Requires Two-Thirds Majority Vote (§ 31.5)            

                                                 (Reprinted with amendments adopted on April 17, 2003)

 

Senate Bill No. 241–Committee on Commerce and Labor

 

March 6, 2003

____________

 

Referred to Committee on Commerce and Labor

 

SUMMARY—Makes various changes to provisions governing certain claims for constructional defects. (BDR 3‑156)

 

FISCAL NOTE:  Effect on Local Government: No.

                           Effect on the State: No.

 

~

 

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

 

AN ACT relating to real property; making various changes to provisions governing certain claims for constructional defects; establishing certain rights, remedies and procedures governing certain claims for constructional defects; revising and recodifying various provisions governing certain claims for constructional defects; 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. Title 3 of NRS is hereby amended by adding

1-2  thereto a new chapter to consist of the provisions set forth as

1-3  sections 2 to 53, inclusive, of this act.

1-4  Sec. 2.  As used in this chapter, unless the context otherwise

1-5  requires, the words and terms defined in sections 3 to 21,

1-6  inclusive, of this act have the meanings ascribed to them in those

1-7  sections.

1-8  Sec. 3.  “Amend a complaint to add a cause of action for a

1-9  constructional defect” means any act by which a claimant seeks

1-10  to:

1-11      1.  Add to the pleadings a constructional defect that is not

1-12  otherwise included in the pleadings; or

2-1  2.  Amend the pleadings in such a manner that the practical

2-2  effect is the addition of a constructional defect that is not

2-3  otherwise included in the pleadings.

2-4  Sec. 4.  1.  “Appurtenance” means any structure,

2-5  installation, facility, amenity or other improvement which is

2-6  appurtenant to or benefits one or more residences but which is not

2-7  a part of the dwelling unit.

2-8  2.  The term includes, without limitation, the parcel of real

2-9  property, recreational facilities, golf courses, walls, sidewalks,

2-10  driveways, landscaping, common elements and limited common

2-11  elements other than those described in NRS 116.2102, and other

2-12  structures, installations, facilities, amenities and improvements

2-13  associated with or benefiting one or more residences.

2-14      Sec. 5.  “Building inspector” means an inspector who is

2-15  employed by a governmental entity and who has the authority to

2-16  approve or certify any construction project.

2-17      Sec. 6.  “Cause of action for a constructional defect” means a

2-18  claim brought by a claimant in a court of competent jurisdiction in

2-19  which the claimant alleges that one or more contractors,

2-20  subcontractors, suppliers, design professionals or other persons

2-21  are liable for damages arising from a constructional defect.

2-22      Sec. 7.  “Claimant” means:

2-23      1.  An owner of a residence or appurtenance;

2-24      2.  A representative of a homeowners’ association that is

2-25  responsible for a residence or appurtenance if the representative is

2-26  acting within the scope of his authority under the law and the

2-27  governing documents for the homeowners’ association; or

2-28      3.  Each member of a class action who has complied with the

2-29  notice provisions of section 27 of this act.

2-30      Sec. 8.  “Common elements” has the meaning ascribed to it

2-31  in NRS 116.110318.

2-32      Sec. 9.  “Construction project” means any design,

2-33  development, construction, manufacturing, alteration,

2-34  improvement, repair or landscaping involving a residence or

2-35  appurtenance, or any part thereof.

2-36      Sec. 10.  1.  “Constructional defect” means a defect in the

2-37  design, construction, manufacturing, alteration, improvement,

2-38  repair or landscaping of:

2-39      (a) A new residence or a new appurtenance; or

2-40      (b) An existing residence or an existing appurtenance, when

2-41  the existing residence or existing appurtenance is changed,

2-42  altered, added to or improved by a construction project.

2-43      2.  The term includes physical damage to the residence, an

2-44  appurtenance or the real property to which the residence or

3-1  appurtenance is affixed that is proximately caused by a

3-2  constructional defect.

3-3  3.  The term does not include:

3-4  (a) Any design, construction, manufacturing, alteration,

3-5  improvement, repair or landscaping for which a contractor,

3-6  subcontractor, supplier or design professional cannot be held

3-7  liable pursuant to section 24 of this act; or

3-8  (b) Any act, omission, condition or damage for which a

3-9  contractor, subcontractor, supplier or design professional cannot

3-10  be held liable pursuant to section 25 of this act.

3-11      Sec. 11.  “Contractor” means a person who, with or without a

3-12  license issued pursuant to chapter 624 of NRS, by himself or

3-13  through his agents, employees or subcontractors:

3-14      1.  Develops, designs, constructs, manufactures, alters,

3-15  improves, repairs or landscapes a residence, appurtenance or any

3-16  part thereof;

3-17      2.  Develops a site for a residence, appurtenance or any part

3-18  thereof; or

3-19      3.  Sells a residence or appurtenance, any part of which the

3-20  person, by himself or through his agents, employees or

3-21  subcontractors, has developed, designed, constructed,

3-22  manufactured, altered, improved, repaired or landscaped.

3-23      Sec. 12.  “Contractor for the construction project” means,

3-24  with regard to any construction project:

3-25      1.  The contractor who is the general contractor for the

3-26  construction project; or

3-27      2.  In the absence of a general contractor for the construction

3-28  project, the contractor who is the primary contractor for the

3-29  construction project or who is responsible for the work performed

3-30  on the construction project.

3-31      Sec. 13.  “Design professional” means:

3-32      1.  A person who holds a professional license or certificate

3-33  issued pursuant to chapter 623, 623A or 625 of NRS and who

3-34  provides professional services with regard to any construction

3-35  project; or

3-36      2.  A person who is primarily engaged in the practice of

3-37  professional engineering, land surveying, architecture or

3-38  landscape architecture and who provides professional services

3-39  with regard to any construction project.

3-40      Sec. 14.  1.  “Homeowner’s warranty” means a warranty or

3-41  policy of insurance:

3-42      (a) Issued or purchased by or on behalf of a contractor,

3-43  subcontractor, supplier or design professional for the protection of

3-44  a claimant; or

4-1  (b) Purchased by or on behalf of a claimant pursuant to NRS

4-2  690B.100 to 690B.180, inclusive.

4-3  2.  The term includes a warranty contract issued by a risk

4-4  retention group that operates in compliance with chapter 695E of

4-5  NRS and insures all or any part of the liability of a contractor,

4-6  subcontractor, supplier or design professional for the cost to

4-7  repair a constructional defect.

4-8  Sec. 15.  “Limited common element” has the meaning

4-9  ascribed to it in NRS 116.110355.

4-10      Sec. 16.  “Master developer” means a person who buys, sells

4-11  or develops a planned unit development, including, without

4-12  limitation, a person who enters into a development agreement

4-13  pursuant to NRS 278.0201.

4-14      Sec. 17.  “Planned unit development” has the meaning

4-15  ascribed to it in NRS 278A.065.

4-16      Sec. 18.  “Residence” means any dwelling in which title to

4-17  the individual units is transferred to the owners.

4-18      Sec. 19.  “Subcontractor” means a contractor who performs

4-19  work on behalf of another contractor for any construction project.

4-20      Sec. 20.  “Subdivider” has the meaning ascribed to it in

4-21  NRS 278.0185.

4-22      Sec. 21.  “Supplier” means a person who provides materials,

4-23  equipment or other supplies for any construction project.

4-24      Sec. 22.  For the purposes of this chapter, a claimant

4-25  “recovers money for a constructional defect” if the claimant

4-26  recovers any amount of money to remedy the constructional defect

4-27  or to compensate the claimant for the constructional defect,

4-28  whether the recovery occurs through a final judgment, order,

4-29  award, settlement or compromise or through any other means that

4-30  resolves the claim for the constructional defect.

4-31      Sec. 23.  1.  The provisions of this chapter apply to any

4-32  claim for a constructional defect that arises before, on or after the

4-33  effective date of this act, unless the claimant:

4-34      (a) Has commenced an action concerning the claim in

4-35  accordance with NRS 40.600 to 40.695, inclusive, before the

4-36  effective date of this act; or

4-37      (b) Has given notice of the claim to the contractor,

4-38  subcontractor, supplier or design professional pursuant to NRS

4-39  40.600 to 40.695, inclusive, before the effective date of this act.

4-40      2.  Except as otherwise provided in this chapter, the provisions

4-41  of this chapter prevail over any conflicting law otherwise

4-42  applicable to a claim or cause of action for a constructional defect.

4-43      3.  The provisions of this chapter do not:

4-44      (a) Create a new theory upon which liability may be based; or

5-1  (b) Bar or limit any defense otherwise available, unless the

5-2  defense is expressly barred or limited pursuant to the provisions of

5-3  this chapter.

5-4  4.  The provisions of this chapter do not apply to:

5-5  (a) A claim for personal injury or wrongful death; or

5-6  (b) A claim that is subject to the provisions of NRS 40.600 to

5-7  40.695, inclusive.

