[Rev. 2/28/2019 2:44:29 PM]
κ1965 Statutes of Nevada, Page 801 (CHAPTER 353, SB 15)κ
young to be born within 12 months after contracting or for the sale of crops to be harvested within 12 months or the next normal harvest season after contracting, whichever is longer.
2. The seller retains an insurable interest in goods so long as title to or any security interest in the goods remains in him and where the identification is by the seller alone he may until default insolvency or notification to the buyer that the identification is final substitute other goods for those identified.
3. Nothing in this section impairs any insurable interest recognized under any other statute or rule of law.
Sec. 2-502. 1. Subject to subsection 2 and even though the goods have not been shipped a buyer who has paid a part or all of the price of goods in which he has a special property under the provisions of the immediately preceding section may on making and keeping good a tender of any unpaid portion of their price recover them from the seller if the seller becomes insolvent within 10 days after receipt of the first installment on their price.
2. If the identification creating his special property has been made by the buyer he acquires the right to recover the goods only if they conform to the contract for sale.
Sec. 2-503. 1. Tender of delivery requires that the seller put and hold conforming goods at the buyers disposition and give the buyer any notification reasonably necessary to enable him to take delivery. The manner, time and place for tender are determined by the agreement and this article, and in particular:
(a) Tender must be at a reasonable hour, and if it is of goods they must be kept available for the period reasonably necessary to enable the buyer to take possession; but
(b) Unless otherwise agreed the buyer must furnish facilities reasonably suited to the receipt of the goods.
2. Where the case is within the next section respecting shipment tender requires that the seller comply with its provisions.
3. Where the seller is required to deliver at a particular destination tender requires that he comply with subsection 1 and also in any appropriate case tender documents as described in subsections 4 and 5 of this section.
4. Where goods are in the possession of a bailee and are to be delivered without being moved:
(a) Tender requires that the seller either tender a negotiable document of title covering such goods or procure acknowledgment by the bailee of the buyers right to possession of the goods; but
(b) Tender to the buyer of a nonnegotiable document of title or of a written direction to the bailee to deliver is sufficient tender unless the buyer seasonably objects, and receipt by the bailee of notification of the buyers rights fixes those rights as against the bailee and all third persons; but risk of loss of the goods and of any failure by the bailee to honor the nonnegotiable document of title or to obey the direction remains on the seller until the buyer has had a reasonable time to present the document or direction, and a refusal by the bailee to honor the document or to obey the direction defeats the tender.
κ1965 Statutes of Nevada, Page 802 (CHAPTER 353, SB 15)κ
5. Where the contract requires the seller to deliver documents:
(a) He must tender all such documents in correct form, except as provided in this article with respect to bills of lading in a set (subsection 2 of section 2-323); and
(b) Tender through customary banking channels is sufficient and dishonor of a draft accompanying the documents constitutes nonacceptance or rejection.
Sec. 2-504. Where the seller is required or authorized to send the goods to the buyer and the contract does not require him to deliver them at a particular destination, then unless otherwise agreed he must:
1. Put the goods in the possession of such a carrier and make such a contract for their transportation as may be reasonable having regard to the nature of the goods and other circumstances of the case; and
2. Obtain and promptly deliver or tender in due form any document necessary to enable the buyer to obtain possession of the goods or otherwise required by the agreement or by usage of trade; and
3. Promptly notify the buyer of the shipment.
Failure to notify the buyer under paragraph (c) or to make a proper contract under paragraph (a) is a ground for rejection only if material delay or loss ensues.
Sec. 2-505. 1. Where the seller has identified goods to the contract by or before shipment:
(a) His procurement of a negotiable bill of lading to his own order or otherwise reserves in him a security interest in the goods. His procurement of the bill to the order of a financing agency or of the buyer indicates in addition only the sellers expectation of transferring that interest to the person named.
(b) A nonnegotiable bill of lading to himself or his nominee reserves possession of the goods as security but except in a case of conditional delivery (subsection 2 of section 2-507) a nonnegotiable bill of lading naming the buyer as consignee reserves no security interest even though the seller retains possession of the bill of lading.
2. When shipment by the seller with reservation of a security interest is in violation of the contract for sale it constitutes an improper contract for transportation within the preceding section but impairs neither the rights given to the buyer by shipment and identification of the goods to the contract nor the sellers powers as a holder of a negotiable document.
Sec. 2-506. 1. A financing agency by paying or purchasing for value a draft which relates to a shipment of goods acquires to the extent of the payment or purchase and in addition to its own rights under the draft and any document of title securing it any rights of the shipper in the goods including the right to stop delivery and the shippers right to have the draft honored by the buyer.
2. The right to reimbursement of a financing agency which has in good faith honored or purchased the draft under commitment to or authority from the buyer is not impaired by subsequent discovery of defects with reference to any relevant document which was apparently regular on its face.
Sec. 2-507. 1. Tender of delivery is a condition to the buyers duty to accept the goods and, unless otherwise agreed, to his duty to pay for them.
κ1965 Statutes of Nevada, Page 803 (CHAPTER 353, SB 15)κ
them. Tender entitles the seller to acceptance of the goods and to payment according to the contract.
2. Where payment is due and demanded on the delivery to the buyer of goods or documents of title, his right as against the seller to retain or dispose of them is conditional upon his making the payment due.
Sec. 2-508. 1. Where any tender or delivery by the seller is rejected because nonconforming and the time for performance has not yet expired, the seller may seasonably notify the buyer of his intention to cure and may then within the contract time make a conforming delivery.
2. Where the buyer rejects a nonconforming tender which the seller had reasonable grounds to believe would be acceptable with or without money allowance the seller may if he seasonably notifies the buyer have a further reasonable time to substitute a conforming tender.
Sec. 2-509. 1. Where the contract requires or authorizes the seller to ship the goods by carrier:
(a) If it does not require him to deliver them at a particular destination, the risk of loss passes to the buyer when the goods are duly delivered to the carrier even though the shipment is under reservation (section 2-505); but
(b) If it does not require him to deliver them at a particular destination and the goods are there duly tendered while in the possession of the carrier, the risk of loss passes to the buyer when the goods are there duly so tendered as to enable the buyer to take delivery.
2. Where the goods are held by a bailee to be delivered without being moved, the risk of loss passes to the buyer:
(a) On his receipt of a negotiable document of title covering the goods; or
(b) On acknowledgment by the bailee of the buyers right to possession of the goods; or
(c) After his receipt of a nonnegotiable document of title or other written direction to deliver, as provided in paragraph (b) of subsection 4 of section 2-503.
3. In any case not within subsection 1 or 2, the risk of loss passes to the buyer on his receipt of the goods if the seller is a merchant; otherwise the risk passes to the buyer on tender of delivery.
4. The provisions of this section are subject to contrary agreement of the parties and to the provisions of this article on sale on approval (section 2-327) and on effect of breach on risk of loss (section 2-510).
Sec. 2-510. 1. Where a tender or delivery of goods so fails to conform to the contract as to give a right of rejection the risk of their loss remains on the seller until cure or acceptance.
2. Where the buyer rightfully revokes acceptance he may to the extent of any deficiency in his effective insurance coverage treat the risk of loss as having rested on the seller from the beginning.
3. Where the buyer as to conforming goods already identified to the contract for sale repudiates or is otherwise in breach before risk of their loss has passed to him, the seller may to the extent of any deficiency in his effective insurance coverage treat the risk of loss as resting on the buyer for a commercially reasonable time.
κ1965 Statutes of Nevada, Page 804 (CHAPTER 353, SB 15)κ
deficiency in his effective insurance coverage treat the risk of loss as resting on the buyer for a commercially reasonable time.
Sec. 2-511. 1. Unless otherwise agreed tender of payment is a condition to the sellers duty to tender and complete any delivery.
2. Tender of payment is sufficient when made by any means or in any manner current in the ordinary course of business unless the seller demands payment in legal tender and gives any extension of time reasonably necessary to procure it.
