division.

15-33  3.  The representative shall comply with the same standards for

15-34  conducting business as are applied to real estate brokers and salesmen

15-35  pursuant to chapter 645 of NRS and the regulations adopted pursuant

15-36  thereto.

15-37  4.  A representative shall not make targeted solicitations of

15-38  purchasers or prospective purchasers of time shares in another project. A

15-39  developer or project broker shall not pay or offer to pay a representative

15-40  a bonus or other type of special compensation to engage in such activity.

15-41  Sec. 44.  NRS 119A.263 is hereby amended to read as follows:

15-42  119A.263  1.  An applicant for the issuance or renewal of a sales

15-43  agent’s license or registration as a [representative] manager shall submit to

15-44  the administrator the statement prescribed by the welfare division of the

15-45  department of human resources pursuant to NRS 425.520. The statement

15-46  must be completed and signed by the applicant.

15-47  2.  The administrator shall include the statement required pursuant to

15-48  subsection 1 in:

16-1    (a) The application or any other forms that must be submitted for the

16-2  issuance or renewal of the license or registration; or

16-3    (b) A separate form prescribed by the administrator.

16-4    3.  A sales agent’s license or registration as a [representative] manager

16-5  may not be issued or renewed by the administrator if the applicant:

16-6    (a) Fails to complete or submit the statement required pursuant to

16-7  subsection 1; or

16-8    (b) Indicates on the statement submitted pursuant to subsection 1 that he

16-9  is subject to a court order for the support of a child and is not in

16-10  compliance with the order or a plan approved by the district attorney or

16-11  other public agency enforcing the order for the repayment of the amount

16-12  owed pursuant to the order.

16-13  4.  If an applicant indicates on the statement submitted pursuant to

16-14  subsection 1 that he is subject to a court order for the support of a child and

16-15  is not in compliance with the order or a plan approved by the district

16-16  attorney or other public agency enforcing the order for the repayment of

16-17  the amount owed pursuant to the order, the administrator shall advise the

16-18  applicant to contact the district attorney or other public agency enforcing

16-19  the order to determine the actions that the applicant may take to satisfy the

16-20  arrearage.

16-21  Sec. 45.  NRS 119A.266 is hereby amended to read as follows:

16-22  119A.266  1.  If the administrator receives a copy of a court order

16-23  issued pursuant to NRS 425.540 that provides for the suspension of all

16-24  professional, occupational and recreational licenses, certificates and

16-25  permits issued to a person who has been issued a sales agent’s license or

16-26  has been registered as a [representative,] manager, the administrator shall

16-27  deem the license or registration to be suspended at the end of the 30th day

16-28  after the date on which the court order was issued unless the administrator

16-29  receives a letter issued to the holder of the license or registration by the

16-30  district attorney or other public agency pursuant to NRS 425.550 stating

16-31  that the holder of the license or registration has complied with the

16-32  subpoena or warrant or has satisfied the arrearage pursuant to NRS

16-33  425.560.

16-34  2.  The administrator shall reinstate a sales agent’s license or the

16-35  registration of a [representative] manager that has been suspended by a

16-36  district court pursuant to NRS 425.540 if the administrator receives a letter

16-37  issued by the district attorney or other public agency pursuant to NRS

16-38  425.550 to the person whose license or registration was suspended stating

16-39  that the person whose license or registration was suspended has complied

16-40  with the subpoena or warrant or has satisfied the arrearage pursuant to NRS

16-41  425.560.

16-42  Sec. 46.  NRS 119A.300 is hereby amended to read as follows:

16-43  119A.300  Except as otherwise provided in NRS 119A.310, the

16-44  administrator shall issue a public offering statement and a permit to sell

16-45  time shares to each applicant who:

16-46  1.  Submits an application, in the manner provided by the division,

16-47  which includes:

16-48  (a) The name and address of the project broker;

17-1    (b) A copy of [the document in which the time-share project is created;]

17-2  each time-share instrument that relates to the time-share plan;

17-3    (c) A preliminary title report for the [time-share] project and copies of

17-4  the documents listed as exceptions in the report;

17-5    (d) Copies of any other documents which relate to the time-share plan

17-6  or the project, including any contract, agreement or other document to be

17-7  used to establish and maintain an association [of time-share owners] and to

17-8  provide for the management of the time-share plan or the project[;] , or

17-9  both;

17-10  (e) Copies of instructions for escrow, deeds, sales contracts and any

17-11  other documents that will be used in the sale of the time shares;

17-12  (f) A copy of any proposed trust agreement which establishes a trust for

17-13  the time-share plan or the project[;] , or both;

17-14  (g) Documents which show the current assessments for property taxes

17-15  on the [time-share] project;

17-16  (h) Documents which show compliance with local zoning laws;

17-17  (i) If the units [in the time-share project] which are the subject of the

17-18  time-share plan are in a condominium project, or other form of

17-19  [community] common-interest ownership of property, documents which

17-20  show that use of the units [in a time-share project] is in compliance with

17-21  the documents which created the [community] common-interest

17-22  ownership;

17-23  (j) Copies of all documents which will be given to a purchaser who is

17-24  interested in participating in a program for the exchange of occupancy

17-25  rights among [time-share] owners and copies of the documents which show

17-26  acceptance of the time-share [project] plan in such a program;

17-27  (k) A copy of the budget or a projection of the operating expenses of the

17-28  association, if applicable;

17-29  (l) A financial statement of the developer; and

17-30  (m) Such other information as the division, by regulation, requires; and

17-31  2.  Pays the fee provided for in this chapter.

17-32  Sec. 47.  NRS 119A.305 is hereby amended to read as follows:

17-33  119A.305  The terms and conditions of the documents and agreements

17-34  submitted pursuant to NRS 119A.300 which relate to the creation and

17-35  management of the time-share [project] plan and to the sale of time shares

17-36  and to which the applicant or an affiliate of the applicant is a party must be

17-37  described in the public offering statement and constitute additional terms

17-38  and conditions of the applicant’s permit to sell time shares.