5-8  Sec. 24.  1.  A contractor, subcontractor, supplier or design

5-9  professional is not liable for any design, construction,

5-10  manufacturing, alteration, improvement, repair or landscaping

5-11  that:

5-12      (a) Is functioning as intended and was completed in

5-13  compliance with the provisions of the applicable building codes in

5-14  effect when it was completed; or

5-15      (b) Is not the proximate cause of any damage or injury.

5-16      2.  For the purposes of this section, the approval of any

5-17  design, construction, manufacturing, alteration, improvement,

5-18  repair or landscaping by a building inspector is prima facie

5-19  evidence that the design, construction, manufacturing, alteration,

5-20  improvement, repair or landscaping was completed in compliance

5-21  with the provisions of the applicable building codes in effect when

5-22  it was completed.

5-23      Sec. 25.  1.  A contractor, subcontractor, supplier or design

5-24  professional:

5-25      (a) Is liable only for damages that are proximately caused by

5-26  his own acts or omissions or the acts or omissions of his agents,

5-27  employees or subcontractors; and

5-28      (b) Is not liable for damages that are proximately caused by:

5-29          (1) The acts or omissions of any other person; or

5-30          (2) The failure of any other person to take reasonable

5-31  action to maintain a residence or appurtenance or to reduce or

5-32  mitigate any damage or injury.

5-33      2.  A contractor, subcontractor, supplier or design

5-34  professional is not liable for:

5-35      (a) Normal wear, tear or deterioration; or

5-36      (b) Normal shrinkage, swelling, expansion or settlement.

5-37      3.  A contractor, subcontractor, supplier or design

5-38  professional is not liable for any constructional defect that is

5-39  disclosed to an owner before his purchase of the residence, if the

5-40  disclosure was provided in language that is understandable and

5-41  was written in underlined and boldfaced type with capital letters.

5-42      Sec. 26.  1.  Except as otherwise provided in this chapter, a

5-43  claimant may not bring a cause of action for a constructional

5-44  defect or amend a complaint to add a cause of action for a

6-1  constructional defect against a contractor, subcontractor, supplier

6-2  or design professional, unless the claimant has:

6-3  (a) Complied with the procedures concerning notice set forth

6-4  in this chapter with regard to each constructional defect that

6-5  forms the basis of the cause of action;

6-6  (b) Complied with the procedures concerning repairs set forth

6-7  in this chapter with regard to each constructional defect that

6-8  forms the basis of the cause of action; and

6-9  (c) Complied with the procedures concerning mediation set

6-10  forth in this chapter with regard to each constructional defect that

6-11  forms the basis of the cause of action.

6-12      2.  If a claimant brings a cause of action for a constructional

6-13  defect in violation of this section or amends a complaint to add a

6-14  cause of action for a constructional defect in violation of this

6-15  section, the court does not have jurisdiction to hear the subject

6-16  matter of the cause of action and the court shall dismiss the cause

6-17  of action without prejudice. The provisions of this section do not

6-18  preclude the court from dismissing the cause of action with

6-19  prejudice for reasons other than a violation of this section.

6-20      Sec. 27.  1.  Except as otherwise provided in this chapter,

6-21  before a claimant may bring a cause of action for a constructional

6-22  defect or amend a complaint to add a cause of action for a

6-23  constructional defect against a contractor, subcontractor, supplier

6-24  or design professional, the claimant must provide the contractor

6-25  for the construction project with written notice of each

6-26  constructional defect that forms the basis of the cause of action.

6-27  To provide such written notice, the claimant must:

6-28      (a) Use the standard form for providing notice of a

6-29  constructional defect;

6-30      (b) List on the standard form each contractor, subcontractor,

6-31  supplier and design professional who may be liable for the

6-32  constructional defect and whose identity is known by the claimant;

6-33  and

6-34      (c) Send the standard form by registered mail, return receipt

6-35  requested, to:

6-36          (1) The last known address of the contractor; or

6-37          (2) The address of the contractor that is listed in the records

6-38  of the State Contractors’ Board, the office of the county recorder

6-39  for the county where the work was performed, or the office of

6-40  the clerk that issues business licenses for the county or city where

6-41  the work was performed.

6-42      2.  If, before the claimant provides written notice to the

6-43  contractor for the construction project, the claimant knows that

6-44  the contractor for the construction project is no longer in business

6-45  as a contractor, the claimant shall provide written notice to each

7-1  subcontractor, supplier and design professional who may be liable

7-2  for the constructional defect and whose identity is known by the

7-3  claimant. To provide such written notice, the claimant must:

7-4  (a) Use the standard form for providing notice of a

7-5  constructional defect;

7-6  (b) List on the standard form each contractor, subcontractor,

7-7  supplier and design professional who may be liable for the

7-8  constructional defect and whose identity is known by the claimant;

7-9  and

7-10      (c) Send the standard form by registered mail, return receipt

7-11  requested, to:

7-12          (1) The last known address of the subcontractor, supplier

7-13  or design professional; or

7-14          (2) The address of the subcontractor, supplier or design

7-15  professional that is listed in the records of the State Contractors’

7-16  Board, the office of the county recorder for the county where the

7-17  work was performed, or the office of the clerk that issues business

7-18  licenses for the county or city where the work was performed.

7-19      3.  A subcontractor, supplier or design professional who

7-20  receives written notice from a claimant pursuant to this section is

7-21  entitled to the same rights to repair the constructional defect that

7-22  are afforded to a contractor pursuant to this chapter.

7-23      4.  A representative of a homeowners’ association that is

7-24  responsible for a residence or appurtenance may not provide the

7-25  written notice required by this section, unless the representative is

7-26  acting within the scope of his authority under the law and the

7-27  governing documents for the homeowners’ association and has

7-28  obtained an affirmative vote of at least a simple majority of the

7-29  members of the association.

7-30      5.  The State Contractors’ Board shall:

7-31      (a) Develop a standard form for providing notice of a

7-32  constructional defect for the purposes of this section; and

7-33      (b) Make the standard form available to claimants.

7-34      Sec. 28.  1.  After the claimant sends written notice of a

7-35  constructional defect pursuant to section 27 of this act, the

7-36  claimant, upon reasonable notice, shall provide the contractor for

7-37  the construction project and each subcontractor, supplier or

7-38  design professional who may be liable for the constructional

7-39  defect with access to the residence or appurtenance where the

7-40  constructional defect is located for the purposes of inspecting the

7-41  residence or appurtenance to determine the nature and extent of

7-42  the constructional defect and the nature and extent of any repairs

7-43  that may be necessary.

7-44      2.  The claimant shall provide the access required by this

7-45  section not later than 60 days after the date that written notice is

8-1  sent to the contractor pursuant to section 27 of this act or, if

8-2  written notice is sent to a subcontractor, supplier or design

8-3  professional pursuant to that section, not later than 60 days after

8-4  the date that written notice is sent to the subcontractor, supplier or

8-5  design professional.

8-6  Sec. 29.  1.  Not later than 30 days after the date that written

8-7  notice of a constructional defect is received by the contractor for

8-8  the construction project pursuant to section 27 of this act, the

8-9  contractor shall provide a copy of the written notice to each

8-10  subcontractor, supplier or design professional who the contractor

8-11  reasonably believes may be liable for the constructional defect.

8-12  The contractor must send the copy by registered mail, return

8-13  receipt requested, to:

8-14      (a) The last known address of the subcontractor, supplier or

8-15  design professional; and

8-16      (b) The address of the subcontractor, supplier or design

8-17  professional that is listed in the contract between the contractor

8-18  and the subcontractor, supplier or design professional.

8-19      2.  Not later than 15 days after the date of the inspection of

8-20  the constructional defect, the subcontractor, supplier or design

8-21  professional shall provide the contractor with:

8-22      (a) A written statement indicating whether the subcontractor,

8-23  supplier or design professional has elected to repair the

8-24  constructional defect; and

8-25      (b) If such an election is made:

8-26          (1) A written estimate as to the length of time to complete

8-27  the repairs and at least two proposed dates and times when the

8-28  repairs will begin; and

8-29          (2) A written statement waiving all rights to file mechanics’

8-30  and materialmen’s liens against the residence and its

8-31  appurtenances pursuant to NRS 108.221 to 108.246, inclusive,

8-32  with regard to the repairs performed pursuant to this chapter.

8-33      3.  Except as otherwise provided in this chapter, the

8-34  contractor may not pursue any claim related to the constructional

8-35  defect against a subcontractor, supplier or design professional

8-36  who is liable for the constructional defect, unless the contractor

8-37  has provided the subcontractor, supplier or design professional

8-38  with:

8-39      (a) A copy of the written notice from the claimant as required

8-40  by this section; and

8-41      (b) A reasonable opportunity to repair the constructional

8-42  defect.

