Assembly Bill No. 43–Committee on Judiciary

 

February 4, 2003

____________

 

Referred to Committee on Judiciary

 

SUMMARY—Makes various changes to provisions governing common-interest communities. (BDR 10‑94)

 

FISCAL NOTE:  Effect on Local Government: No.

                           Effect on the State: No.

 

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EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.

 

AN ACT relating to property; authorizing the units’ owners in certain common-interest communities to have delegates or representatives exercise their voting rights; authorizing a penalty to be imposed against a unit’s owner for failing to adhere to a schedule for certain construction related to the unit; authorizing a unit-owners’ association to place and foreclose a lien on a unit for failure to pay such a penalty under certain circumstances; and providing other matters properly relating thereto.

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

1-1  Section 1. Chapter 116 of NRS is hereby amended by adding

1-2  thereto the provisions set forth as sections 2 and 3 of this act.

1-3  Sec. 2.  1.  If the declaration so provides, in a common-

1-4  interest community that consists of at least 1,000 units, the voting

1-5  rights of the units’ owners in the association for that common-

1-6  interest community may be exercised by delegates or

1-7  representatives.

1-8  2.  In addition to a common-interest community identified in

1-9  subsection 1, if the declaration so provides, in a common-interest

1-10  community created before October 1, 1999, the voting rights of the

1-11  units’ owners in the association for that common-interest

1-12  community may be exercised by delegates or representatives.

2-1  3.  For the purposes of subsection 1, each unit that a

2-2  declarant has reserved the right to create pursuant to

2-3  NRS 116.2105 and for which developmental rights exist must be

2-4  counted in determining the number of units in a common-interest

2-5  community.

2-6  Sec. 3.  1.  A unit’s owner shall adhere to a schedule

2-7  required by the association for:

2-8  (a) The completion of the design of a unit or the design of an

2-9  improvement to a unit;

2-10      (b) The commencement of the construction of a unit or the

2-11  construction of an improvement to a unit;

2-12      (c) The completion of the construction of a unit or the

2-13  construction of an improvement to the unit; or

2-14      (d) The issuance of a permit which is necessary for the

2-15  occupancy of a unit or for the use of an improvement to a unit.

2-16      2.  The association may impose and enforce a construction

2-17  penalty against a unit’s owner who fails to adhere to a schedule as

2-18  required pursuant to subsection 1 if:

2-19      (a) The maximum amount of the construction penalty and the

2-20  schedule are set forth in:

2-21          (1) The declaration;

2-22          (2) Another document related to the common-interest

2-23  community that is recorded before the date on which the unit’s

2-24  owner acquired title to the unit; or

2-25          (3) A contract between the unit’s owner and the

2-26  association; and

2-27      (b) The unit’s owner receives notice of the alleged violation

2-28  which informs him that he has a right to a hearing on the alleged

2-29  violation.

2-30      3.  For the purposes of this chapter, a construction penalty is

2-31  not a fine.

2-32      Sec. 4.  NRS 116.1201 is hereby amended to read as follows:

2-33      116.1201  1.  Except as otherwise provided in this section and

2-34  NRS 116.1203, this chapter applies to all common‑interest

2-35  communities created within this state.

2-36      2.  This chapter does not apply to:

2-37      (a) Associations created for the limited purpose of maintaining:

2-38          (1) The landscape of the common elements of a common-

2-39  interest community;

2-40          (2) Facilities for flood control; or

2-41          (3) A rural agricultural residential common-interest

2-42  community.

2-43      (b) A planned community in which all units are restricted

2-44  exclusively to nonresidential use unless the declaration provides that

2-45  the chapter does apply to that planned community. This chapter

3-1  applies to a planned community containing both units that are

3-2  restricted exclusively to nonresidential use and other units that are

3-3  not so restricted, only if the declaration so provides or the real estate

3-4  comprising the units that may be used for residential purposes

3-5  would be a planned community in the absence of the units that may

3-6  not be used for residential purposes.

3-7  (c) Common-interest communities or units located outside of

3-8  this state, but the provisions of NRS 116.4102 to 116.4108,

3-9  inclusive, apply to all contracts for the disposition thereof signed in

3-10  this state by any party unless exempt under subsection 2 of

3-11  NRS 116.4101.

3-12      (d) Except as otherwise provided in this chapter, time shares

3-13  governed by the provisions of chapter 119A of NRS.