3. Subject to the provisions of this chapter on the effect of an instrument on an obligation (section 3-802), payment by check is conditional and is defeated as between the parties by dishonor of the check on due presentment.
Sec. 2-512. 1. Where the contract requires payment before inspection nonconformity of the goods does not excuse the buyer from so making payment unless:
(a) The nonconformity appears without inspection; or
(b) Despite tender of the required documents the circumstances would justify injunction against honor under the provisions of this chapter (section 5-114).
2. Payment pursuant to subsection 1 does not constitute an acceptance of goods or impair the buyers right to inspect or any of his remedies.
Sec. 2-513. 1. Unless otherwise agreed and subject to subsection 3, where goods are tendered or delivered or identified to the contract for sale, the buyer has a right before payment or acceptance to inspect them at any reasonable place and time and in any reasonable manner. When the seller is required or authorized to send the goods to the buyer, the inspection may be after their arrival.
2. Expenses of inspection must be borne by the buyer but may be recovered from the seller if the goods do not conform and are rejected.
3. Unless otherwise agreed and subject to the provisions of this article on C.I.F. contracts (subsection 3 of section 2-321), the buyer is not entitled to inspect the goods before payment of the price when the contract provides:
(a) For delivery C.O.D. or on other like terms; or
(b) For payment against documents of title, except where such payment is due only after the goods are to become available for inspection.
4. A place or method of inspection fixed by the parties is presumed to be exclusive but unless otherwise expressly agreed it does not postpone identification or shift the place for delivery or for passing the risk of loss. If compliance becomes impossible, inspection shall be as provided in this section unless the place or method fixed was clearly intended as an indispensable condition failure of which avoids the contract.
Sec. 2-514. Unless otherwise agreed documents against which a draft is drawn are to be delivered to the drawee on acceptance of the draft if it is payable more than 3 days after presentment; otherwise, only on payment.
Sec. 2-515. In furtherance of the adjustment of any claim or dispute:
κ1965 Statutes of Nevada, Page 805 (CHAPTER 353, SB 15)κ
1. Either party on reasonable notification to the other and for the purpose of ascertaining the facts and preserving evidence has the right to inspect, test and sample the goods, including such of them as may be in the possession or control of the other; and
2. The parties may agree to a third party inspection or survey to determine the conformity or condition of the goods and may agree that the findings shall be binding upon them in any subsequent litigation or adjustment.
part 6
breach, repudiation and excuse
Sec. 2-601. Subject to the provisions of this article on breach in installment contracts (section 2-612) and unless otherwise agreed under the sections on contractual limitations of remedy (sections 2-718 and 2-719), if the goods or the tender of delivery fail in any respect to conform to the contract, the buyer may:
1. Reject the whole; or
2. Accept the whole; or
3. Accept any commercial unit or units and reject the rest.
Sec. 2-602. 1. Rejection of goods must be within a reasonable time after their delivery or tender. It is ineffective unless the buyer seasonably notifies the seller.
2. Subject to the provisions of the two following sections on rejected goods (section 2-603 and 2-604):
(a) After rejection any exercise of ownership by the buyer with respect to any commercial unit is wrongful as against the seller; and
(b) If the buyer has before rejection taken physical possession of goods in which he does not have a security interest under the provisions of this article (subsection 3 of section 2-711), he is under a duty after rejection to hold them with reasonable care at the sellers disposition for a time sufficient to permit the seller to remove them; but
(c) The buyer has no further obligations with regard to goods rightfully rejected.
3. The sellers rights with respect to goods wrongfully rejected are governed by the provisions of this article on sellers remedies in general (section 2-703).
Sec. 2-603. 1. Subject to any security interest in the buyer (subsection 3 of section 2-711), when the seller has no agent or place of business at the market of rejection a merchant buyer is under a duty after rejection of goods in his possession or control to follow any reasonable instructions received from the seller with respect to the goods and in the absence of such instructions to make reasonable efforts to sell them for the sellers account if they are perishable or threaten to decline in value speedily. Instructions are not reasonable if on demand indemnity for expenses is not forthcoming.
2. When the buyer sells goods under subsection 1, he is entitled to reimbursement from the seller or out of the proceeds for reasonable expenses of caring for and selling them, and if the expenses include no selling commission then to such commission as is usual in the trade or if there is none to a reasonable sum not exceeding 10 percent on the gross proceeds.
κ1965 Statutes of Nevada, Page 806 (CHAPTER 353, SB 15)κ
selling commission then to such commission as is usual in the trade or if there is none to a reasonable sum not exceeding 10 percent on the gross proceeds.
3. In complying with this section the buyer is held only to good faith and good faith conduct hereunder is neither acceptance nor conversion nor the basis of an action for damages.
Sec. 2-604. Subject to the provisions of the immediately preceding section on perishables if the seller gives no instructions within a reasonable time after notification of rejection the buyer may store the rejected goods for the sellers account or reship them to him or resell them for the sellers account with reimbursement as provided in the preceding section. Such action is not acceptance or conversion.
Sec. 2-605. 1. The buyers failure to state in connection with rejection a particular defect which is ascertainable by reasonable inspection precludes him from relying on the unstated defect to justify rejection or to establish breach:
(a) Where the seller could have cured it if stated seasonably; or
(b) Between merchants when the seller has after rejection made a request in writing for a full and final written statement of all defects on which the buyer proposes to rely.
2. Payment against documents made without reservation of rights precludes recovery of the payment for defects apparent on the face of the documents.
Sec. 2-606. 1. Acceptance of goods occurs when the buyer:
(a) After a reasonable opportunity to inspect the goods signifies to the seller that the goods are conforming or that he will take or retain them in spite of their nonconformity; or
(b) Fails to make an effective rejection (subsection 1 of section 2-602), but such acceptance does not occur until the buyer has had a reasonable opportunity to inspect them; or
(c) Does any act inconsistent with the sellers ownership; but if such act is wrongful as against the seller it is an acceptance only if ratified by him.
2. Acceptance of a part of any commercial unit is acceptable of that entire unit.
Sec. 2-607. 1. The buyer must pay at the contract rate for any goods accepted.
2. Acceptance of goods by the buyer precludes rejection of the goods accepted and if made with knowledge of a nonconformity cannot be revoked because of it unless the acceptance was on the reasonable assumption that the nonconformity would be seasonably cured but acceptance does not of itself impair any other remedy provided by this article for nonconformity.
3. Where a tender has been accepted:
(a) The buyer must within a reasonable time after he discovers or should have discovered any breach notify the seller of breach or be barred from any remedy; and
(b) If the claim is one for infringement or the like (subsection 3 of section 2-312) and the buyer is sued as a result of such a breach he must so notify the seller within a reasonable time after he receives notice of the litigation or be barred from any remedy over for liability established by the litigation.
κ1965 Statutes of Nevada, Page 807 (CHAPTER 353, SB 15)κ
notice of the litigation or be barred from any remedy over for liability established by the litigation.
4. The burden is on the buyer to establish any breach with respect to the goods accepted.
5. Where the buyer is sued for breach of a warranty or other obligation for which his seller is answerable over:
(a) He may give his seller written notice of the litigation. If the notice states that the seller may come in and defend and that if the seller does not do so he will be bound in any action against him by his buyer by any determination of fact common to the two litigations, then unless the seller after seasonable receipt of the notice does come in and defend he is so bound.
(b) If the claim is one for infringement or the like (subsection 3 of section 2-312) the original seller may demand in writing that his buyer turn over to him control of the litigation including settlement or else be barred from any remedy over and if he also agrees to bear all expense and to satisfy any adverse judgment, then unless the buyer after seasonable receipt of the demand does turn over control the buyer is so barred.
6. The provisions of subsections 3, 4 and 5 apply to any obligation of a buyer to hold the seller harmless against infringement or the like (subsection 3 of section 2-312).