8-43      4.  The contractor may pursue a claim related to the

8-44  constructional defect against a subcontractor, supplier or design

9-1  professional who is liable for the constructional defect if the

9-2  contractor:

9-3  (a) Made a good faith effort to discover the identity of the

9-4  subcontractor, supplier or design professional after the contractor

9-5  received written notice of the constructional defect from the

9-6  claimant; and

9-7  (b) Was unable to discover the identity of the subcontractor,

9-8  supplier or design professional within the 30-day period for

9-9  providing a copy of the written notice to the subcontractor,

9-10  supplier or design professional.

9-11      Sec. 30.  1.  Not later than 90 days after the date that written

9-12  notice is sent to the contractor pursuant to section 27 of this act or,

9-13  if written notice is sent to a subcontractor, supplier or design

9-14  professional pursuant to that section, not later than 90 days after

9-15  the date that written notice is sent to the subcontractor, supplier or

9-16  design professional, the contractor, subcontractor, supplier or

9-17  design professional, as appropriate, shall provide the claimant

9-18  with a written statement indicating whether the contractor,

9-19  subcontractor, supplier or design professional has elected to repair

9-20  the constructional defect.

9-21      2.  Except as otherwise provided in this chapter:

9-22      (a) If the contractor, subcontractor, supplier or design

9-23  professional has elected not to repair the constructional defect, the

9-24  claimant may bring a cause of action for the constructional defect

9-25  or amend a complaint to add a cause of action for the

9-26  constructional defect.

9-27      (b) If the contractor, subcontractor, supplier or design

9-28  professional has elected to repair the constructional defect, the

9-29  claimant must provide the contractor, subcontractor, supplier or

9-30  design professional with a reasonable opportunity to repair the

9-31  constructional defect.

9-32      3.  If the contractor, subcontractor, supplier or design

9-33  professional has elected to repair the constructional defect, the

9-34  contractor, subcontractor, supplier or design professional must:

9-35      (a) Either perform the repairs, but only if he is properly

9-36  licensed, bonded and insured to perform the repairs, or have the

9-37  repairs performed by a properly licensed, bonded and insured

9-38  contractor or subcontractor;

9-39      (b) Perform the repairs or have the repairs performed at

9-40  reasonable dates and times that are agreed to in advance with the

9-41  claimant;

9-42      (c) Complete the repairs or have the repairs completed within a

9-43  reasonable period as required by the provisions of this section;

9-44      (d) Not later than 30 days after the repairs are completed,

9-45  provide the claimant with a written statement indicating the nature

10-1  and extent of the repairs, the methods that were used to perform

10-2  the repairs and the nature and extent of any materials or parts that

10-3  were replaced; and

10-4      (e) Ensure that all contractors, subcontractors and suppliers

10-5  are paid for any labor performed or materials furnished for the

10-6  repairs so that there are no mechanics’ and materialmen’s liens

10-7  filed against the residence and its appurtenances pursuant to NRS

10-8  108.221 to 108.246, inclusive, and indemnify the claimant against

10-9  all such liens.

10-10     4.  Except as otherwise provided in this chapter, the

10-11  contractor, subcontractor, supplier or design professional must

10-12  complete or have the repairs completed not later than 150 days

10-13  after the date that written notice of the constructional defect is

10-14  sent to the contractor pursuant to section 27 of this act or, if

10-15  written notice is sent to the subcontractor, supplier or design

10-16  professional pursuant to that section, not later than 150 days after

10-17  the date that written notice is sent to the subcontractor, supplier or

10-18  design professional.

10-19     5.  The contractor, subcontractor, supplier or design

10-20  professional is not required to complete or have the repairs

10-21  completed within the period set forth in subsection 4 if:

10-22     (a) Completion of the repairs is delayed by the claimant or by

10-23  other events beyond the control of the contractor, subcontractor,

10-24  supplier or design professional; or

10-25     (b) Timely completion of the repairs is not reasonably possible.

10-26  If timely completion of the repairs is not reasonably possible, the

10-27  claimant and the contractor, subcontractor, supplier or design

10-28  professional must negotiate in good faith to set a reasonable

10-29  period for completion of the repairs.

10-30     6.  The claimant and any contractor, subcontractor, supplier

10-31  or design professional may agree in writing to extend the periods

10-32  prescribed by this section and sections 28 and 29 of this act.

10-33     Sec. 31.  1.  If the claimant disputes the method or adequacy

10-34  of any repairs that are performed pursuant to section 30 of this

10-35  act, the claimant or the contractor, subcontractor, supplier or

10-36  design professional who performed or had the repairs performed

10-37  may submit the dispute to the State Contractors’ Board.

10-38     2.  If a dispute is submitted to the State Contractors’ Board

10-39  pursuant to this section, the State Contractors’ Board shall,

10-40  pursuant to its regulations, rules and procedures, investigate the

10-41  dispute and render a decision concerning:

10-42     (a) Whether the method used to perform the repairs was

10-43  appropriate; and

10-44     (b) Whether the repairs were performed adequately in a good

10-45  and workmanlike manner and in accordance with applicable law.

11-1      3.  The decision of the State Contractors’ Board:

11-2      (a) Is not subject to judicial review pursuant to the provisions

11-3  of chapters 233B and 624 of NRS; and

11-4      (b) Is admissible in any action brought pursuant to the

11-5  provisions of this chapter.

11-6      4.  The provisions of this chapter do not preclude a claimant

11-7  or a contractor, subcontractor, supplier or design professional

11-8  from pursuing any remedy otherwise available from the State

11-9  Contractors’ Board pursuant to the provisions of chapter 624 of

11-10  NRS concerning a constructional defect.

11-11     5.  If a claimant or a contractor, subcontractor, supplier or

11-12  design professional pursues any remedy available from the State

11-13  Contractors’ Board pursuant to the provisions of this section or

11-14  chapter 624 of NRS concerning a constructional defect, no person

11-15  may bring a cause of action for the constructional defect or, if

11-16  such a cause of action already has been brought in a court of

11-17  competent jurisdiction, no further court proceedings may be held

11-18  concerning the cause of action until the State Contractors’ Board

11-19  renders a decision in the matter.

11-20     Sec. 31.5. 1.  In carrying out the duties assigned to it

11-21  pursuant to the provisions of this chapter, the State Contractors’

11-22  Board may, as necessary:

11-23     (a) Adopt regulations and charge and collect reasonable fees;

11-24     (b) Recover its administrative, investigative and legal costs

11-25  from contractors and subcontractors who are parties to

11-26  proceedings before the State Contractors’ Board pursuant to the

11-27  provisions of this chapter; and

11-28     (c) Delegate its authority to investigators, hearing officers,

11-29  hearing panels and other appropriate persons.

11-30     2.  The State Contractors’ Board and its members and the

11-31  employees and agents of the State Contractors’ Board are not

11-32  liable in a civil action for any act performed in good faith and

11-33  within the scope of the duties assigned to the State Contractors’

11-34  Board pursuant to the provisions of this chapter.

11-35     Sec. 32.  1.  Any statutes of limitation or statutes of repose

11-36  applicable to a cause of action for a constructional defect are

11-37  tolled during the following periods:

11-38     (a) From the date that the claimant sends written notice of the

11-39  constructional defect pursuant to section 27 of this act until:

11-40         (1) Sixty days after the date that the period for completion

11-41  of the repairs has expired pursuant to this chapter; or

11-42         (2) If the parties by mutual agreement have set a later date

11-43  for the completion of the repairs, 60 days after the later date.

12-1      (b) During any period in which the constructional defect is

12-2  the subject of an administrative proceeding that is pending before

12-3  the State Contractors’ Board.

12-4      (c) During any period in which the constructional defect is the

12-5  subject of a mediation that is pending.

12-6      2.  The tolling of any applicable statutes of limitation or

12-7  statutes of repose pursuant to this section:

12-8      (a) Applies only to the specific constructional defect that is the

12-9  subject of the repairs, the administrative proceeding pending

12-10  before the State Contractors’ Board or the mediation; and

12-11     (b) Does not apply to any other constructional defect,

12-12  regardless of whether the other constructional defect is in the

12-13  same residence or appurtenance.

12-14     3.  If any applicable statutes of limitation or statutes of repose

12-15  are tolled pursuant to this section, that tolling applies to the

12-16  claimant and to each contractor, subcontractor, supplier or design

12-17  professional who may be liable for the constructional defect.

12-18     Sec. 33.  1.  If a contractor, subcontractor, supplier or

12-19  design professional receives written notice of a constructional

12-20  defect pursuant to this chapter, the contractor, subcontractor,

12-21  supplier or design professional may present the claim to an

12-22  insurer which has issued a policy of insurance that covers all or

12-23  any portion of the business of the contractor, subcontractor,

12-24  supplier or design professional.

