Nevada Legislature: Construction defects bill headed for Sandoval’s desk

Legislation making extensive changes designed to reduce the number and impact of construction defects litigation won final legislative passage Friday.

Assembly Bill 125 now heads to Gov. Brian Sandoval’s desk for his signature.

The measure was approved on a party line vote by the 11 Republican Senators present on the floor. All eight Democrats in attendance voted no. Senators Debbie Smith, D-Sparks, and Tick Segerblom, D-Las Vegas, were absent.

Judiciary Chairman Greg Brower, R-Reno, termed AB125 “a good bill that fixes a real problem and it’s a long overdue fix.”

He said the debate on the measure had “gone off the rails” with most of the Democratic objections centered on the attorney fees the measure was in part designed to rein in.

“I think it’s time we stopped talking about attorney fees and talk about average Nevadans and what’s good for them,” Brower said.

Sen. Ruben Kihuen, charged the bill, “as written, would destroy the means to hold homebuilders accountable.”

“Supporters of this legislation never explained once what this bill would do to protect homeowners and their rights,” he said.

Kihuen called for an amendment that would allow the prevailing party in a construction defects action to seek attorney’s fees and extend to 15 years instead of cutting to six years the amount of time a homebuyer has to file a defects suit saying six years isn’t enough.

Senate Majority Leader Michael Roberson, R-Las Vegas, questioned whether Democrats really want to change fees so a homeowner could be charged huge attorney fees if they lost.

The amendment was defeated on a party-line vote, opening the way for a final vote on the bill, which passed the Assembly on a party-line vote Monday.

Senate Minority Leader Aaron Ford, D-Las Vegas, said the measure shouldn’t be reduced to a partisan battle since it started more than a year back with bipartisan talks. He said his problem is “the issue is deliberative and that’s not happened here.”

He and Kihuen as well as other Democrats charged the bill was rushed through without proper hearings and the chance for homeowners to testify on it.

Brower countered there was a hearing attended by more than 100 people last week.

“There was no lack of notice to those interested in the bill,” he said. “Anybody who wanted to testify against this bill had an opportunity and, for whatever reason, the opposition decided that one lawyer from Las Vegas should do that.”

The bill attempted to reduce litigation by removing guarantees plaintiff’s lawyers get all their fees if they win at any level.

A change to measure is defining what is — and what is not — a construction defect. Specifically, it defines a defect as something that presents “an unreasonable risk of injury to a person or property,” or something “not completed in a good and workmanlike manner and proximately causes physical damage to the residence.”

It bars homeowner associations from filing defects litigation on behalf of an entire complex except over defects in common areas. It requires those suing fully describe the problem, how it’s a defect and where it occurs and reduces the window for filing suit from 10 to six years.