SB241 Passes - Contractors Gain Right To Repair

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.

"We are grateful to the Legislature and the Governor for working with us on this challenging issue," said Coalition for Fairness in Construction Chairman Steve Hill. "We are confident that this new law will protect homeowners by allowing contractors to make repairs promptly and professionally, and we are hopeful that it will work to curb unnecessary lawsuits."

The Coalition received substantial support from associations such as the Southern Nevada Home Builders Association, the Nevada Subcontractors Association, Associated General Contractors, Associated Builders & Contractors and the Plumbing & Mechanical Contractors of Nevada. Other associations contributing finds were the Roofing Contractors of Nevada, the Southern Nevada Air Conditioning Refrigeration Service Contractors Association and Builders Association of Northern Nevada.

At some point, representatives for each of those associations were in Carson City to discuss construction defect lawsuits with legislators.

The bill goes into effect August 1, 2003, and Hill said that the next two years will allow time to determine if the new law will achieve its goals of accelerating contractor repairs for consumers, reducing the number of construction lawsuits, and reining in skyrocketing construction liability insurance premiums. The Coalition says it will monitor legal activity under the new law, and plans to report to the 2005 Legislature.

SB 241: The Right to Repair

SB 241 gives contractors the right to repair defects prior to being sued. Among the bill’s most significant points are:

*	Mandatory pre-litigation chance for contractors to be notified about defects and allowed to repair without being dragged into a lawsuit;
*	Gives contractors and subs 60 days (20 days in cases where there is an "imminent threat") to inspect the home and determine if there exists a valid claim;
*	Homeowners and contractors can go to the Nevada State Contractors Board for an inspection and assessment of any repairs made. Any such advice offered is not mandatory;
*	Unsatisfied homeowners can still sue after the limited time of repair has expired;
*	There is no longer a distinction between "complex" and "non-complex" cases. No longer do construction defect cases have preferential trial status;
*	In cases involving four homes or less, the contractor (or subcontractor) has 105 days to do repairs. For cases involving five or more homes, that time period is 150 days;
*	Refines and clarifies what a construction defect;
*	The court can determine if there exists a "class action" in construction defect cases;
*	Clarifies that an offer of judgment is acceptable if the offer includes all recoverable damages;
*	Allows contractors and subcontractors to keep the right to repair for newly discovered defects after a lawsuit is filed as long as the new defect is "separate and unrelated" to the initial defects;
*	Pre-litigation mediation is maintained and even refined.

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