Sec. 2-608. 1. The buyer may revoke his acceptance of a lot or commercial unit whose nonconformity substantially impairs its value to him if he has accepted it:
(a) On the reasonable assumption that its nonconformity would be cured and it has not been seasonably cured; or
(b) Without discovery of such nonconformity if his acceptance was reasonably induced either by the difficulty of discovery before acceptance or by the sellers assurances.
2. Revocation of acceptance must occur within a reasonable time after the buyer discovers or should have discovered the ground for it and before any substantial change in condition of the goods which is not caused by their own defects. It is not effective until the buyer notifies the seller of it.
3. A buyer who so revokes has the same rights and duties with regard to the goods involved as if he had rejected them.
Sec. 2-609. 1. A contract for sale imposes an obligation on each party that the others expectation of receiving due performance will not be impaired. When reasonable grounds for insecurity arise with respect to the performance of either party the other may in writing demand adequate assurance of due performance and until he receives such assurance may if commercially reasonable suspend any performance for which he has not already received the agreed return.
2. Between merchants the reasonableness of grounds for insecurity and the adequacy of any assurance offered shall be determined according to commercial standards.
3. Acceptance of any improper delivery or payment does not prejudice the aggrieved partys right to demand adequate assurance of future performance.
κ1965 Statutes of Nevada, Page 808 (CHAPTER 353, SB 15)κ
4. After receipt of a justified demand failure to provide within a reasonable time not exceeding 30 days such assurance of due performance as is adequate under the circumstances of the particular case is a repudiation of the contract.
Sec. 2-610. When either party repudiates the contract with respect to a performance not yet due the loss of which will substantially impair the value of the contract to the other, the aggrieved party may:
(a) For a commercially reasonable time await performance by the repudiating party; or
(b) Resort to any remedy for breach (sections 2-703 or 2-711), even though he has notified the repudiating party that he would await the latters performance and has urged retraction; and
(c) In either case suspend his own performance or proceed in accordance with the provisions of this article on the sellers right to identify goods to the contract notwithstanding breach or to salvage unfinished goods (section 2-704).
Sec. 2-611. 1. Until the repudiating partys next performance is due he can retract his repudiation unless the aggrieved party has since the repudiation canceled or materially changed his position or otherwise indicated that he considers the repudiation final.
2. Retraction may be by any method which clearly indicates to the aggrieved party that the repudiating party intends to perform, but must include any assurance justifiably demanded under the provisions of this article (section 2-609).
3. Retraction reinstates the repudiating partys rights under the contract with due excuse and allowance to the aggrieved party for any delay occasioned by the repudiation.
Sec. 2-612. 1. An installment contract is one which requires or authorizes the delivery of goods in separate lots to be separately accepted, even though the contract contains a clause each delivery is a separate contract or its equivalent.
2. The buyer may reject any installment which is nonconforming if the nonconformity substantially impairs the value of that installment and cannot be cured or if the nonconformity is a defect in the required documents; but if the nonconformity does not fall within subsection 3 and the seller gives adequate assurance of its cure the buyer must accept that installment.
3. Whenever nonconformity or default with respect to one or more installments substantially impairs the value of the whole contract there is a breach of the whole. But the aggrieved party reinstates the contract if he accepts a nonconforming installment without seasonably notifying of cancellation or if he brings an action with respect only to past installments or demands performance as to future installments.
Sec. 2-613. Where the contract requires for its performance goods identified when the contract is made, and the goods suffer casualty without fault of either party before the risk of loss passes to the buyer, or in a proper case under a no arrival, no sale term (section 2-324) then:
(a) If the loss is total the contract is avoided; and
(b) If the loss is partial or the goods have so deteriorated as no longer to conform to the contract the buyer may nevertheless demand inspection and at his option either treat the contract as avoided or accept the goods with due allowance from the contract price for the deterioration or the deficiency in quality but without further right against the seller.
κ1965 Statutes of Nevada, Page 809 (CHAPTER 353, SB 15)κ
inspection and at his option either treat the contract as avoided or accept the goods with due allowance from the contract price for the deterioration or the deficiency in quality but without further right against the seller.
Sec. 2-614. 1. Where without fault of either party the agreed berthing, loading or unloading facilities fail or an agreed type of carrier becomes unavailable or the agreed manner of delivery otherwise becomes commercially impracticable but a commercially reasonable substitute is available, such substitute performance must be tendered and accepted.
2. If the agreed means or manner of payment fails because of domestic or foreign governmental regulation, the seller may withhold or stop delivery unless the buyer provides a means or manner of payment which is commercially a substantial equivalent. If delivery has already been taken, payment by the means or in the manner provided by the regulation discharges the buyers obligation unless the regulation is discriminatory, oppressive or predatory.
Sec. 2-615. Except so far as a seller may have assumed a greater obligation and subject to the preceding section on substituted performance:
1. Delay in delivery or nondelivery in whole or in part by a seller who complies with subsections 2 and 3 is not a breach of his duty under a contract for sale if performance as agreed has been made impracticable by the occurrence of a contingency the nonoccurrence of which was a basic assumption on which the contract was made or by compliance in good faith with any applicable foreign or domestic governmental regulation or order whether or not it later proves to be invalid.
2. Where the causes mentioned in subsection 1 affect only a part of the sellers capacity to perform, he must allocate production and deliveries among his customers but may at his option include regular customers not then under contract as well as his own requirements for further manufacture. He may so allocate in any manner which is fair and reasonable.
3. The seller must notify the buyer seasonably that there will be delay or nondelivery and, when allocation is required under subsection 2, of the estimate quota thus made available for the buyer.
Sec. 2-616. 1. Where the buyer receives notification of a material or indefinite delay or an allocation justified under the preceding section he may by written notification to the seller as to any delivery concerned, and where the prospective deficiency substantially impairs the value of the whole contract under the provisions of this article relating to breach of installment contracts (section 2-612), then also as to the whole:
(a) Terminate and thereby discharge any unexecuted portion of the contract; or
(b) Modify the contract by agreeing to take his available quota in substitution.
2. If after receipt of such notification from the seller the buyer fails so to modify the contract within a reasonable time not exceeding 30 days the contract lapses with respect to any deliveries affected.
κ1965 Statutes of Nevada, Page 810 (CHAPTER 353, SB 15)κ
3. The provisions of this section may not be negated by agreement except insofar as the seller has assumed a greater obligation under the preceding section.
part 7
remedies
Sec. 2-701. Remedies for breach of any obligation or promise collateral or ancillary to a contract for sale or not impaired by the provisions of this article.
Sec. 2-702. 1. Where the seller discovers the buyer to be insolvent he may refuse delivery except for cash including payment for all goods theretofore delivered under the contract, and stop delivery under this article (section 2-705).
2. Where the seller discovers that the buyer has received goods on credit while insolvent he may reclaim the goods upon demand made within 10 days after the receipt, but if misrepresentation of solvency has been made to the particular seller in writing within 3 months before delivery the 10-day limitation does not apply. Except as provided in this subsection the seller may not base a right to reclaim goods on the buyers fraudulent or innocent misrepresentation of solvency or of intent to pay.
3. The sellers right to reclaim under subsection 2 is subject to the rights of a buyer in ordinary course or other good faith purchaser or lien creditor under this article (section 2-403). Successful reclamation of goods excludes all other remedies with respect to them.
Sec. 2-703. Where the buyer wrongfully rejects or revokes acceptance of goods or fails to make a payment due on or before delivery or repudiates with respect to a part or the whole, then with respect to any goods directly affected and, if the breach is of the whole contract (section 2-612), then also with respect to the whole undelivered balance, the aggrieved seller may:
1. Withhold delivery of such goods.
2. Stop delivery by any bailee as hereafter provided (section 2-705).
3. Proceed under the next section respecting goods still unidentified to the contract.
4. Resell and recover damages as hereafter provided (section 2-706).
5. Recover damages for nonacceptance (section 2-708) or in a proper case the price (section 2-709).
6. Cancel.
Sec 2-704. 1. An aggrieved seller under the preceding section may:
(a) Identify to the contract conforming goods not already identified if at the time he learned of the breach they are in his possession or control.
