Assembly Bill No. 498-Assemblyman Goldwater (by request)
May 16, 1997
____________
Referred to Committee on Commerce
SUMMARY--Requires arbitration of certain liens relating to residential dwellings. (BDR 3-819)
FISCAL NOTE: Effect on Local Government: Yes.
Effect on the State or on Industrial Insurance: No.
EXPLANATION - Matter in italics is new; matter in brackets [ ] is material to be omitted.
AN ACT relating to arbitration; requiring the arbitration of certain liens relating to residential dwellings; and providing other matters properly relating thereto.
THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:
Section 1 Chapter 38 of NRS is hereby amended by adding thereto the provisions set forth as sections 2 to 10, inclusive, of this act.
Sec. 2 As used in sections 2 to 10, inclusive, of this act, unless the context otherwise requires, the words and terms defined in sections 3 and 4 of this act have the meanings ascribed to them in those sections.
Sec. 3 "Center" means a neighborhood justice center established pursuant to the provisions of NRS 244.1607.
Sec. 4 "Residential dwelling" means any building or structure that is:
1. Occupied as or designed or intended for occupancy as a residence by one or more persons; and
2. Is located within a county whose population is more than 400,000.
The term includes the lot, parcel or other real property upon which the building or structure is situated. The term does not include commercial property if no portion of that property includes property that is used for residential purposes.
Sec. 5 1. No person may:
(a) Record a lien for labor performed or materials furnished by him for a residential dwelling; or
(b) Commence a civil action to enforce such a lien,
in any court in this state pursuant to the provisions of NRS 108.221 to 108.246, inclusive, unless the lien has been submitted to arbitration pursuant to the provisions of sections 2 to 10, inclusive, of this act.
2. A court shall dismiss any lien that is recorded or civil action that is commenced in violation of the provisions of subsection 1.
Sec. 6 1. Any lien described in section 5 of this act must be submitted for arbitration by filing a written claim with the center. The claim must include:
(a) The names, addresses and telephone numbers of all parties to the claim;
(b) The number and date of issuance of any license that the claimant is required to obtain to perform the labor or furnish the materials by the claimant;
(c) A specific statement of the nature of the claim;
(d) A copy of any order for labor or materials or other contract signed by the owner of the dwelling pursuant to which the claimant performed the labor or provided the materials for the owner;
(e) A statement indicating whether a declaration of completion was filed pursuant to NRS 108.228 or, if the declaration was not filed, a statement indicating the reasons why it was not filed;
(f) An affidavit signed by the claimant stating that the dwelling was not damaged as a result of the labor performed or materials furnished by him for that dwelling and that he exercised reasonable care in performing the labor or furnishing the materials; and
(g) Such other information as the center may require.
2. The claim must be accompanied by the fee established by the center.
3. Upon the filing of the claim, the claimant shall serve a copy of the claim in the manner prescribed in Rule 4 of the Nevada Rules of Civil Procedure for the service of a summons and complaint. The claim so served must be accompanied by a statement explaining the procedure for arbitration set forth in sections 2 to 10, inclusive, of this act.
4. Upon being served pursuant to subsection 4, the person upon whom a copy of the claim was served shall, within 30 days after the date of service, file a written answer with the center. The answer must be accompanied by the fee established by the center.
Sec. 7 1. The parties named in a claim filed pursuant to section 6 of this act shall select an arbitrator from the list of arbitrators maintained by the center pursuant to section 8 of this act. Any arbitrator selected must be available within the geographic area. If the parties fail to agree upon an arbitrator, the center shall appoint an arbitrator from the list maintained by the center. Any arbitrator appointed must be available within the geographic area. Upon appointing an arbitrator, the center shall provide the name of the arbitrator to each party.
2. Except where inconsistent with the provisions of sections 2 to 10, inclusive, of this act, the arbitration of a lien pursuant to this section must be conducted in accordance with the provisions of NRS 38.075 to 38.205, inclusive. An award must be made within 90 days after the conclusion of arbitration, unless a shorter period is agreed upon by the parties to the arbitration.
3. If, after the conclusion of arbitration, a party:
(a) Applies to have an award vacated and a rehearing granted pursuant to NRS 38.145; or
(b) Commences a civil action to enforce a lien that was the subject of arbitration,
the party shall, if he fails to obtain a more favorable award or judgment than that which was obtained in the initial arbitration, pay the costs and reasonable attorney's fees incurred by the opposing party after the application for a rehearing was made or after the complaint in the civil action was filed.