17-39  Sec. 48.  NRS 119A.310 is hereby amended to read as follows:

17-40  119A.310  1.  The administrator shall deny an application for a permit

17-41  to sell time shares if he finds that:

17-42  (a) The developer failed to comply with any of the provisions of this

17-43  chapter or the regulations adopted by the division; or

17-44  (b) The developer, any [of its affiliates] affiliate of the developer or any

17-45  officer of the developer or an affiliate[,] of the developer, has:

17-46     (1) Been convicted of or pleaded nolo contendere to forgery,

17-47  embezzlement, obtaining money under false pretenses, larceny, extortion,

17-48  conspiracy to defraud or other crime involving moral turpitude;

18-1      (2) Been the subject of a judgment in any civil or administrative

18-2  action, including a proceeding to revoke or suspend a license, involving

18-3  fraud or dishonesty;

18-4      (3) Been permanently enjoined by a court of competent jurisdiction

18-5  from selling real estate, time shares or securities in an unlawful manner;

18-6      (4) Had a registration as a broker-dealer in securities or a license to

18-7  act as a real estate broker or salesman, project broker or sales agent

18-8  revoked;

18-9      (5) Been convicted of or pleaded nolo contendere to selling time

18-10  shares without a license; or

18-11     (6) Had a permit to sell time shares, securities or real estate revoked.

18-12  2.  The administrator may deny an application for a permit to sell time

18-13  shares if he finds that the developer, or any [of its affiliates,] affiliate of the

18-14  developer, has failed to offer satisfactory proof that it has a good reputation

18-15  for honesty, trustworthiness, integrity and competence to transact the

18-16  business of a developer in a manner which safeguards the interests of the

18-17  public.

18-18  3.  The burden of proof is on the developer to establish to the

18-19  satisfaction of the division that [it] he is qualified to receive a license.

18-20  Sec. 49.  NRS 119A.340 is hereby amended to read as follows:

18-21  119A.340  If a [time-share] project has not been completed before the

18-22  issuance of a permit to sell time shares, the permit must state the estimated

18-23  date of completion and:

18-24  1.  The developer shall deliver to the agency a bond in an amount and

18-25  upon terms approved by the division to assure completion of the [time-

18-26  share] project free of any liens, which is payable to the division for the

18-27  benefit of the purchasers of the time-share property and which remains in

18-28  effect until the [time-share] project is completed free of all liens;

18-29  2.  A cash deposit to cover the estimated costs of completing the [time-

18-30  share] project must be deposited with an escrow agent under an agreement

18-31  which is approved by the division; or

18-32  3.  [Any] The developer shall make any other arrangement which is

18-33  approved by the division.

18-34  Sec. 50.  NRS 119A.355 is hereby amended to read as follows:

18-35  119A.355  1.  A permit must be renewed annually by the developer by

18-36  filing an application with and paying the fee for renewal to the

18-37  administrator. The application must be filed and the fee paid not later than

18-38  30 days before the date on which the permit expires. The application must

18-39  include the budget of the association [of time-share owners or the budget of

18-40  the developer, if there is no association,] and any change that has occurred

18-41  in the information previously provided to the administrator or in a

18-42  statement of disclosure provided to a prospective purchaser pursuant to the

18-43  provisions of NRS 119A.400.

18-44  2.  The renewal is effective on the 30th day after the filing of the

18-45  application unless the administrator:

18-46  (a) Denies the renewal; or

18-47  (b) Approves the renewal on an earlier date.

 

 

19-1    Sec. 51.  NRS 119A.360 is hereby amended to read as follows:

19-2    119A.360  1.  The division shall collect the following fees at such

19-3  times and upon such conditions as it may provide by regulation:

19-4  Application fee for preliminary permit to sell time shares................................................................ $250

19-5  [Application fee for registration of representative     65

19-6  For renewal of registration of representative.. 65

19-7  Application fee for transfer of registration of representative to

19-8  different developer or location...................... 20

19-9  For reinstatement of registration of representative    25]

19-10  For each permit to sell time shares, per subdivision500

19-11  For each amendment to a public offering statement after the

19-12  issuance of the report................................ 100

19-13  For renewal of a permit............................. 500

19-14  2.  Each developer shall pay an additional fee for each time share he

19-15  sells in a time-share [project] plan over 50 pursuant to the following

19-16  schedule:

19-17                                                          Amount to be

19-18  Number of time shares                  paid per time share

19-19          51-250.......................................... $5.00

19-20        251-500............................................ 4.00

19-21        501-750............................................ 3.00

19-22      751-1500............................................ 2.50

19-23     over 1500............................................ 1.00

19-24  3.  [Except for the fees relating to the registration of a representative,

19-25  the] The administrator may reduce the fees established by this section if the

19-26  reduction is equitable in relation to the costs of carrying out the provisions

19-27  of this chapter.

19-28  Sec. 52.  NRS 119A.380 is hereby amended to read as follows:

19-29  119A.380  1.  Each time-share [project] plan must be created by [a

19-30  time-share instrument which provides:

19-31  1.] one or more time-share instruments.

19-32  2.  A time-share instrument must provide:

19-33  (a) A legal description and the physical address of the [time-share

19-34  project;

19-35  2.] project;

19-36  (b) The name [and location] of the time-share [project;

19-37  3.] plan;

19-38  (c) A system [of identification of the time periods by letter, name,

19-39  number or any combination thereof;

19-40  4.] for establishing the permanent identifying numbers of the time

19-41  shares;

19-42  (d) For assessment of the expenses of the time-share [project] plan and

19-43  an allocation of those expenses among the time shares [and the] ;

19-44  (e) The voting rights which are assigned to each time share;

19-45  [5.  A]

19-46  (f) If applicable, the procedure to add units and other real estate to ,

19-47  and to withdraw units and other real estate from, the time-share [project;

19-48  6.] plan, and the method of reallocating expenses among the time

19-49  shares after any such addition or withdrawal;

20-1    (g) The maximum number of time shares that may be created under

20-2  the time-share plan;

20-3    (h) For selection of the trustee for insurance which is required to be

20-4  maintained by the association or the developer;

20-5    [7.] (i) For maintenance of the [time-share units;

20-6    8.] units;

20-7    (j) For management of the time-share [project;

20-8    9.] plan;

20-9    (k) A procedure to amend the time-share instrument; and

20-10  [10.] (l) The rights of the purchaser relating to the occupancy of the

20-11  [time-share] unit.

20-12  3.  A time-share instrument may provide for:

20-13  (a) The developer’s reserved rights;

20-14  (b) Cumulative voting, but only for the purpose of electing the

20-15  members of the board; and

20-16  (c) The establishment of:

20-17     (1) Separate voting classes based on the size or type of unit to which

20-18  the votes are allocated; and

20-19     (2) A separate voting class for the developer during the period in

20-20  which the developer is in control.

20-21  4.  The provisions of a time-share instrument are severable.

20-22  5.  The rule against perpetuities and NRS 111.103 to 111.1039,

20-23  inclusive, do not apply to defeat any provisions of a time-share

20-24  instrument.