(b) Treat as the subject of resale goods which have demonstrably been intended for the particular contract even though those goods are unfinished.
κ1965 Statutes of Nevada, Page 811 (CHAPTER 353, SB 15)κ
2. Where the goods are unfinished an aggrieved seller may in the exercise of reasonable commercial judgment for the purposes of avoiding loss and of effective realization either complete the manufacture and wholly identify the goods to the contract or cease manufacture and resell for scrap or salvage value or proceed in any other reasonable manner.
Sec. 2-705. 1. The seller may stop delivery of goods in the possession of a carrier or other bailee when he discovers the buyer to be insolvent (section 2-702) and may stop delivery of carload, truckload, planeload or larger shipments of express or freight when the buyer repudiates or fails to make a payment due before delivery or if for any other reason the seller has a right to withhold or reclaim the goods.
2. As against such buyer the seller may stop delivery until:
(a) Receipt of the goods by the buyer; or
(b) Acknowledgment to the buyer by any bailee of the goods except a carrier that the bailee holds the goods for the buyer; or
(c) Such acknowledgment to the buyer by a carrier by reshipment or as warehouseman; or
(d) Negotiation to the buyer of any negotiable document of title covering the goods.
3. (a) To stop delivery the seller must so notify as to enable the bailee by reasonable diligence to prevent delivery of the goods.
(b) After such notification the bailee must hold and deliver the goods according to the directions of the seller but the seller is liable to the bailee for any ensuing charges or damages.
(c) If a negotiable document of title has been issued for goods the bailee is not obliged to obey a notification to stop until surrender of the document.
(d) A carrier who has issued a nonnegotiable bill of lading is not obliged to obey a notification to stop received from a person other than the consignor.
Sec. 2-706. 1. Under the conditions stated in section 2-703 on sellers remedies, the seller may resell the goods concerned or the undelivered balance thereof. Where the resale is made in good faith and in a commercially reasonable manner the seller may recover the difference between the resale price and the contract price together with any incidental damages allowed under the provisions of this article (section 2-710), but less expenses saved in consequence of the buyers breach.
2. Except as otherwise provided in subsection 3 or unless otherwise agreed resale may be at public or private sale including sale by way of one or more contracts to sell or of identification to an existing contract of the seller. Sale may be as a unit or in parcels and at any time and place and on any terms but every aspect of the sale including the method, manner, time, place and terms must be commercially reasonable. The resale must be reasonably identified as referring to the broken contract, but it is not necessary that the goods be in existence or that any or all of them have been identified to the contract before the breach.
3. Where the resale is at private sale the seller must give the buyer reasonable notification of his intention to resell.
4. Where the resale is at public sale:
κ1965 Statutes of Nevada, Page 812 (CHAPTER 353, SB 15)κ
(a) Only identified goods can be sold except where there is a recognized market for a public sale of futures in goods of the kind; and
(b) It must be made at a usual place or market for public sale if one is reasonably available and except in the case of goods which are perishable or threaten to decline in value speedily the seller must give the buyer reasonable notice of the time and place of the resale; and
(c) If the goods are not to be within the view of those attending the sale the notification of sale must state the place where the goods are located and provide for their reasonable inspection by prospective bidders; and
(d) The seller may buy.
5. A purchaser who buys in good faith at a resale takes the goods free of any rights of the original buyer even though the seller fails to comply with one or more of the requirements of this section.
6. The seller is not accountable to the buyer for any profit made on any resale. A person in the position of a seller (section 2-707) or a buyer who has rightfully rejected or justifiably revoked acceptance must account for any excess over the amount of his security interest, as hereinafter defined (subsection 3 of section 2-711).
Sec. 2-707. 1. A person in the position of a seller includes as against a principal an agent who has paid or become responsible for the price of goods on behalf of his principal or anyone who otherwise holds a security interest or other right in goods similar to that of a seller.
2. A person in the position of a seller may as provided in this article withhold or stop delivery (section 2-705) and resell (section 2-706) and recover incidental damages (section 2-710).
Sec. 2-708. 1. Subject to subsection 2 and to the provisions of this article with respect to proof of market price (section 2-723), the measure of damages for nonacceptance or repudiation by the buyer is the difference between the market price at the time and place for tender and the unpaid contract price together with any incidental damages provided in this article (section 2-710), but less expenses saved in consequence of the buyers breach.
2. If the measure of damages provided in subsection 1 is inadequate to put the seller in as good a position as performance would have done then the measure of damages is the profit (including reasonable overhead) which the seller would have made from full performance by the buyer, together with any incidental damages provided in this article (section 2-710), due allowance for costs reasonably incurred and due credit for payments or proceeds of resale.
Sec. 2-709. 1. When the buyer fails to pay the price as it becomes due the seller may recover, together with any incidental damages under the next section, the price:
(a) Of goods accepted or of conforming goods lost or damaged within a commercially reasonable time after risk of their loss has passed to the buyer; and
(b) Of goods identified to the contract if the seller is unable after reasonable effort to resell them at a reasonable price or the circumstances reasonably indicate that such effort will be unavailing.
2. Where the seller sues for the price he must hold for the buyer any goods which have been identified to the contract and are still in his control except that if resale becomes possible he may resell them at any time prior to the collection of the judgment.
κ1965 Statutes of Nevada, Page 813 (CHAPTER 353, SB 15)κ
any goods which have been identified to the contract and are still in his control except that if resale becomes possible he may resell them at any time prior to the collection of the judgment. The net proceeds of any such resale must be credited to the buyer and payment of the judgment entitles him to any goods not resold.
3. After the buyer has wrongfully rejected or revoked acceptance of the goods or has failed to make a payment due or has repudiated (section 2-610), a seller who is held not entitled to the price under this section shall nevertheless be awarded damages for nonacceptance under the preceding section.
Sec. 2-710. Incidental damages to an aggrieved seller include any commercially reasonable charges, expenses or commissions incurred in stopping delivery, in the transportation, care and custody of goods after the buyers breach, in connection with return or resale of the goods or otherwise resulting from the breach.
Sec. 2-711. 1. Where the seller fails to make delivery or repudiates or the buyer rightfully rejects or justifiably revokes acceptance then with respect to any goods involved, and with respect to the whole if the breach goes to the whole contract (section 2-612), the buyer may cancel and whether or not he has done so may in addition to recovering so much of the price as has been paid:
(a) Cover and have damages under the next section as to all the goods affected whether or not they have been identified to the contract; or
(b) Recover damages for nondelivery as provided in this article (section 2-713).
2. Where the seller fails to deliver or repudiates the buyer may also:
(a) If the goods have been identified recover them as provided in this article (section 2-502); or
(b) In a proper case obtain specific performance or replevy the goods as provided in this article (section 2-716).
3. On rightful rejection or justifiable revocation of acceptance a buyer has a security interest in goods in his possession or control for any payments made on their price and any expenses reasonably incurred in their inspection, receipt, transportation, care and custody and may hold such goods and resell them in like manner as an aggrieved seller (section 2-706).
Sec. 2-712. 1. After a breach within the preceding section the buyer may cover by making in good faith and without unreasonable delay any reasonable purchase of or contract to purchase goods in substitution for those due from the seller.
2. The buyer may recover from the seller as damages the difference between the cost of cover and the contract price together with any incidental or consequential damages as hereinafter defined (section 2-715), but less expenses saved in consequence of the sellers breach.
3. Failure of the buyer to effect cover within this section does not bar him from any other remedy.
Sec. 2-713. 1. Subject to the provisions of this article with respect to proof of market price (section 2-723), the measure of damages for nondelivery or repudiation by the seller is the difference between the market price at the time when the buyer learned of the breach and the contract price together with any incidental and consequential damages provided in this article (section 2-715), but less expenses saved in consequence of the sellers breach.
κ1965 Statutes of Nevada, Page 814 (CHAPTER 353, SB 15)κ
market price at the time when the buyer learned of the breach and the contract price together with any incidental and consequential damages provided in this article (section 2-715), but less expenses saved in consequence of the sellers breach.
