Senate Bill No. 261–Senator Schneider
CHAPTER..........
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; 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
1-18 absence of the units that may not be used for residential purposes.
1-19 (c) Common-interest communities or units located outside of this state,
1-20 but the provisions of NRS 116.4102 to 116.4108, inclusive, apply to all
1-21 contracts for the disposition thereof signed in this state by any party unless
1-22 exempt under subsection 2 of NRS 116.4101.
1-23 (d) Except as otherwise provided in this chapter, time shares governed
1-24 by the provisions of chapter 119A of NRS.
1-25 3. The provisions of this chapter do not:
1-26 (a) Prohibit a common-interest community created before January 1,
1-27 1992, from providing for separate classes of voting for the units’ owners
1-28 of the association;
1-29 (b) Require a common-interest community created before January 1,
1-30 1992, to comply with the provisions of NRS 116.2101 to 116.2122,
1-31 inclusive;
1-32 (c) Invalidate any assessments that were imposed on or before
1-33 October 1, 1999, by a common-interest community created before
1-34 January 1, 1992; or
1-35 (d) Prohibit a common-interest community created before January 1,
1-36 1992, from providing for a representative form of government.
1-37 4. The provisions of chapters 117 and 278A of NRS do not apply to
1-38 common-interest communities.
2-1 5. For the purposes of this section, the administrator shall establish, by
2-2 regulation, the criteria for determining whether an association is created for
2-3 the limited purpose of maintaining the landscape of the common elements
2-4 of a common-interest community, maintaining facilities for flood control
2-5 or maintaining a rural agricultural residential common-interest
2-6 community.
2-7 Sec. 2. NRS 116.212 is hereby amended to read as follows:
2-8 116.212 1. If the declaration provides that any of the powers
2-9 described in NRS 116.3102, are to be exercised by or may be delegated to
2-10 a profit or nonprofit corporation that exercises those or other powers on
2-11 behalf of one or more common-interest communities or for the benefit of
2-12 the units’ owners of one or more common-interest communities, or on
2-13 behalf of a common-interest community and a time-share plan created
2-14 pursuant to chapter 119A of NRS, all provisions of this chapter
2-15 applicable to unit-owners’ associations apply to any such corporation,
2-16 except as modified by this section.
2-17 2. Unless it is acting in the capacity of an association described in NRS
2-18 116.3101, a master association may exercise the powers set forth in
2-19 paragraph (b) of subsection 1 of NRS 116.3102 only to the extent
2-20 expressly permitted in [the] :
2-21 (a) The declarations of common-interest communities which are part of
2-22 the master association or expressly described in the delegations of power
2-23 from those common-interest communities to the master association[.] ; or
2-24 (b) The declaration of the common-interest community which is a part
2-25 of the master association and the time-share instrument creating the
2-26 time-share plan governed by the master association.
2-27 3. If the declaration of any common-interest community provides that
2-28 the executive board may delegate certain powers to a master association,
2-29 the members of the executive board have no liability for the acts or
2-30 omissions of the master association with respect to those powers following
2-31 delegation.
2-32 4. The rights and responsibilities of units’ owners with respect to the
2-33 unit-owners’ association set forth in NRS 116.3103 to 116.31038,
2-34 inclusive, 116.3108, 116.3109, 116.311 and 116.3112 apply in the conduct
2-35 of the affairs of a master association only to persons who elect the board
2-36 of a master association, whether or not those persons are otherwise units’
2-37 owners within the meaning of this chapter.
2-38 5. Even if a master association is also an association described in NRS
2-39 116.3101, the certificate of incorporation or other instrument creating the
2-40 master association and the declaration of each common-interest
2-41 community, the powers of which are assigned by the declaration or
2-42 delegated to the master association, may provide that the executive board
2-43 of the master association must be elected after the period of the declarant’s
2-44 control in any of the following ways:
2-45 (a) All units’ owners of all common-interest communities subject to the
2-46 master association may elect all members of the master association’s
2-47 executive board.
2-48 (b) All members of the executive boards of all common-interest
2-49 communities subject to the master association may elect all members of
2-50 the master association’s executive board.
3-1 (c) All units’ owners of each common-interest community subject to the
3-2 master association may elect specified members of the master association’s
3-3 executive board.
3-4 (d) All members of the executive board of each common-interest
3-5 community subject to the master association may elect specified members
3-6 of the master association’s executive board.
3-7 Sec. 3. NRS 116.31032 is hereby amended to read as follows:
3-8 116.31032 1. Except as otherwise provided in [subsection 2,] this
3-9 section, the declaration may provide for a period of declarant’s control of
3-10 the association, during which a declarant, or persons designated by him,
3-11 may appoint and remove the officers of the association and members of
3-12 the executive board. Regardless of the period provided in the declaration, a
3-13 period of declarant’s control terminates no later than : [the earlier of:]
3-14 (a) Sixty days after conveyance of 75 percent of the units that may be
3-15 created to units’ owners other than a declarant[, except that if a majority
3-16 of the units are divided into time shares, the percentage is 80 percent;] or,
3-17 if the association exercises powers over a common-interest community
3-18 pursuant to this chapter and a time-share plan pursuant to chapter 119A
3-19 of NRS, 120 days after conveyance of 80 percent of the units that may be
3-20 created to units’ owners other than a declarant;
3-21 (b) Five years after all declarants have ceased to offer units for sale in
3-22 the ordinary course of business; or
3-23 (c) Five years after any right to add new units was last exercised
3-24 [.] ,
3-25 whichever occurs earlier.
3-26 2. A declarant may voluntarily surrender the right to appoint and
3-27 remove officers and members of the executive board before termination of
3-28 that period, but in that event the declarant may require, for the duration of
3-29 the period of declarant’s control, that specified actions of the association
3-30 or executive board, as described in a recorded instrument executed by the
3-31 declarant, be approved by the declarant before they become effective.
3-32 [2.] 3. Not later than 60 days after conveyance of 25 percent of the
3-33 units that may be created to units’ owners other than a declarant, at least
3-34 one member and not less than 25 percent of the members of the executive
3-35 board must be elected by units’ owners other than the declarant. Not later
3-36 than 60 days after conveyance of 50 percent of the units that may be
3-37 created to units’ owners other than a declarant, not less than 33 1/3 percent
3-38 of the members of the executive board must be elected by units’ owners
3-39 other than the declarant.
3-40 Sec. 4. NRS 116.31038 is hereby amended to read as follows:
3-41 116.31038 Within 30 days after units’ owners other than the declarant
3-42 may elect a majority of the members of the executive board, the declarant
3-43 shall deliver to the association all property of the units’ owners and of the
3-44 association held by or controlled by him, including:
3-45 1. The original or a certified copy of the recorded declaration as
3-46 amended, the association’s articles of incorporation if the association is
3-47 incorporated, bylaws, minute books and other books and records of the
3-48 association and any rules or regulations which may have been adopted.
3-49 2. An accounting for money of the association and financial statements
3-50 from the date the association received money to the date the period of the
4-1 declarant’s control ends. The financial statements must fairly and
4-2 accurately report the association’s financial condition prepared in
4-3 accordance with generally accepted accounting principles.
4-4 3. A complete study of the reserves of the association, conducted by a
4-5 person qualified by training and experience to conduct such a study. At the
4-6 time the control of the declarant ends, he shall:
4-7 (a) Except as otherwise provided in this paragraph, deliver to the
4-8 association a reserve account that contains the declarant’s share of the
4-9 amounts then due, and control of the account. If the declaration was
4-10 recorded before October 1, 1999, and, at the time the control of the
4-11 declarant ends, he has failed to pay his share of the amounts due, the
4-12 executive board shall authorize the declarant to pay the deficiency in
4-13 installments for a period of 3 years, unless the declarant and the executive
4-14 board agree to a shorter period.
4-15 (b) Disclose, in writing, the amount by which he has subsidized the
4-16 association’s dues on a per unit or per lot basis.
4-17 [The provisions of this subsection do not apply to a time share or time
4-18 -share project governed by the provisions of chapter 119A of NRS.]
4-19 4. The association’s money or control thereof.
4-20 5. All of the declarant’s tangible personal property that has been
4-21 represented by the declarant as property of the association or, unless the
4-22 declarant has disclosed in the public offering statement that all such
4-23 personal property used in the common-interest community will remain the
4-24 declarant’s property, all of the declarant’s tangible personal property that
4-25 is necessary for, and has been used exclusively in, the operation and
4-26 enjoyment of the common elements, and inventories of these properties.
4-27 6. A copy of any plans and specifications used in the construction of
4-28 the improvements in the common-interest community which were
4-29 completed within 2 years before the declaration was recorded.
4-30 7. All insurance policies then in force, in which the units’ owners, the
4-31 association, or its directors and officers are named as insured persons.
4-32 8. Copies of any certificates of occupancy that may have been issued
4-33 with respect to any improvements comprising the common-interest
4-34 community other than units in a planned community.
4-35 9. Any renewable permits and approvals issued by governmental
4-36 bodies applicable to the common-interest community which are in force
4-37 and any other permits and approvals so issued and applicable which are
4-38 required by law to be kept on the premises of the community.
4-39 10. Written warranties of the contractor, subcontractors, suppliers and
4-40 manufacturers that are still effective.
4-41 11. A roster of owners and mortgagees of units and their addresses and
4-42 telephone numbers, if known, as shown on the declarant’s records.
4-43 12. Contracts of employment in which the association is a contracting
4-44 party.
4-45 13. Any contract for service in which the association is a contracting
4-46 party or in which the association or the units’ owners have any obligation
4-47 to pay a fee to the persons performing the services.
4-48 Sec. 5. NRS 116.3115 is hereby amended to read as follows:
4-49 116.3115 1. Until the association makes an assessment for common
4-50 expenses, the declarant shall pay all common expenses. After an
5-1 assessment has been made by the association, assessments must be made at
5-2 least annually, based on a budget adopted at least annually by the
5-3 association in accordance with the requirements set forth in NRS
5-4 116.31151. [Except for an association for a time-share project governed by
5-5 the provisions of chapter 119A of NRS, and unless] Unless the declaration
5-6 imposes more stringent standards, the budget must include a budget for the
5-7 daily operation of the association and the money for the reserve required
5-8 by paragraph (b) of subsection 2.
5-9 2. Except for assessments under subsections 4 to 7, inclusive:
5-10 (a) All common expenses, including a reserve, must be assessed against
5-11 all the units in accordance with the allocations set forth in the declaration
5-12 pursuant to subsections 1 and 2 of NRS 116.2107.
5-13 (b) The association shall establish an adequate reserve, funded on a
5-14 reasonable basis, for the repair, replacement and restoration of the major
5-15 components of the common elements. The reserve may be used only for
5-16 those purposes, including, without limitation, repairing, replacing and
5-17 restoring roofs, roads and sidewalks, and must not be used for daily
5-18 maintenance.
5-19 3. Any past due assessment for common expenses or installment
5-20 thereof bears interest at the rate established by the association not
5-21 exceeding 18 percent per year.