12-25     2.  If the contractor, subcontractor, supplier or design

12-26  professional presents the claim to the insurer pursuant to this

12-27  section, the insurer:

12-28     (a) Must treat the claim as if a civil action has been brought

12-29  against the contractor, subcontractor, supplier or design

12-30  professional; and

12-31     (b) Must provide coverage under the policy of insurance as if a

12-32  civil action has been brought against the contractor,

12-33  subcontractor, supplier or design professional.

12-34     3.  A contractor, subcontractor, supplier or design

12-35  professional is not required to present a claim to the insurer

12-36  pursuant to this section, and the failure to present such a claim to

12-37  the insurer does not relieve the insurer of any duty under the

12-38  policy of insurance to the contractor, subcontractor, supplier or

12-39  design professional.

12-40     Sec. 34.  1.  If a claimant brings a cause of action for a

12-41  constructional defect or amends a complaint to add a cause of

12-42  action for a constructional defect against the contractor for the

12-43  construction project, any subcontractor, supplier or design

12-44  professional who is liable for the constructional defect and who

12-45  did not receive written notice of the constructional defect pursuant

13-1  to section 27 or 29 of this act may make directly to the claimant an

13-2  offer to repair the constructional defect.

13-3      2.  Except as otherwise provided in this section, if the claimant

13-4  accepts the offer of the subcontractor, supplier or design

13-5  professional, the contractor may not pursue any claim related to

13-6  the constructional defect against the subcontractor, supplier or

13-7  design professional if:

13-8      (a) The subcontractor, supplier or design professional has the

13-9  constructional defect repaired to the satisfaction of the claimant;

13-10  and

13-11     (b) The claimant provides a written statement to the

13-12  subcontractor, supplier or design professional which indicates that

13-13  the constructional defect has been repaired to the satisfaction of

13-14  the claimant and which releases all claims against the contractor,

13-15  subcontractor, supplier or design professional with regard to the

13-16  constructional defect.

13-17     3.  Notwithstanding the provisions of subsections 1 and 2, the

13-18  contractor may pursue a claim related to the constructional defect

13-19  against the subcontractor, supplier or design professional if the

13-20  contractor:

13-21     (a) Made a good faith effort to discover the identity of the

13-22  subcontractor, supplier or design professional after the contractor

13-23  received written notice of the constructional defect from the

13-24  claimant; and

13-25     (b) Was unable to discover the identity of the subcontractor,

13-26  supplier or design professional within the 30-day period for

13-27  providing a copy of the written notice to the subcontractor,

13-28  supplier or design professional.

13-29     Sec. 35.  1.  Notwithstanding any other provision of this

13-30  chapter, if a claimant sends written notice of a constructional

13-31  defect to the contractor for the construction project and the nature

13-32  and extent of the constructional defect would lead a reasonable

13-33  contractor to believe that the constructional defect creates an

13-34  imminent threat to the health or safety of the inhabitants of the

13-35  residence, the contractor is required to repair the constructional

13-36  defect as soon as reasonably practicable. The contractor must:

13-37     (a) Either perform the repairs, but only if he is properly

13-38  licensed, bonded and insured to perform the repairs, or have the

13-39  repairs performed by a properly licensed, bonded and insured

13-40  contractor or subcontractor; and

13-41     (b) Ensure that all contractors, subcontractors and suppliers

13-42  are paid for any labor performed or materials furnished for the

13-43  repairs so that there are no mechanics’ and materialmen’s liens

13-44  filed against the residence and its appurtenances pursuant to NRS

14-1  108.221 to 108.246, inclusive, and indemnify the claimant against

14-2  all such liens.

14-3      2.  If the contractor does not repair the constructional defect

14-4  as soon as reasonably practicable, the claimant may have

14-5  the defect repaired and may bring a cause of action for the

14-6  constructional defect against the contractor to recover:

14-7      (a) The reasonable costs of the repairs;

14-8      (b) Reasonable attorney’s fees and costs; and

14-9      (c) Any other damages recoverable under any other law.

14-10     3.  If, after a reasonable inspection of the residence, the

14-11  contractor determines, in good faith, that the constructional defect

14-12  does not create an imminent threat to the health or safety of the

14-13  inhabitants of the residence, the contractor is not subject to the

14-14  provisions of this section unless, after the contractor makes his

14-15  determination, a building inspector certifies that the

14-16  constructional defect creates an imminent threat to the health or

14-17  safety of the inhabitants of the residence.

14-18     Sec. 36.  1.  Notwithstanding any other provision of this

14-19  chapter, if a claimant is the initial purchaser of a new residence

14-20  and, not later than 1 year after the close of escrow for the initial

14-21  purchase, the claimant sends to the contractor for the construction

14-22  project written notice of a constructional defect that does not

14-23  create an imminent threat to the health or safety of the inhabitants

14-24  of the residence, the contractor is required to repair the

14-25  constructional defect in accordance with the provisions of this

14-26  section, unless:

14-27     (a) After a reasonable inspection, the contractor determines, in

14-28  good faith, that there is no constructional defect; and

14-29     (b) The contractor provides to the claimant written notice of

14-30  the contractor’s determination.

14-31     2.  If the contractor is required to repair the constructional

14-32  defect in accordance with the provisions of this section, the

14-33  contractor must:

14-34     (a) Either perform the repairs, but only if he is properly

14-35  licensed, bonded and insured to perform the repairs, or have the

14-36  repairs performed by a properly licensed, bonded and insured

14-37  contractor or subcontractor;

14-38     (b) Perform the repairs or have the repairs performed at

14-39  reasonable dates and times that are agreed to in advance with the

14-40  claimant;

14-41     (c) Complete the repairs or have the repairs completed within a

14-42  reasonable period as required by the provisions of this section;

14-43  and

14-44     (d) Ensure that all contractors, subcontractors and suppliers

14-45  are paid for any labor performed or materials furnished for the

15-1  repairs so that there are no mechanics’ and materialmen’s liens

15-2  filed against the residence and its appurtenances pursuant to NRS

15-3  108.221 to 108.246, inclusive, and indemnify the claimant against

15-4  all such liens.

15-5      3.  The contractor must complete the repairs or have the

15-6  repairs completed not later than 45 days after the date that written

15-7  notice of the constructional defect is sent to the contractor, unless:

15-8      (a) Completion of the repairs is delayed by the claimant or by

15-9  other events beyond the control of the contractor; or

15-10     (b) Timely completion of the repairs is not reasonably possible.

15-11  If timely completion of the repairs is not reasonably possible, the

15-12  claimant and the contractor must negotiate in good faith to set a

15-13  reasonable period for completion of the repairs.

15-14     4.  The claimant and the contractor may agree in writing to

15-15  extend the periods prescribed by this section.

15-16     5.  If the contractor fails to comply with this section, the

15-17  contractor is immediately subject to discipline pursuant to

15-18  NRS 624.300.

15-19     Sec. 37.  1.  In addition to the other requirements of this

15-20  chapter, a claimant may not bring a cause of action for a

15-21  constructional defect or amend a complaint to add a cause of

15-22  action for a constructional defect against a contractor,

15-23  subcontractor, supplier or design professional, unless:

15-24     (a) The matter is first submitted to a mediation; or

15-25     (b) The claimant and the other parties agree, in writing, to

15-26  waive the mediation.

15-27     2.  If the matter is submitted to a mediation, the mediator must

15-28  be selected by an agreement between the claimant and the other

15-29  parties. If the claimant and the other parties fail to agree upon a

15-30  mediator within 45 days after a mediator is first selected by the

15-31  claimant, the claimant or any other party may petition the

15-32  American Arbitration Association, the Nevada Arbitration

15-33  Association, Nevada Dispute Resolution Services or any other

15-34  mediation service acceptable to the parties for the appointment of

15-35  a mediator.

15-36     3.  The mediator shall commence the mediation within 60

15-37  days after the matter is submitted to him, unless the claimant and

15-38  the other parties agree to extend the time for the commencement

15-39  of the mediation.

15-40     4.  Before the mediation begins:

15-41     (a) The claimant shall deposit $50 with the mediation service;

15-42  and

15-43     (b) The other parties shall deposit with the mediation service

15-44  the remaining amount estimated by the mediation service as

15-45  necessary to pay the fees and expenses of the mediator for the first

16-1  session of the mediation. The other parties shall deposit additional

16-2  amounts demanded by the mediation service as incurred for that

16-3  purpose.

16-4      5.  The total fees for each day of the mediation and the

16-5  mediator must not exceed $750 per day, unless the claimant and

16-6  the other parties agree to a different amount.

16-7      6.  The mediator may discover only those documents or

16-8  materials which are necessary to conduct the mediation.

16-9      7.  Not later than 15 days before the mediation begins and

16-10  upon providing 15 days’ notice, each party shall provide the other

16-11  party, or shall make a reasonable effort to assist the other party to

16-12  obtain, all relevant reports, photos, correspondence, plans,

16-13  specifications, warranties, contracts, subcontracts, work orders for

16-14  repair, videotapes, technical reports, soil and other engineering

16-15  reports and other documents or materials relating to the

16-16  constructional defect to the extent that such documents or

16-17  materials are not privileged.