20-25  Sec. 53.  NRS 119A.430 is hereby amended to read as follows:

20-26  119A.430  Escrow may not be closed unless the developer has

20-27  provided satisfactory evidence to the administrator that:

20-28  1.  The project is free and clear of any blanket encumbrance;

20-29  2.  Each person who holds an interest in the blanket encumbrance has

20-30  executed an agreement, approved by the administrator, to subordinate his

20-31  rights to the rights of the purchaser;

20-32  3.  Title to the [time-share] project has been conveyed to a trustee;

20-33  4.  All holders of a lien recorded against the project have recorded an

20-34  instrument providing for the release and reconveyance of each time share

20-35  from the lien upon the payment of a specified sum or the performance of a

20-36  specified act;

20-37  5.  [He] The developer has obtained and recorded [a] one or more

20-38  binding nondisturbance [agreement] agreements acceptable to the

20-39  administrator, executed by [himself and] the developer, all holders of a lien

20-40  recorded against the project [which provides that subsequent owners or

20-41  foreclosing holders of a lien take title to the project subject to the rights of

20-42  prior purchasers provided in the contracts] and any other person whose

20-43  interest in the project could defeat the rights or interests of any

20-44  purchaser under the time-share instrument or contract of sale; or

20-45  6.  Alternative arrangements have been made which are adequate to

20-46  protect the rights of the purchasers of the time shares and approved by the

20-47  administrator.

 

 

21-1    Sec. 54.  NRS 119A.450 is hereby amended to read as follows:

21-2    119A.450  1.  A contract for the sale of a time share or any other

21-3  evidence of an obligation to purchase a time share must provide in 12-point

21-4  bold type that the purchaser is relieved of all obligations under the contract

21-5  if his interests are defeated because of the foreclosure of liens against the

21-6  project. The provisions of this subsection do not apply to any [time-share]

21-7  project which meets any one of the requirements of subsections 1 to 5,

21-8  inclusive, of NRS 119A.430.

21-9    2.  If a developer or owner is in default on a blanket encumbrance, he

21-10  may not sell or pledge any of the notes or contracts of sale given in

21-11  payment of the time shares purchased from him.

21-12  Sec. 55.  NRS 119A.460 is hereby amended to read as follows:

21-13  119A.460  If a trust is created pursuant to a requirement of this chapter,

21-14  the:

21-15  1.  Trustee must be approved by the administrator.

21-16  2.  Trust must be irrevocable, unless otherwise provided by the

21-17  division.

21-18  3.  Trustee must not be permitted to encumber the property unless

21-19  permission to do so has been given by the division.

21-20  4.  Association or each [time-share] owner must be made a third-party

21-21  beneficiary.

21-22  5.  Trustee must be required to give at least 30 days’ notice in writing

21-23  of his intention to resign to the association, if it has been formed, and to the

21-24  division, and the division must approve a substitute trustee before the

21-25  resignation of the trustee may be accepted.

21-26  Sec. 56.  NRS 119A.470 is hereby amended to read as follows:

21-27  119A.470  1.  If title to a [time-share] project is conveyed to a trustee

21-28  pursuant to subsection 3 of NRS 119A.430, before escrow closes for the

21-29  sale of the first time share, the developer must provide the division with

21-30  satisfactory evidence that:

21-31  (a) Title to the project has been conveyed to the trustee.

21-32  (b) All proceeds received by the developer from the sales of time shares

21-33  are being delivered to the trustee and deposited in a fund which has been

21-34  established to provide for the payment of any taxes, costs of insurance or

21-35  the discharge of any lien recorded against the project.

21-36  2.  The trustee shall pay the charges against the trust in the following

21-37  order:

21-38  (a) Trustee’s fees and costs.

21-39  (b) Payment of taxes.

21-40  (c) Payments due any holder of a lien recorded against the project.

21-41  (d) Any other payments authorized by the document creating the trust.

21-42  3.  The administrator may inspect the records relating to the trust at any

21-43  reasonable time.

21-44  Sec. 57.  NRS 119A.4771 is hereby amended to read as follows:

21-45  119A.4771  1.  A person who , on behalf of an owner other than a

21-46  developer, wishes to list, advertise or promote for resale, or solicit

21-47  prospective purchasers of, [promote or resell] 12 or more time shares that

21-48  were previously sold must:

22-1    (a) Be licensed as a real estate broker pursuant to the provisions of

22-2  chapter 645 of NRS; and

22-3    (b) Register as a time-share resale broker with the division by

22-4  completing a form for registration provided by the division.

22-5    2.  A time-share resale broker shall renew his registration with the

22-6  division annually on a form provided by the division.

22-7    3.  Unless the method of resales of time shares is made to evade the

22-8  provisions of this chapter, a person is not required to register as a time-

22-9  share resale broker if the person:

22-10  (a) Has acquired fewer than 12 time shares and [who] later resells or

22-11  offers to resell one or more of those time shares; or

22-12  (b) Is a project broker who resells or offers to resell a time share in a

22-13  project as an agent for a developer who holds a permit for the project.

22-14  Sec. 58.  NRS 119A.4775 is hereby amended to read as follows:

22-15  119A.4775  1.  Before a purchaser signs any contract to purchase a

22-16  time share that is offered for resale, the person who is reselling the time

22-17  share , other than a developer, shall disclose by a written document

22-18  separate from the contract to purchase a time share:

22-19  (a) The period during which the purchaser may use the time share;

22-20  (b) A legal description of the interest in the time share;

22-21  (c) The earliest date that the prospective purchaser may use the time

22-22  share;

22-23  (d) The name, address and telephone number of the agent managing the

22-24  time-share plan and the project;

22-25  (e) The place where the documents of formation of the association and

22-26  documents governing the time-share plan and the project may be obtained;

22-27  (f) The amount of the annual assessment of the association of the time

22-28  share for the current fiscal year, if any;

22-29  (g) Whether all assessments against the time share are paid in full, and

22-30  the consequences of failure to pay any assessment;

22-31  (h) Whether participation in any program for the exchange of

22-32  occupancy rights among [time-share] owners or with the owners of time

22-33  shares in other time-share [properties] plans is mandatory; and

22-34  (i) Any other information required to be disclosed pursuant to the

22-35  regulations adopted by the administrator pursuant to subsection 2.

22-36  2.  The administrator shall adopt regulations prescribing the form and

22-37  contents of the disclosure statement described in this section.

22-38  Sec. 59.  NRS 119A.490 is hereby amended to read as follows:

22-39  119A.490  1.  Any proposed amendment by the developer of the

22-40  provisions of [the document which created the time-share project] a time-

22-41  share instrument must be filed with the division.