2. Market price is to be determined as of the place for tender or, in cases of rejection after arrival or revocation of acceptance, as of the place of arrival.
Sec. 2-714. 1. Where the buyer has accepted goods and given notification (subsection 3 of section 2-607) he may recover as damages for any nonconformity of tender the loss resulting in the ordinary course of events from the sellers breach as determined in any manner which is reasonable.
2. The measure of damages for breach of warranty is the difference at the time and place of acceptance between the value of the goods accepted and the value they would have had if they had been as warranted, unless special circumstances show proximate damages of a different amount.
3. In a proper case any incidental and consequential damages under the next section may also be recovered.
Sec. 2-715. 1. Incidental damages resulting from the sellers breach include expenses reasonably incurred in inspection, receipt, transportation and care and custody of goods rightfully rejected, any commercially reasonable charges, expenses or commissions in connection with effecting cover and any other reasonable expense incident to the delay or other breach.
2. Consequential damages resulting from the sellers breach include:
(a) Any loss resulting from general or particular requirements and needs of which the seller at the time of contracting had reason to know and which could not reasonably be prevented by cover or otherwise; and
(b) Injury to person or property proximately resulting from any breach of warranty.
Sec. 2-716. 1. Specific performance may be decreed where the goods are unique or in other proper circumstances.
2. The decree for specific performance may include such terms and conditions as to payment of the price, damages or other relief as the court may deem just.
3. The buyer has a right of replevin for goods identified to the contract if after reasonable effort he is unable to effect cover for such goods or the circumstances reasonably indicate that such effort will be unavailing or if the goods have been shipped under reservation and satisfaction of the security interest in them has been made or tendered.
Sec. 2-717. The buyer on notifying the seller of his intention to do so may deduct all or any part of the damages resulting from any breach of the contract from any part of the price still due under the same contract.
Sec. 2-718. 1. Damages from breach by either party may be liquidated in the agreement but only at an amount which is reasonable in the light of the anticipated or actual harm caused by the breach, the difficulties of proof of loss, and the inconvenience or nonfeasibility of otherwise obtaining an adequate remedy.
κ1965 Statutes of Nevada, Page 815 (CHAPTER 353, SB 15)κ
difficulties of proof of loss, and the inconvenience or nonfeasibility of otherwise obtaining an adequate remedy. A term fixing unreasonably large liquidated damages is void as a penalty.
2. Where the seller justifiably withholds delivery of goods because of the buyers breach, the buyer is entitled to restitution of any amount by which the sum of his payments exceeds:
(a) The amount to which the seller is entitled by virtue of terms liquidating the sellers damages in accordance with subsection 1; or
(b) In the absence of such terms, 20 percent of the value of the total performance for which the buyer is obligated under the contract or $500, whichever is smaller.
3. The buyers right to restitution under subsection 2 is subject to offset to the extent that the seller establishes:
(a) A right to recover damages under the provisions of this article other than subsection 1; and
(b) The amount or value of any benefits received by the buyer directly or indirectly by reason of the contract.
4. Where a seller has received payment in goods their reasonable value or the proceeds of their resale shall be treated as payments for the purposes of subsection 2; but if the seller has notice of the buyers breach before reselling goods received in part performance, his resale is subject to the conditions laid down in this article on resale by an aggrieved seller (section 2-706).
Sec. 2-719. 1. Subject to the provisions of subsections 2 and 3 of this section and of the preceding section on liquidation and limitation of damages:
(a) The agreement may provide for remedies in addition to or in substitution for those provided in this article and may limit or alter the measure of damages recoverable under this article, as by limiting the buyers remedies to return of the goods and repayment of the price or to repair and replacement of nonconforming goods or parts; and
(b) Resort to a remedy as provided is optional unless the remedy is expressly agreed to be exclusive, in which case it is the sole remedy.
2. Where circumstances cause an exclusive or limited remedy to fail of its essential purpose, remedy may be had as provided in this chapter.
3. Consequential damages may be limited or excluded unless the limitation or exclusion is unconscionable. Limitation of consequential damages for injury to the person in the case of consumer goods is prima facie unconscionable but limitation of damages where the loss is commercial is not.
Sec. 2-720. Unless the contrary intention clearly appears, expressions of cancellation or rescission of the contract or the like shall not be construed as a renunciation or discharge of any claim in damages for an antecedent breach.
Sec. 2-721. Remedies for material misrepresentation or fraud include all remedies available under this article for nonfraudulent breach. Neither rescission or a claim for rescission of the contract for sale nor rejection or return of the goods shall bar or be deemed inconsistent with a claim for damages or other remedy.
κ1965 Statutes of Nevada, Page 816 (CHAPTER 353, SB 15)κ
Sec. 2-722. Where a third party so deals with goods which have been identified to a contract for sale as to cause actionable injury to a party to that contract:
1. A right of action against the third party is in either party to the contract for sale who has title to or a security interest or a special property or an insurable interest in the goods; and if the goods have been destroyed or converted a right of action is also in the party who either bore the risk of loss under the contract for sale or has since the injury assumed that risk as against the other.
2. If at the time of the injury the party plaintiff did not bear the risk of loss as against the other party to the contract for sale and there is no arrangement between them for disposition of the recovery, his suit or settlement is, subject to his own interest, as a fiduciary for the other party to the contract.
3. Either party may with the consent of the other sue for the benefit of whom it may concern.
Sec. 2-723. 1. If an action based on anticipatory repudiation comes to trial before the time for performance with respect to some or all of the goods, any damages based on market price (section 2-708 or 2-713) shall be determined according to the price of such goods prevailing at the time when the aggrieved party learned of the repudiation.
2. If evidence of a price prevailing at the times or places described in this article is not readily available the price prevailing within any reasonable time before or after the time described or at any other place which in commercial judgment or under usage of trade would serve as a reasonable substitute for the one described may be used, making any proper allowance for the cost of transporting the goods to or from such other place.
3. Evidence of a relevant price prevailing at a time or place other than the one described in this article offered by one party is not admissible unless and until he has given the other party such notice as the court finds sufficient to prevent unfair surprise.
Sec. 2-724. Whenever the prevailing price or value of any goods regularly bought and sold in any established commodity market is in issue, reports in official publications or trade journals or in newspapers or periodicals of general circulation published as the reports of such market shall be admissible in evidence. The circumstances of the preparation of such a report may be shown to affect its weight but not its admissibility.
Sec. 2-725. 1. An action for breach of any contract for sale must be commenced within 4 years after the cause of action has accrued. By the original agreement the parties may reduce the period of limitation to not less than 1 year but may not extend it.
2. A cause of action accrues when the breach occurs, regardless of the aggrieved partys lack of knowledge of the breach. A breach of warranty occurs when tender of delivery is made, except that where a warranty explicitly extends to future performance of the goods and discovery of the breach must await the time of such performance the cause of action accrues when the breach is or should have been discovered.
κ1965 Statutes of Nevada, Page 817 (CHAPTER 353, SB 15)κ
3. Where an action commenced within the time limited by subsection 1 is so terminated as to leave available a remedy by another action for the same breach such other action may be commenced after the expiration of the time limited and within 6 months after the termination of the first action unless the termination resulted from voluntary discontinuance or from dismissal for failure or neglect to prosecute.
4. This section does not alter the law on tolling of the statute of limitations nor does it apply to causes of action which have accrued before this chapter becomes effective.
ARTICLE 3
COMMERCIAL PAPER
PART 1
SHORT TITLE, FORM AND INTERPRETATION
Sec. 3-101. This article shall be known and may be cited as Uniform Commercial Code-Commercial Paper.
Sec. 3-102. 1. In this article unless the context otherwise requires:
(a) Issue means the first delivery of an instrument to a holder or a remitter.
(b) An order is a direction to pay and must be more than an authorization or request. It must identify the person to pay with reasonable certainty. It may be addressed to one or more such persons jointly or in the alternative but not in succession.
(c) A promise is an undertaking to pay and must be more than an acknowledgment of an obligation.