4. Upon the request of a party, the center shall provide a statement to the party indicating the amount of the fees charged by the arbitrator selected or appointed pursuant to this section.
5. As used in this section, "geographic area" means an area within 150 miles from any residential dwelling that is the subject of a claim submitted pursuant to section 6 of this act.
Sec. 8 For the purposes of sections 2 to 10, inclusive, of this act, the center shall establish and maintain:
1. A list of arbitrators who are available for arbitration of claims. The list must include arbitrators who, as determined by the center, have received training and experience in arbitration and in the resolution of disputes concerning the creation, perfection and enforcement of liens pursuant to the provisions of NRS 108.221 to 108.246, inclusive. To establish and maintain the list, the center may use lists of qualified persons maintained by any organization that provides arbitration services. Before including an arbitrator on the list established and maintained pursuant to this section, the center may require the arbitrator to present proof satisfactory to the center that he has received the training and experience required for arbitrators pursuant to this section.
2. A document that sets forth a written explanation of the procedure for arbitrating liens pursuant to sections 2 to 10, inclusive, of this act.
Sec. 9 Any statute of limitations applicable to a lien or civil action described in section 5 of this act is tolled from the time the lien is submitted for arbitration pursuant to section 6 of this act until the conclusion of arbitration of the lien and the period for vacating the award has expired.
Sec. 10 1. The center shall carry out the provisions of sections 2 to 10, inclusive, of this act. The board of county commissioners of the county in which the center is located may adopt such regulations as are necessary for the center to carry out those provisions.
2. The fees collected by the center pursuant to section 6 of this act must be accounted for separately and deposited in the account for dispute resolution in the county general fund. The fees may only be used by the center to carry out the provisions of section 2 to 10, inclusive, of this act.
Sec. 11 NRS 108.226 is hereby amended to read as follows:
108.2261. [Every] Except as otherwise provided in sections 2 to 10, inclusive, of this act, each person claiming the benefit of NRS 108.221 to 108.246, inclusive, must record his notice of lien in the form provided in subsection 5:
(a) Within 90 days after the completion of the work of improvement;
(b) Within 90 days after the last delivery of material by the lien claimant; or
(c) Within 90 days after the last performance of labor by the lien claimant,
whichever is later.
2. The time within which to perfect the lien by recording the notice of lien is shortened if a notice of completion is recorded in a timely manner pursuant to NRS 108.228 . [, in which event] If the notice of completion is recorded, the notice of lien must be recorded within 40 days after the recording of the notice of completion.
3. Any one of the following acts or events is equivalent to "completion of the work of improvement" for all purposes of NRS 108.221 to 108.246, inclusive:
(a) The occupation or use of a building, improvement or structure by the owner, his agent or his representative and accompanied by cessation of labor thereon.
(b) The acceptance by the owner, his agent or his representative of the building, improvement or structure.
(c) The cessation from labor for 30 days upon any building, improvement or structure, or the alteration, addition to or repair thereof.
(d) The recording of the notice of completion provided in NRS 108.228.
4. For the purposes of this section, if a work of improvement consists of the construction of more than one separate building and each building is constructed pursuant to:
(a) A separate contract, each building shall be deemed a separate work of improvement. The time within which to perfect the lien by recording the notice of lien pursuant to subsection 1 commences to run upon the completion of each separate building; or
(b) A single contract, the time within which to perfect the lien by recording the notice of lien pursuant to subsection 1 commences to run upon the completion of all the buildings constructed pursuant to that contract.
As used in this subsection, "separate building" means one structure of a work of improvement and any garages or other outbuildings appurtenant thereto.
5. The notice of mechanic's lien must be recorded in the office of the county recorder of the county where the property or some part thereof is situated and must contain:
(a) A statement of his demand after deducting all just credits and offsets.
(b) The name of the owner or reputed owner if known.
(c) The name of the person by whom he was employed or to whom he furnished the material.
(d) A statement of the terms, time given and conditions of his contract.
(e) A description of the property to be charged with the lien sufficient for identification.
6. The claim must be verified by the oath of the claimant or some other person. The claim need not be acknowledged to be recorded.
Sec. 12 NRS 108.239 is hereby amended to read as follows:
108.2391. [Liens] Except as otherwise provided in sections 2 to 10, inclusive, of this act, liens may be enforced by an action in any court of competent jurisdiction, on setting out in the complaint the particulars of the demand, with a description of the premises to be charged with the lien.