3-14      3.  The provisions of this chapter do not:

3-15      (a) Prohibit a common-interest community created before

3-16  January 1, 1992, from providing for separate classes of voting for

3-17  the units’ owners of the association;

3-18      (b) Require a common-interest community created before

3-19  January 1, 1992, to comply with the provisions of NRS 116.2101 to

3-20  116.2122, inclusive; or

3-21      (c) Invalidate any assessments that were imposed on or before

3-22  October 1, 1999, by a common-interest community created before

3-23  January 1, 1992 . [; or

3-24      (d) Prohibit a common‑interest community created before

3-25  January 1, 1992, from providing for a representative form of

3-26  government.]

3-27      4.  The provisions of chapters 117 and 278A of NRS do not

3-28  apply to common-interest communities.

3-29      5.  For the purposes of this section, the Administrator shall

3-30  establish, by regulation, the criteria for determining whether an

3-31  association is created for the limited purpose of maintaining the

3-32  landscape of the common elements of a common-interest

3-33  community, maintaining facilities for flood control or maintaining a

3-34  rural agricultural residential common-interest community.

3-35      Sec. 5.  NRS 116.1203 is hereby amended to read as follows:

3-36      116.1203  1.  Except as otherwise provided in subsection 2, if

3-37  a planned community contains no more than 12 units and is not

3-38  subject to any developmental rights, it is subject only to NRS

3-39  116.1105, 116.1106 and 116.1107 unless the declaration provides

3-40  that this entire chapter is applicable.

3-41      2.  Except for NRS 116.3104, 116.31043, 116.31046 and

3-42  116.31138, NRS 116.3101 to 116.3119, inclusive, and section 3 of

3-43  this act, and 116.110305 to 116.110393, inclusive, to the extent

3-44  necessary in construing any of those sections, apply to a residential

3-45  planned community containing more than six units.

 

 

4-1  Sec. 6.  NRS 116.212 is hereby amended to read as follows:

4-2  116.212  1.  If the declaration provides that any of the powers

4-3  described in NRS 116.3102 are to be exercised by or may be

4-4  delegated to a profit or nonprofit corporation that exercises those or

4-5  other powers on behalf of one or more common-interest

4-6  communities or for the benefit of the units’ owners of one or more

4-7  common-interest communities, or on behalf of a common-interest

4-8  community and a time-share plan created pursuant to chapter 119A

4-9  of NRS, all provisions of this chapter applicable to unit-owners’

4-10  associations apply to any such corporation, except as modified by

4-11  this section.

4-12      2.  Unless it is acting in the capacity of an association described

4-13  in NRS 116.3101, a master association may exercise the powers set

4-14  forth in paragraph (b) of subsection 1 of NRS 116.3102 only to the

4-15  extent expressly permitted in:

4-16      (a) The declarations of common-interest communities which are

4-17  part of the master association or expressly described in the

4-18  delegations of power from those common-interest communities to

4-19  the master association; or

4-20      (b) The declaration of the common-interest community which is

4-21  a part of the master association and the time-share instrument

4-22  creating the time-share plan governed by the master association.

4-23      3.  If the declaration of any common-interest community

4-24  provides that the executive board may delegate certain powers to a

4-25  master association, the members of the executive board have no

4-26  liability for the acts or omissions of the master association with

4-27  respect to those powers following delegation.

4-28      4.  The rights and responsibilities of units’ owners with respect

4-29  to the unit-owners’ association set forth in NRS 116.3103 [to

4-30  116.31038, inclusive,] , 116.31032, 116.31034, 116.31036,

4-31  116.3108, 116.31085, 116.3109, 116.311 and 116.3112 and section

4-32  2 of this act apply in the conduct of the affairs of a master

4-33  association only to persons who elect the board of a master

4-34  association, whether or not those persons are otherwise units’

4-35  owners within the meaning of this chapter.

4-36      5.  Even if a master association is also an association described

4-37  in NRS 116.3101, the certificate of incorporation or other

4-38  instrument creating the master association and the declaration of

4-39  each common-interest community, the powers of which are assigned

4-40  by the declaration or delegated to the master association, may

4-41  provide that the executive board of the master association must be

4-42  elected after the period of the declarant’s control in any of the

4-43  following ways:

5-1  (a) All units’ owners of all common-interest communities

5-2  subject to the master association may elect all members of the

5-3  master association’s executive board.

5-4  (b) All members of the executive boards of all common-interest

5-5  communities subject to the master association may elect all

5-6  members of the master association’s executive board.