16-18     Sec. 38.  1.  If the claimant and any other party fail to

16-19  resolve the matter during the mediation or if any other party fails

16-20  to pay the required fees for the mediation or fails to appear for the

16-21  mediation:

16-22     (a) The claimant may bring a cause of action for the

16-23  constructional defect or amend a complaint to add a cause of

16-24  action for the constructional defect against the party; and

16-25     (b) The prevailing party in the action may recover, as costs of

16-26  the action, the reasonable costs and fees paid by the party for the

16-27  mediation.

16-28     2.  In such an action, the claimant or any other party may

16-29  petition the court in which the action is commenced for the

16-30  appointment of a special master. If the court appoints a special

16-31  master, the special master may:

16-32     (a) Review all pleadings, papers or documents filed with the

16-33  court concerning the action.

16-34     (b) Coordinate the discovery of any books, records, papers or

16-35  other documents or materials by the parties, including the

16-36  disclosure of witnesses and the taking of the deposition of any

16-37  party.

16-38     (c) Order any inspections on the site of the property by a party

16-39  and any consultants or experts of a party.

16-40     (d) Order settlement conferences and attendance at those

16-41  conferences by any representative of the insurer of a party.

16-42     (e) Require any attorney representing a party to provide

16-43  statements of legal and factual issues concerning the action.

17-1      (f) Refer to the judge who appointed him or to the presiding

17-2  judge of the court in which the action is commenced any matter

17-3  requiring assistance from the court.

17-4      3.  The special master shall not personally conduct any

17-5  settlement conferences or engage in any ex parte meetings

17-6  regarding the action, unless the claimant and the other parties

17-7  agree to allow the special master to engage in such conduct.

17-8      4.  Upon application by a party to the court in which the

17-9  action is commenced, any decision or other action taken by the

17-10  special master may be appealed to the court for a decision.

17-11     5.  A report issued by a mediator or a special master which

17-12  indicates that a party has failed to appear before him or to mediate

17-13  in good faith is admissible in the action, but a statement or

17-14  admission made by a party in the course of the mediation or an

17-15  appearance before the special master is not admissible.

17-16     Sec. 39.  1.  In addition to the other requirements of this

17-17  chapter and except as otherwise provided in subsection 2, if a

17-18  claimant brings a cause of action for a constructional defect or

17-19  amends a complaint to add a cause of action for a constructional

17-20  defect against a design professional, including, without limitation,

17-21  a cause of action for professional negligence, the attorney for the

17-22  claimant must file an affidavit with the court concurrently with the

17-23  service of the first pleading in the action stating that the attorney:

17-24     (a) Has reviewed the facts of the case;

17-25     (b) Has consulted with an expert;

17-26     (c) Reasonably believes the expert who was consulted is

17-27  knowledgeable in the relevant discipline involved in the action;

17-28  and

17-29     (d) Has concluded on the basis of his review and the

17-30  consultation with the expert that the action has a reasonable basis

17-31  in law and fact.

17-32     2.  The attorney for the claimant may file the affidavit

17-33  required pursuant to subsection 1 at a later time if the attorney

17-34  could not consult with an expert and prepare the affidavit before

17-35  filing the action without causing the action to be impaired or

17-36  barred by any statutes of limitations or statutes of repose, or other

17-37  limitations prescribed by law. If the attorney must submit the

17-38  affidavit late, the attorney shall:

17-39     (a) File an affidavit concurrently with the service of the first

17-40  pleading in the action stating his reason for failing to comply with

17-41  subsection 1; and

17-42     (b) Consult with an expert and file the affidavit required

17-43  pursuant to subsection 1 not later than 45 days after filing the

17-44  action.

18-1      3.  In addition to the statement included in the affidavit

18-2  pursuant to subsection 1, a report must be attached to the

18-3  affidavit. Except as otherwise provided in subsection 4, the report

18-4  must be prepared by the expert consulted by the attorney and

18-5  include, without limitation:

18-6      (a) The resume of the expert;

18-7      (b) A statement that the expert is experienced in each

18-8  discipline which is the subject of the report;

18-9      (c) A copy of each nonprivileged document reviewed by the

18-10  expert in preparing his report, including, without limitation, each

18-11  record, report and related document that the expert has

18-12  determined is relevant to the allegations of negligent conduct that

18-13  are the basis for the action;

18-14     (d) The conclusions of the expert and the basis for the

18-15  conclusions; and

18-16     (e) A statement that the expert has concluded that there is a

18-17  reasonable basis for filing the action.

18-18     4.  In an action brought by a claimant in which an affidavit is

18-19  required to be filed pursuant to subsection 1:

18-20     (a) The report required pursuant to subsection 3 is not

18-21  required to include the information set forth in paragraphs (c) and

18-22  (d) of subsection 3 if the claimant or his attorney files an affidavit,

18-23  at the time that the affidavit is filed pursuant to subsection 1,

18-24  stating that he made reasonable efforts to obtain the nonprivileged

18-25  documents described in paragraph (c) of subsection 3, but was

18-26  unable to obtain such documents before filing the action;

18-27     (b) The claimant or his attorney shall amend the report

18-28  required pursuant to subsection 3 to include any documents and

18-29  information required pursuant to paragraph (c) or (d) of

18-30  subsection 3 as soon as reasonably practicable after receiving the

18-31  document or information; and

18-32     (c) The court may dismiss the action if the claimant and his

18-33  attorney fail to comply with the requirements of paragraph (b).

18-34     5.  An expert consulted by the attorney of the claimant to

18-35  prepare an affidavit pursuant to this section must not be a party to

18-36  the action.

18-37     6.  The court shall dismiss the action against the design

18-38  professional if the attorney for the claimant fails to:

18-39     (a) File an affidavit required pursuant to this section;

18-40     (b) File a report required pursuant to subsection 3; or

18-41     (c) Name the expert consulted in the affidavit required

18-42  pursuant to subsection 1.

18-43     7.  The fact that the attorney for the claimant has complied or

18-44  failed to comply with the provisions of this section is admissible in

18-45  the action.

19-1      8.  As used in this section, “expert” means a person who is

19-2  licensed in a state to engage in the practice of professional

19-3  engineering, land surveying, architecture or landscape

19-4  architecture.

19-5      Sec. 40.  1.  Notwithstanding any other provision of this

19-6  chapter, a claimant may not bring a cause of action or amend a

19-7  complaint to add a cause of action against a subdivider or master

19-8  developer for a constructional defect in an appurtenance

19-9  constructed on behalf of the subdivider or master developer in a

19-10  planned unit development, to the extent that the appurtenance was

19-11  constructed by or through a licensed general contractor, unless:

19-12     (a) The subdivider or master developer fails to provide to the

19-13  claimant the name, address and telephone number of each

19-14  contractor hired by the subdivider or master developer to construct

19-15  the appurtenance within 30 days after the receipt by the subdivider

19-16  or master developer of a request from the claimant for such

19-17  information; or

19-18     (b) After the claimant has made a good faith effort to obtain

19-19  full recovery from the contractors hired by the subdivider or

19-20  master developer to construct the appurtenance, the claimant has

19-21  not obtained a full recovery.

19-22     2.  Any statutes of limitation or statutes of repose applicable to

19-23  a claim governed by this section are tolled from the time the

19-24  claimant notifies a contractor hired by the subdivider or master

19-25  developer of the claim until the earlier of the date:

19-26     (a) A court determines that the claimant cannot obtain a full

19-27  recovery against those contractors; or

19-28     (b) The claimant receives notice that those contractors are

19-29  bankrupt, insolvent or dissolved.

19-30  Tolling pursuant to this subsection applies only to the subdivider

19-31  or master developer. Notwithstanding any applicable statutes of

19-32  limitation or statutes of repose, the claimant may commence an

19-33  action against the subdivider or master developer for the claim

19-34  within 1 year after the end of the tolling described in this

19-35  subsection.

19-36     3.  The provisions of this section do not prohibit the

19-37  commencement of an action against a subdivider or master

19-38  developer for a constructional defect in a residence sold, designed

19-39  or constructed by or on behalf of the subdivider or master

19-40  developer.

19-41     4.  The provisions of this section do not prohibit a person

19-42  other than the claimant from commencing an action against a

19-43  subdivider or master developer to enforce his own rights.

19-44     5.  The provisions of this section do not apply to a subdivider

19-45  or master developer who acts as a general contractor or uses his

20-1  license as a general contractor in the course of constructing the

20-2  appurtenance that is the subject of the action.

20-3      Sec. 41.  (Deleted by amendment.)