22-42  2.  Unless the division notifies the developer of its disapproval within

22-43  15 days, the amendments shall be deemed to be approved by the division.

22-44  Sec. 60.  NRS 119A.500 is hereby amended to read as follows:

22-45  119A.500  No action for partition of a [time-share] unit may be

22-46  maintained except as provided in the time-share instrument. If a time share

22-47  is owned by two or more persons, an action may be brought for the judicial

22-48  sale of the time share. A provision for the waiver or subordination of the

23-1  right of partition or any other right characteristic of a tenancy in common is

23-2  valid.

23-3    Sec. 61.  NRS 119A.510 is hereby amended to read as follows:

23-4    119A.510  If a unit is unavailable for a period to which the owner is

23-5  entitled by schedule or by confirmed reservation, the owner is entitled to be

23-6  provided by the association : [or, if there is no association, by the

23-7  developer:]

23-8    1.  A comparable unit; or

23-9    2.  Monetary compensation for the loss of such use.

23-10  Sec. 62.  NRS 119A.520 is hereby amended to read as follows:

23-11  119A.520  1.  Each owner is a member of the association for the time-

23-12  share [project.] plan. The association may be incorporated.

23-13  2.  The state of incorporation may be:

23-14  (a) This state;

23-15  (b) The state in which the [time-share] project is located; or

23-16  (c) Any state where the developer has obtained a permit to sell time

23-17  shares under statutes which govern the sale of time shares.

23-18  3.  The [developer shall transfer to the owners the control of the

23-19  association within 120 days after 80 percent of the time shares have been

23-20  sold.] association may adopt and amend bylaws, rules and regulations.

23-21  4.  Except as otherwise provided in NRS 82.321, any proxy which is

23-22  executed by an owner to an association is valid for an indefinite period if

23-23  the owner may revoke his proxy, by written notice to the association, to

23-24  vote at a particular meeting.

23-25  Sec. 63.  NRS 119A.530 is hereby amended to read as follows:

23-26  119A.530  1.  A developer or an affiliate of the developer shall

23-27  provide for the management of the time-share plan and the project, by a

23-28  written agreement with the [time-share] association or, if there is no

23-29  association, with the owners. The initial term of the agreement must expire

23-30  upon the first annual meeting of the members of the association or at the

23-31  end of 5 years, whichever comes first. All succeeding terms of the

23-32  agreement must be renewed annually unless the manager refuses to renew

23-33  the agreement or a majority of the [owners,] members of the association

23-34  who are entitled to vote, excluding the developer, [notify] notifies the

23-35  manager of [their] its refusal to renew the agreement.

23-36  2.  The agreement must provide that:

23-37  (a) The manager or a majority of the owners may terminate the

23-38  agreement for cause.

23-39  (b) The resignation of the manager will not be accepted until 90 days

23-40  after receipt by the association, or if there is no association, by the owners

23-41  , of the written resignation.

23-42  (c) A fidelity bond must be delivered by the manager to the association.

23-43  3.  An agreement entered into or renewed on or after October 1, 2001,

23-44  must contain a detailed, itemized schedule of all fees, compensation or

23-45  other property that the manager is entitled to receive for services

23-46  rendered to the association or any member of the association or

23-47  otherwise derived from the manager’s affiliation with the time-share plan

23-48  or the project, or both, unless the manager is the developer or an affiliate

23-49  of the developer.

24-1    4.  Except as otherwise provided in this subsection, if the developer

24-2  retains a [reversionary] property interest in the [time-share] project, the

24-3  parties to such an agreement must include the developer, the manager and

24-4  the association. In addition to the provisions required in subsections 1 and

24-5  2, the agreement must provide:

24-6    (a) That the project will be maintained in good condition. Except as

24-7  otherwise provided in this paragraph, any defect which is not cured within

24-8  10 days after notification by the developer may be cured by him. In an

24-9  emergency situation, notice is not required. The association must repay the

24-10  developer for any cost of the repairs plus the legal rate of interest. Each

24-11  owner must be assessed for his share of the cost of repairs.

24-12  (b) That, if any dispute arises between the developer and the manager or

24-13  association, either party may request from the American Arbitration

24-14  Association or the Nevada Arbitration Association a list of seven potential

24-15  factfinders from which one must be chosen to settle the dispute. The

24-16  agreement must provide for the method of selecting one factfinder from

24-17  this list.

24-18  (c) For the collection of assessments from the owners to pay obligations

24-19  which may be due to the developer for breach of the covenant to maintain

24-20  the premises in good condition and repair.

24-21  If the developer[, after his request to be included,] is not made a party to

24-22  this agreement, he shall be considered to be a third-party beneficiary of

24-23  such an agreement.

24-24  Sec. 64.  NRS 119A.540 is hereby amended to read as follows:

24-25  119A.540  1.  The association [or if there is no association, the

24-26  developer] shall adopt an annual budget for revenues, expenditures and

24-27  reserves and collect assessments for the expenses of the time-share plan

24-28  and the project from [time-share] the owners. The annual budgets of the

24-29  association must be submitted to and approved by the division until such

24-30  time as the association is controlled by members other than the developer.

24-31  2.  The administrator may require that the association[, or if there is no

24-32  association, the developer] provide, at the association’s or the developer’s

24-33  expense, an opinion from an independent professional consultant as to the

24-34  sufficiency of the budget to sustain the time-share plan offered by the

24-35  association or the developer. The association or the developer shall place

24-36  any money collected for assessments [in a trust account.] and any other

24-37  revenues received in an account established by the association.

24-38  3.  The developer shall pay assessments for any time shares which are

24-39  unsold or enter into an agreement with the association, [on] in a form

24-40  approved by the division, to pay the difference between the actual expenses

24-41  incurred by the association and the sum of the amounts payable to the

24-42  association as assessments by [the time-share owners.] owners, other than

24-43  the developer, and other revenues received by the association. The

24-44  division may require the developer to provide a surety bond or other form

24-45  of security which is satisfactory to the division, to guarantee payment of

24-46  the developer’s obligation.

24-47  Sec. 65.  NRS 119A.550 is hereby amended to read as follows:

24-48  119A.550  1.  The developer or the association may levy and enforce

24-49  a reasonable assessment upon any time share in accordance with the time-

25-1  share instrument, which is a debt of the owner thereof at the time the

25-2  assessment is made. The amount of the assessment plus any other charges

25-3  thereon, such as interest, costs, attorney’s fees and penalties, as may be

25-4  provided for in the time-share instrument is a lien upon the time share

25-5  assessed when the developer or the association causes to be recorded with

25-6  the county recorder of the county in which the [time-share] project is

25-7  located a notice of assessment, which must state:

25-8    (a) The amount of the assessment and such other charges thereon as

25-9  may be authorized by the time-share instrument;

25-10  (b) A description of the time share against which the lien has been

25-11  assessed; and

25-12  (c) The name of the [time-share] owner.