5-7  (c) All units’ owners of each common-interest community

5-8  subject to the master association may elect specified members of the

5-9  master association’s executive board.

5-10      (d) All members of the executive board of each common-interest

5-11  community subject to the master association may elect specified

5-12  members of the master association’s executive board.

5-13      Sec. 7.  NRS 116.3102 is hereby amended to read as follows:

5-14      116.3102  1.  Except as otherwise provided in subsection 2,

5-15  and subject to the provisions of the declaration, the association may:

5-16      (a) Adopt and amend bylaws, rules and regulations;

5-17      (b) Adopt and amend budgets for revenues, expenditures and

5-18  reserves and collect assessments for common expenses from units’

5-19  owners;

5-20      (c) Hire and discharge managing agents and other employees,

5-21  agents and independent contractors;

5-22      (d) Institute, defend or intervene in litigation or administrative

5-23  proceedings in its own name on behalf of itself or two or more units’

5-24  owners on matters affecting the common-interest community;

5-25      (e) Make contracts and incur liabilities;

5-26      (f) Regulate the use, maintenance, repair, replacement and

5-27  modification of common elements;

5-28      (g) Cause additional improvements to be made as a part of the

5-29  common elements;

5-30      (h) Acquire, hold, encumber and convey in its own name any

5-31  right, title or interest to real estate or personal property, but:

5-32          (1) Common elements in a condominium or planned

5-33  community may be conveyed or subjected to a security interest only

5-34  pursuant to NRS 116.3112; and

5-35          (2) Part of a cooperative may be conveyed, or all or part of a

5-36  cooperative may be subjected to a security interest, only pursuant to

5-37  NRS 116.3112;

5-38      (i) Grant easements, leases, licenses and concessions through or

5-39  over the common elements;

5-40      (j) Impose and receive any payments, fees or charges for the use,

5-41  rental or operation of the common elements, other than limited

5-42  common elements described in subsections 2 and 4 of NRS

5-43  116.2102, and for services provided to units’ owners;

5-44      (k) Impose charges for late payment of assessments , impose

5-45  construction penalties when authorized pursuant to section 3 of

6-1  this act and, except as otherwise provided in NRS 116.31031, after

6-2  notice and an opportunity to be heard, levy reasonable fines for

6-3  violations of the declaration, bylaws, rules and regulations of the

6-4  association;

6-5  (l) Impose reasonable charges for the preparation and

6-6  recordation of amendments to the declaration, the information

6-7  required by NRS 116.4109 or statements of unpaid assessments;

6-8  (m) Provide for the indemnification of its officers and executive

6-9  board and maintain directors’ and officers’ liability insurance;

6-10      (n) Assign its right to future income, including the right to

6-11  receive assessments for common expenses, but only to the extent the

6-12  declaration expressly so provides;

6-13      (o) Exercise any other powers conferred by the declaration or

6-14  bylaws;

6-15      (p) Exercise all other powers that may be exercised in this state

6-16  by legal entities of the same type as the association;

6-17      (q) Direct the removal of vehicles improperly parked on

6-18  property owned or leased by the association, pursuant to NRS

6-19  487.038; and

6-20      (r) Exercise any other powers necessary and proper for the

6-21  governance and operation of the association.

6-22      2.  The declaration may not impose limitations on the power of

6-23  the association to deal with the declarant which are more restrictive

6-24  than the limitations imposed on the power of the association to deal

6-25  with other persons.

6-26      Sec. 8.  NRS 116.31031 is hereby amended to read as follows:

6-27      116.31031  1.  If a unit’s owner, or a tenant or guest of a unit’s

6-28  owner, does not comply with a provision of the governing

6-29  documents of an association, the executive board of the association

6-30  may, if the governing documents so provide:

6-31      (a) Prohibit, for a reasonable time, the unit’s owner, or the

6-32  tenant or guest of the unit’s owner, from:

6-33          (1) Voting on matters related to the common-interest

6-34  community.

6-35          (2) Using the common elements. The provisions of this

6-36  subparagraph do not prohibit the unit’s owner, or the tenant or guest

6-37  of the unit’s owner, from using any vehicular or pedestrian ingress

6-38  or egress to go to or from the unit, including any area used for

6-39  parking.