5-22 4. To the extent required by the declaration:
5-23 (a) Any common expense associated with the maintenance, repair,
5-24 restoration or replacement of a limited common element must be assessed
5-25 against the units to which that limited common element is assigned,
5-26 equally, or in any other proportion the declaration provides;
5-27 (b) Any common expense or portion thereof benefiting fewer than all of
5-28 the units must be assessed exclusively against the units benefited; and
5-29 (c) The costs of insurance must be assessed in proportion to risk and the
5-30 costs of utilities must be assessed in proportion to usage.
5-31 5. Assessments to pay a judgment against the association may be made
5-32 only against the units in the common-interest community at the time the
5-33 judgment was entered, in proportion to their liabilities for common
5-34 expenses.
5-35 6. If any common expense is caused by the misconduct of any unit’s
5-36 owner, the association may assess that expense exclusively against his
5-37 unit.
5-38 7. The association of a common-interest community created before
5-39 January 1, 1992, is not required to make an assessment against a vacant lot
5-40 located within the community that is owned by the declarant.
5-41 8. If liabilities for common expenses are reallocated, assessments for
5-42 common expenses and any installment thereof not yet due must be
5-43 recalculated in accordance with the reallocated liabilities.
5-44 9. The association shall provide written notice to the owner of each
5-45 unit of a meeting at which an assessment for a capital improvement or the
5-46 commencement of a civil action is to be considered or action is to be taken
5-47 on such an assessment at least 21 calendar days before the meeting. Except
5-48 as otherwise provided in this subsection, the association may commence a
5-49 civil action only upon a vote or written agreement of the owners of units to
5-50 which at least a majority of the votes of the members of the association are
6-1 allocated. The provisions of this subsection do not apply to a civil action
6-2 that is commenced:
6-3 (a) [By an association for a time-share project governed by the
6-4 provisions of chapter 119A of NRS;
6-5 (b)] To enforce the payment of an assessment;
6-6 [(c)] (b) To enforce the declaration, bylaws or rules of the association;
6-7 [(d)] (c) To proceed with a counterclaim; or
6-8 [(e)] (d) To protect the health, safety and welfare of the members of the
6-9 association. If a civil action is commenced pursuant to this paragraph
6-10 without the required vote or agreement, the action must be ratified within
6-11 90 days after the commencement of the action by a vote or written
6-12 agreement of the owners of the units to which at least a majority of votes
6-13 of the members of the association are allocated. If the association, after
6-14 making a good faith effort, cannot obtain the required vote or agreement to
6-15 commence or ratify such a civil action, the association may thereafter seek
6-16 to dismiss the action without prejudice for that reason only if a vote or
6-17 written agreement of the owners of the units to which at least a majority of
6-18 votes of the members of the association are allocated was obtained at the
6-19 time the approval to commence or ratify the action was sought.
6-20 10. At least 10 days before an association commences or seeks to
6-21 ratify the commencement of a civil action, the association shall provide a
6-22 written statement to all units’ owners that includes:
6-23 (a) A reasonable estimate of the costs of the civil action, including
6-24 reasonable attorney’s fees;
6-25 (b) An explanation of the potential benefits of the civil action and the
6-26 potential adverse conGreen numbers along left margin indicate location on the printed bill (e.g., 5-15 indicates page 5, line 15).sequences if the association does not commence the
6-27 action or if the outcome of the action is not favorable to the association;
6-28 and
6-29 (c) All disclosures that are required to be made upon the sale of the
6-30 property.
6-31 11. No person other than a unit’s owner may request the dismissal of a
6-32 civil action commenced by the association on the ground that the
6-33 association failed to comply with any provision of this section.
6-34 Sec. 6. NRS 116.4102 is hereby amended to read as follows:
6-35 116.4102 1. Except as otherwise provided in subsection 2, a
6-36 declarant, before offering any interest in a unit to the public, shall prepare
6-37 a public offering statement conforming to the requirements of NRS
6-38 116.4103 to 116.4106, inclusive.
6-39 2. A declarant may transfer responsibility for the preparation of all or a
6-40 part of the public offering statement to a successor declarant [(] pursuant
6-41 to NRS 116.3104 and 116.31043 , [)] or to a dealer who intends to offer
6-42 units in the common-interest community. In the event of any such transfer,
6-43 the transferor shall provide the transferee with any information necessary
6-44 to enable the transferee to fulfill the requirements of subsection 1.
6-45 3. Any declarant or dealer who offers a unit to a purchaser shall deliver
6-46 a public offering statement in the manner prescribed in subsection 1 of
6-47 NRS 116.4108. The declarant or his transferee under subsection 2 is liable
6-48 under NRS 116.4108 and 116.4117 for any false or misleading statement
6-49 set forth therein or for any omission of a material fact therefrom with
6-50 respect to that portion of the public offering statement which he prepared.
7-1 If a declarant or dealer did not prepare any part of a public offering
7-2 statement that he delivers, he is not liable for any false or misleading
7-3 statement set forth therein or for any omission of a material fact therefrom
7-4 unless he had actual knowledge of the statement or omission or, in the
7-5 exercise of reasonable care, should have known of the statement or
7-6 omission.
7-7 4. If a unit is part of a common-interest community and is part of any
7-8 other real estate in connection with the sale of which the delivery of a
7-9 public offering statement is required under the laws of this state, a single
7-10 public offering statement conforming to the requirements of NRS
7-11 116.4103 to 116.4106, inclusive, as those requirements relate to the real
7-12 estate in which the unit is located, and to any other requirements imposed
7-13 under the laws of this state, may be prepared and delivered in lieu of
7-14 providing two or more public offering statements. [Except as otherwise
7-15 provided in NRS 119A.165, if] If the requirements of this chapter conflict
7-16 with those of another law of this state, the requirements of this chapter
7-17 prevail.
7-18 Sec. 7. NRS 116.4109 is hereby amended to read as follows:
7-19 116.4109 1. Except in the case of a sale in which delivery of a public
7-20 offering statement is required, or unless exempt under subsection 2 of
7-21 NRS 116.4101, a unit’s owner shall furnish to a purchaser before
7-22 execution of any contract for sale of a unit, or otherwise before
7-23 conveyance:
7-24 (a) A copy of the declaration, other than any plats and plans, the bylaws,
7-25 the rules or regulations of the association and[, except for a time share
7-26 governed by the provisions of chapter 119A of NRS,] the information
7-27 statement required by NRS 116.41095;
7-28 (b) A statement setting forth the amount of the monthly assessment for
7-29 common expenses and any unpaid assessment of any kind currently due
7-30 from the selling unit’s owner;
7-31 (c) The current operating budget of the association and a financial
7-32 statement for the association; and
7-33 (d) A statement of any unsatisfied judgments or pending legal actions
7-34 against the association and the status of any pending legal actions relating
7-35 to the common-interest community of which the unit’s owner has actual
7-36 knowledge.
7-37 2. The association, within 10 days after a request by a unit’s owner,
7-38 shall furnish a certificate containing the information necessary to enable
7-39 the unit’s owner to comply with this section. A unit’s owner providing a
7-40 certificate pursuant to subsection 1 is not liable to the purchaser for any
7-41 erroneous information provided by the association and included in the
7-42 certificate.
7-43 3. Neither a purchaser nor the purchaser’s interest in a unit is liable for
7-44 any unpaid assessment or fee greater than the amount set forth in the
7-45 certificate prepared by the association. If the association fails to furnish
7-46 the certificate within the 10 days allowed by subsection 2, the seller is not
7-47 liable for the delinquent assessment.
7-48 Sec. 8. Chapter 119A of NRS is hereby amended by adding thereto
7-49 the provisions set forth as sections 9 to 31, inclusive, of this act.
7-50 Sec. 9. “Affiliate of the manager” means any person who controls,
7-51 is controlled by or is under common control with a manager, including a
7-52 person who:
8-1 1. Is a general partner, officer, director or employer of the manager;
8-2 2. Directly or indirectly or acting in concert with one or more
8-3 persons, or through one or more subsidiaries, owns, controls, or holds
8-4 with the power to vote more than 20 percent of the voting interest in the
8-5 manager;
8-6 3. Controls the election of a majority of the directors of the
8-7 manager; or
8-8 4. Has contributed more than 20 percent of the capital of the
8-9 manager.
8-10 Sec. 10. “Association” means an association of owners established
8-11 pursuant to NRS 119A.520.
8-12 Sec. 11. “Board” means the governing body designated in a time
8-13 -share instrument to act on behalf of an association.
8-14 Sec. 12. “Common area” means those portions of a project other
8-15 than the units. The term includes any easement which benefits the
8-16 project.
8-17 Sec. 13. “Developer’s reserved rights” means any right reserved in a
8-18 time-share instrument for the benefit of the developer, the exercise of
8-19 which does not require a vote of the other owners.
8-20 Sec. 14. “Limited common area” means a portion of the common
8-21 area allocated by a time-share instrument for the exclusive use of at
8-22 least one, but not all, of the units in a project.
8-23 Sec. 15. “Manager” means a person who undertakes, directly or
8-24 indirectly, the duties, responsibilities and obligations of managing, in
8-25 whole or in part, a time-share plan or a project, or both, in accordance
8-26 with an agreement entered into pursuant to NRS 119A.530.
8-27 Sec. 16. “Permanent identifying number” means a series of
8-28 numbers or letters, or any combination thereof, which identifies, for the
8-29 duration of a time-share plan, one time share in the plan.
8-30 Sec. 17. “Time-share plan” means the rights to time shares and the
8-31 obligations and interests appurtenant thereto created by a time-share
8-32 instrument.
8-33 Sec. 18. 1. A building code may not impose any requirements upon
8-34 any structure in a project which it would not impose upon a physically
8-35 identical development under a different form of ownership.
8-36 2. Except as otherwise provided in subsection 1, the provisions of this
8-37 chapter do not invalidate or modify any provision of any building code
8-38 or zoning, subdivision or other law, ordinance, rule or regulation
8-39 governing the use of real estate.
8-40 Sec. 19. 1. Except as otherwise provided in subsection 2 and
8-41 subject to the provisions of the time-share instrument and other
8-42 provisions of law, a developer may, with the prior approval of the
8-43 division, relocate the boundaries between adjoining units by amending
8-44 the provisions of the time-share instrument and any recorded map or
8-45 plat relating thereto.
8-46 2. A developer may relocate the boundaries between adjoining units
8-47 without the prior approval of the division if:
8-48 (a) The relocation is necessary to comply with the law; or
8-49 (b) No time share attributable to either of the adjoining units is owned
8-50 by a purchaser.