(d) Secondary party means a drawer or endorser.
(e) Instrument means a negotiable instrument.
2. Other definitions applying to this article and the sections in which they appear are:
Acceptance. Section 3-410.
Accommodation party. Section 3-415.
Alteration. Section 3-407.
Certificate of deposit. Section 3-104.
Certification. Section 3-411.
Check. Section 3-104.
Definite time. Section 3-109.
Dishonor. Section 3-507.
Draft. Section 3-104.
Holder in due course. Section 3-302.
Negotiation. Section 3-202.
Note. Section 3-104.
Notice of dishonor. Section 3-508.
On demand. Section 3-108.
Presentment. Section 3-504.
Protest. Section 3-509.
κ1965 Statutes of Nevada, Page 818 (CHAPTER 353, SB 15)κ
Restrictive endorsement. Section 3-205.
Signature. Section 3-401.
3. The following definitions in other articles apply to this article:
Account. Section 4-104.
Banking Day. Section 4-104.
Clearing house. Section 4-104.
Collecting bank. Section 4-105.
Customer. Section 4-104.
Depository Bank. Section 4-105.
Documentary Draft. Section 4-104
Intermediary Bank. Section 4-105.
Item. Section 4-104.
Midnight deadline. Section 4-104.
Payor bank. Section 4-105.
4. In addition article 1 contains general definitions and principles of construction and interpretation applicable throughout this article.
Sec. 3-103. 1. This article does not apply to money, documents of title or investment securities.
2. The provisions of this article are subject to the provisions of the article on bank deposits and collections (article 4) and secured transactions (article 9).
Sec. 3-104. 1. Any writing to be a negotiable instrument within this article must:
(a) Be signed by the maker or drawer; and
(b) Contain an unconditional promise or order to pay a sum certain in money and no other promise, order, obligation or power given by the maker or drawer except as authorized by this article; and
(c) Be payable on demand or at a definite time; and
(d) Be payable to order or to bearer.
2. A writing which complies with the requirements of this section is:
(a) A draft (bill of exchange) if it is an order.
(b) A check if it is a draft drawn on a bank and payable on demand.
(c) A certificate of deposit if it is an acknowledgment by a bank of receipt of money with an engagement to repay it.
(d) A note if it is a promise other than a certificate of deposit.
3. As used in other articles of this chapter, and as the context may require, the terms draft, check, certificate of deposit and note may refer to instruments which are not negotiable within this article as well as to instruments which are so negotiable.
Sec. 3-105. 1. A promise or order otherwise unconditional is not made conditional by the fact that the instrument:
(a) Is subject to implied or constructive conditions; or
(b) States its consideration, whether performed or promised, or the transaction which gave rise to the instrument, or that the promise or order is made or the instrument matures in accordance with or as per such transaction; or
(c) Refers to or states that it arises out of a separate agreement or refers to a separate agreement for rights as to prepayment or acceleration; or
κ1965 Statutes of Nevada, Page 819 (CHAPTER 353, SB 15)κ
refers to a separate agreement for rights as to prepayment or acceleration; or
(d) States that it is drawn under a letter of credit; or
(e) States that it is secured, whether by mortgage, reservation of title or otherwise; or
(f) Indicates a particular account to be debited or any other fund or source from which reimbursement is expected; or
(g) Is limited to payment out of a particular fund or the proceeds of a particular source, if the instrument is issued by a government or governmental agency or unit; or
(h) Is limited to payment out of the entire assets of a partnership, unincorporated association, trust or estate by or on behalf of which the instrument is issued.
2. A promise or order is not unconditional if the instrument:
(a) States that it is subject to or governed by any other agreement; or
(b) States that it is to be paid only out of a particular fund or source except as provided in this section.
Sec. 3-106. 1. The sum payable is a sum certain even though it is to be paid:
(a) With stated interest or by stated installments; or
(b) With stated different rates of interest before and after default or a specified date; or
(c) With a stated discount or addition if paid before or after the date fixed for payment; or
(d) With exchange or less exchange, whether at a fixed rate or at the current rate; or
(e) With costs of collection or an attorneys fee or both upon default.
2. Nothing in this section shall validate any term which is otherwise illegal.
Sec. 3-107. 1. An instrument is payable in money if the medium of exchange in which it is payable is money at the time the instrument is made. An instrument payable in currency or current funds is payable in money.
2. A promise or order to pay a sum stated in a foreign currency is for a sum certain in money and, unless a different medium of payment is specified in the instrument, may be satisfied by payment of that number of dollars which the stated foreign currency will purchase at the buying sight rate for that currency on the day on which the instrument is payable or, if payable on demand, on the day of demand. If such an instrument specifies a foreign currency as the medium of payment the instrument is payable in that currency.
Sec. 3-108. Instruments payable on demand include those payable at sight or on presentation and those in which no time for payment is stated.
Sec. 3-109. 1. An instrument is payable at a definite time if by its terms it is payable:
(a) On or before a stated date or at a fixed period after a stated date; or
(b) At a fixed period after sight; or
(c) At a definite time subject to any acceleration; or
κ1965 Statutes of Nevada, Page 820 (CHAPTER 353, SB 15)κ
(d) At a definite time subject to extension at the option of the holder, or to extension to a further definite time at the option of the maker or acceptor or automatically upon or after a specified act or event.
2. An instrument which by its terms is otherwise payable only upon an act or even uncertain as to time of occurrence is not payable at a definite time even though the act or event has occurred.
Sec. 3-110. 1. An instrument is payable to order when by its terms it is payable to the order or assigns of any person therein specified with reasonable certainty, or to him or his order, or when it is conspicuously designated on its face as exchange or the like and names a payee. It may be payable to the order of:
(a) The maker or drawer; or
(b) The drawee; or
(c) A payee who is not maker, drawer or drawee; or
(d) Two or more payees together or in the alternative; or
(e) An estate, trust or fund, in which case it is payable to the order of the representative of such estate, trust or fund or his successors; or
(f) An office, or an officer by his title as such, in which case it is payable to the principal, but the incumbent of the office or his successors may act as if he or they were the holder; or
(g) A partnership or unincorporated association, in which case it is payable to the partnership or association and may be endorsed or transferred by any person thereto authorized.
2. An instrument not payable to order is not made so payable by such words as payable upon return of this instrument properly endorsed.
3. An instrument made payable both to order and to bearer is payable to order unless the bearer words are handwritten or typewritten.
Sec. 3-111. An instrument is payable to bearer when by its terms it is payable to:
1. Bearer or the order of bearer; or
2. A specified person or bearer; or
3. Cash or the order of cash, or any other indication which does not purport to designate a specific payee.
Sec. 3-112. 1. The negotiability of an instrument is not affected by:
(a) The omission of a statement of any consideration or of the place where the instrument is drawn or payable; or
(b) A statement that collateral has been given to secure obligations either on the instrument or otherwise of an obligor on the instrument or that in case of default on those obligations the holder may realize on or dispose of the collateral; or
(c) A promise or power to maintain or protect collateral or to give additional collateral; or
(d) A term authorizing a confession of judgment on the instrument if it is not paid when due; or
(e) A term purporting to waive the benefit of any law intended for the advantage or protection of any obligor; or
(f) A term in a draft providing that the payee by endorsing or cashing it acknowledges full satisfaction of an obligation of the drawer; or
κ1965 Statutes of Nevada, Page 821 (CHAPTER 353, SB 15)κ
cashing it acknowledges full satisfaction of an obligation of the drawer; or
(g) A statement in a draft drawn in a set of parts (section 3-801) to the effect that the order is effective only if no other part has been honored.
2. Nothing in this section shall validate any term which is otherwise illegal.
Sec. 3-113. An instrument otherwise negotiable is within this article even though it is under a seal.
Sec. 3-114. 1. The negotiability of an instrument is not affected by the fact that it is undated, antedated or postdated.
2. Where an instrument in antedated or postdated the time when it is payable is determined by the stated date if the instrument is payable on demand or at a fixed period after date.