25-13  The notice must be signed by an authorized representative of the developer

25-14  or the association or as otherwise provided in the time-share instrument.

25-15  Upon payment of the assessment and charges in connection with which the

25-16  notice has been so recorded, or other satisfaction thereof, the developer or

25-17  the association shall cause to be recorded a further notice stating the

25-18  satisfaction and the release of the lien thereof.

25-19  2.  The lien is prior to all other liens recorded [subsequent to] after the

25-20  recordation of the notice of assessment except that the time-share

25-21  instrument may provide for the subordination thereof to any other liens and

25-22  encumbrances. Unless sooner satisfied and released or the enforcement

25-23  thereof initiated as provided in subsection 3, the lien expires and has no

25-24  further force or effect 1 year after the date of recordation of the notice of

25-25  assessment, but the 1-year period may be extended by the developer or the

25-26  association for a period not to exceed 1 additional year by recording a

25-27  written extension thereof.

25-28  3.  The lien may be enforced by sale by the developer or the

25-29  association, its agent or attorney, after failure of the owner to pay such an

25-30  assessment in accordance with the terms of the time-share instrument. The

25-31  sale must be conducted in accordance with the provisions of Covenants

25-32  Nos. 6, 7 and 8 of NRS 107.030, and NRS 107.090 insofar as they are

25-33  consistent with the provisions of NRS 119A.560, or in any other manner

25-34  permitted by law. Unless otherwise provided in the time-share instrument,

25-35  the developer or the association, if it is a corporation, cooperative

25-36  association, partnership or natural person, may bid at foreclosure sale and

25-37  hold, lease, mortgage and convey the time share.

25-38  Sec. 66.  NRS 119A.560 is hereby amended to read as follows:

25-39  119A.560  1.  The power of sale may not be exercised until:

25-40  (a) The developer or the association, its agent or attorney has first

25-41  executed and caused to be recorded with the recorder of the county wherein

25-42  the [time-share] project is located a notice of default and election to sell the

25-43  time share or cause its sale to satisfy the assessment lien; and

25-44  (b) The [time-share] owner or his successor in interest has failed to pay

25-45  the amount of the lien, including costs, fees and expenses incident to its

25-46  enforcement for 60 days computed as prescribed in subsection 2.

25-47  2.  The 60-day period provided in subsection 1 begins on the first day

25-48  following the day upon which the notice of default and election to sell is

25-49  recorded and a copy of the notice is mailed by certified or registered mail

26-1  with postage prepaid to the [time-share] owner or to his successor in

26-2  interest at his address if that address is known, otherwise to the address of

26-3  the [time-share] project. The notice must describe the deficiency in

26-4  payment.

26-5    3.  The developer or the association, its agent or attorney shall, after

26-6  expiration of the 60-day period and before selling the time share, give

26-7  notice of the time and place of the sale in the manner and for a time not

26-8  less than that required for the sale of real property upon execution, except

26-9  that a copy of the notice of sale must be mailed on or before the first

26-10  publication or posting required by NRS 21.130 by certified or registered

26-11  mail with postage prepaid to the [time-share] owner or to his successor in

26-12  interest at his address if that address is known, otherwise to the address of

26-13  the [time-share] project. The sale [itself] may be made at the office of the

26-14  developer or the association if the notice so provided, whether the [time-

26-15  share] project is located within the same county as the office of the

26-16  developer or the association or not.

26-17  4.  Every sale made under the provisions of NRS 119A.550 vests in the

26-18  purchaser the title of the [time-share] owner without equity or right of

26-19  redemption.

26-20  Sec. 67.  NRS 119A.570 is hereby amended to read as follows:

26-21  119A.570  1.  The developer or the association, if it has been formed,

26-22  shall maintain:

26-23  (a) Property insurance on the [time-share] project and any personal

26-24  property available for use by the [time-share] owners in conjunction

26-25  therewith, other than personal property separately owned by [a time-share]

26-26  an owner, insuring against all risks of direct physical loss commonly

26-27  insured against, with a provision agreed to by the lender, that the proceeds

26-28  must be disbursed for the repair or restoration of the property, and that the

26-29  [time-share] owners and lien holders are not entitled to receive payment of

26-30  any portion of the proceeds unless there is a surplus of proceeds after the

26-31  property has been completely repaired or restored;

26-32  (b) Liability insurance, including insurance for medical payments, in an

26-33  amount not less than $1,000,000 per occurrence, covering all occurrences

26-34  commonly insured against for death, bodily injury and property damage

26-35  arising out of or in connection with the use, ownership or maintenance of

26-36  the time-share property and [time-share] units; and

26-37  (c) Insurance covering the costs of temporary quarters for the [time-

26-38  share] owners and other losses commonly insured against.

26-39  2.  Each insurance policy carried pursuant to subsection 1 must provide

26-40  that:

26-41  (a) Each [time-share] owner is an insured person under the policy

26-42  whether designated as an insured by name individually or as part of a

26-43  named group or otherwise, as his interest may appear;

26-44  (b) The insurer waives its right to subrogation under the policy against

26-45  any [time-share] owner or members of his household; and

26-46  (c) No act or omission by any [time-share] owner, unless acting within

26-47  the scope of his authority on behalf of an association, will void the policy

26-48  or be a condition to recovery by any other person under the policy.

 

27-1    Sec. 68.  NRS 119A.580 is hereby amended to read as follows:

27-2    119A.580  No labor performed or services or materials furnished with

27-3  the consent of or at the request of [a time-share] an owner may be the basis

27-4  for the filing of a lien against the time share of any other [time-share]

27-5  owner, or against any part thereof, or against any other property of any

27-6  other [time-share] owner, unless the other owner has expressly consented

27-7  to or requested the performance of such labor or furnishing of such

27-8  materials or services. Express consent shall be deemed to have been given

27-9  by the owner of any time share in the case of emergency repairs thereto.

27-10  Labor performed or services or materials furnished for the insured

27-11  property, if authorized by the association and provided for in the time-share

27-12  instrument, shall be deemed to be performed or furnished with the express

27-13  consent of each [time-share owner. A time-share] owner. An owner may

27-14  remove his time share from a lien against two or more time shares or any

27-15  part thereof by payment to the holder of the lien of the fraction of the total

27-16  sum secured by such lien which is attributable to his time share.