9-1 Sec. 20. The provisions of this chapter and chapter 645 of NRS
9-2 relating to real estate brokers and sales agents do not apply to an owner,
9-3 other than a developer, who, for compensation, refers prospective
9-4 purchasers to a developer or an employee or agent of the developer, if
9-5 the owner:
9-6 1. Refers to the developer or an employee or agent of the developer,
9-7 or any combination thereof, not more than 20 prospective purchasers
9-8 within any 1 calendar year; and
9-9 2. Does not show a unit to the prospective purchaser, discuss with the
9-10 prospective purchaser the terms and conditions of the purchase or
9-11 otherwise participate in negotiations relating to the sale of the time
9-12 share.
9-13 Sec. 21. If a time-share instrument authorizes the developer to
9-14 withdraw units from the time-share plan, any unit that is subject to
9-15 withdrawal may not be withdrawn if a time share attributable to that unit
9-16 is owned by a purchaser.
9-17 Sec. 22. A description of a time share is a legally sufficient
9-18 description of the time share and all rights, obligations and interests
9-19 appurtenant to that time share that were created by the time-share plan
9-20 if the description includes, without limitation:
9-21 1. The name under which the time-share plan is registered with the
9-22 division;
9-23 2. The county in which the project is located;
9-24 3. Information which indicates where the time-share instruments are
9-25 recorded; and
9-26 4. The permanent identifying number of the time share as set forth
9-27 in the time-share instruments.
9-28 Sec. 23. 1. Except as otherwise provided in this section, a time
9-29 -share instrument may provide for a period of the developer’s control of
9-30 an association during which the developer, or a person designated by
9-31 him, may appoint and remove the officers of the association and the
9-32 members of the board. Regardless of the period provided in the time
9-33 -share instrument, the period of the developer’s control of the association
9-34 terminates no later than:
9-35 (a) One hundred and twenty days after conveyance of 80 percent of
9-36 the time shares that may be created by the time-share instrument to
9-37 owners other than the developer;
9-38 (b) Five years after the developer has ceased to offer time shares for
9-39 sale in the ordinary course of business; or
9-40 (c) Five years after any right to add new time shares was last
9-41 exercised,
9-42 whichever occurs earlier.
9-43 2. A developer may voluntarily surrender the right to appoint and
9-44 remove officers and members of the board before the end of the period
9-45 provided for in subsection 1 by executing and recording with the time
9-46 -share instrument a written instrument declaring the surrender. If such
9-47 an instrument is recorded, the developer may require that, for the
9-48 duration of the period of the developer’s control, specified actions of the
9-49 association or board, as described in the recorded instrument, be
9-50 approved by the developer before they become effective.
10-1 3. Not later than 60 days after conveyance of 25 percent of the time
10-2 shares that may be created pursuant to the time-share instrument to
10-3 owners other than the developer, at least one member and not less than
10-4 25 percent of the members of the board must be elected by owners other
10-5 than the developer. Not later than 60 days after conveyance of 50
10-6 percent of the time shares that may be created pursuant to the time
10-7 -share instrument to owners other than the developer, not less than 33
10-8 1/3 percent of the members of the board must be elected by owners other
10-9 than the developer.
10-10 Sec. 24. 1. Notwithstanding any provision of a time-share
10-11 instrument or the bylaws of an association to the contrary, the owners,
10-12 by a two-thirds vote of all persons present, in person or by proxy, who
10-13 are entitled to vote at any meeting of the owners at which a quorum is
10-14 present, may remove any member of the board, with or without cause,
10-15 other than a member appointed by the developer.
10-16 2. If a member of the board is sued for liability for actions
10-17 undertaken in his role as a member of the board, the association shall
10-18 indemnify him for his losses or claims, and undertake all costs of
10-19 defense, unless it is proven that he acted with willful or wanton
10-20 misfeasance or with gross negligence. After such proof, the association
10-21 is no longer liable for the costs of defense, and may recover from the
10-22 member of the board who so acted, costs already expended. Members of
10-23 the board are not personally liable to the victims of crimes occurring on
10-24 the project. Punitive damages may not be recovered against the
10-25 association, but may be recovered from persons whose activity gave rise
10-26 to the damages.
10-27 Sec. 25. 1. Unless the bylaws of an association specify a larger
10-28 percentage, a quorum is present throughout any meeting of the
10-29 association if persons entitled to cast 10 percent of the votes that may be
10-30 cast are present in person or by proxy at the beginning of the meeting.
10-31 2. Unless the bylaws of an association provide otherwise, a quorum
10-32 shall be deemed to be present throughout a meeting of the board if
10-33 persons entitled to cast a majority of the votes on that board are present
10-34 at the beginning of the meeting.
10-35 Sec. 26. 1. The board of an association shall:
10-36 (a) Cause to be conducted at least once every 5 years, a study of the
10-37 reserves required to repair, replace and restore the major components of
10-38 the project;
10-39 (b) Review the results of that study at least annually to determine if
10-40 those reserves are sufficient; and
10-41 (c) Make any adjustments it deems necessary to maintain the required
10-42 reserves.
10-43 2. The study required by subsection 1 must be conducted by a person
10-44 qualified by training and experience to conduct such a study, including
10-45 a member of the board or the manager of the time-share plan or the
10-46 project, or both, who is so qualified. The study must include, without
10-47 limitation:
10-48 (a) A summary of an inspection of the major components of the
10-49 project;
11-1 (b) An identification of the major components of the project which
11-2 have a remaining useful life of less than 30 years;
11-3 (c) An estimate of the remaining useful life of each major component
11-4 identified pursuant to paragraph (b);
11-5 (d) An estimate of the cost of repair, replacement or restoration of
11-6 each major component identified pursuant to paragraph (b) during and
11-7 at the end of its useful life; and
11-8 (e) An estimate of the total annual assessment that may be required to
11-9 cover the cost of repairing, replacing or restoring the major components
11-10 identified pursuant to paragraph (b), after subtracting the reserves of the
11-11 association as of the date of the study.
11-12 3. The administrator shall adopt by regulation the qualifications
11-13 required for conducting a study required by subsection 1.
11-14 Sec. 27. An association, upon the receipt of a written request, shall
11-15 furnish to an owner or any lender who has a security interest in a time
11-16 share or the project, a statement setting forth the amount of unpaid
11-17 assessments made against the owner’s time share. The statement must
11-18 be furnished within 10 business days after receipt of the request and is
11-19 binding on the association, the board and every owner.
11-20 Sec. 28. A developer’s reserved rights may include, without
11-21 limitation, the right to:
11-22 1. Add units or real estate to, and withdraw units or real estate from,
11-23 a time-share plan.
11-24 2. Create units, a common area or a limited common area within the
11-25 project.
11-26 3. Subdivide units or convert units into a common area.
11-27 4. Make and complete improvements to the project.
11-28 5. Maintain sales offices, management offices and signs for
11-29 advertising the time-share plan, project and models.
11-30 6. Enter into a subsidy agreement with the association in lieu of
11-31 paying the assessments allocated to the time shares owned by the
11-32 developer.
11-33 7. Provide for the establishment of a master association, as defined
11-34 in NRS 116.110358.
11-35 8. Merge or consolidate a time-share plan with another time-share
11-36 plan which has the same form of ownership.
11-37 9. Relocate boundaries between adjoining units in accordance with
11-38 the provisions of this chapter.
11-39 Sec. 29. 1. A person who wishes to engage in the business of, act
11-40 in the capacity of, advertise or assume to act as a manager shall register
11-41 with the division on a form prescribed by the division.
11-42 2. The form for registration must include, without limitation:
11-43 (a) The registered name of the time-share plan or the project, or both,
11-44 that the manager will manage;
11-45 (b) The address and telephone number of the manager’s principal
11-46 place of business;
11-47 (c) The social security number of the manager; and
11-48 (d) The name of the manager’s responsible managing employee.
11-49 3. The form for registration must be accompanied by:
12-1 (a) Satisfactory evidence, acceptable to the division, that the manager
12-2 and his employees have obtained fidelity bonds in accordance with
12-3 regulations adopted by the division; and
12-4 (b) The statement required pursuant to NRS 119A.263.
12-5 4. The division may collect a fee for registering a manager in an
12-6 amount not to exceed the administrative costs of registering the
12-7 manager.
12-8 5. As used in this section, “responsible managing employee” means
12-9 the person designated by the manager to:
12-10 (a) Make technical and administrative decisions in connection with
12-11 the manager’s business; and
12-12 (b) Hire, superintend, promote, transfer, lay off, discipline or
12-13 discharge other employees or recommend such action on behalf of the
12-14 manager.
12-15 Sec. 30. 1. A manager who enters into or renews an agreement
12-16 that must comply with the provisions of subsection 3 of NRS 119A.530
12-17 shall submit to the association and to the division a disclosure statement
12-18 that contains a description of any arrangement made by the manager or
12-19 an affiliate of the manager relating to:
12-20 (a) The resale of time shares on behalf of the association or its
12-21 members;
12-22 (b) Actions taken for the collection of assessments and the foreclosure
12-23 of liens on behalf of the association or its members;
12-24 (c) The exchange or rental of time shares owned by the association or
12-25 its members; and
12-26 (d) The use of the names of the members of the association for
12-27 purposes unrelated to the duties of the association as set forth in the
12-28 time-share instrument and this chapter.
12-29 2. The disclosure statement must be:
12-30 (a) Submitted annually at a time designated by the administrator and
12-31 at least 120 days before any date on which the agreement is
12-32 automatically renewed.
12-33 (b) Signed by the manager or an authorized representative of the
12-34 manager under penalty of perjury.
12-35 3. The administrator shall adopt regulations prescribing the form
12-36 and contents of the disclosure statements required by this section.
12-37 Sec. 31. 1. It is unlawful for any person to display or deliver to
12-38 prospective purchasers of time shares promotional material that
12-39 describes or portrays an improvement that has not been made to the
12-40 project unless the improvement is conspicuously labeled or identified
12-41 with the phrase “MUST BE BUILT” or “NEED NOT BE BUILT” or
12-42 with other similar language approved by the division.
12-43 2. A developer shall construct and complete any improvement to a
12-44 project that is described or portrayed in promotional material for the
12-45 sale of time shares unless the improvement is labeled or identified as
12-46 “NEED NOT BE BUILT” or with other similar language approved by
12-47 the division.
12-48 Sec. 32. NRS 119A.010 is hereby amended to read as follows:
12-49 119A.010 As used in this chapter, unless the context otherwise
12-50 requires, the words and terms defined in NRS 119A.020 to 119A.160,
13-1 inclusive, and sections 9 to 17, inclusive, of this act, have the meanings
13-2 ascribed to them in those sections.
13-3 Sec. 33. NRS 119A.030 is hereby amended to read as follows:
13-4 119A.030 [“Affiliate”] “Affiliate of the developer” means any person
13-5 who controls, is controlled by or is under common control with a
13-6 developer, including a person who:
13-7 1. Is a general partner, officer, director or employer of the developer;
13-8 2. Directly or indirectly or acting in concert with one or more other
13-9 persons, or through one or more subsidiaries, owns, controls, holds with
13-10 the power to vote, or holds proxies representing more than 20 percent of
13-11 the voting interest in the developer;
13-12 3. Controls the election of a majority of the directors of the
13-13 developer; or
13-14 4. Has contributed more than 20 percent of the capital of the
13-15 developer.