3. Where the instrument or any signature thereon is dated, the date is presumed to be correct.
Sec. 3-115. 1. When a paper whose contents at the time of signing show that it is intended to become an instrument is signed while still incomplete in any necessary respect it cannot be enforced until completed, but when it is completed in accordance with authority given it is effective as completed.
2. If the completion is unauthorized the rules as to material alteration apply (section 3-407), even though the paper was not delivered by the maker or drawer; but the burden of establishing that any completion is unauthorized is on the party so asserting.
Sec. 3-116. An instrument payable to the order of two or more persons:
1. If in the alternative is payable to any one of them and may be negotiated, discharged or enforced by any of them who has possession of it.
2. If not in the alternative is payable to all of them and may be negotiated, discharged or enforced only by all of them.
Sec. 3-117. An instrument made payable to a named person with the addition of words describing him:
1. As agent of officer of a specified person is payable to his principal but the agent or officer may act as if he were the holder.
2. As any other fiduciary for a specified person or purpose is payable to the payee and may be negotiated, discharged or enforced by him.
3. In any other manner is payable to the payee unconditionally and the additional words are without effect on subsequent parties.
Sec. 3-118. The following rules apply to every instrument:
1. Where there is doubt whether the instrument is a draft or a note the holder may treat it as either. A draft drawn on the drawer is effective as a note.
2. Handwritten terms control typewritten and printed terms, and typewritten control printed.
3. Words control figures except that if the words are ambiguous figures control.
4. Unless otherwise specified a provision for interest means interest at the judgment rate at the place of payment from the date of the instrument, or if it is undated from the date of issue.
κ1965 Statutes of Nevada, Page 822 (CHAPTER 353, SB 15)κ
at the judgment rate at the place of payment from the date of the instrument, or if it is undated from the date of issue.
5. Unless the instrument otherwise specifies two or more persons who sign as maker, acceptor or drawer or endorser and as a part of the same transaction are jointly and severally liable even though the instrument contains such words as I promise to pay.
6. Unless otherwise specified consent to extension authorizes a single extension for not longer than the original period. A consent to extension, expressed in the instrument, is binding on secondary parties and accommodation makers. A holder may not exercise his option to extend an instrument over the objection of a maker or acceptor or other party who in accordance with section 3-604 tenders full payment when the instrument is due.
Sec. 3-119. 1. As between the obligor and his immediate obligee or any transferee the terms of an instrument may be modified or affected by any other written agreement executed as a part of the same transaction, except that a holder in due course is not affected by any limitation of his rights arising out of the separate written agreement if he had no notice of the limitation when he took the instrument.
2. A separate agreement does not affect the negotiability of an instrument.
Sec. 3-120. An instrument which states that it is payable through a bank or the like designates that bank as a collecting bank to make presentment but does not of itself authorize the bank to pay the instrument.
Sec. 3-121. A note or acceptance which states that it is payable at a bank is the equivalent of a draft drawn on the bank payable when it falls due out of any funds of the maker or acceptor in current account or otherwise available for such payment.
Sec. 3-122. 1. A cause of action against a maker or an acceptor accrues:
(a) In the case of a time instrument on the day after maturity.
(b) In the case of a demand instrument upon its date or, if no date is stated, on the date of issue.
2. A cause of action against the obligor of a demand or time certificate of deposit accrues upon demand, but demand on a time certificate may not be made until on or after the date of maturity.
3. A cause of action against a drawer of a draft or an endorser of any instrument accrues upon demand following dishonor of the instrument. Notice of dishonor is a demand.
4. Unless an instrument provides otherwise, interest runs at the rate provided by law for a judgment:
(a) In the case of a maker, acceptor or other primary obligor of a demand instrument, from the date of demand.
(b) In all other cases from the date of accrual of the cause of action.
κ1965 Statutes of Nevada, Page 823 (CHAPTER 353, SB 15)κ
part 2
transfer and negotiations
Sec. 3-201. 1. Transfer of an instrument vests in the transferee such rights as the transferor has therein, except that a transferee who has himself been a party to any fraud or illegality affecting the instrument or who as a prior holder had notice of a defense or claim against it cannot improve his position by taking from a later holder in due course.
2. A transfer of a security interest in an instrument vests the foregoing rights in the transferee to the extent of the interest transferred.
3. Unless otherwise agreed any transfer for value of an instrument not then payable to bearer gives the transferee the specifically enforcible right to have the unqualified endorsement of the transferor. Negotiation takes effect only when the endorsement is made and until that time there is no presumption that the transferee is the owner.
Sec. 3-202. 1. Negotiation is the transfer of an instrument in such form that the transferee becomes a holder. If the instrument is payable to order it is negotiated by delivery with any necessary endorsement; if payable to bearer it is negotiated by delivery.
2. An endorsement must be written by or on behalf of the holder and on the instrument or on a paper so firmly affixed thereto as to become a part thereof.
3. An endorsement is effective for negotiation only when it conveys the entire instrument or any unpaid residue. If it purports to be of less it operates only as a partial assignment.
4. Words of assignment, condition, waiver, guaranty, limitation or disclaimer of liability and the like accompanying an endorsement do not affect its character as an endorsement.
Sec. 3-203. Where an instrument is made payable to a person under a misspelled name or one other than his own he may endorse in that name or his own or both; but signature in both names may be required by a person paying or giving value for the instrument.
Sec. 3-204. 1. A special endorsement specifies the person to whom or to whose order it makes the instrument payable. Any instrument specially endorsed becomes payable to the order of the special endorsee and may be further negotiated only by his endorsement.
2. An endorsement in blank specifies no particular endorsee and may consist of a mere signature. An instrument payable to order and endorsed in blank becomes payable to bearer and may be negotiated by delivery alone until specially endorsed.
3. The holder may convert a blank endorsement into a special endorsement by writing over the signature of the endorser in blank any contract consistent with the character of the endorsement.
Sec. 3-205. An endorsement is restrictive which either:
1. Is conditional; or
2. Purports to prohibit further transfer of the instrument; or
3. Includes the words for collection, for deposit, pay any bank, or like terms signifying a purpose of deposit or collection; or
κ1965 Statutes of Nevada, Page 824 (CHAPTER 353, SB 15)κ
4. Otherwise states that it is for the benefit or use of the endorser or of another person.
Sec. 3-206. 1. No restrictive endorsement prevents further transfer or negotiation of the instrument.
2. An intermediary bank, or a payor bank which is not the depositary bank, is neither given notice nor otherwise affected by a restrictive endorsement of any person except the banks immediate transferor or the person presenting for payment.
3. Except for an intermediary bank, any transferee under an endorsement which is conditional or includes the words for collection, for deposit, pay any bank, or like terms (subsections 1 and 3 of section 3-205) must pay or apply any value given by him for or on the security of the instrument consistently with the endorsement and to the extent that he does so he becomes a holder for value. In addition such transferee is a holder in due course if he otherwise complies with the requirements of section 3-302 on what constitutes a holder in due course.
4. The first taker under an endorsement for the benefit of the endorser or another person (subsection 4 of section 3-205) must pay or apply any value given by him for or on the security of the instrument consistently with the endorsement and to the extent that he does so he becomes a holder for value. In addition such taker is a holder in due course if he otherwise complies with the requirements of section 3-302 on what constitutes a holder in due course. A later holder for value is neither given notice nor otherwise affected by such restrictive endorsement unless he has knowledge that a fiduciary or other person has negotiated the instrument in any transaction for his own benefit or otherwise in breach of duty (subsection 2 of section 3-304).
Sec. 3-207. 1. Negotiation is effective to transfer the instrument although the negotiation is:
(a) Made by an infant, a corporation exceeding its powers, or any other person without capacity; or
(b) Obtained by fraud, duress or mistake of any kind; or
(c) Part of an illegal transaction; or
(d) Made in breach of duty.
2. Except as against a subsequent holder in due course such negotiation is in an appropriate case subject to rescission, the declaration of a constructive trust or any other remedy permitted by law.