27-17  Sec. 69.  NRS 119A.590 is hereby amended to read as follows:

27-18  119A.590  1.  A developer who offers a program for the exchange of

27-19  occupancy rights among [time-share] owners or with the owners of time

27-20  shares in other time-share [properties,] plans, or both, shall give to the

27-21  purchaser the following information:

27-22  (a) The name and address of the company offering the program.

27-23  (b) The names of the officers, directors and shareholders owning at least

27-24  5 percent of the outstanding stock of that company.

27-25  (c) A statement indicating whether the company or any of its officers or

27-26  directors has any legal or beneficial interest in any interest of the developer

27-27  or managing agent in any time-share plan [to sell time shares] included in

27-28  the program and, if so, the name, location and nature of the interest.

27-29  (d) A statement that the purchaser’s contract with the company is a

27-30  contract separate and distinct from the contract to purchase the time share,

27-31  unless the company and the developer or an affiliate of the developer are

27-32  the same.

27-33  (e) A statement indicating whether the purchaser’s participation in the

27-34  program is dependent upon the continued inclusion of the time-share plan

27-35  [to sell time shares] in the program.

27-36  (f) A statement indicating whether the purchaser’s membership or

27-37  participation in the program, is voluntary or mandatory.

27-38  (g) A complete and accurate description of:

27-39     (1) The terms and conditions of the purchaser’s contractual

27-40  relationship with the company and the procedure by which changes thereto

27-41  may be made.

27-42     (2) The procedure to qualify for and make exchanges.

27-43     (3) All limitations, restrictions or priorities of the program, including,

27-44  but not limited to, limitations on exchanges based on the seasons of the

27-45  year, the size of units or levels of occupancy, printed in boldface type, and,

27-46  if such limitations, restrictions or priorities are not uniformly applied by the

27-47  program, a clear description of the manner in which they are applied.

28-1    (h) A statement indicating whether exchanges are arranged on the basis

28-2  of available space and whether there are any guarantees of fulfilling

28-3  specific requests for exchanges.

28-4    (i) A statement indicating whether and under what circumstances an

28-5  owner, in dealing with the company, may lose the right to use and occupy a

28-6  [time-share] unit in any properly applied for exchange without being

28-7  provided with substitute accommodations by the company.

28-8    (j) The fees to be paid by owners in the program, including a statement

28-9  indicating whether any fees may be changed by the company and, if so, the

28-10  circumstances under which those changes may be made.

28-11  (k) The name and address of the site of each [time-share] project

28-12  included in the program.

28-13  (l) The number of units in each [project] time-share plan included in

28-14  the program which are available for occupancy, expressed in numerical

28-15  groupings of from 1 to 5, 6 to 10, 11 to 20, 21 to 50 and over 50.

28-16  (m) The number of owners with respect to each time-share plan [to sell

28-17  time shares] or other property who are eligible to participate in the

28-18  program, expressed in numerical groupings of from 1 to 100, 101 to 249,

28-19  250 to 499, 500 to 999 and at least 1,000, and a statement of the criteria

28-20  used to determine those owners who are eligible to participate in the

28-21  program.

28-22  (n) The disposition made by the company of time shares deposited with

28-23  the program by owners who are eligible to participate in the program and

28-24  not used by the company in effecting exchanges.

28-25  (o) An annual report completed on or before July 1 of the succeeding

28-26  year which must be independently certified by a certified public accountant

28-27  or accounting firm in accordance with the standards of the Accounting

28-28  Standards Board of the American Institute of Certified Public Accountants,

28-29  as those standards exist on May 19, 1983. The report must include:

28-30     (1) The number of owners who are enrolled to participate in the

28-31  program, including an indication of whether the relationship between the

28-32  company and the owners is based on the payment of a fee or is gratuitous.

28-33     (2) The number of time-share [projects] plans included in the

28-34  program, categorized by those [projects] plans which are the subject of a

28-35  contract between the developer or the association and the company and

28-36  those [projects] plans which are the subject of a contract between the

28-37  company and owners directly.

28-38     (3) The number of time shares for which the company has an

28-39  outstanding obligation to provide an exchange to an owner who

28-40  relinquished a time share during the year in exchange for a time share in

28-41  any future year.

28-42     (4) The number of exchanges confirmed by the company during the

28-43  year.

28-44  2.  The information required by subsection 1 must be delivered to the

28-45  purchaser before the execution of any contract between the purchaser and

28-46  the company or the contract to purchase the time share.

28-47  3.  Upon receipt of the information, the purchaser shall certify in

28-48  writing that he has received the information from the developer.

29-1    4.  Except as otherwise provided in this subsection, the information

29-2  required by subsection 1 must be [accurate as of 30 days before the date on

29-3  which the information is delivered to the purchaser.] periodically revised to

29-4  reflect any material changes in that information. The information

29-5  required by paragraphs (b), (c), (k), (l), (m) and (o) of subsection 1 must be

29-6  consistent with the latest audited statement of the company which is

29-7  prepared not more than 18 months before the information is delivered.

29-8    Sec. 70.  NRS 119A.600 is hereby amended to read as follows:

29-9    119A.600  If a company intends to offer a program for the exchange of

29-10  occupancy rights among [time-share] owners or with the owners of time

29-11  shares in other time-share [projects,] plans, or both, directly to a purchaser

29-12  or owner, the company shall deliver to him, before the offering or the

29-13  execution of any contract between the purchaser or owner and the company

29-14  offering the program, the information set forth in subsection 1 of NRS

29-15  119A.590. The requirements of this section do not apply to any renewal of

29-16  a contract between an owner and such a company.

29-17  Sec. 71.  NRS 119A.620 is hereby amended to read as follows:

29-18  119A.620  1.  A company whose program for the exchange of

29-19  occupancy rights among [time-share] owners or with the owners of time

29-20  shares in other time-share [projects,] plans, or both, is offered to

29-21  purchasers of time shares in this state shall, on or before July 1 of each

29-22  year, file with the division and secretary of the association the information

29-23  required by subsection 1 of NRS 119A.590 as it relates to that plan.

29-24  2.  No developer is liable for the use, delivery or publication of

29-25  information provided to it by the company.

29-26  3.  Except as otherwise provided in this subsection, no company is

29-27  liable for:

29-28  (a) Any representation made by the developer relating to the program or

29-29  company.

29-30  (b) The use, delivery or publication by the developer of any information

29-31  relating to the program or company.