13-16 Sec. 34. NRS 119A.056 is hereby amended to read as follows:
13-17 119A.056 “Owner” means a [purchaser who is the equitable or legal
13-18 owner of a time share.] person, including a developer, who has an
13-19 equitable or legal interest in a time share. The term does not include a
13-20 person who has an interest in a time share solely as security for an
13-21 obligation.
13-22 Sec. 35. NRS 119A.080 is hereby amended to read as follows:
13-23 119A.080 “Project” means the real property [in which time shares are
13-24 created by a single instrument or set of instruments.] which, in whole or
13-25 in part, is the subject of a time-share plan.
13-26 Sec. 36. NRS 119A.090 is hereby amended to read as follows:
13-27 119A.090 “Project broker” means any person who coordinates the sale
13-28 of time shares for a time-share [project] plan and to whom sales agents
13-29 and representatives are responsible.
13-30 Sec. 37. NRS 119A.100 is hereby amended to read as follows:
13-31 119A.100 “Public offering statement” means a report, issued by the
13-32 administrator pursuant to the provisions of this chapter, which authorizes a
13-33 developer to offer to sell or sell time shares in the [project] time-share
13-34 plan which is the subject of the report.
13-35 Sec. 38. NRS 119A.140 is hereby amended to read as follows:
13-36 119A.140 “Time share” means the right to use and occupy a unit on a
13-37 recurrent periodic basis according to an arrangement allocating this right
13-38 among various [time-share] owners whether or not there is an additional
13-39 charge to the [time-share] owner for occupying the unit.
13-40 Sec. 39. NRS 119A.160 is hereby amended to read as follows:
13-41 119A.160 “Unit” means that portion of a project which is designated
13-42 for separate [use.] occupancy.
13-43 Sec. 40. NRS 119A.170 is hereby amended to read as follows:
13-44 119A.170 1. The provisions of this chapter, except subsection 4, do
13-45 not apply to:
13-46 (a) The sale of 12 or fewer time shares in a [time-share] project or the
13-47 sale of 12 or fewer time shares in the same subdivision;
13-48 (b) The sale or transfer of a time share by an owner who is not the
13-49 developer, unless the time share is sold in the ordinary course of business
13-50 of that owner;
14-1 (c) Any transfer of a time share [by] :
14-2 (1) By deed in lieu of foreclosure [or as a result of foreclosure of the
14-3 time share;] ;
14-4 (2) At a foreclosure sale; or
14-5 (3) By the resale of a time share that has been acquired by an
14-6 association by deed in lieu of foreclosure or at a foreclosure sale;
14-7 (d) A gratuitous transfer of a time share;
14-8 (e) A transfer by devise or descent or a transfer to an inter vivos trust; or
14-9 (f) The sale or transfer of the right to use and occupy a unit on a
14-10 periodic basis which recurs over a period of less than 5 years,
14-11 unless the method of disposition is adopted [for the purpose of evading] to
14-12 evade the provisions of this chapter[.] or chapter 645 of NRS.
14-13 2. Any campground or developer [which] who is subject to the
14-14 requirements of chapter 119B of NRS and complies with those provisions
14-15 is not required to comply with the provisions of this chapter.
14-16 3. The division may [from time to time, pursuant to regulations
14-17 adopted by it, exempt from any of the provisions] waive any provision of
14-18 this chapter [any other sale, transfer or disposition of a time share] if it
14-19 finds that the enforcement of [this chapter with respect to such a
14-20 transaction] that provision is not necessary in the public interest [and] or
14-21 for the protection of purchasers.
14-22 4. The provisions of chapter 645 of NRS apply to the sale of time
14-23 shares, except any sale of a time share to which this chapter applies, and
14-24 for that purpose the terms “real property” and “real estate” as used in
14-25 chapter 645 of NRS shall be deemed to include a time share, whether it is
14-26 an interest in real property or merely a contractual right to occupancy.
14-27 Sec. 41. NRS 119A.180 is hereby amended to read as follows:
14-28 119A.180 1. A [time-share owner] purchaser shall not be deemed to
14-29 hold an investment contract, nor shall his purchase be considered risk
14-30 capital, because income derived from the [time-share] project and any
14-31 personal property available for use by the [time-share owner] purchaser in
14-32 conjunction therewith reduces the assessment for time-share expenses, if
14-33 the income inures directly to the benefit of the association and not to his
14-34 direct benefit.
14-35 2. An interest in a time share is not a security under the provisions of
14-36 chapter 90 of NRS.
14-37 Sec. 42. NRS 119A.200 is hereby amended to read as follows:
14-38 119A.200 Time shares , [and] time-share plans and projects to which
14-39 this chapter applies are subject to licensing by local governments for
14-40 revenue but not for regulation.
14-41 Sec. 42.5. NRS 119A.250 is hereby amended to read as follows:
14-42 119A.250 1. [All registrations] The registration of a representative
14-43 issued pursuant to this chapter [expire] expires 1 year after [their] its
14-44 issuance.
14-45 2. Each representative who submits the statement required pursuant to
14-46 NRS 119A.263 and meets the requirements for renewal adopted by the
14-47 division may renew his registration upon the payment of the annual
14-48 renewal fee before the expiration of his registration.
14-49 3. If a representative fails to pay the annual renewal fee before the
14-50 expiration of his registration, the registration may be reinstated upon the
15-1 submission of the statement and payment of the reinstatement fee in
15-2 addition to the annual renewal fee. A registration may be reinstated under
15-3 this subsection only if the statement is submitted and the fees are paid
15-4 within 1 year after the registration expires.
15-5 4. A representative issued a registration shall not change his
15-6 association to another developer or change his location with the same
15-7 developer unless he has obtained from the division a transfer of his
15-8 registration for its unexpired term. An application to the division for the
15-9 transfer of his registration for the unexpired term must be accompanied by
15-10 the fee specified in NRS 119A.360 for the transfer of registration.
15-11 Sec. 43. NRS 119A.260 is hereby amended to read as follows:
15-12 119A.260 1. A representative shall not negotiate or make
15-13 representations concerning the merits or value of a time-share plan or a
15-14 project. He may only induce and solicit persons to attend promotional
15-15 meetings for the sale of time shares and distribute information [approved
15-16 by the division.] on behalf of a developer.
15-17 2. The representative’s activities must strictly conform to the methods
15-18 for the procurement of prospective purchasers which have been approved
15-19 by the division.
15-20 3. The representative shall comply with the same standards for
15-21 conducting business as are applied to real estate brokers and salesmen
15-22 pursuant to chapter 645 of NRS and the regulations adopted pursuant
15-23 thereto.
15-24 4. A representative shall not make targeted solicitations of
15-25 purchasers or prospective purchasers of time shares in another project.
15-26 A developer or project broker shall not pay or offer to pay a
15-27 representative a bonus or other type of special compensation to engage
15-28 in such activity.
15-29 Sec. 44. NRS 119A.263 is hereby amended to read as follows:
15-30 119A.263 1. An applicant for the issuance or renewal of a sales
15-31 agent’s license or registration as a representative or manager shall submit
15-32 to the administrator the statement prescribed by the welfare division of the
15-33 department of human resources pursuant to NRS 425.520. The statement
15-34 must be completed and signed by the applicant.
15-35 2. The administrator shall include the statement required pursuant to
15-36 subsection 1 in:
15-37 (a) The application or any other forms that must be submitted for the
15-38 issuance or renewal of the license or registration; or
15-39 (b) A separate form prescribed by the administrator.
15-40 3. A sales agent’s license or registration as a representative or
15-41 manager may not be issued or renewed by the administrator if the
15-42 applicant:
15-43 (a) Fails to complete or submit the statement required pursuant to
15-44 subsection 1; or
15-45 (b) Indicates on the statement submitted pursuant to subsection 1 that he
15-46 is subject to a court order for the support of a child and is not in
15-47 compliance with the order or a plan approved by the district attorney or
15-48 other public agency enforcing the order for the repayment of the amount
15-49 owed pursuant to the order.
15-50 4. If an applicant indicates on the statement submitted pursuant to
15-51 subsection 1 that he is subject to a court order for the support of a child
15-52 and
16-1 is not in compliance with the order or a plan approved by the district
16-2 attorney or other public agency enforcing the order for the repayment of
16-3 the amount owed pursuant to the order, the administrator shall advise the
16-4 applicant to contact the district attorney or other public agency enforcing
16-5 the order to determine the actions that the applicant may take to satisfy the
16-6 arrearage.
16-7 Sec. 45. NRS 119A.266 is hereby amended to read as follows:
16-8 119A.266 1. If the administrator receives a copy of a court order
16-9 issued pursuant to NRS 425.540 that provides for the suspension of all
16-10 professional, occupational and recreational licenses, certificates and
16-11 permits issued to a person who has been issued a sales agent’s license or
16-12 has been registered as a representative [,] or manager, the administrator
16-13 shall deem the license or registration to be suspended at the end of the
16-14 30th day after the date on which the court order was issued unless the
16-15 administrator receives a letter issued to the holder of the license or
16-16 registration by the district attorney or other public agency pursuant to NRS
16-17 425.550 stating that the holder of the license or registration has complied
16-18 with the subpoena or warrant or has satisfied the arrearage pursuant to
16-19 NRS 425.560.
16-20 2. The administrator shall reinstate a sales agent’s license or the
16-21 registration of a representative or manager that has been suspended by a
16-22 district court pursuant to NRS 425.540 if the administrator receives a letter
16-23 issued by the district attorney or other public agency pursuant to NRS
16-24 425.550 to the person whose license or registration was suspended stating
16-25 that the person whose license or registration was suspended has complied
16-26 with the subpoena or warrant or has satisfied the arrearage pursuant to
16-27 NRS 425.560.
16-28 Sec. 46. NRS 119A.300 is hereby amended to read as follows:
16-29 119A.300 Except as otherwise provided in NRS 119A.310, the
16-30 administrator shall issue a public offering statement and a permit to sell
16-31 time shares to each applicant who:
16-32 1. Submits an application, in the manner provided by the division,
16-33 which includes:
16-34 (a) The name and address of the project broker;
16-35 (b) A copy of [the document in which the time-share project is created;]
16-36 each time-share instrument that relates to the time-share plan;
16-37 (c) A preliminary title report for the [time-share] project and copies of
16-38 the documents listed as exceptions in the report;
16-39 (d) Copies of any other documents which relate to the time-share plan
16-40 or the project, including any contract, agreement or other document to be
16-41 used to establish and maintain an association [of time-share owners] and to
16-42 provide for the management of the time-share plan or the project[;] , or
16-43 both;
16-44 (e) Copies of instructions for escrow, deeds, sales contracts and any
16-45 other documents that will be used in the sale of the time shares;
16-46 (f) A copy of any proposed trust agreement which establishes a trust for
16-47 the time-share plan or the project[;] , or both;
16-48 (g) Documents which show the current assessments for property taxes
16-49 on the [time-share] project;
16-50 (h) Documents which show compliance with local zoning laws;
17-1 (i) If the units [in the time-share project] which are the subject of the
17-2 time-share plan are in a condominium project, or other form of
17-3 [community] common-interest ownership of property, documents which
17-4 show that use of the units [in a time-share project] is in compliance with
17-5 the documents which created the [community] common-interest
17-6 ownership;
17-7 (j) Copies of all documents which will be given to a purchaser who is
17-8 interested in participating in a program for the exchange of occupancy
17-9 rights among [time-share] owners and copies of the documents which
17-10 show acceptance of the time-share [project] plan in such a program;
17-11 (k) A copy of the budget or a projection of the operating expenses of the
17-12 association, if applicable;
17-13 (l) A financial statement of the developer; and
17-14 (m) Such other information as the division, by regulation, requires; and
17-15 2. Pays the fee provided for in this chapter.