6-40      (b) Require the unit’s owner, or the tenant or guest of the unit’s

6-41  owner, to pay a fine for each failure to comply that does not threaten

6-42  the health and welfare of the common-interest community[.] ,

6-43  except that a fine may not be imposed for a violation that is the

6-44  subject of a construction penalty pursuant to section 3 of this act.

6-45  The fine must be commensurate with the severity of the violation,

7-1  but must not exceed $100 for each violation or a total amount of

7-2  $500, whichever is less.

7-3  2.  If a fine is imposed pursuant to subsection 1 and the

7-4  violation is not cured within 14 days or a longer period as may be

7-5  established by the executive board, the violation shall be deemed a

7-6  continuing violation. Thereafter, the executive board may impose an

7-7  additional fine for the violation for each 7‑day period or portion

7-8  thereof that the violation is not cured. Any additional fine may be

7-9  imposed without notice and an opportunity to be heard.

7-10      3.  Except as otherwise provided in subsection 2, the imposition

7-11  of a fine pursuant to this section must comply with the requirements

7-12  of subsection 6 of NRS 116.31065.

7-13      Sec. 9.  NRS 116.31034 is hereby amended to read as follows:

7-14      116.31034  1.  Except as otherwise provided in subsection 5 of

7-15  NRS 116.212, not later than the termination of any period of

7-16  declarant’s control, the units’ owners shall elect an executive board

7-17  of at least three members, at least a majority of whom must be units’

7-18  owners. The executive board shall elect the officers. The members

7-19  and officers of the executive board shall take office upon election.

7-20      2.  The term of office of a member of the executive board may

7-21  not exceed 2 years. A member of the executive board may be

7-22  elected to succeed himself. The governing documents of the

7-23  association must set forth the month during which elections for the

7-24  members of the executive board must be held after the termination

7-25  of any period of the declarant’s control.

7-26      3.  Not less than 30 days before the preparation of a ballot for

7-27  the election of members of the executive board, the secretary or

7-28  other officer specified in the bylaws of the association shall cause

7-29  notice to be given to each unit’s owner of his eligibility to serve as a

7-30  member of the executive board. Each unit’s owner who is qualified

7-31  to serve as a member of the executive board may have his name

7-32  placed on the ballot along with the names of the nominees selected

7-33  by the members of the executive board or a nominating committee

7-34  established by the association.

7-35      4.  An officer, employee, agent or director of a corporate owner

7-36  of a unit, a trustee or designated beneficiary of a trust that owns a

7-37  unit, a partner of a partnership that owns a unit, and a fiduciary of an

7-38  estate that owns a unit may be an officer or member of the executive

7-39  board. In all events where the person serving or offering to serve as

7-40  an officer or member of the executive board is not the record owner,

7-41  he shall file proof in the records of the association that:

7-42      (a) He is associated with the corporate owner, trust, partnership

7-43  or estate as required by this subsection; and

7-44      (b) Identifies the unit or units owned by the corporate owner,

7-45  trust, partnership or estate.

8-1  5.  The election of any member of the executive board must be

8-2  conducted by secret written ballot[. The] unless the declaration of

8-3  the association provides that voting rights may be exercised by

8-4  delegates or representatives as set forth in section 2 of this act. If

8-5  the election is conducted by secret written ballot, the secretary or

8-6  other officer specified in the bylaws of the association shall cause to

8-7  be sent , prepaid by United States mail to the mailing address of

8-8  each unit within the common-interest community or to any other

8-9  mailing address designated in writing by the unit’s owner, a secret

8-10  ballot and a return envelope.

8-11      6.  Votes cast for the election of a member of the executive

8-12  board of an association must be counted in public.

8-13      7.  Each member of the executive board shall, within 30 days

8-14  after his appointment or election, certify in writing that he has read

8-15  and understands the governing documents of the association and the

8-16  provisions of this chapter to the best of his ability.

8-17      Sec. 10.  NRS 116.31085 is hereby amended to read as

8-18  follows:

8-19      116.31085  1.  Except as otherwise provided in this section, a

8-20  unit’s owner may attend any meeting of the units’ owners of the

8-21  association or of the executive board and speak at any such meeting.

8-22  The executive board may establish reasonable limitations on the

8-23  time a unit’s owner may speak at such a meeting.

