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Construction Defect
Bill Debated After nearly a year of speculation about which provisions would be part of the long-awaited construction defect reform bill, the Coalition for Fairness in Construction introduced the bill on the floor of the Nevada State Senate on Thursday, March 6, with the first hearing of the bill on March 19. SB 241 would require homeowners to file a complaint with their builder prior to filing a lawsuit. A lawsuit could go forward only if the builder fails to fix the problem within five months of being notified. The bill seeks a definition of a construction defect. Under current law, the definition is two sentences long and extremely vague. The bill identifies a construction defect more by what it is not than what it is. |
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Contractors, if the bill passes as written, would no
longer be liable for construction that is functioning as intended, or has not
caused any damage or injury. They would also no longer be liable for normal wear
or tear, shrinkage, swelling or deterioration.
Contractors would no longer be held liable for construction that meets approval by a building code official. The bill, in fact, holds approval by a building code official as "prima facie evidence" that the construction was completed correctly and that no "defect" exists. SB 241 would also require the Nevada State Contractors Board to become involved in disputes. The Contractors Board strongly testified last session against a bill which required them to investigate defects to determine if there was anything "defective" about the workmanship. The current bill seeks to solve the problem of "band-aid" repairs by identifying the Contractors Board as a mediator after repairs have been made. More than 300 contractors crammed into a hearing room in the Grant Sawyer Building on March 19 and 20 to hear testimony on SB 241, the Coalition for Fairness in Construction’s "Right to Repair" bill. They were joined by about 25 "Safe Homes Nevada" folks and representatives of various law firms. Testimony went as expected, with the entire pro-SB 241 testimony coming in at just over an hour. Steve Hill, chairman of the Coalition, briefly outlined the need for changes to Chapter 40, the section of Nevada law that deals with construction defects. He was followed by Robert Lewis of Lewis Homes, and Bruce King of Pete King Corporation. All echoed that defect lawsuits are unnecessary, that contractors want the responsibility to repair defects. Jim Wadhams, SNHBA’ lobbyist, discussed the major provisions of SB 241. The Coalition’s prepared testimony concluded with several homeowners who had their construction problems resolved without a lawsuit. Attorney Scott Canepa spoke on behalf of the Nevada Trial Lawyers Association, and presented a detailed Powerpoint presentation on the Contractor’s Liability Task Force hearings and recommendations. Canepa testified that SB 241 should not be passed, and used the phrase, "Morally repugnant" to describe sections that, according to his description of the bill, would force homeowners to actually suffer damage or injury prior to claiming a construction defect. The only real surprise came at the end of the hearing when Randolph Townsend (R-Reno), chairman of the Senate Commerce & Labor Committee, said he wanted to look at a bill from the 2001 session that dealt with soils. On Thursday, March 20, the committee again took up testimony on SB 241, this time with appearances by representatives of the Nevada State Contractor’s Board and Clark County. The issues were the role of the Contractor’s Board in construction defect issues and the role of soils in creating the defects themselves.Clark County Building Official Ron Lynn discussed soils analysis and the county’s process for determining suitability for construction. Language outlining such testing was inserted into SB 241. |
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Margie Grein, executive director of the State Contractor’s
Board, questioned whether SB 241's requirement that Contractor’s Board
investigators examine defect repairs would expose her people to liability beyond
the $50,000 cap on municipalities. Townsend
The bill was passed by the Senate on March 21 and was referred to the Assembly Judiciary Committee where it will undergo at least one more round of hearings. A "citizens" group created and financed by trial lawyers is lobbying against passage of SB 241. Safe Homes Nevada representatives have already made numerous trips to Carson City to lobby legislators, and is running ads on television and in major newspapers advocating that the bill be rejected. The Coalition for Fairness in Construction has called the ads unfair, and said they distort the truth about SB 241. |
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Call (702) 615-7644 |