17-16 Sec. 47. NRS 119A.305 is hereby amended to read as follows:
17-17 119A.305 The terms and conditions of the documents and agreements
17-18 submitted pursuant to NRS 119A.300 which relate to the creation and
17-19 management of the time-share [project] plan and to the sale of time shares
17-20 and to which the applicant or an affiliate of the applicant is a party must be
17-21 described in the public offering statement and constitute additional terms
17-22 and conditions of the applicant’s permit to sell time shares.
17-23 Sec. 48. NRS 119A.310 is hereby amended to read as follows:
17-24 119A.310 1. The administrator shall deny an application for a permit
17-25 to sell time shares if he finds that:
17-26 (a) The developer failed to comply with any of the provisions of this
17-27 chapter or the regulations adopted by the division; or
17-28 (b) The developer, any [of its affiliates] affiliate of the developer or any
17-29 officer of the developer or an affiliate[,] of the developer, has:
17-30 (1) Been convicted of or pleaded nolo contendere to forgery,
17-31 embezzlement, obtaining money under false pretenses, larceny, extortion,
17-32 conspiracy to defraud or other crime involving moral turpitude;
17-33 (2) Been the subject of a judgment in any civil or administrative
17-34 action, including a proceeding to revoke or suspend a license, involving
17-35 fraud or dishonesty;
17-36 (3) Been permanently enjoined by a court of competent jurisdiction
17-37 from selling real estate, time shares or securities in an unlawful manner;
17-38 (4) Had a registration as a broker-dealer in securities or a license to
17-39 act as a real estate broker or salesman, project broker or sales agent
17-40 revoked;
17-41 (5) Been convicted of or pleaded nolo contendere to selling time
17-42 shares without a license; or
17-43 (6) Had a permit to sell time shares, securities or real estate revoked.
17-44 2. The administrator may deny an application for a permit to sell time
17-45 shares if he finds that the developer, or any [of its affiliates,] affiliate of
17-46 the developer, has failed to offer satisfactory proof that it has a good
17-47 reputation for honesty, trustworthiness, integrity and competence to
17-48 transact the business of a developer in a manner which safeguards the
17-49 interests of the public.
18-1 3. The burden of proof is on the developer to establish to the
18-2 satisfaction of the division that [it] he is qualified to receive a license.
18-3 Sec. 49. NRS 119A.340 is hereby amended to read as follows:
18-4 119A.340 If a [time-share] project has not been completed before the
18-5 issuance of a permit to sell time shares, the permit must state the estimated
18-6 date of completion and:
18-7 1. The developer shall deliver to the agency a bond in an amount and
18-8 upon terms approved by the division to assure completion of the [time
18-9 -share] project free of any liens, which is payable to the division for the
18-10 benefit of the purchasers of the time-share property and which remains in
18-11 effect until the [time-share] project is completed free of all liens;
18-12 2. A cash deposit to cover the estimated costs of completing the [time
18-13 -share] project must be deposited with an escrow agent under an agreement
18-14 which is approved by the division; or
18-15 3. [Any] The developer shall make any other arrangement which is
18-16 approved by the division.
18-17 Sec. 50. NRS 119A.355 is hereby amended to read as follows:
18-18 119A.355 1. A permit must be renewed annually by the developer by
18-19 filing an application with and paying the fee for renewal to the
18-20 administrator. The application must be filed and the fee paid not later than
18-21 30 days before the date on which the permit expires. The application must
18-22 include the budget of the association [of time-share owners or the budget
18-23 of the developer, if there is no association,] and any change that has
18-24 occurred in the information previously provided to the administrator or in
18-25 a statement of disclosure provided to a prospective purchaser pursuant to
18-26 the provisions of NRS 119A.400.
18-27 2. The renewal is effective on the 30th day after the filing of the
18-28 application unless the administrator:
18-29 (a) Denies the renewal pursuant to NRS 119A.654 or for any other
18-30 reason;
18-31 (b) Approves the renewal on an earlier date.
18-32 Sec. 50.5. NRS 119A.360 is hereby amended to read as follows:
18-33 119A.360 1. The division shall collect the following fees at such
18-34 times and upon such conditions as it may provide by regulation:
18-35 Application fee for preliminary permit to sell time shares......... $250
18-36 Application fee for registration of representative. 65
18-37 For renewal of registration of representative. 65
18-38 Application fee for transfer of registration of representative to
18-39 different developer or location............. 20
18-40 For reinstatement of registration of representative. 25
18-41 For each permit to sell time shares, per subdivision... 500
18-42 For each amendment to a public offering statement after the
18-43 issuance of the report.. 100
18-44 For renewal of a permit........... 500
18-45 2. Each developer shall pay an additional fee for each time share he
18-46 sells in a time-share [project] plan over 50 pursuant to the following
18-47 schedule:
19-1 Amount to be
19-2 Number of time sharespaid per time share
19-3 51-250.... $5.00
19-4 251-500..... 4.00
19-5 501-750..... 3.00
19-6 751-1500..... 2.50
19-7 over 1500..... 1.00
19-8 3. Except for the fees relating to the registration of a representative, the
19-9 administrator may reduce the fees established by this section if the
19-10 reduction is equitable in relation to the costs of carrying out the provisions
19-11 of this chapter.
19-12 Sec. 51. NRS 119A.370 is hereby amended to read as follows:
19-13 119A.370 1. A time share must not be advertised or offered for sale
19-14 within this state until the advertisement or offering is [approved by] filed
19-15 with the division.
19-16 2. Each [advertisement must contain the processing number assigned
19-17 to it by the division.
19-18 3. Each application for the approval of advertising] such filing must:
19-19 (a) Include the form and content of advertising to be used;
19-20 (b) Include the nature of the offer of gifts or other free benefits to be
19-21 extended;
19-22 (c) Include the nature of promotional meetings involving any person or
19-23 act described in NRS 119A.300; and
19-24 (d) Be accompanied by a filing fee of not more than $200, to be
19-25 established by the division.
19-26 [4. The division shall render a decision upon an application for the
19-27 approval of advertising or an offer for sale within 30 days after the date
19-28 the application is filed.]
19-29 Sec. 52. NRS 119A.380 is hereby amended to read as follows:
19-30 119A.380 1. Each time-share [project] plan must be created by [a
19-31 time-share instrument which provides:
19-32 1.] one or more time-share instruments.
19-33 2. A time-share instrument must provide:
19-34 (a) A legal description and the physical address of the [time-share
19-35 project;
19-36 2.] project;
19-37 (b) The name [and location] of the time-share [project;
19-38 3.] plan;
19-39 (c) A system [of identification of the time periods by letter, name,
19-40 number or any combination thereof;
19-41 4.] for establishing the permanent identifying numbers of the time
19-42 shares;
19-43 (d) For assessment of the expenses of the time-share [project] plan and
19-44 an allocation of those expenses among the time shares [and the] ;
19-45 (e) The voting rights which are assigned to each time share;
19-46 [5. A]
19-47 (f) If applicable, the procedure to add units and other real estate to ,
19-48 and to withdraw units and other real estate from, the time-share [project;
20-1 6.] plan, and the method of reallocating expenses among the time
20-2 shares after any such addition or withdrawal;
20-3 (g) The maximum number of time shares that may be created under
20-4 the time-share plan;
20-5 (h) For selection of the trustee for insurance which is required to be
20-6 maintained by the association or the developer;
20-7 [7.] (i) For maintenance of the [time-share units;
20-8 8.] units;
20-9 (j) For management of the time-share [project;
20-10 9.] plan;
20-11 (k) A procedure to amend the time-share instrument; and
20-12 [10.] (l) The rights of the purchaser relating to the occupancy of the
20-13 [time-share] unit.
20-14 3. A time-share instrument may provide for:
20-15 (a) The developer’s reserved rights;
20-16 (b) Cumulative voting, but only for the purpose of electing the
20-17 members of the board; and
20-18 (c) The establishment of:
20-19 (1) Separate voting classes based on the size or type of unit to which
20-20 the votes are allocated; and
20-21 (2) A separate voting class for the developer during the period in
20-22 which the developer is in control.
20-23 4. The provisions of a time-share instrument are severable.
20-24 5. The rule against perpetuities and NRS 111.103 to 111.1039,
20-25 inclusive, do not apply to defeat any provisions of a time-share
20-26 instrument.
20-27 Sec. 53. NRS 119A.430 is hereby amended to read as follows:
20-28 119A.430 Escrow may not be closed unless the developer has
20-29 provided satisfactory evidence to the administrator that:
20-30 1. The project is free and clear of any blanket encumbrance;
20-31 2. Each person who holds an interest in the blanket encumbrance has
20-32 executed an agreement, approved by the administrator, to subordinate his
20-33 rights to the rights of the purchaser;
20-34 3. Title to the [time-share] project has been conveyed to a trustee;
20-35 4. All holders of a lien recorded against the project have recorded an
20-36 instrument providing for the release and reconveyance of each time share
20-37 from the lien upon the payment of a specified sum or the performance of a
20-38 specified act;
20-39 5. [He] The developer has obtained and recorded [a] one or more
20-40 binding nondisturbance [agreement] agreements acceptable to the
20-41 administrator, that:
20-42 (a) Are executed by [himself and] the developer, all holders of a lien
20-43 recorded against the project [which provides that subsequent owners or
20-44 foreclosing holders of a lien take title to the project subject to the rights of
20-45 prior purchasers provided in the contracts] and any other person whose
20-46 interest in the project could defeat the rights or interests of any
20-47 purchaser under the time-share instrument or contract of sale; and
20-48 (b) Provide that any person whose interest in the project could defeat
20-49 the rights or interests of any purchaser under the time-share instrument
21-1 or contract of sale takes title to the project subject to the rights of the
21-2 purchasers; or
21-3 6. Alternative arrangements have been made which are adequate to
21-4 protect the rights of the purchasers of the time shares and approved by the
21-5 administrator.