20-4      Sec. 42.  1.  If any party brings an action pursuant to this

20-5  chapter as a class action or seeks certification of an action

20-6  brought pursuant to this chapter as a class action, a claimant shall

20-7  not be deemed to be a member of the class or a party to the class

20-8  action and is not bound by any order, decision or judgment in the

20-9  class action, unless:

20-10     (a) The claimant, or a party to the class action acting on

20-11  behalf of the claimant, files with the court a certification which is

20-12  signed and sworn by the claimant and which contains an

20-13  affirmative representation stating that the claimant has complied

20-14  with the notice provisions of section 27 of this act; and

20-15     (b) Each other claimant who has chosen to be a member of the

20-16  class, or a party to the class action acting on behalf of that

20-17  claimant, files with the court a certification which is signed and

20-18  sworn by the claimant and which contains an affirmative

20-19  representation stating that the claimant has complied with the

20-20  notice provisions of section 27 of this act.

20-21     2.  If there is a conflict between the provisions of this section

20-22  and the provisions of any other statute or any court rule or any

20-23  principle of the common law or equity, the provisions of this

20-24  section prevail and must be interpreted to supersede any other

20-25  provisions or principles that are in conflict with the provisions of

20-26  this section.

20-27     Sec. 43.  1.  At the same time that a claimant brings a cause

20-28  of action for a constructional defect or amends a complaint to add

20-29  a cause of action for a constructional defect, the claimant shall

20-30  send written notice of the cause of action by registered mail,

20-31  return receipt requested, to each person who holds a security

20-32  interest in the residence or appurtenance which is the subject of

20-33  the constructional defect and whose security interest is recorded in

20-34  the office of the county recorder for the county where the

20-35  residence or appurtenance is located.

20-36     2.  If the claimant recovers money for the constructional

20-37  defect, not later than 30 days before the claimant disburses or

20-38  spends the money, the claimant shall send written notice by

20-39  registered mail, return receipt requested, to each person who was

20-40  entitled to receive the prior written notice from the claimant

20-41  pursuant to subsection 1. The written notice must set forth the

20-42  amount of money that the claimant recovered for the

20-43  constructional defect.

20-44     Sec. 44.  1.  If a constructional defect is part of a residence

20-45  or appurtenance which is covered by a homeowner’s warranty that

21-1  has been purchased by or on behalf of a claimant pursuant to

21-2  NRS 690B.100 to 690B.180, inclusive, the claimant shall diligently

21-3  pursue a claim under the homeowner’s warranty.

21-4      2.  If the claimant is paid any money under the homeowner’s

21-5  warranty for the constructional defect, the amount paid to the

21-6  claimant under the homeowner’s warranty must be deducted from

21-7  any amount that the claimant recovers from a contractor,

21-8  subcontractor, supplier or design professional for the

21-9  constructional defect. The provisions of this subsection do not

21-10  apply to any amount paid to the claimant in satisfaction of claims

21-11  that are collateral to any coverage issued to or by the contractor,

21-12  subcontractor, supplier or design professional.

21-13     3.  If an insurer, in bad faith, denies coverage under a

21-14  homeowner’s warranty, the claimant and each contractor,

21-15  subcontractor, supplier or design professional who is liable for the

21-16  constructional defect may bring a cause of action against the

21-17  insurer to recover:

21-18     (a) The money that would have been paid under the

21-19  homeowner’s warranty if the coverage had been provided; and

21-20     (b) Reasonable attorney’s fees and costs.

21-21     Sec. 45.  1.  Not later than 10 days after bringing a cause of

21-22  action or amending a complaint to add a cause of action for a

21-23  constructional defect against a contractor, subcontractor, supplier

21-24  or design professional, the claimant shall disclose all information

21-25  about any homeowner’s warranty that is applicable to the cause of

21-26  action.

21-27     2.  Not later than 10 days after the claimant’s disclosure, the

21-28  contractor, subcontractor, supplier or design professional shall

21-29  disclose any information about insurance agreements that may be

21-30  obtained by discovery pursuant to Rule 26(b)(2) of the Nevada

21-31  Rules of Civil Procedure. Such disclosure does not affect the

21-32  admissibility at trial of the information disclosed.

21-33     3.  Except as otherwise provided in subsection 4, if any party

21-34  fails to provide the information required pursuant to subsection 1

21-35  or 2 within the time allowed, any party who is aggrieved by the

21-36  failure may petition the court to compel production of the

21-37  information. Upon receiving such a petition, the court may order

21-38  the party to produce the required information and may award the

21-39  petitioning party reasonable attorney’s fees and costs incurred in

21-40  petitioning the court pursuant to this subsection.

21-41     4.  The parties may agree to an extension of time to produce

21-42  the information required pursuant to this section.

21-43     5.  If there is a conflict between the provisions of this section

21-44  and the provisions of any other statute or any court rule or any

21-45  principle of the common law or equity, the provisions of this

22-1  section prevail and must be interpreted to supersede any other

22-2  provisions or principles that are in conflict with the provisions of

22-3  this section.

22-4      6.  As used in this section, “information about insurance

22-5  agreements” means any declaration sheets, endorsements and

22-6  contracts of insurance issued to the contractor, subcontractor,

22-7  supplier or design professional from the commencement of

22-8  construction of the residence or appurtenance to the date on

22-9  which the request for the information is made. The term does not

22-10  include any information concerning any disputes between the

22-11  contractor, subcontractor, supplier or design professional and the

22-12  insurer, or any information concerning any reservation of rights

22-13  by the insurer.

22-14     Sec. 46.  1.  Not later than 30 days after the date of service

22-15  of the answer to the complaint, the parties shall meet to establish:

22-16     (a) A schedule for the parties to exchange or provide

22-17  reasonable access to all relevant reports, photos, correspondence,

22-18  plans, specifications, warranties, contracts, subcontracts, work

22-19  orders for repair, videotapes, technical reports, soil and other

22-20  engineering reports and other documents or materials relating to

22-21  each constructional defect to the extent that such documents or

22-22  materials are not privileged.

22-23     (b) A schedule for the parties to inspect the residence or

22-24  appurtenance where each constructional defect is located.

22-25     (c) A schedule for the parties to conduct any tests that are

22-26  reasonably necessary to determine the nature and cause of each

22-27  constructional defect or any damage or injury, and the nature and

22-28  extent of any repairs necessary to remedy each constructional

22-29  defect or any damage or injury. The party conducting the test shall

22-30  provide reasonable notice of the test to all other parties and

22-31  conduct the test at a reasonable time.

22-32     (d) A deadline for the claimant to issue to the other parties a

22-33  final defect list. The deadline must not be later than 180 days after

22-34  the date that the meeting is held pursuant to this subsection. The

22-35  final defect list must include:

22-36         (1) A description of each constructional defect;

22-37         (2) The disclosure of each specific location which has been

22-38  inspected with regard to each constructional defect;

22-39         (3) The disclosure of each specific location which has

22-40  been intrusively tested with regard to each constructional defect;

22-41         (4) A description of any other testing which has been

22-42  conducted to substantiate each constructional defect; and

22-43         (5) A statement of the legal and factual basis for each

22-44  constructional defect, including, without limitation, any applicable

23-1  construction standards or specifications which may have been

23-2  violated.

23-3      (e) A deadline for the claimant to issue to the other parties a

23-4  statement of the method and cost of repair. The deadline must not

23-5  be later than 180 days after the date that the meeting is held

23-6  pursuant to this subsection. The statement of the method and cost

23-7  of repair must include:

23-8          (1) A description of the method to be used to repair each

23-9  constructional defect described in the final defect list; and

23-10         (2) An estimate of the cost to repair each constructional

23-11  defect described in the final defect list, including, without

23-12  limitation, an estimate of the quantities of materials needed for the

23-13  repairs and the unit cost for those materials, an estimate of the

23-14  cost for labor and other materials and an estimate of any

23-15  construction burdens.

23-16     2.  The claimant shall issue the final defect list and the

23-17  statement of the method and cost of repair to the other parties not

23-18  later than the deadline established by the parties pursuant to

23-19  subsection 1. After the claimant issues the final defect list and the

23-20  statement of the method and cost of repair, the claimant may not

23-21  amend or otherwise change the final defect list or the statement of

23-22  the method and cost of repair to include any additional

23-23  constructional defects, unless the claimant is able to demonstrate,

23-24  by clear and convincing evidence, that the additional

23-25  constructional defects arose after the date that the claimant issued

23-26  the final defect list.

23-27     3.  At the meeting held pursuant to subsection 1, the parties

23-28  shall establish a schedule for adding additional parties to the

23-29  complaint and for filing any third-party complaints against

23-30  additional parties who may be liable, in whole or in part, for the

23-31  constructional defects alleged in the complaint.

23-32     4.  If any party adds an additional party to the complaint or

23-33  files a third-party complaint against an additional party:

23-34     (a) The additional party shall file and serve an answer as

23-35  required by law; and

23-36     (b) Not later than 30 days after the date that the additional

23-37  party files an answer, the additional party shall meet with the

23-38  other parties to establish or modify the schedules and deadlines

23-39  required by subsection 1 with regard to the additional party.