29-32  Such a company is liable only for the written information provided to the

29-33  developer by the company.

29-34  Sec. 72.  NRS 119A.660 is hereby amended to read as follows:

29-35  119A.660  1.  Whenever the administrator believes that any person

29-36  has violated any order, regulation, permit, decision, demand or

29-37  requirement, or any of the provisions of this chapter, he may bring an

29-38  action in the district court in the county in which the person resides or

29-39  maintains his principal place of business or, if the person resides outside

29-40  the state, in any court of competent jurisdiction within or outside the state,

29-41  against the person to enjoin him from continuing the violation.

29-42  2.  The administrator may intervene in any action involving a time-

29-43  share [property,] plan, a project or a time share if intervention is necessary

29-44  in the public interest and for the protection of purchasers.

29-45  Sec. 73.  NRS 119A.665 is hereby amended to read as follows:

29-46  119A.665  1.  When the administrator ascertains that an association

29-47  [of time-share owners] or a developer, if there is no association, is

29-48  insolvent or in imminent danger of insolvency, or the association’s or

29-49  developer’s affairs are being mismanaged, he may file a complaint in the

30-1  district court of the county in which the principal office of the association

30-2  or developer is located for the appointment of a receiver.

30-3    2.  Upon appointment, the receiver shall take possession of all the

30-4  property, business and assets of the association or developer which are

30-5  located within this state and retain possession of them until further order of

30-6  the court. The receiver shall make or cause to be made an inventory of the

30-7  assets and known liabilities of the association or developer. Upon approval

30-8  of the court, the receiver shall take such other actions as appear necessary

30-9  and reasonable for the conduct of the business of the association or

30-10  developer.

30-11  3.  The inventory made by the receiver and all claims filed by creditors

30-12  are open at all reasonable times for inspection and any action taken by the

30-13  receiver upon any of the claims is subject to the approval of the court

30-14  before which the cause is pending.

30-15  4.  The expenses of the receiver and compensation of counsel, as well

30-16  as all expenditures required in any liquidation proceeding, must be fixed by

30-17  the receiver, subject to the approval of the court, and, upon certification of

30-18  the receiver, must be paid out of the assets he controls as receiver.

30-19  Sec. 74.  NRS 119A.680 is hereby amended to read as follows:

30-20  119A.680  1.  It is unlawful for any person to engage in the business

30-21  of, act in the capacity of, advertise or assume to act as a:

30-22  (a) Project broker or sales agent within the State of Nevada without first

30-23  obtaining a license from the division pursuant to chapter 645 of NRS or

30-24  NRS 119A.210.

30-25  (b) [Representative] Manager or time-share resale broker within the

30-26  State of Nevada without first registering with the division.

30-27  2.  Any person who violates subsection 1 is guilty of a gross

30-28  misdemeanor.

30-29  Sec. 75.  NRS 119A.690 is hereby amended to read as follows:

30-30  119A.690  Any person who willfully submits, in the application for a

30-31  permit to sell time shares or an application for a sales agent’s license, any

30-32  materially false or misleading information or fails to submit an annual

30-33  report on a program for the exchange of occupancy rights among [time-

30-34  share] owners or with the owners of time shares in other time-share

30-35  [properties,] plans, or both, is guilty of a misdemeanor.

30-36  Sec. 76.  NRS 119A.710 is hereby amended to read as follows:

30-37  119A.710  It is unlawful to engage in unfair methods of competition or

30-38  deceptive or unfair acts in the offer to sell or sale of a time share including,

30-39  without limitation:

30-40  1.  Misrepresenting or failing to disclose any material fact concerning a

30-41  time share.

30-42  2.  Including in an agreement for the purchase of a [time-share] time

30-43  share provisions purporting to waive any right or benefit provided for

30-44  purchasers under this chapter.

30-45  3.  Receiving from a prospective purchaser any money or other

30-46  valuable consideration before the purchaser has received a statement of

30-47  public offering.

30-48  4.  Misrepresenting the amount of time or period of time the unit will

30-49  be available to a purchaser.

31-1    5.  Misrepresenting the location or locations of the unit.

31-2    6.  Misrepresenting the size, nature, extent, qualities or characteristics

31-3  of the unit.

31-4    7.  Misrepresenting the nature or extent of any services incident to the

31-5  unit.

31-6    8.  Misrepresenting the conditions under which a purchaser may

31-7  exchange occupancy rights to a unit in one location for occupancy rights to

31-8  a unit in another location.

31-9    9.  Failing to disclose initially that any promised entertainment, food or

31-10  other inducements are being offered to solicit the sale of a time share.

31-11  10.  Conducting or participating in, without prior approval by the

31-12  division, any type of lottery or contest, or offering prizes or gifts to induce

31-13  or encourage a person to visit a [time-share] project, attend a meeting at

31-14  which a time share will be discussed, attend a presentation or purchase a

31-15  time share.

31-16  11.  Failing to disclose initially to a prospective purchaser any

31-17  agreement between the project broker or sales agent and the developer that

31-18  results in a sharing of sales proceeds in excess of a minimum sales price for

31-19  a time share.

31-20  12.  Any act or practice considered an unfair method of competition or

31-21  an unfair or deceptive act or practice under NRS 207.170, 207.171 or

31-22  598.0915 to 598.0925, inclusive, or chapter 598A or 599A of NRS.

31-23  Sec. 77.  Section 29 of this act is hereby amended to read as follows:

31-24  Sec.29. 1.  A person who wishes to engage in the business of,

31-25  act in the capacity of, advertise or assume to act as a manager shall

31-26  register with the division on a form prescribed by the division.

31-27  2.  The form for registration must include, without limitation:

31-28  (a) The registered name of the time-share plan or the project, or

31-29  both, that the manager will manage;

31-30  (b) The address and telephone number of the manager’s principal

31-31  place of business; and

31-32  (c) [The social security number of the manager; and

31-33  (d)] The name of the manager’s responsible managing employee.

31-34  3.  The form for registration must be accompanied by[:

31-35  (a) Satisfactory] satisfactory evidence, acceptable to the division,

31-36  that the manager and his employees have obtained fidelity bonds in

31-37  accordance with regulations adopted by the division . [; and

31-38  (b) The statement required pursuant to NRS 119A.263.]

31-39  4.  The division may collect a fee for registering a manager in an

31-40  amount not to exceed the administrative costs of registering the

31-41  manager.

31-42  5.  As used in this section, “responsible managing employee”

31-43  means the person designated by the manager to:

31-44  (a) Make technical and administrative decisions in connection with

31-45  the manager’s business; and

31-46  (b) Hire, superintend, promote, transfer, lay off, discipline or

31-47  discharge other employees or recommend such action on behalf of the

31-48  manager.