21-6 Sec. 54. NRS 119A.450 is hereby amended to read as follows:
21-7 119A.450 1. A contract for the sale of a time share or any other
21-8 evidence of an obligation to purchase a time share must provide in 12
21-9 -point bold type that the purchaser is relieved of all obligations under the
21-10 contract if his interests are defeated because of the foreclosure of liens
21-11 against the project. The provisions of this subsection do not apply to any
21-12 [time-share] project which meets any one of the requirements of
21-13 subsections 1 to 5, inclusive, of NRS 119A.430.
21-14 2. If a developer or owner is in default on a blanket encumbrance, he
21-15 may not sell or pledge any of the notes or contracts of sale given in
21-16 payment of the time shares purchased from him.
21-17 Sec. 55. NRS 119A.460 is hereby amended to read as follows:
21-18 119A.460 If a trust is created pursuant to a requirement of this chapter,
21-19 the:
21-20 1. Trustee must be approved by the administrator.
21-21 2. Trust must be irrevocable, unless otherwise provided by the
21-22 division.
21-23 3. Trustee must not be permitted to encumber the property unless
21-24 permission to do so has been given by the division.
21-25 4. Association or each [time-share] owner must be made a third-party
21-26 beneficiary.
21-27 5. Trustee must be required to give at least 30 days’ notice in writing
21-28 of his intention to resign to the association, if it has been formed, and to
21-29 the division, and the division must approve a substitute trustee before the
21-30 resignation of the trustee may be accepted.
21-31 Sec. 56. NRS 119A.470 is hereby amended to read as follows:
21-32 119A.470 1. If title to a [time-share] project is conveyed to a trustee
21-33 pursuant to subsection 3 of NRS 119A.430, before escrow closes for the
21-34 sale of the first time share, the developer must provide the division with
21-35 satisfactory evidence that:
21-36 (a) Title to the project has been conveyed to the trustee.
21-37 (b) All proceeds received by the developer from the sales of time shares
21-38 are being delivered to the trustee and deposited in a fund which has been
21-39 established to provide for the payment of any taxes, costs of insurance or
21-40 the discharge of any lien recorded against the project.
21-41 2. The trustee shall pay the charges against the trust in the following
21-42 order:
21-43 (a) Trustee’s fees and costs.
21-44 (b) Payment of taxes.
21-45 (c) Payments due any holder of a lien recorded against the project.
21-46 (d) Any other payments authorized by the document creating the trust.
21-47 3. The administrator may inspect the records relating to the trust at any
21-48 reasonable time.
22-1 Sec. 57. NRS 119A.4771 is hereby amended to read as follows:
22-2 119A.4771 1. A person who , on behalf of an owner other than a
22-3 developer, wishes to list, advertise or promote for resale, or solicit
22-4 prospective purchasers of, [promote or resell] 12 or more time shares that
22-5 were previously sold must:
22-6 (a) Be licensed as a real estate broker pursuant to the provisions of
22-7 chapter 645 of NRS; and
22-8 (b) Register as a time-share resale broker with the division by
22-9 completing a form for registration provided by the division.
22-10 2. A time-share resale broker shall renew his registration with the
22-11 division annually on a form provided by the division.
22-12 3. Unless the method of resales of time shares is made to evade the
22-13 provisions of this chapter, a person is not required to register as a time
22-14 -share resale broker if the person:
22-15 (a) Has acquired fewer than 12 time shares and [who] later resells or
22-16 offers to resell one or more of those time shares; or
22-17 (b) Is a project broker who resells or offers to resell a time share in a
22-18 project as an agent for a developer who holds a permit for the project.
22-19 Sec. 57.5. NRS 119A.4773 is hereby amended to read as follows:
22-20 119A.4773 1. A time share must not be advertised or offered for
22-21 resale within this state until the advertisement or offering is [approved by]
22-22 filed with the division.
22-23 2. Each [advertisement must contain the processing number assigned
22-24 to it by the division.
22-25 3. Each application for the approval of advertising] such filing must
22-26 include:
22-27 (a) The form and content of advertising to be used;
22-28 (b) The nature of the offer of gifts or other free benefits to be extended;
22-29 and
22-30 (c) The nature of promotional meetings involving any person or act
22-31 described in NRS 119A.300.
22-32 [4. The division shall render a decision upon an application for the
22-33 approval of advertising or an offer for resale within 30 days after the date
22-34 the application is filed.]
22-35 Sec. 58. NRS 119A.4775 is hereby amended to read as follows:
22-36 119A.4775 1. Before a purchaser signs any contract to purchase a
22-37 time share that is offered for resale, the person who is reselling the time
22-38 share , other than a developer, shall disclose by a written document
22-39 separate from the contract to purchase a time share:
22-40 (a) The period during which the purchaser may use the time share;
22-41 (b) A legal description of the interest in the time share;
22-42 (c) The earliest date that the prospective purchaser may use the time
22-43 share;
22-44 (d) The name, address and telephone number of the agent managing the
22-45 time-share plan and the project;
22-46 (e) The place where the documents of formation of the association and
22-47 documents governing the time-share plan and the project may be
22-48 obtained;
22-49 (f) The amount of the annual assessment of the association of the time
22-50 share for the current fiscal year, if any;
23-1 (g) Whether all assessments against the time share are paid in full, and
23-2 the consequences of failure to pay any assessment;
23-3 (h) Whether participation in any program for the exchange of
23-4 occupancy rights among [time-share] owners or with the owners of time
23-5 shares in other time-share [properties] plans is mandatory; and
23-6 (i) Any other information required to be disclosed pursuant to the
23-7 regulations adopted by the administrator pursuant to subsection 2.
23-8 2. The administrator shall adopt regulations prescribing the form and
23-9 contents of the disclosure statement described in this section.
23-10 Sec. 59. NRS 119A.490 is hereby amended to read as follows:
23-11 119A.490 1. Any proposed amendment by the developer of the
23-12 provisions of [the document which created the time-share project] a time
23-13 -share instrument must be filed with the division.
23-14 2. Unless the division notifies the developer of its disapproval within
23-15 15 days, the amendments shall be deemed to be approved by the division.
23-16 Sec. 60. NRS 119A.500 is hereby amended to read as follows:
23-17 119A.500 No action for partition of a [time-share] unit may be
23-18 maintained except as provided in the time-share instrument. If a time share
23-19 is owned by two or more persons, an action may be brought for the
23-20 judicial sale of the time share. A provision for the waiver or subordination
23-21 of the right of partition or any other right characteristic of a tenancy in
23-22 common is valid.
23-23 Sec. 61. NRS 119A.510 is hereby amended to read as follows:
23-24 119A.510 If a unit is unavailable for a period to which the owner is
23-25 entitled by schedule or by confirmed reservation, the owner is entitled to
23-26 be provided by the association : [or, if there is no association, by the
23-27 developer:]
23-28 1. A comparable unit; or
23-29 2. Monetary compensation for the loss of such use.
23-30 Sec. 62. NRS 119A.520 is hereby amended to read as follows:
23-31 119A.520 1. Each owner is a member of the association for the time
23-32 -share [project.] plan. The association may be incorporated.
23-33 2. The state of incorporation may be:
23-34 (a) This state;
23-35 (b) The state in which the [time-share] project is located; or
23-36 (c) Any state where the developer has obtained a permit to sell time
23-37 shares under statutes which govern the sale of time shares.
23-38 3. The [developer shall transfer to the owners the control of the
23-39 association within 120 days after 80 percent of the time shares have been
23-40 sold.] association may adopt and amend bylaws, rules and regulations.
23-41 4. Except as otherwise provided in NRS 82.321, any proxy which is
23-42 executed by an owner to an association is valid for an indefinite period if
23-43 the owner may revoke his proxy, by written notice to the association, to
23-44 vote at a particular meeting.
23-45 Sec. 63. NRS 119A.530 is hereby amended to read as follows:
23-46 119A.530 1. A developer or an affiliate of the developer shall
23-47 provide for the management of the time-share plan and the project, by a
23-48 written agreement with the [time-share] association or, if there is no
23-49 association, with the owners. The initial term of the agreement must
23-50 expire upon the first annual meeting of the members of the association or
23-51 at the
24-1 end of 5 years, whichever comes first. All succeeding terms of the
24-2 agreement must be renewed annually unless the manager refuses to renew
24-3 the agreement or a majority of the [owners,] members of the association
24-4 who are entitled to vote, excluding the developer, [notify] notifies the
24-5 manager of [their] its refusal to renew the agreement.
24-6 2. The agreement must provide that:
24-7 (a) The manager or a majority of the owners may terminate the
24-8 agreement for cause.
24-9 (b) The resignation of the manager will not be accepted until 90 days
24-10 after receipt by the association, or if there is no association, by the
24-11 owners , of the written resignation.
24-12 (c) A fidelity bond must be delivered by the manager to the association.
24-13 3. An agreement entered into or renewed on or after October 1, 2001,
24-14 must contain a detailed, itemized schedule of all fees, compensation or
24-15 other property that the manager is entitled to receive for services
24-16 rendered to the association or any member of the association or
24-17 otherwise derived from the manager’s affiliation with the time-share
24-18 plan or the project, or both, unless the manager is the developer or an
24-19 affiliate of the developer. Upon the request of the association, the
24-20 manager shall disclose to the association annual revenue received by the
24-21 manager from the manager’s affiliation with the time-share plan or the
24-22 project, or both.
24-23 4. Except as otherwise provided in this subsection, if the developer
24-24 retains a [reversionary] property interest in the [time-share] project, the
24-25 parties to such an agreement must include the developer, the manager and
24-26 the association. In addition to the provisions required in subsections 1 and
24-27 2, the agreement must provide:
24-28 (a) That the project will be maintained in good condition. Except as
24-29 otherwise provided in this paragraph, any defect which is not cured within
24-30 10 days after notification by the developer may be cured by him. In an
24-31 emergency situation, notice is not required. The association must repay the
24-32 developer for any cost of the repairs plus the legal rate of interest. Each
24-33 owner must be assessed for his share of the cost of repairs.
24-34 (b) That, if any dispute arises between the developer and the manager or
24-35 association, either party may request from the American Arbitration
24-36 Association or the Nevada Arbitration Association a list of seven potential
24-37 factfinders from which one must be chosen to settle the dispute. The
24-38 agreement must provide for the method of selecting one factfinder from
24-39 this list.
24-40 (c) For the collection of assessments from the owners to pay obligations
24-41 which may be due to the developer for breach of the covenant to maintain
24-42 the premises in good condition and repair.
24-43 If the developer[, after his request to be included,] is not made a party to
24-44 this agreement, he shall be considered to be a third-party beneficiary of
24-45 such an agreement.
24-46 Sec. 64. NRS 119A.540 is hereby amended to read as follows:
24-47 119A.540 1. The association or , if there is no association, the
24-48 developer shall adopt an annual budget for revenues, expenditures and
24-49 reserves and collect assessments for the expenses of the time-share plan
24-50 and the project from [time-share] the owners. The annual budgets of the
25-1 association must be submitted to and approved by the division until such
25-2 time as the association is controlled by members other than the developer.