2. At the time of filing the complaint and issuing the summons, the plaintiff shall:
(a) File a notice of pendency of the action in the manner provided in NRS 14.010; and
(b) Cause a notice to be published at least once a week for 3 successive weeks, in one newspaper published in the county, and if there is no newspaper published in the county, then in such mode as the court may determine, notifying all persons holding or claiming liens pursuant to the provisions of NRS 108.221 to 108.246, inclusive, on the premises to file with the clerk and serve on the plaintiff and also on the defendant, if the defendant is within the state or is represented by counsel, written statements of the facts constituting their liens, together with the dates and amounts [thereof.] of those liens. The statements must be filed within 10 days after the last publication of the notice. The plaintiff and other parties adversely interested must be allowed 5 days to answer the statements.
3. If it appears from the records of the county recorder that there are other lien claims recorded against the same premises at the time of the commencement of the action, the plaintiff shall, in addition to and after the initial publication of the notice as provided in paragraph (b) of subsection 2, mail to those other lien claimants, by registered or certified mail, or deliver in person a copy of the notice as published.
4. At the time of any change in the venue of the action, the plaintiff shall file a notice of pendency of the action, in the manner provided in NRS 14.010, and include in the notice the court and county to which the action is changed.
5. The court shall enter judgment according to the right of the parties, and shall, by decree, proceed to hear and determine the claims in a summary way, or may, if it [be] is the district court, refer the claims to a master to ascertain and report upon the liens and the amount justly due [thereon.] on those liens. All liens not so exhibited shall be deemed to be waived in favor of those which are so exhibited.
6. On ascertaining the whole amount of the liens with which the premises are justly chargeable, as provided in NRS 108.221 to 108.246, inclusive, the court shall cause the premises to be sold in satisfaction of the liens and costs, including costs of suit, and any party in whose favor judgment may be rendered may cause the premises to be sold within the time and in the manner provided for sales on execution, issued out of any district court, for the sale of real property.
7. If the proceeds of sale, after the payment of costs, are not sufficient to satisfy the whole amount of the liens included in the decree of sale, the proceeds must be apportioned according to the right of the several parties. If the proceeds of the sale amount to more than the sum of the liens and the cost of sale, the remainder must be paid over to the owner of the property.
8. Each party whose claim is not satisfied in the manner provided in this section is entitled to personal judgment for the residue against the party legally liable for it if that person has been personally summoned or has appeared in the action.
Sec. 13 NRS 244.1607 is hereby amended to read as follows:
244.16071. In a county whose population is more than 400,000, the board of county commissioners shall establish a neighborhood justice center. The center must be closely modeled after the program established by the American Bar Association for multi-door courthouses for the resolution of disputes.
2. Except as otherwise provided in subsection 3, the center must provide, at no charge:
(a) A forum for conducting arbitration pursuant to the provisions of sections 2 to 10, inclusive, of this act.
(b) A forum for the impartial mediation of minor disputes including, but not limited to, disputes between landlord and tenant, neighbors, family members, local businesses and their customers, hospitals and their patients, and governmental agencies and their clients, except where prohibited by federal law.
[(b)] (c) A system of providing information concerning the resolution of disputes and the services available in the community.
[(c)] (d) An efficient and effective referral system which assists in the resolution of disputes and otherwise guides the client to the appropriate public or private agency to assist in the resolution of the particular dispute, including referrals to the justices of the peace, municipal courts, lawyer referral systems, legal aid services, district attorney, city attorneys, district courts, mental health services, other alternative methods of resolving disputes and other governmental and private services.
3. The board of county commissioners may authorize a center to charge a fee for:
(a) Services which are provided relating to the resolution of complex cases; and
(b) Training provided by the center.
4. The center must be supported from the money in the account for dispute resolution in the county general fund and any gifts or grants received by the county for the support of the center.
5. The board of county commissioners shall submit a report to the director of the legislative counsel bureau for distribution to each regular session of the legislature on or before March 1 of each odd-numbered year. The report must include a summary of the number and type of cases arbitrated, mediated, referred and resolved by the center during the previous biennium. The report must also [contain] include suggestions for any necessary legislation to improve the effectiveness and efficiency of the center.
Sec. 14 The amendatory provisions of this do not apply to any lien for which a notice of lien is recorded pursuant to the provisions of NRS 108.226 before October 1, 1997.
Sec. 15 The provisions of subsection 1 of NRS 354.599 do not apply to any additional expenses of a local government that are related to the provisions of this act.