8-24      2.  An executive board may meet in executive session to:

8-25      (a) Consult with the attorney for the association on matters

8-26  relating to proposed or pending litigation if the contents of the

8-27  discussion would otherwise be governed by the privilege set forth in

8-28  NRS 49.035 to 49.115, inclusive;

8-29      (b) Discuss matters relating to personnel; [or]

8-30      (c) Discuss a violation of the governing documents alleged to

8-31  have been committed by a unit’s owner, including, without

8-32  limitation, the failure to pay an assessment, except as otherwise

8-33  provided in subsection 3[.] ; or

8-34      (d) Discuss the alleged failure of a unit’s owner to adhere to a

8-35  schedule required pursuant to section 3 of this act the failure of

8-36  which may subject the unit’s owner to a construction penalty.

8-37      3.  An executive board shall meet in executive session to hold a

8-38  hearing on an alleged violation of the governing documents unless

8-39  the unit’s owner who allegedly committed the violation requests in

8-40  writing that the hearing be conducted by the executive board at an

8-41  open meeting. The unit’s owner who is alleged to have committed

8-42  the violation may attend the hearing and testify concerning the

8-43  alleged violation, but may be excluded by the executive board from

8-44  any other portion of the hearing, including, without limitation, the

8-45  deliberations of the executive board.

9-1  4.  Except as otherwise provided in this subsection, any matter

9-2  discussed in executive session must be generally noted in the

9-3  minutes of the meeting of the executive board. The executive board

9-4  shall maintain minutes of any decision made pursuant to subsection

9-5  3 and, upon request, provide a copy of the decision to the unit’s

9-6  owner who was the subject of the hearing or to his designated

9-7  representative.

9-8  5.  Except as otherwise provided in subsection 3, a unit’s owner

9-9  is not entitled to attend or speak at a meeting of the executive board

9-10  held in executive session.

9-11      Sec. 11.  NRS 116.3109 is hereby amended to read as follows:

9-12      116.3109  1.  Except as otherwise provided in this section and

9-13  unless the bylaws provide otherwise, a quorum is present throughout

9-14  any meeting of the association if persons entitled to cast 20 percent

9-15  of the votes that may be cast for election of the executive board[,]

9-16  are present in person or by proxy at the beginning of the meeting.

9-17      2.  Unless the bylaws specify a larger percentage, a quorum is

9-18  deemed present throughout any meeting of the executive board if

9-19  persons entitled to cast 50 percent of the votes on that board are

9-20  present at the beginning of the meeting.

9-21      [3.  For the purposes of determining whether a quorum is

9-22  present for the election of any member of the executive board, only

9-23  the secret written ballots that are returned to the association may be

9-24  counted.]

9-25      Sec. 12.  NRS 116.311 is hereby amended to read as follows:

9-26      116.311  1.  If only one of several owners of a unit is present

9-27  at a meeting of the association, that owner is entitled to cast all the

9-28  votes allocated to that unit. If more than one of the owners are

9-29  present, the votes allocated to that unit may be cast only in

9-30  accordance with the agreement of a majority in interest of the

9-31  owners, unless the declaration expressly provides otherwise. There

9-32  is majority agreement if any one of the owners cast the votes

9-33  allocated to that unit without protest made promptly to the person

9-34  presiding over the meeting by any of the other owners of the unit.

9-35      2.  Except as otherwise provided in this section, votes allocated

9-36  to a unit may be cast pursuant to a proxy executed by a unit’s owner.

9-37  A unit’s owner may give a proxy only to a member of his immediate

9-38  family, a tenant of the unit’s owner who resides in the common-

9-39  interest community , [or] another unit’s owner who resides in the

9-40  common-interest community[.] , or to a delegate or representative

9-41  when authorized pursuant to section 2 of this act. If a unit is

9-42  owned by more than one person, each owner of the unit may vote or

9-43  register protest to the casting of votes by the other owners of the unit

9-44  through an executed proxy. A unit’s owner may revoke a proxy

10-1  given pursuant to this section only by actual notice of revocation to

10-2  the person presiding over a meeting of the association.

10-3      3.  A proxy is void if:

10-4      (a) It is not dated or purports to be revocable without notice;

10-5      (b) It does not designate the votes that must be cast on behalf of

10-6  the unit’s owner who executed the proxy; or

10-7      (c) The holder of the proxy does not disclose at the beginning of

10-8  the meeting for which the proxy is executed the number of proxies

10-9  pursuant to which he will be casting votes and the voting

10-10  instructions received for each proxy.

10-11     4.  A proxy terminates immediately after the conclusion of the

10-12  meeting for which it was executed.