32-1    Sec. 78.  Section 518 of chapter 483, Statutes of Nevada 1997, at page

32-2  2211, is hereby amended to read as follows:

32-3    Sec. 518.  The amendatory provisions of sections 1 to 4,

32-4  inclusive, [and] 6 to 18.4, inclusive, and 19 to 516, inclusive, of this

32-5  act expire by limitation on the date on which the provisions of 42

32-6  U.S.C. § 666 requiring each state to establish procedures under which

32-7  the state has authority to withhold or suspend, or to restrict the use of

32-8  professional, occupational and recreational licenses of persons who:

32-9    1.  Have failed to comply with a subpoena or warrant relating to a

32-10  proceeding to determine the paternity of a child or to establish or

32-11  enforce an obligation for the support of a child; or

32-12  2.  Are in arrears in the payment for the support of one or more

32-13  children,

32-14  are repealed by the Congress of the United States.

32-15  Sec. 79.  NRS 119A.165, 119A.240, 119A.250, 119A.370, 119A.4773

32-16  are hereby repealed.

32-17  Sec. 80.  Notwithstanding the provisions of section 29 of this act, a

32-18  person who is engaged in the business of, acting in the capacity of,

32-19  advertising or assuming to act as a manager on October 1, 2001, shall

32-20  register with the real estate division of the department of business and

32-21  industry no later than January 1, 2002.

32-22  Sec. 81.  The amendatory provisions of this act do not apply to

32-23  offenses committed before October 1, 2001.

32-24  Sec. 82.  1.  This section and sections 1 to 76, inclusive, and 78 to 81,

32-25  inclusive, of this act become effective on October 1, 2001.

32-26  2.  Section 77 of this act becomes effective on the date on which the

32-27  provisions of 42 U.S.C. § 666 requiring each state to establish procedures

32-28  under which the state has authority to withhold or suspend, or to restrict the

32-29  use of professional, occupational and recreational licenses of persons who:

32-30  (a) Have failed to comply with a subpoena or warrant relating to a

32-31  procedure to determine the paternity of a child or to establish or enforce an

32-32  obligation for the support of a child; or

32-33  (b) Are in arrears in the payment for the support of one or more

32-34  children,

32-35  are repealed by the Congress of the United States.

 

32-36  TEXT OF REPEALED SECTIONS

 

32-37  119A.165  Applicability of chapter to matter also governed by

32-38   chapter 116 of NRS.

32-39  1.  If a matter governed by this chapter is also governed by chapter 116

32-40   of NRS, compliance with the provisions of chapter 116 of NRS governing

32-41   the matter which are in addition to or different from the provisions in this

32-42   chapter governing the same matter is not required. In the event of a

32-43   conflict between provisions of this chapter and chapter 116 of NRS, the

32-44   provisions of this chapter prevail.

33-1    2.  Without limiting the generality of subsection 1, the provisions of

33-2  NRS 116.11145, 116.12065, 116.3103, 116.31031, 116.31034, 116.3106,

33-3   116.31065, 116.3108 to 116.311, inclusive, 116.31139, 116.31145 to

33-4   116.31158, inclusive, 116.31162, 116.31175, 116.31177, 116.41095 and

33-5   116.4117 do not apply to a time share or a time-share project.

33-6    119A.240  Representatives: Qualifications for registration.

33-7    1.  The administrator shall register as a representative each applicant

33-8   who:

33-9    (a) Submits proof satisfactory to the division that he has a reputation for

33-10   honesty, trustworthiness and competence;

33-11  (b) Applies for registration in the manner provided by the division;

33-12  (c) Submits the statement required pursuant to NRS 119A.263; and

33-13  (d) Pays the fees provided for in this chapter.

33-14  2.  An application for registration as a representative must include the

33-15   social security number of the applicant.

33-16  119A.250  Representatives: Expiration, renewal, reinstatement and

33-17   transfer of registration.

33-18  1.  All registrations issued pursuant to this chapter expire 1 year after

33-19   their issuance.

33-20  2.  Each representative who submits the statement required pursuant to

33-21   NRS 119A.263 and meets the requirements for renewal adopted by the

33-22   division may renew his registration upon the payment of the annual

33-23   renewal fee before the expiration of his registration.

33-24  3.  If a representative fails to pay the annual renewal fee before the

33-25   expiration of his registration, the registration may be reinstated upon the

33-26   submission of the statement and payment of the reinstatement fee in

33-27   addition to the annual renewal fee. A registration may be reinstated under

33-28   this subsection only if the statement is submitted and the fees are paid

33-29   within 1 year after the registration expires.

33-30  4.  A representative issued a registration shall not change his

33-31   association to another developer or change his location with the same

33-32   developer unless he has obtained from the division a transfer of his

33-33   registration for its unexpired term. An application to the division for the

33-34   transfer of his registration for the unexpired term must be accompanied by

33-35   the fee specified in NRS 119A.360 for the transfer of registration.

33-36  119A.370  Approval of advertisement or offering.

33-37  1.  A time share must not be advertised or offered for sale within this

33-38   state until the advertisement or offering is approved by the division.

33-39  2.  Each advertisement must contain the processing number assigned to

33-40   it by the division.

33-41  3.  Each application for the approval of advertising must:

33-42  (a) Include the form and content of advertising to be used;

33-43  (b) Include the nature of the offer of gifts or other free benefits to be

33-44   extended;

33-45  (c) Include the nature of promotional meetings involving any person or

33-46   act described in NRS 119A.300; and

33-47  (d) Be accompanied by a filing fee of not more than $200, to be

33-48   established by the division.

34-1    4.  The division shall render a decision upon an application for the

34-2  approval of advertising or an offer for sale within 30 days after the date the

34-3   application is filed.

34-4    119A.4773  Approval of advertisement or offering.

34-5    1.  A time share must not be advertised or offered for resale within this

34-6   state until the advertisement or offering is approved by the division.

34-7    2.  Each advertisement must contain the processing number assigned to

34-8   it by the division.

34-9    3.  Each application for the approval of advertising must include:

34-10  (a) The form and content of advertising to be used;

34-11  (b) The nature of the offer of gifts or other free benefits to be extended;

34-12   and

34-13  (c) The nature of promotional meetings involving any person or act

34-14   described in NRS 119A.300.

34-15  4.  The division shall render a decision upon an application for the

34-16   approval of advertising or an offer for resale within 30 days after the date

34-17   the application is filed.

 

34-18  H