23-40     Sec. 47.  1.  If a settlement conference is held concerning a

23-41  claim for a constructional defect, the special master, if any, or the

23-42  judge presiding over the claim may order a representative of an

23-43  insurer of a party to attend the settlement conference. If a

23-44  representative of an insurer is ordered to attend the settlement

24-1  conference, the insurer shall ensure that the representative is

24-2  authorized, on behalf of the insurer, to:

24-3      (a) Bind the insurer to any settlement agreement relating to

24-4  the claim;

24-5      (b) Enter into any agreement relating to coverage under the

24-6  party’s policy of insurance that is required to carry out any

24-7  settlement relating to the claim; and

24-8      (c) Commit for expenditure any money or other assets

24-9  available under the party’s policy of insurance.

24-10     2.  If a representative of an insurer who is ordered to attend a

24-11  settlement conference pursuant to subsection 1 fails to attend the

24-12  settlement conference or attends but is substantially unprepared to

24-13  participate, or fails to participate in good faith, the special master

24-14  or the judge may, on his own motion or that of a party, issue any

24-15  order with regard thereto that is just under the circumstances.

24-16     3.  In lieu of or in addition to any other sanction, the special

24-17  master or the judge may require the insurer to pay any reasonable

24-18  expenses or attorney’s fees incurred by a party because of the

24-19  failure of the insurer or its representative to comply with the

24-20  provisions of this section or any order issued pursuant to this

24-21  section, unless the special master or the judge finds that the

24-22  failure to comply was substantially justified or that any other

24-23  circumstances make the award of such expenses or fees unjust.

24-24     4.  The special master may report any violation of this section

24-25  or any order issued by the special master pursuant to this section

24-26  to any judge who subsequently presides over the claim and may

24-27  recommend any appropriate sanctions as a result of the violation.

24-28     5.  Any insurer which conducts business in this state and

24-29  which insures a party against liability for the claim shall be

24-30  deemed to have consented to the jurisdiction of the special master

24-31  or the judge for the purposes of this section. To the extent that the

24-32  insurer fails to comply with any order issued by the special master

24-33  or the judge, the insurer is subject to an award of sanctions

24-34  imposed by the special master or the judge.

24-35     6.  The authority conferred upon the special master or the

24-36  judge pursuant to this section is in addition to any other authority

24-37  conferred upon the special master or the judge pursuant to any

24-38  other statute or any court rule.

24-39     Sec. 48.  1.  In addition to any other method for settling a

24-40  claim for a constructional defect, a contractor, subcontractor,

24-41  supplier or design professional may enter into a written agreement

24-42  with the claimant to settle the claim by repurchasing the

24-43  claimant’s residence and the real property upon which it is

24-44  located.

25-1      2.  The agreement may include provisions which reimburse

25-2  the claimant for:

25-3      (a) The market value of the residence as if no constructional

25-4  defect existed, except that if a residence is less than 2 years of age

25-5  and was purchased from the contractor against whom the claim is

25-6  brought, the market value is the price at which the residence was

25-7  sold to the claimant;

25-8      (b) The value of any improvements made to the property by a

25-9  person other than the contractor, subcontractor, supplier or design

25-10  professional;

25-11     (c) Reasonable attorney’s fees and fees for experts; and

25-12     (d) Any other costs, including, without limitation:

25-13         (1) Costs and expenses for moving; and

25-14         (2) Costs, points and fees for loans.

25-15     Sec. 49.  1.  If a contractor, subcontractor, supplier or

25-16  design professional is found liable to the claimant for a cause of

25-17  action for a constructional defect, the claimant is entitled to

25-18  recover only the damages set forth in this section to the extent

25-19  those damages are proximately caused by the constructional

25-20  defect.

25-21     2.  The claimant is entitled to recover the lesser of:

25-22     (a) The reasonable cost of any repairs already made that were

25-23  necessary and of any repairs yet to be made that are necessary to

25-24  cure the constructional defect to the extent that the contractor,

25-25  subcontractor, supplier or design professional failed to cure the

25-26  constructional defect, plus the reasonable expenses of any

25-27  temporary housing that was or will be reasonably necessary

25-28  during any such repairs; or

25-29     (b) The diminution in the value of the residence, appurtenance

25-30  or other property resulting from the constructional defect to the

25-31  extent that the contractor, subcontractor, supplier or design

25-32  professional failed to cure the constructional defect.

25-33     3.  The claimant is entitled to recover the reasonable value of

25-34  any other property damaged by the constructional defect.

25-35     4.  The claimant is entitled to recover any interest provided by

25-36  statute, except that the claimant is not entitled to recover any

25-37  prejudgment interest if the claimant is using present value as the

25-38  basis for determining the cost of repairs or the amount of the

25-39  damages.

25-40     Sec. 50.  1.  For each cause of action for a constructional

25-41  defect, the court shall determine which party is the prevailing

25-42  party for the cause of action. A prevailing party is entitled to

25-43  recover:

25-44     (a) Reasonable attorney’s fees; and

26-1      (b) Any other fees and costs reasonably incurred by the

26-2  prevailing party, including, without limitation, any fees and costs

26-3  incurred for the retention of experts.

26-4      2.  For the purposes of this section, the claimant is not a

26-5  prevailing party and is not entitled to recover any attorney’s fees

26-6  or other fees and costs with regard to a cause of action for a

26-7  constructional defect if the court finds that there is no contractor,

26-8  subcontractor, supplier or design professional who is liable to the

26-9  claimant for the constructional defect.

26-10     3.  For the purposes of this section, if the claimant rejects any

26-11  offer or any best and final offer made by a contractor,

26-12  subcontractor, supplier or design professional, and if the final

26-13  judgment in the action is less favorable to the claimant than the

26-14  offer or the best and final offer rejected by the claimant, the

26-15  contractor, subcontractor, supplier or design professional who

26-16  made the offer or the best and final offer shall be deemed to be the

26-17  prevailing party beginning on the date that the offer or the best

26-18  and final offer was rejected by the claimant. If the final judgment

26-19  in the action is more favorable to the claimant than the offer or

26-20  best and final offer rejected by the claimant, the claimant shall be

26-21  deemed to be the prevailing party beginning on the date that the

26-22  offer or the best and final offer was rejected by the claimant.

26-23     4.  Any party may challenge the reasonableness of any

26-24  attorney’s fees or other fees and costs requested pursuant to this

26-25  section.

26-26     5.  Any party may submit an offer to repair a constructional

26-27  defect or to settle a claim directly to the claimant. In such an offer,

26-28  the party may reserve the right to challenge the reasonableness of

26-29  any attorney’s fees or other fees and costs. An attorney who

26-30  represents the claimant shall not refuse to present an offer to the

26-31  claimant because the offer contains a reservation of rights to

26-32  challenge the reasonableness of any attorney’s fees or other fees

26-33  and costs.

26-34     6.  The court is given the discretion to determine the

26-35  reasonableness of any attorney’s fees or other fees and costs

26-36  requested pursuant to this section, and the court must approve the

26-37  reasonableness of any attorney’s fees or other fees and costs

26-38  before they are awarded to the claimant or any other party.

26-39     7.  In determining the reasonableness of any attorney’s fees or

26-40  other fees and costs, the court:

26-41     (a) Must multiply the number of hours reasonably spent on the

26-42  case by a reasonable hourly rate as determined by the court;

26-43     (b) Must take into account the nature and the extent of the risk

26-44  involved in prosecuting or defending the cause of action and the

27-1  necessity of agreeing to a contingency arrangement to procure

27-2  competent counsel; and

27-3      (c) May consider the extent to which the attorney’s fees or

27-4  other fees and costs are based on causes of action for which the

27-5  claimant prevailed and did not prevail.

27-6      8.  A determination made by the court relating to the

27-7  reasonableness of any attorney’s fees or other fees and costs:

27-8      (a) Is binding upon the attorney; and

27-9      (b) Controls over any conflicting provision set forth in a

27-10  contract or other agreement entered into between the attorney and

27-11  the party.

27-12     9.  The provisions of this chapter:

27-13     (a) Do not prohibit a party from making an offer of judgment

27-14  pursuant to NRS 17.115 or Rule 68 of the Nevada Rules of Civil

27-15  Procedure or obtaining an award of attorney’s fees or other fees

27-16  and costs pursuant thereto;

27-17     (b) Do not prevail over, but must be applied in addition to, any

27-18  other statute or court rule relating to the settlement of claims or

27-19  the award of attorney’s fees or other fees and costs; and

27-20     (c) Do not impair any right of a contractor, subcontractor,

27-21  supplier or design professional to enter into or enforce any

27-22  contract or agreement providing for the recovery of attorney’s fees

27-23  or other fees and costs from another contractor, subcontractor,

27-24  supplier or design professional.