10-13     5.  A vote may not be cast pursuant to a proxy for the election

10-14  of a member of the executive board of an association[.

10-15     3.  Only a vote cast in person, by secret ballot or by proxy, may

10-16  be counted.

10-17     4.] unless the proxy is exercised through a delegate or

10-18  representative authorized pursuant to section 2 of this act.

10-19     6. If the declaration requires that votes on specified matters

10-20  affecting the common-interest community be cast by lessees rather

10-21  than units’ owners of leased units:

10-22     (a) The provisions of subsections 1 and 2 apply to lessees as if

10-23  they were units’ owners;

10-24     (b) Units’ owners who have leased their units to other persons

10-25  may not cast votes on those specified matters; and

10-26     (c) Lessees are entitled to notice of meetings, access to records

10-27  [,] and other rights respecting those matters as if they were units’

10-28  owners.

10-29     7.  Units’ owners must [also] be given notice, in the manner

10-30  provided in NRS 116.3108, of all meetings at which lessees are

10-31  entitled to vote.

10-32     [5.] 8. No votes allocated to a unit owned by the association

10-33  may be cast.

10-34     [6.  Votes cast for the election of a member of the executive

10-35  board of an association must be counted in public.]

10-36     Sec. 13.  NRS 116.3116 is hereby amended to read as follows:

10-37     116.3116  1.  The association has a lien on a unit for any

10-38  construction penalty that is imposed against the unit’s owner

10-39  pursuant to section 3 of this act, any assessment levied against that

10-40  unit or any fines imposed against the unit’s owner from the time the

10-41  construction penalty, assessment or fine becomes due. Unless the

10-42  declaration otherwise provides, penalties, fees, charges, late

10-43  charges, fines and interest charged pursuant to paragraphs (j), (k)

10-44  and (l) of subsection 1 of NRS 116.3102 are enforceable as

10-45  assessments under this section. If an assessment is payable in

11-1  installments, the full amount of the assessment is a lien from the

11-2  time the first installment thereof becomes due.

11-3      2.  A lien under this section is prior to all other liens and

11-4  encumbrances on a unit except:

11-5      (a) Liens and encumbrances recorded before the recordation of

11-6  the declaration and, in a cooperative, liens and encumbrances which

11-7  the association creates, assumes or takes subject to;

11-8      (b) A first security interest on the unit recorded before the date

11-9  on which the assessment sought to be enforced became delinquent

11-10  [,] or, in a cooperative, the first security interest encumbering only

11-11  the unit’s owner’s interest and perfected before the date on which

11-12  the assessment sought to be enforced became delinquent; and

11-13     (c) Liens for real estate taxes and other governmental

11-14  assessments or charges against the unit or cooperative.

11-15  The lien is also prior to all security interests described in paragraph

11-16  (b) to the extent of the assessments for common expenses based on

11-17  the periodic budget adopted by the association pursuant to NRS

11-18  116.3115 which would have become due in the absence of

11-19  acceleration during the 6 months immediately preceding institution

11-20  of an action to enforce the lien. This subsection does not affect the

11-21  priority of mechanics’ or materialmen’s liens, or the priority of liens

11-22  for other assessments made by the association.

11-23     3.  Unless the declaration otherwise provides, if two or more

11-24  associations have liens for assessments created at any time on the

11-25  same property, those liens have equal priority.

11-26     4.  Recording of the declaration constitutes record notice and

11-27  perfection of the lien. No further recordation of any claim of lien for

11-28  assessment under this section is required.

11-29     5.  A lien for unpaid assessments is extinguished unless

11-30  proceedings to enforce the lien are instituted within 3 years after the

11-31  full amount of the assessments becomes due.

11-32     6.  This section does not prohibit actions to recover sums for

11-33  which subsection 1 creates a lien or prohibit an association from

11-34  taking a deed in lieu of foreclosure.

11-35     7.  A judgment or decree in any action brought under this

11-36  section must include costs and reasonable attorney’s fees for the

11-37  prevailing party.

11-38     8.  The association , upon written request , shall furnish to a

11-39  unit’s owner a statement setting forth the amount of unpaid

11-40  assessments against the unit. If the interest of the unit’s owner is real

11-41  estate, the statement must be in recordable form. The statement must

11-42  be furnished within 10 business days after receipt of the request and

11-43  is binding on the association, the executive board and every unit’s

11-44  owner.

