UPDATE on AB 421
Author: Natasha A. Landrum
April 18, 2019
On April 12, 2019, proposedchanges to Assembly Bill 421 were posted by the Nevada Assembly Committee
on Judiciary. The proposed revisions
include:
- The removal of the proposed reinstatement of language to NRS 40.655 entitling homeowners to recover “reasonable attorney’s fees.”
- The addition of “and is reasonably likely to cause personal injury or property damage” to the proposed changes to NRS 40.615 – definition of a construction defect.
- Removal of AB 421’s proposed deletion of NRS 40.645(2)(d).Thus, the statute would retain the requirement for a homeowner to sign a statement verifying defects / damages claims.(During the April 9, 2019, meeting, Ms. Canepa advised the Judiciary Committee that this proposal was an error).
- Revision to AB 421’s proposed changes to pre-litigation inspection requirements stated in NRS 40.647.The revision softens instead of excludes the requirement for a Claimant or his/her representative to be present during the inspection providing that they must be able to identify defects / damages to the extent possible.
- Retaining the restriction on HOAs limiting suits to common elements maintained by Associations, but retains the proposed amendment allowing those suits to be presented on the homeowners’ behalves (NRS 116.3102)
- Removal of the proposed amendments to NRS Ch. 624 requiring certain limits for contractors’ insurance.
- Addition of a reference to NRS 40.669 (AB 440’s proposed warranty statute)
- Clarifications to proposed amendments to NRS 40.650(3) suggested by the Nevada Department of Business and Industry, Division of Insurance.
Other proposed amendments to Nevada’s construction defect
laws that were proposed in AB 421 have been retained. If passed, the bill will effectively:
- Revise the definition of a construction defect, revise the notice and pre-litigation inspection requirements,
- Extend the Statute of Repose and remove any limitation on alleged claims involving “fraud” and “willful” conduct,
- Remove limitations on recovery of costs, and
- Allow Associations to pursue common area claims on the owners’ behalves.
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