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Nevada’s Home Building Industry can Breathe Easier: No Action on SB250 Leaves Current Attorney’s Fees Provision Intact

June 21, 2017 — Aaron Lovaas – Newmeyer & Dillion LLP
Construction and design professionals in Nevada’s home building industry breathed a collective sigh of relief on June 5, 2017 when the 79th Session of the Nevada Legislature adjourned without entertaining Senate Bill 250, which sought to reinstate homeowner plaintiffs’ nearly automatic right to recover attorneys’ fees, expert costs, and costs of investigation when bringing suit for alleged constructional defects. Until 2015, homeowners’ recovery of such damages was the reality of the construction defect landscape in Nevada. While Chapter 40 of the Nevada Revised Statutes specifically allowed for recovery of “reasonable” attorneys’ fees, expert costs, and costs of investigation, the trend in Nevada was that plaintiffs were all but guaranteed awards of all such sums. Of course, this environment incentivized plaintiffs’ lawyers to bring claims of questionable or little repair value in cases where the attorney’s fees and expert costs often far exceeded the costs of repair. HOW AB125 CHANGED THE LANDSCAPE Such was the reality in Nevada until 2015 and the passage of Assembly Bill 125, which eliminated the nearly automatic award of attorneys’ fees and expert costs and overhauled Chapter 40 in many other respects. AB125 made over portions of Chapter 40 by:

Placing awards of attorneys’ fees into the framework of offers of judgment, utilized extensively in other fields of civil litigation and available equally to homeowner plaintiffs as well as construction industry defendants; and
Reworking expert costs and costs of investigation to allow for the award of those items only in the case of proven defects and only as to those costs directly related to the investigation and proof of those defects.

INTRODUCING SB250 The 2017 Legislative Session saw efforts to return Chapter 40 to its pre-2015 version through the introduction of SB250. Fortunately for construction and design professionals in the home building industry in Nevada, the State Senate Judiciary Committee did not act upon the bill and the effort died having never made it to a floor vote. Considering that Nevada’s Legislature meets biannually, the current framework of Chapter 40 is intact until at least 2019. The 2017 Legislative Session, however, is an illustration to how quickly those of the construction defect plaintiffs’ bar can move to initiate efforts to turn back the clock to a much riskier time for construction and design professionals. Those in the industry should remain vigilant and monitor future legislative efforts to reinstate such awards or other clearly anti-builder measures. Such measures simply drive-up the overall cost and expense of home construction and, in turn, home ownership, which it is often said, is one of the cornerstones of the American dream. Aaron Lovaas is a partner in the Las Vegas office of Newmeyer & Dillion. As a transactional attorney and business litigator, Aaron has the ability to evaluate legal issues from both points of view and help his clients understand their best option. He can be reached at aaron.lovaas@ndlf.com. About Newmeyer & Dillion For more than 30 years, Newmeyer & Dillion has delivered creative and outstanding legal solutions and trial results for a wide array of clients. With over 70 attorneys practicing in all aspects of business, employment, real estate, construction and insurance law, Newmeyer & Dillion delivers legal services tailored to meet each client’s needs. Headquartered in Newport Beach, California, with offices in Walnut Creek, California and Las Vegas, Nevada, Newmeyer & Dillion attorneys are recognized by The Best Lawyers in America©, and Super Lawyers as top tier and some of the best lawyers in California, and have been given Martindale-Hubbell Peer Review's AV Preeminent® highest rating. For additional information, call 949-854-7000 or visit www.ndlf.com. Read the court decision
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Consumer Protections for California Residential Solar Energy Systems

September 25, 2018 — Robert A. James & Alexandra Brandt - Gravel2Gavel Construction & Real Estate Blog
It was already the case that in order to offer to install California residential solar energy systems, a contractor must be licensed by the California Contractors State License Board (CSLB) and must hold an appropriate specialty classification. Under AB 1070 enacted late last year (Chapter 662, Statutes of 2017), special consumer protections are being deployed for the benefit of homeowners. Those protections are steadily rolling out. Step one is the requirement of new Business & Professions Code (B&P Code) Section 7169 that, as of January 1, 2019, a disclosure document must be provided to consumers prior to sale and included on page 1 of the sale contract. The initial version of this document, which was developed by the CSLB and endorsed on August 23, 2018 by the California Public Utilities Commission (CPUC), is available here. The disclosure requirement doesn’t apply to systems included in new home construction. Reprinted courtesy of Robert A. James, Pillsbury and Alexandra Brandt, Pillsbury Mr. James may be contacted at rob.james@pillsburylaw.com Ms. Brandt may be contacted at alexandra.brandt@pillsburylaw.com Read the court decision
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A Changing Climate for State Policy-Making Regarding Climate Change

February 18, 2020 — Sheila McCafferty Harvey - Gravel2Gavel Construction & Real Estate Law Blog
Issued by 13 federal agencies, the 2018 Fourth National Climate Assessment presented a stark warning on the consequences of climate change for the United States. The report predicts that if significant steps are not taken to rein in global warming, the damage will reduce the U.S. economy by as much as 10 percent by the end of the century. The report, which was mandated by Congress and made public by the White House, is notable not only for the precision of its calculations and bluntness of its conclusions—the 1,656-page assessment lays out the devastating effects of a changing climate on the economy—but also in how it conflicts with President Donald Trump’s environmental deregulation plan. U.S. policy efforts at the state and local levels are ramping up to address this complex topic. These include: Targeting Net-Zero Emissions. Hailed as the most aggressive climate law in the nation, New York State’s Climate Leadership and Community Protection Act are targeting 100 percent carbon-free electricity by 2040 and economy-wide, net-zero carbon emissions by 2050. California set a statewide target to reach carbon neutrality by 2045. Reducing and Renewing. New Mexico established a statewide goal of reducing greenhouse gas emissions by 45 percent below 2005 levels by 2030. Nevada passed a bill to increase the amount of electricity it gets from renewable resources to 50 percent by 2030. Read the court decision
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Reprinted courtesy of Sheila McCafferty Harvey, Pillsbury
Ms. Harvey may be contacted at sheila.harvey@pillsburylaw.com