12-1      9.  In a cooperative, upon nonpayment of an assessment on a

12-2  unit, the unit’s owner may be evicted in the same manner as

12-3  provided by law in the case of an unlawful holdover by a

12-4  commercial tenant, and the lien may be foreclosed as provided by

12-5  this section or by NRS 116.31162 to 116.31168, inclusive.

12-6      10.  In a cooperative where the owner’s interest in a unit is

12-7  personal property [(NRS 116.1105),] as provided in NRS 116.1105,

12-8  the association’s lien may be foreclosed in like manner as a security

12-9  interest under NRS 104.9101 to 104.9709, inclusive.

12-10     Sec. 14.  NRS 116.31162 is hereby amended to read as

12-11  follows:

12-12     116.31162  1.  Except as otherwise provided in subsection 4,

12-13  in a condominium, a cooperative where the owner’s interest in a unit

12-14  is real estate as determined pursuant to NRS 116.1105[,] or a

12-15  planned community, the association may foreclose its lien by sale

12-16  after:

12-17     (a) The association has mailed by certified or registered mail,

12-18  return receipt requested, to the unit’s owner or his successor in

12-19  interest, at his address if known[,] and at the address of the unit, a

12-20  notice of delinquent assessment which states the amount of the

12-21  assessments and other sums which are due in accordance with

12-22  subsection 1 of NRS 116.3116, a description of the unit against

12-23  which the lien is imposed[,] and the name of the record owner of

12-24  the unit;

12-25     (b) The association or other person conducting the sale has

12-26  executed and caused to be recorded, with the county recorder of the

12-27  county in which the common-interest community or any part of it is

12-28  situated, a notice of default and election to sell the unit to satisfy the

12-29  lien, which contains the same information as the notice of

12-30  delinquent assessment, but must also describe the deficiency in

12-31  payment and the name and address of the person authorized by the

12-32  association to enforce the lien by sale; and

12-33     (c) The unit’s owner or his successor in interest has failed to pay

12-34  the amount of the lien, including costs, fees and expenses incident to

12-35  its enforcement, for 60 days following the recording of the notice of

12-36  default and election to sell.

12-37     2.  The notice of default and election to sell must be signed by

12-38  the person designated in the declaration or by the association for that

12-39  purpose[,] or , if no one is designated, by the president of the

12-40  association.

12-41     3.  The period of 60 days begins on the first day following the

12-42  later of:

12-43     (a) The day on which the notice of default is recorded; or

12-44     (b) The day on which a copy of the notice of default is mailed

12-45  by certified or registered mail, return receipt requested, to the unit’s

13-1  owner or his successor in interest at his address if known, and at the

13-2  address of the unit.

13-3      4.  The association may not foreclose a lien by sale [for the

13-4  assessment of] based on a fine or penalty for a violation of the

13-5  declaration, bylaws, rules or regulations of the association[, unless

13-6  the violation is of a type that threatens] unless:

13-7      (a) The violation threatens the health, safety or welfare of the

13-8  residents of the common-interest community[.] ; or

13-9      (b) The penalty is imposed for failure to adhere to a schedule

13-10  required pursuant to section 3 of this act.

13-11     Sec. 15.  NRS 38.300 is hereby amended to read as follows:

13-12     38.300  As used in NRS 38.300 to 38.360, inclusive, unless the

13-13  context otherwise requires:

13-14     1.  “Assessments” means:

13-15     (a) Any charge which an association may impose against an

13-16  owner of residential property pursuant to a declaration of covenants,

13-17  conditions and restrictions, including any late charges, interest and

13-18  costs of collecting the charges; and

13-19     (b) Any penalties, fines, fees and other charges which may be

13-20  imposed by an association pursuant to paragraphs (j), (k) and (l) of

13-21  subsection 1 of NRS 116.3102.

13-22     2.  “Association” has the meaning ascribed to it in

13-23  NRS 116.110315.

13-24     3.  “Civil action” includes an action for money damages or

13-25  equitable relief. The term does not include an action in equity for

13-26  injunctive relief in which there is an immediate threat of irreparable

13-27  harm, or an action relating to the title to residential property.

13-28     4.  “Division” means the Real Estate Division of the

13-29  Department of Business and Industry.

13-30     5.  “Residential property” includes, but is not limited to, real

13-31  estate within a planned community subject to the provisions of

13-32  chapter 116 of NRS. The term does not include commercial property

13-33  if no portion thereof contains property which is used for residential

13-34  purposes.

 

13-35  H