25-3 2. The administrator may require that the association [,] or , if there is
25-4 no association, the developer provide, at the association’s or the
25-5 developer’s expense, an opinion from an independent professional
25-6 consultant as to the sufficiency of the budget to sustain the time-share
25-7 plan offered by the association or the developer. The association or the
25-8 developer shall place any money collected for assessments [in a trust
25-9 account.] and any other revenues received by or on behalf of the
25-10 association in an account established by the association.
25-11 3. The developer shall pay assessments for any time shares which are
25-12 unsold or enter into an agreement with the association, [on] in a form
25-13 approved by the division, to pay the difference between the actual
25-14 expenses incurred by the association and the sum of the amounts payable
25-15 to the association as assessments by [the time-share owners.] owners,
25-16 other than the developer, and other revenues received by the association.
25-17 The division may require the developer to provide a surety bond or other
25-18 form of security which is satisfactory to the division, to guarantee payment
25-19 of the developer’s obligation.
25-20 Sec. 65. NRS 119A.550 is hereby amended to read as follows:
25-21 119A.550 1. The developer or the association may levy and enforce
25-22 a reasonable assessment upon any time share in accordance with the time
25-23 -share instrument, which is a debt of the owner thereof at the time the
25-24 assessment is made. The amount of the assessment plus any other charges
25-25 thereon, such as interest, costs, attorney’s fees and penalties, as may be
25-26 provided for in the time-share instrument is a lien upon the time share
25-27 assessed when the developer or the association causes to be recorded with
25-28 the county recorder of the county in which the [time-share] project is
25-29 located a notice of assessment, which must state:
25-30 (a) The amount of the assessment and such other charges thereon as
25-31 may be authorized by the time-share instrument;
25-32 (b) A description of the time share against which the lien has been
25-33 assessed; and
25-34 (c) The name of the [time-share] owner.
25-35 The notice must be signed by an authorized representative of the developer
25-36 or the association or as otherwise provided in the time-share instrument.
25-37 Upon payment of the assessment and charges in connection with which the
25-38 notice has been so recorded, or other satisfaction thereof, the developer or
25-39 the association shall cause to be recorded a further notice stating the
25-40 satisfaction and the release of the lien thereof.
25-41 2. The lien is prior to all other liens recorded [subsequent to] after the
25-42 recordation of the notice of assessment except that the time-share
25-43 instrument may provide for the subordination thereof to any other liens
25-44 and encumbrances. Unless sooner satisfied and released or the
25-45 enforcement thereof initiated as provided in subsection 3, the lien expires
25-46 and has no further force or effect 1 year after the date of recordation of the
25-47 notice of assessment, but the 1-year period may be extended by the
25-48 developer or the association for a period not to exceed 1 additional year by
25-49 recording a written extension thereof.
26-1 3. The lien may be enforced by sale by the developer or the
26-2 association, its agent or attorney, after failure of the owner to pay such an
26-3 assessment in accordance with the terms of the time-share instrument. The
26-4 sale must be conducted in accordance with the provisions of Covenants
26-5 Nos. 6, 7 and 8 of NRS 107.030, and NRS 107.090 insofar as they are
26-6 consistent with the provisions of NRS 119A.560, or in any other manner
26-7 permitted by law. Unless otherwise provided in the time-share instrument,
26-8 the developer or the association, if it is a corporation, cooperative
26-9 association, partnership or natural person, may bid at foreclosure sale and
26-10 hold, lease, mortgage and convey the time share.
26-11 Sec. 66. NRS 119A.560 is hereby amended to read as follows:
26-12 119A.560 1. The power of sale may not be exercised until:
26-13 (a) The developer or the association, its agent or attorney has first
26-14 executed and caused to be recorded with the recorder of the county
26-15 wherein the [time-share] project is located a notice of default and election
26-16 to sell the time share or cause its sale to satisfy the assessment lien; and
26-17 (b) The [time-share] owner or his successor in interest has failed to pay
26-18 the amount of the lien, including costs, fees and expenses incident to its
26-19 enforcement for 60 days computed as prescribed in subsection 2.
26-20 2. The 60-day period provided in subsection 1 begins on the first day
26-21 following the day upon which the notice of default and election to sell is
26-22 recorded and a copy of the notice is mailed by certified or registered mail
26-23 with postage prepaid to the [time-share] owner or to his successor in
26-24 interest at his address if that address is known, otherwise to the address of
26-25 the [time-share] project. The notice must describe the deficiency in
26-26 payment.
26-27 3. The developer or the association, its agent or attorney shall, after
26-28 expiration of the 60-day period and before selling the time share, give
26-29 notice of the time and place of the sale in the manner and for a time not
26-30 less than that required for the sale of real property upon execution, except
26-31 that a copy of the notice of sale must be mailed on or before the first
26-32 publication or posting required by NRS 21.130 by certified or registered
26-33 mail with postage prepaid to the [time-share] owner or to his successor in
26-34 interest at his address if that address is known, otherwise to the address of
26-35 the [time-share] project. The sale [itself] may be made at the office of the
26-36 developer or the association if the notice so provided, whether the [time
26-37 -share] project is located within the same county as the office of the
26-38 developer or the association or not.
26-39 4. Every sale made under the provisions of NRS 119A.550 vests in the
26-40 purchaser the title of the [time-share] owner without equity or right of
26-41 redemption.
26-42 Sec. 67. NRS 119A.570 is hereby amended to read as follows:
26-43 119A.570 1. The developer or the association, if it has been formed,
26-44 shall maintain:
26-45 (a) Property insurance on the [time-share] project and any personal
26-46 property available for use by the [time-share] owners in conjunction
26-47 therewith, other than personal property separately owned by [a time-share]
26-48 an owner, insuring against all risks of direct physical loss commonly
26-49 insured against, with a provision agreed to by the lender, that the proceeds
26-50 must be disbursed for the repair or restoration of the property, and that the
27-1 [time-share] owners and lien holders are not entitled to receive payment of
27-2 any portion of the proceeds unless there is a surplus of proceeds after the
27-3 property has been completely repaired or restored;
27-4 (b) Liability insurance, including insurance for medical payments, in an
27-5 amount not less than $1,000,000 per occurrence, covering all occurrences
27-6 commonly insured against for death, bodily injury and property damage
27-7 arising out of or in connection with the use, ownership or maintenance of
27-8 the time-share property and [time-share] units; and
27-9 (c) Insurance covering the costs of temporary quarters for the [time
27-10 -share] owners and other losses commonly insured against.
27-11 2. Each insurance policy carried pursuant to subsection 1 must provide
27-12 that:
27-13 (a) Each [time-share] owner is an insured person under the policy
27-14 whether designated as an insured by name individually or as part of a
27-15 named group or otherwise, as his interest may appear;
27-16 (b) The insurer waives its right to subrogation under the policy against
27-17 any [time-share] owner or members of his household; and
27-18 (c) No act or omission by any [time-share] owner, unless acting within
27-19 the scope of his authority on behalf of an association, will void the policy
27-20 or be a condition to recovery by any other person under the policy.
27-21 Sec. 68. NRS 119A.580 is hereby amended to read as follows:
27-22 119A.580 No labor performed or services or materials furnished with
27-23 the consent of or at the request of [a time-share] an owner may be the
27-24 basis for the filing of a lien against the time share of any other [time-share]
27-25 owner, or against any part thereof, or against any other property of any
27-26 other [time-share] owner, unless the other owner has expressly consented
27-27 to or requested the performance of such labor or furnishing of such
27-28 materials or services. Express consent shall be deemed to have been given
27-29 by the owner of any time share in the case of emergency repairs thereto.
27-30 Labor performed or services or materials furnished for the insured
27-31 property, if authorized by the association and provided for in the time
27-32 -share instrument, shall be deemed to be performed or furnished with the
27-33 express consent of each [time-share owner. A time-share] owner. An
27-34 owner may remove his time share from a lien against two or more time
27-35 shares or any part thereof by payment to the holder of the lien of the
27-36 fraction of the total sum secured by such lien which is attributable to his
27-37 time share.
27-38 Sec. 69. NRS 119A.590 is hereby amended to read as follows:
27-39 119A.590 1. A developer who offers a program for the exchange of
27-40 occupancy rights among [time-share] owners or with the owners of time
27-41 shares in other time-share [properties,] plans, or both, shall give to the
27-42 purchaser the following information:
27-43 (a) The name and address of the company offering the program.
27-44 (b) The names of the officers, directors and shareholders owning at least
27-45 5 percent of the outstanding stock of that company.
27-46 (c) A statement indicating whether the company or any of its officers or
27-47 directors has any legal or beneficial interest in any interest of the
27-48 developer or managing agent in any time-share plan [to sell time shares]
27-49 included in the program and, if so, the name, location and nature of the
27-50 interest.
27-51 (d) A statement that the purchaser’s contract with the company is a
27-52 contract separate and distinct from the contract to purchase the time share,
28-1 unless the company and the developer or an affiliate of the developer are
28-2 the same.
28-3 (e) A statement indicating whether the purchaser’s participation in the
28-4 program is dependent upon the continued inclusion of the time-share plan
28-5 [to sell time shares] in the program.
28-6 (f) A statement indicating whether the purchaser’s membership or
28-7 participation in the program, is voluntary or mandatory.
28-8 (g) A complete and accurate description of:
28-9 (1) The terms and conditions of the purchaser’s contractual
28-10 relationship with the company and the procedure by which changes thereto
28-11 may be made.
28-12 (2) The procedure to qualify for and make exchanges.
28-13 (3) All limitations, restrictions or priorities of the program, including,
28-14 but not limited to, limitations on exchanges based on the seasons of the
28-15 year, the size of units or levels of occupancy, printed in boldface type, and,
28-16 if such limitations, restrictions or priorities are not uniformly applied by
28-17 the program, a clear description of the manner in which they are applied.
28-18 (h) A statement indicating whether exchanges are arranged on the basis
28-19 of available space and whether there are any guarantees of fulfilling
28-20 specific requests for exchanges.
28-21 (i) A statement indicating whether and under what circumstances an
28-22 owner, in dealing with the company, may lose the right to use and occupy
28-23 a [time-share] unit in any properly applied for exchange without being
28-24 provided with substitute accommodations by the company.
28-25 (j) The fees to be paid by owners in the program, including a statement
28-26 indicating whether any fees may be changed by the company and, if so,
28-27 the circumstances under which those changes may be made.
28-28 (k) The name and address of the site of each [time-share] project
28-29 included in the program.
28-30 (l) The number of units in each [project] time-share plan included in
28-31 the program which are available for occupancy, expressed in numerical
28-32 groupings of from 1 to 5, 6 to 10, 11 to 20, 21 to 50 and over 50.
28-33 (m) The number of owners with respect to each time-share plan [to sell
28-34 time shares] or other property who are eligible to participate in the
28-35 program, expressed in numerical groupings of from 1 to 100, 101 to 249,
28-36 250 to 499, 500 to 999 and at least 1,000, and a statement of the criteria
28-37 used to determine those owners who are eligible to participate in the
28-38 program.
