Construction Litigation Still Major Concern for Contractors
By Joe Wheeler

    “When you talk to a customer who says there’s a problem, you fix it,” Steve Hill said.  “But when you get a list of problems on 200 homes, you can’t do that.”
    Hill listed a lack of specific defect charges as one of many problems lingering in the wake of construction defect reform efforts in 2003 – and said that construction companies in Nevada still face an insurance crisis that will continue to drive up the cost of a new home.
    “While we were in the 2003 legislative session, the median cost of a home was $200,000,” he said.  “Today it’s $300,000.  Construction defect litigation is not the only reason for that, but it remains the big reason we don’t have enough condos.”

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Highlights and Warning Signals
Legal Trends in Construction Defects Lawsuits
by Ned Barnett

The laws on construction defects are being written – and rewritten – but more than that, they are being interpreted and reinterpreted, sometimes dramatically reinterpreted, by the courts.  This was one of the core messages coming out of West Coast Casualty’s 12^th Annual Construction Defects Seminar, held in May in Anaheim.

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Nevada Case Law
Report from the Front Lines of the
Construction Defect Wars
by Ned Barnett

Class-Action certification for construction defect lawsuits covering detached single-family homes may soon come to an end – at least in Nevada .  At least, that is the opinion of a panel of experts convened at the most recent Construction Defects Seminar, held annually in Anaheim in May and hosted by West Coast Casualty.  

To date, five construction defect lawsuits in Nevada have gone to a verdict.  In two cases involving condos, the courts awarded more in the way of damages to plaintiffs than they had asked for.  And three suits involving single family homes proved how easy it had been – until now, perhaps – to gain the class certification necessary to file a class-action suit.  In one of those cases, a single homeowner’s complaint was sufficient grounds for the judge to certify this class for a class action suit.

However, that seems to be changing. 

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Construction Defects –
Some Insights on a Cottage Industry

Cindy Nevin, Executive Director of the Nevada Subcontractors Association, is a true veteran of the “construction defect wars.”  She has fought the good fight in Carson City – and wherever she can find legislators to button-hole – for years.  

In those years, she has seen West Coast Casualty’s Annual Construction Defects Seminar, held in Anaheim in May, grow from 200 attendees 10 years ago to more than 1,200 attendees this year.  And as she’s watched interest in construction defects grow, she’s also noted that it’s become what she called – quite accurately – a “cottage industry.”

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Construction Defect Seminar
Largest Of Its' Kind
by Joe Wheeler

A sea of suits. Attorneys from four Western states gathered for an annual event that has grown into the largest such conclave of it's kind – and a telling reminder of how far the pursuit of construction defect litigation has come in the last ten years.

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"Right To Repair" Means Work For Contractors

SB 241, the "Right To Repair" bill, went into effect August 1, 2003. The Nevada Legislature, urged by the Coalition For Fairness in Construction and impressed by large turnouts of home owners and construction workers at legislative hearings, gave contractors the right to repair construction defects prior to being sued... and now contractors must figure out to make the new law work for them and their customers.

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The Construction ZONE is now
delivered to contractors in
California, Nevada and Utah.

Contractors Gain "Right To Repair"
Construction Defect Legislation Signed By Governor

In a major victory for contractors, the "Right to Repair" bill cleared both houses of the Nevada Legislature and was signed into law by Governor Kenny Guinn on June 9, 2003.  

Last minute negotiations and a few concessions to the interests of trial attorneys resulted in the bill passing the Assembly without a single nay vote. The bill is being hailed as a major fix of the complicated construction defect issue, with the effective repeal of Chapter 40 when it comes to "complex" cases.

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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.

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Senate Committee Holds First Hearing on S.B. 241
Surprising Twist As Townsend Resurrects Previous Bill
by Joe Wheeler

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.

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Homeowners, Construction Industry Employees Turn Out in Force to Support "Right to Repair" Litigation Reform Legislation. The full story is posted at the Web site of the Southern Nevada Home Builders Association, an NAHB affiliate, at www.snhba.com.

Thank you for all of your hard work, support, and participation - Senate Bill 241 was today voted out of the Senate Committee of Commerce and Labor.  Senator Warren Hardy (R-Clark) made the "do pass" motion, seconded by Senator Mike Schneider (D-Clark).  The bill was supported by the full committee with the exception of Senator Maggie Carlton (D-Clark) who cast an opposing vote.

How a Bill Becomes Law
The next step in the legislative process: Now that SB241 has been given the "do pass" recommendation it will be read and placed on the general file for debate and a vote in the State Senate (early next week).  A roll-call vote will be conducted.  Following passage of SB241 in the Senate, it will then be sent to the State Assembly where the method of processing the bill will be identical to the actions taken in the Senate.  The bill will be assigned to a committee where an Assembly hearing to take testimony will be held.  If the Assembly amends SB241, it will be returned to the Senate for consideration of the amendments. 

NSA Legislative Day March 26th
The NSA will be hosting a legislative day for its members and industry partners in Carson City on March 26th.  Next Wednesday's activities will include a visit to the Legislative Chambers where members will have an opportunity to tour the building and watch the day's legislative session.  (Wouldn't it be neat if that was the same day SB241 was on the agenda?)  The day will conclude with a legislative reception that will bring together NSA members, industry partners, and elected officials.

The Legislative Reception Wednesday evening will provide us an opportunity to meet with elected officials and discuss SB241 in a social setting.  The two-hour reception will be held at Glen Eagles Restaurant in Carson City beginning at 5:30 pm. 

Please contact me at your earliest convenience to confirm your attendance at the Legislative Session and/or Reception.

Once again, heartfelt thanks for all your hard work and participation this week. 
                                                      

Cindy Nevin
Nevada Subcontractors Association
3644 Meade Avenue
Las Vegas, Nevada  89102-7814
Office      (702) 736-6686
Fax          (702) 736-4796
Cellular    (702) 498-2665
penandhand@aol.com

The "Coalition For Fairness In Construction" kicked off  in April, 2002.  Here's their press release about it the first meeting:

COALITION FOR FAIRNESS IN GOVERNMENT