27-25     Sec. 51.  1.  Notwithstanding any other provision of this

27-26  chapter, a claimant or a contractor, subcontractor, supplier or

27-27  design professional may not bring any claim relating to a

27-28  constructional defect against a government, governmental agency

27-29  or political subdivision of a government during the period in

27-30  which the claim is being settled, mediated or otherwise resolved

27-31  pursuant to the provisions of this chapter.

27-32     2.  The settlement of any claim relating to a constructional

27-33  defect does not affect the rights or obligations of the claimant or

27-34  any contractor, subcontractor, supplier or design professional in

27-35  any action brought by the claimant or the contractor,

27-36  subcontractor, supplier or design professional against a third

27-37  party.

27-38     Sec. 52.  1.  A contractor who develops, constructs or

27-39  landscapes a new residence shall provide to the initial purchaser

27-40  of the new residence, not later than 60 days after the close of

27-41  escrow for the initial purchase, a written statement which contains

27-42  the following information:

27-43     (a) For each subcontractor who performed any work relating

27-44  to the development, construction or landscaping of the new

27-45  residence:

28-1          (1) The name, license number, business address and

28-2  telephone number of the subcontractor; and

28-3          (2) A brief description of the work performed by the

28-4  subcontractor.

28-5      (b) An informational statement indicating that each

28-6  subcontractor is entitled to record a notice of lien upon the new

28-7  residence and its appurtenances pursuant to NRS 108.221 to

28-8  108.246, inclusive, for any labor performed or materials furnished

28-9  by the subcontractor in the development, construction or

28-10  landscaping of the new residence.

28-11     (c) An informational statement describing the rights and duties

28-12  of contractors, subcontractors and owners with regard to:

28-13         (1) The provisions of chapter 624 of NRS; and

28-14         (2) The filing and enforcement of mechanics’ and

28-15  materialmen’s liens pursuant to NRS 108.221 to 108.246,

28-16  inclusive.

28-17     2.  The State Contractors’ Board shall prescribe requirements

28-18  relating to the form and contents for the written statement that a

28-19  contractor must provide to the initial purchaser of a new residence

28-20  pursuant to this section.

28-21     3.  A contractor shall not provide to the initial purchaser of a

28-22  new residence a written statement that deviates materially from the

28-23  requirements prescribed by the State Contractors’ Board.

28-24     4.  A contractor who violates any provision of this section:

28-25     (a) Shall be deemed to have violated the provisions of chapter

28-26  624 of NRS; and

28-27     (b) Is subject to any appropriate disciplinary action or

28-28  punishment that is authorized for a violation of the provisions of

28-29  chapter 624 of NRS.

28-30     Sec. 53. 1.  If a claimant attempts to sell a residence that is

28-31  or has been the subject of a cause of action for a constructional

28-32  defect, the claimant shall disclose, in writing, to any prospective

28-33  purchaser of the residence:

28-34     (a) All notices which the claimant has given to a contractor,

28-35  subcontractor, supplier or design professional regarding the

28-36  constructional defect that is or has been the subject of the cause of

28-37  action;

28-38     (b) All opinions which the claimant has obtained from experts

28-39  regarding the constructional defect that is or has been the subject

28-40  of the cause of action;

28-41     (c) The terms of any settlement, order or judgment relating to

28-42  the cause of action; and

28-43     (d) A detailed report of all repairs made to the residence by or

28-44  on behalf of the claimant as a result of the constructional defect

28-45  that is or has been the subject of the cause of action.

29-1      2.  The claimant shall provide the disclosure required by this

29-2  section:

29-3      (a) Not less than 30 days before the close of escrow for the sale

29-4  of the residence, if escrow is to close more than 30 days after the

29-5  execution of the sales agreement;

29-6      (b) Immediately upon the execution of the sales agreement, if

29-7  escrow is to close not more than 30 days after the execution of the

29-8  sales agreement; or

29-9      (c) Within 24 hours after sending written notice to a

29-10  contractor, subcontractor, supplier or design professional

29-11  pursuant to section 27 of this act, if the claimant sends such notice

29-12  after the execution of the sales agreement.

29-13     3.  Before taking any action on a claim for a constructional

29-14  defect pursuant to this chapter, the attorney for the claimant shall

29-15  notify the claimant in writing of the provisions of this section.

29-16     Sec. 54.  NRS 40.635 is hereby amended to read as follows:

29-17     40.635  1.  The provisions of NRS 40.600 to 40.695,

29-18  inclusive[:

29-19     1.  Apply] , apply to any claim for a constructional defect that

29-20  arises before, on or after July 1, 1995, [as the result of a

29-21  constructional defect, except a claim for personal injury or wrongful

29-22  death, if the claim is the subject of] and before the effective date of

29-23  this act, if the claimant:

29-24     (a) Has commenced an action [commenced] concerning the

29-25  claim pursuant to NRS 40.600 to 40.695, inclusive, on or after

29-26  July 1, 1995[.] , and before the effective date of this act; or

29-27     (b) Has provided notice of the claim to the contractor,

29-28  subcontractor, supplier or design professional pursuant to NRS

29-29  40.600 to 40.695, inclusive, before the effective date of this act.

29-30     2.  The provisions of NRS 40.600 to 40.695, inclusive:

29-31     (a) Prevail over any conflicting law otherwise applicable to the

29-32  claim or cause of action.

29-33     [3.] (b) Do not bar or limit any defense otherwise available

29-34  except as otherwise provided in those sections.

29-35     [4.] (c) Do not create a new theory upon which liability may be

29-36  based.

29-37     3.  The provisions of NRS 40.600 to 40.695, inclusive, do not

29-38  apply to:

29-39     (a) A claim for personal injury or wrongful death; or

29-40     (b) A claim that is subject to the provisions of sections 2 to 53,

29-41  inclusive, of this act.

29-42     Sec. 55.  NRS 113.135 is hereby amended to read as follows:

29-43     113.135  1.  Upon signing a sales agreement with the initial

29-44  purchaser of residential property that was not occupied by the

30-1  purchaser for more than 120 days after substantial completion of the

30-2  construction of the residential property, the seller shall:

30-3      (a) Provide to the initial purchaser a copy of NRS 11.202 to

30-4  11.206, inclusive, and [40.600 to 40. 695, inclusive;] sections 2 to

30-5  53, inclusive, of this act;

30-6      (b) Notify the initial purchaser of any soil report prepared for the

30-7  residential property or for the subdivision in which the residential

30-8  property is located; and

30-9      (c) If requested in writing by the initial purchaser not later than

30-10  5 days after signing the sales agreement, provide to the purchaser

30-11  without cost each report described in paragraph (b) not later than 5

30-12  days after the seller receives the written request.

30-13     2.  Not later than 20 days after receipt of all reports pursuant to

30-14  paragraph (c) of subsection 1, the initial purchaser may rescind the

30-15  sales agreement.

30-16     3.  The initial purchaser may waive his right to rescind the sales

30-17  agreement pursuant to subsection 2. Such a waiver is effective only

30-18  if it is made in a written document that is signed by the purchaser.

30-19     Sec. 56.  NRS 624.160 is hereby amended to read as follows:

30-20     624.160  1.  The Board is vested with all of the functions and

30-21  duties relating to the administration of this chapter.

30-22     2.  The Board shall:

30-23     (a) Carry out a program of education for customers of

30-24  contractors.

30-25     (b) Maintain and make known a telephone number for the public

30-26  to obtain information about self-protection from fraud in

30-27  construction and other information concerning contractors and

30-28  contracting.

30-29     3.  The Board may provide advisory opinions and take other

30-30  actions that are necessary for the effective administration of this

30-31  chapter and the regulations of the Board.

30-32     4.  The Board may exercise any powers granted to the Board

30-33  pursuant to this chapter in carrying out any duties assigned to the

30-34  Board pursuant to sections 2 to 53, inclusive, of this act.

30-35     Sec. 57.  Notwithstanding the provisions of section 27 of this

30-36  act, until the standard form for providing notice of a constructional

30-37  defect is made available to the public by the State Contractors’

30-38  Board, a claimant must provide the written notice required by

30-39  section 27 of this act through the use of any document that clearly

30-40  and adequately conveys the information set forth in section 27 of

30-41  this act.

30-42     Sec. 58. Notwithstanding the provisions of section 31 of this

30-43  act, a claimant or a contractor, subcontractor, supplier or design

30-44  professional may not submit a dispute to the State Contractors’

31-1  Board pursuant to the provisions of section 31 of this act before

31-2  October 1, 2003.

31-3      Sec. 59. 1.  This section and sections 1 to 51, inclusive, and

31-4  53 to 58, inclusive, of this act become effective upon passage

31-5  and approval.

31-6      2.  Section 52 of this act becomes effective upon passage and

31-7  approval for the purpose of adopting regulations and developing any

31-8  necessary forms, rules and procedures and on October 1, 2003, for

31-9  all other purposes.

 

31-10  H