28-39 (n) The disposition made by the company of time shares deposited with
28-40 the program by owners who are eligible to participate in the program and
28-41 not used by the company in effecting exchanges.
28-42 (o) An annual report completed on or before July 1 of the succeeding
28-43 year which must be independently certified by a certified public
28-44 accountant or accounting firm in accordance with the standards of the
28-45 Accounting Standards Board of the American Institute of Certified Public
28-46 Accountants, as those standards exist on May 19, 1983. The report must
28-47 include:
28-48 (1) The number of owners who are enrolled to participate in the
28-49 program, including an indication of whether the relationship between the
28-50 company and the owners is based on the payment of a fee or is gratuitous.
29-1 (2) The number of time-share [projects] plans included in the
29-2 program, categorized by those [projects] plans which are the subject of a
29-3 contract between the developer or the association and the company and
29-4 those [projects] plans which are the subject of a contract between the
29-5 company and owners directly.
29-6 (3) The number of time shares for which the company has an
29-7 outstanding obligation to provide an exchange to an owner who
29-8 relinquished a time share during the year in exchange for a time share in
29-9 any future year.
29-10 (4) The number of exchanges confirmed by the company during the
29-11 year.
29-12 2. The information required by subsection 1 must be delivered to the
29-13 purchaser before the execution of any contract between the purchaser and
29-14 the company or the contract to purchase the time share.
29-15 3. Upon receipt of the information, the purchaser shall certify in
29-16 writing that he has received the information from the developer.
29-17 4. Except as otherwise provided in this subsection, the information
29-18 required by subsection 1 must be [accurate as of 30 days before the date
29-19 on which the information is delivered to the purchaser.] periodically
29-20 revised to reflect any material changes in that information. The
29-21 information required by paragraphs (b), (c), (k), (l), (m) and (o) of
29-22 subsection 1 must be consistent with the latest audited statement of the
29-23 company which is prepared not more than 18 months before the
29-24 information is delivered.
29-25 Sec. 70. NRS 119A.600 is hereby amended to read as follows:
29-26 119A.600 If a company intends to offer a program for the exchange of
29-27 occupancy rights among [time-share] owners or with the owners of time
29-28 shares in other time-share [projects,] plans, or both, directly to a purchaser
29-29 or owner, the company shall deliver to him, before the offering or the
29-30 execution of any contract between the purchaser or owner and the
29-31 company offering the program, the information set forth in subsection 1 of
29-32 NRS 119A.590. The requirements of this section do not apply to any
29-33 renewal of a contract between an owner and such a company.
29-34 Sec. 71. NRS 119A.620 is hereby amended to read as follows:
29-35 119A.620 1. A company whose program for the exchange of
29-36 occupancy rights among [time-share] owners or with the owners of time
29-37 shares in other time-share [projects,] plans, or both, is offered to
29-38 purchasers of time shares in this state shall, on or before July 1 of each
29-39 year, file with the division and secretary of the association the information
29-40 required by subsection 1 of NRS 119A.590 as it relates to that plan.
29-41 2. No developer is liable for the use, delivery or publication of
29-42 information provided to it by the company.
29-43 3. Except as otherwise provided in this subsection, no company is
29-44 liable for:
29-45 (a) Any representation made by the developer relating to the program or
29-46 company.
29-47 (b) The use, delivery or publication by the developer of any information
29-48 relating to the program or company.
29-49 Such a company is liable only for the written information provided to the
29-50 developer by the company.
30-1 Sec. 72. NRS 119A.660 is hereby amended to read as follows:
30-2 119A.660 1. Whenever the administrator believes that any person
30-3 has violated any order, regulation, permit, decision, demand or
30-4 requirement, or any of the provisions of this chapter, he may bring an
30-5 action in the district court in the county in which the person resides or
30-6 maintains his principal place of business or, if the person resides outside
30-7 the state, in any court of competent jurisdiction within or outside the state,
30-8 against the person to enjoin him from continuing the violation.
30-9 2. The administrator may intervene in any action involving a time
30-10 -share [property,] plan, a project or a time share if intervention is necessary
30-11 in the public interest and for the protection of purchasers.
30-12 Sec. 73. NRS 119A.665 is hereby amended to read as follows:
30-13 119A.665 1. When the administrator ascertains that an association
30-14 [of time-share owners] or a developer, if there is no association, is
30-15 insolvent or in imminent danger of insolvency, or the association’s or
30-16 developer’s affairs are being mismanaged, he may file a complaint in the
30-17 district court of the county in which the principal office of the association
30-18 or developer is located for the appointment of a receiver.
30-19 2. Upon appointment, the receiver shall take possession of all the
30-20 property, business and assets of the association or developer which are
30-21 located within this state and retain possession of them until further order
30-22 of the court. The receiver shall make or cause to be made an inventory of
30-23 the assets and known liabilities of the association or developer. Upon
30-24 approval of the court, the receiver shall take such other actions as appear
30-25 necessary and reasonable for the conduct of the business of the association
30-26 or developer.
30-27 3. The inventory made by the receiver and all claims filed by creditors
30-28 are open at all reasonable times for inspection and any action taken by the
30-29 receiver upon any of the claims is subject to the approval of the court
30-30 before which the cause is pending.
30-31 4. The expenses of the receiver and compensation of counsel, as well
30-32 as all expenditures required in any liquidation proceeding, must be fixed
30-33 by the receiver, subject to the approval of the court, and, upon certification
30-34 of the receiver, must be paid out of the assets he controls as receiver.
30-35 Sec. 74. NRS 119A.680 is hereby amended to read as follows:
30-36 119A.680 1. It is unlawful for any person to engage in the business
30-37 of, act in the capacity of, advertise or assume to act as a:
30-38 (a) Project broker or sales agent within the State of Nevada without first
30-39 obtaining a license from the division pursuant to chapter 645 of NRS or
30-40 NRS 119A.210.
30-41 (b) Representative , manager or time-share resale broker within the
30-42 State of Nevada without first registering with the division.
30-43 2. Any person who violates subsection 1 is guilty of a gross
30-44 misdemeanor.
30-45 Sec. 75. NRS 119A.690 is hereby amended to read as follows:
30-46 119A.690 Any person who willfully submits, in the application for a
30-47 permit to sell time shares or an application for a sales agent’s license, any
30-48 materially false or misleading information or fails to submit an annual
30-49 report on a program for the exchange of occupancy rights among [time-
31-1 share] owners or with the owners of time shares in other time-share
31-2 [properties,] plans, or both, is guilty of a misdemeanor.
31-3 Sec. 76. NRS 119A.710 is hereby amended to read as follows:
31-4 119A.710 It is unlawful to engage in unfair methods of competition or
31-5 deceptive or unfair acts in the offer to sell or sale of a time share
31-6 including, without limitation:
31-7 1. Misrepresenting or failing to disclose any material fact concerning a
31-8 time share.
31-9 2. Including in an agreement for the purchase of a [time-share] time
31-10 share provisions purporting to waive any right or benefit provided for
31-11 purchasers under this chapter.
31-12 3. Receiving from a prospective purchaser any money or other
31-13 valuable consideration before the purchaser has received a statement of
31-14 public offering.
31-15 4. Misrepresenting the amount of time or period of time the unit will
31-16 be available to a purchaser.
31-17 5. Misrepresenting the location or locations of the unit.
31-18 6. Misrepresenting the size, nature, extent, qualities or characteristics
31-19 of the unit.
31-20 7. Misrepresenting the nature or extent of any services incident to the
31-21 unit.
31-22 8. Misrepresenting the conditions under which a purchaser may
31-23 exchange occupancy rights to a unit in one location for occupancy rights
31-24 to a unit in another location.
31-25 9. Failing to disclose initially that any promised entertainment, food or
31-26 other inducements are being offered to solicit the sale of a time share.
31-27 10. Conducting or participating in, without prior approval by the
31-28 division, any type of lottery or contest, or offering prizes or gifts to induce
31-29 or encourage a person to visit a [time-share] project, attend a meeting at
31-30 which a time share will be discussed, attend a presentation or purchase a
31-31 time share.
31-32 11. Failing to disclose initially to a prospective purchaser any
31-33 agreement between the project broker or sales agent and the developer that
31-34 results in a sharing of sales proceeds in excess of a minimum sales price
31-35 for a time share.
31-36 12. Any act or practice considered an unfair method of competition or
31-37 an unfair or deceptive act or practice under NRS 207.170, 207.171 or
31-38 598.0915 to 598.0925, inclusive, or chapter 598A or 599A of NRS.
31-39 Sec. 77. Section 29 of this act is hereby amended to read as follows:
31-40 Sec.29. 1. A person who wishes to engage in the business of,
31-41 act in the capacity of, advertise or assume to act as a manager shall
31-42 register with the division on a form prescribed by the division.
31-43 2. The form for registration must include, without limitation:
31-44 (a) The registered name of the time-share plan or the project, or
31-45 both, that the manager will manage;
31-46 (b) The address and telephone number of the manager’s principal
31-47 place of business; and
31-48 (c) [The social security number of the manager; and
31-49 (d)] The name of the manager’s responsible managing employee.
31-50 3. The form for registration must be accompanied by[:
32-1 (a) Satisfactory] satisfactory evidence, acceptable to the division,
32-2 that the manager and his employees have obtained fidelity bonds in
32-3 accordance with regulations adopted by the division . [; and
32-4 (b) The statement required pursuant to NRS 119A.263.]
32-5 4. The division may collect a fee for registering a manager in an
32-6 amount not to exceed the administrative costs of registering the
32-7 manager.
32-8 5. As used in this section, “responsible managing employee”
32-9 means the person designated by the manager to:
32-10 (a) Make technical and administrative decisions in connection with
32-11 the manager’s business; and
32-12 (b) Hire, superintend, promote, transfer, lay off, discipline or
32-13 discharge other employees or recommend such action on behalf of
32-14 the manager.
32-15 Sec. 78. NRS 119A.165 is hereby repealed.
32-16 Sec. 79. Notwithstanding the provisions of section 29 of this act, a
32-17 person who is engaged in the business of, acting in the capacity of,
32-18 advertising or assuming to act as a manager on October 1, 2001, shall
32-19 register with the real estate division of the department of business and
32-20 industry no later than January 1, 2002.
32-21 Sec. 80. The amendatory provisions of this act do not apply to
32-22 offenses committed before October 1, 2001.
32-23 Sec. 81. 1. This section, sections 1 to 76, inclusive, and 78, 79 and
32-24 80 of this act become effective on October 1, 2001.
32-25 2. Section 77 of this act becomes effective on the date on which the
32-26 provisions of 42 U.S.C. § 666 requiring each state to establish procedures
32-27 under which the state has authority to withhold or suspend, or to restrict
32-28 the use of professional, occupational and recreational licenses of persons
32-29 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 20~~~~~01