New Orleans Is Auctioning Off Vacant Lots Online

March 12, 2015 — Patrick Clark – Bloomberg
New Orleans is selling almost 1,800 properties on the Web to fatten its tax coffers and build on the momentum it's enjoying in the local real estate market. The question is, who's going to show up for the online auction, and what are they going to do with the lots they buy? On Friday, the city posted a list of 1,786 properties—90 percent of them vacant lots—that it plans to sell in the auction. Bidding on the properties, of which the city took control after the owners failed to pay property taxes, will start at $3,000 in most cases, plus the cost of trying to track down the most recent owner. Read the court decision
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Reprinted courtesy of Patrick Clark, Bloomberg
Mr. Clark may be contacted at jclark185@bloomberg.net

CC&Rs Not the Place for Arbitration Agreement, Court Rules

May 24, 2011 — CDJ STAFF

In January, the California Court of Appeals ruled that an arbitration clause inserted in a development’s CC&Rs by the developer could not be enforced. The case, Villa Vicenza Homeowners Association v. Noble Court Development, involved a case in which, according to the opinion, “following the first sale Nobel controlled the board of directors of the Association and because the initial condominium buyers noticed defects in common areas and common facilities and did not believe Nobel had provided a reserve fund sufficient to repair the defects, the condominium owners brought a derivative action on behalf of the Association against Nobel.”

The court concluded, “The use of CC&R's as a means of providing contractual rights to parties with no interest in or responsibility for a common interest development is also problematic from the standpoint of determining what if any consideration would support such third-party agreements. By their terms the CC&R's bind all successors, even those with whom a third party such as Nobel has never had any contractual relationship and to whom Nobel has not provided any consideration.” The court determined that “the trial court did not err in denying Nobel's motion to compel arbitration.”

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A Court-Side Seat: Environmental Developments on the Ninth Circuit

July 13, 2020 — Anthony B. Cavender - Gravel2Gavel
On May 26, 2020, the U.S. Court of Appeals for the Ninth Circuit decided three significant environmental law cases. Two of these cases involved whether global warming tort cases could be brought in California state courts on, for example, a public nuisance claim, and whether the defendant energy companies had the right to have them removed to the federal courts. County of San Mateo, et al. v. Chevron Corp., et al. and City of Oakland v. BP PLC, et al. While acknowledging the immensity of the legal issues, the Ninth Circuit held that the federal removal statutes did not permit these cases to be removed to the federal courts. For one thing, state court jurisdiction was not preempted by the Clean Air Act. Accordingly, the court affirmed the ruling of Federal Judge Chhabria in the Chevron case, and vacated Judge Alsup’s ruling in the BP case that he had jurisdiction to hear this case pursuant to federal common law, and then to dismiss it. The court also remanded the case to Judge Alsup, and directed him to determine if there was an “alternate basis” for federal court jurisdiction based on the pleadings that an issue of ”navigable waters” was a concern. Read the court decision
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Reprinted courtesy of Anthony B. Cavender, Pillsbury
Mr. Cavender may be contacted at anthony.cavender@pillsburylaw.com

Additional Insured Not Entitled to Indemnity Coverage For Damage Caused by Named Insured

February 23, 2017 — Tred R. Eyerly – Insurance Law Hawaii
The additional insured unsuccessfully sought to recover damages to its building caused by the named insured. Brit UW, Ltd. v. Tripar, Inc., 2017 U.S. Dist. LEXIS 2462 (N.D. Ill. Jan. 6, 2017). Davis Russell Real Estate and Management LLC hired Tripar, Inc., a general contractor, to renovate a 12-unit apartment building. The entire roof was to be replaced by a roofing subcontractor. Davis Russell drafted a Professional Services Agreement (PSA) that governed the project. Tripar was to obtain a CGL policy and provide a certificate of insurance evidencing the coverage. Davis Russell was to be named as an additional insured. Tripar's insurance broker prepared a certificate of insurance reflecting that a CGL policy was issued to Tripar by Brit UW, Ltd. But the certificate clearly stated that it was not issued by the insurer and that it did not alter coverage. The certificate of insurance further stated that it conferred no rights upon the holder. Read the court decision
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Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii
Mr. Eyerly may be contacted at te@hawaiilawyer.com

Pensacola Bridge Halted Due to Alleged Construction Defects

July 21, 2018 — David Suggs – Bert L. Howe & Associates, Inc.
The Pensacola News Journal reported that cracks were discovered again in the Pensacola Bay Bridge, which caused construction of said bridge to be halted once more: “Cracks found in a portion of the concrete in the Pensacola Bay Bridge project have twice halted construction in the last several months, raising concerns about oversight and disclosure from the state, particularly in light of the Miami bridge collapse earlier this year.” The Florida Department of Transportation stated “that the cracks were found during a routine visual inspection of newly placed concrete in March,” according to the Pensacola News Journal. The $400 million project began in 2017 and was scheduled to be completed by 2020. Read the court decision
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