Sec. 3-208. Where an instrument is returned to or reacquired by a prior party he may cancel any endorsement which is not necessary to his title and reissue or further negotiate the instrument, but any intervening party is discharged as against the reacquiring party and subsequent holders not in due course and if his endorsement has been canceled is discharged as against subsequent holders in due course as well.
κ1965 Statutes of Nevada, Page 825 (CHAPTER 353, SB 15)κ
part 3
rights of a holder
Sec. 3-301. The holder of an instrument, whether or not he is the owner, may transfer or negotiate it and, except as otherwise provided in section 3-603 on payment or satisfaction, discharge it or enforce payment in his own name.
Sec. 3-302. 1. A holder in due course is a holder who takes the instrument:
(a) For value; and
(b) In good faith; and
(c) Without notice that it is overdue or has been dishonored or of any defense against or claim to it on the part of any person.
2. A payee may be a holder in due course.
3. A holder does not become a holder in due course of an instrument:
(a) By purchase of it at judicial sale or by taking it under legal process; or
(b) By acquiring it in taking over an estate; or
(c) By purchasing it as part of a bulk transaction not in regular course of business of the transferor.
4. A purchaser of a limited interest can be a holder in due course only to the extent of the interest purchased.
Sec. 3-303. A holder takes the instrument for value:
1. To the extent that the agreed consideration has been performed or that he acquires a security interest in or a lien on the instrument otherwise than by legal process; or
2. When he takes the instrument in payment of or as security for an antecedent claim against any person whether or not the claim is due; or
3. When he gives a negotiable instrument for it or makes an irrevocable commitment to a third person.
Sec. 3-304. 1. The purchaser has notice of a claim or defense if:
(a) The instrument is so incomplete, bears such visible evidence of forgery or alteration, or is otherwise so irregular as to call into question its validity, terms or ownership or to create an ambiguity as to the party to pay; or
(b) The purchaser has notice that the obligation of any party is voidable in whole or in part, or that all parties have been discharged.
2. The purchaser has notice of a claim against the instrument when he has knowledge that a fiduciary has negotiated the instrument in payment of or as security for his own debt or in any transaction for his own benefit or otherwise in breach of duty.
3. The purchaser has notice that an instrument is overdue if he has reason to know:
(a) That any part of the principal amount is overdue or that there is an uncured default in payment of another instrument of the same series; or
(b) That acceleration of the instrument has been made; or
(c) That he is taking a demand instrument after demand has been made or more than a reasonable length of time after its issue.
κ1965 Statutes of Nevada, Page 826 (CHAPTER 353, SB 15)κ
made or more than a reasonable length of time after its issue. A reasonable time for a check drawn and payable within the states and territories of the United States and the District of Columbia is presumed to be 30 days.
4. Knowledge of the following facts does not of itself give the purchaser notice of a defense or claim:
(a) That the instrument is antedated or postdated.
(b) That it was issued or negotiated in return for an executory promise or accompanied by a separate agreement, unless the purchaser has notice that a defense or claim has arisen from the terms thereof.
(c) That any party has signed for accommodation.
(d) That an incomplete instrument has been completed, unless the purchaser has notice of any improper completion.
(e) That any person negotiating the instrument is or was a fiduciary.
(f) That there has been default in payment of interest on the instrument or in payment of any other instrument, except one of the same series.
5. The filing or recording of a document does not of itself constitute notice within the provisions of this article to a person who would otherwise be a holder in due course.
6. To be effective notice must be received at such time and in such manner as to give a reasonable opportunity to act on it.
Sec. 3-305. To the extent that a holder is a holder in due course he takes the instrument free from:
1. All claims to it on the part of any person; and
2. All defenses of any party to the instrument with whom the holder has not dealt except:
(a) Infancy, to the extent that it is a defense to a simple contract; and
(b) Such other incapacities, or duress, or illegality of the transaction, as renders the obligation of the party a nullity; and
(c) Such misrepresentation as has induced the party to sign the instrument with neither knowledge nor reasonable opportunity to obtain knowledge of its character or its essential terms; and
(d) Discharge in insolvency proceedings; and
(e) Any other discharge of which the holder has notice when he takes the instrument.
Sec. 3-306. Unless he has the rights of a holder in due course any person takes the instrument subject to:
1. All valid claims to it on the part of any person; and
2. All defenses of any party which would be available in an action on a simple contract; and
3. The defenses of want or failure of consideration, nonperformance or any condition precedent, nondelivery, or delivery for a special purpose (section 3-408); and
4. The defense that he or a person through whom he holds the instrument acquired it by theft, or that payment or satisfaction to such holder would be inconsistent with the terms of a restrictive endorsement. The claim of any third person to the instrument is not otherwise available as a defense to any party liable thereon unless the third person himself defends the action for such party.
κ1965 Statutes of Nevada, Page 827 (CHAPTER 353, SB 15)κ
otherwise available as a defense to any party liable thereon unless the third person himself defends the action for such party.
Sec. 3-307. 1. Unless specifically denied in the pleadings each signature on an instrument is admitted. When the effectiveness of a signature is put in issue:
(a) The burden of establishing it is on the party claiming under the signature; but
(b) The signature is presumed to be genuine or authorized except where the action is to enforce the obligation of a purported signer who has died or become incompetent before proof is required.
2. When signatures are admitted or established, production of the instrument entitles a holder to recover on it unless the defendant establishes a defense.
3. After it is shown that a defense exists a person claiming the rights of a holder in due course has the burden of establishing that he or some person under whom he claims is in all respects a holder in due course.
part 4
liability of parties
Sec. 3-401. 1. No person is liable on an instrument unless his signature appears thereon.
2. A signature is made by use of any name, including any trade or assumed name, upon an instrument, or by any word or mark used in lieu of a written signature.
Sec. 3-402. Unless the instrument clearly indicates that a signature is made in some other capacity it is an endorsement.
Sec. 3-403. 1. A signature may be made by an agent or other representative, and his authority to make it may be established as in other cases of representation. No particular form of appointment is necessary to establish such authority.
2. An authorized representative who signs his own name to an instrument:
(a) Is personally obligated if the instrument neither names the person represented nor shows that the representative signed in a representative capacity.
(b) Except as otherwise established between the immediate parties, is personally obligated if the instrument names the person represented but does not show that the representative signed in a representative capacity, or if the instrument does not name the person represented but does show that the representative signed in a representative capacity.
3. Except as otherwise established the name of an organization preceded or followed by the name and office of an authorized individual is a signature made in a representative capacity.
Sec. 3-404. 1. Any unauthorized signature is wholly inoperative as that of the person whose name is signed unless he ratifies it or is precluded from denying it; but it operates as the signature of the unauthorized signer in favor of any person who in good faith pays the instrument or takes it for value.
κ1965 Statutes of Nevada, Page 828 (CHAPTER 353, SB 15)κ
unauthorized signer in favor of any person who in good faith pays the instrument or takes it for value.
2. Any unauthorized signature may be ratified for all purposes of this article. Such ratification does not of itself affect any rights of the person ratifying against the actual signer.
Sec. 3-405. 1. An endorsement by any person in the name of a named payee is effective if:
(a) An imposter by use of the mails or otherwise has induced the maker or drawer to issue the instrument to him or his confederate in the name of the payee; or
(b) A person signing as or on behalf of a maker or drawer intends the payee to have no interest in the instrument; or
(c) An agent or employee of the maker or drawer has supplied him with the name of the payee intending the latter to have no such interest.
2. Nothing in this section shall affect the criminal or civil liability of the person so endorsing.
Sec. 3-406. Any person who by his negligence substantially contributes to a material alteration of the instrument or to the making of an unauthorized signature is precluded from asserting the alteration or lack of authority against a holder in due course or against a drawee or other payor who pays the instrument in good faith and in accordance with the reasonable commercial standards of the drawees or payors business.
Sec. 3-407. 1. Any alteration of an instrument is material which changes the contract of any party thereto in any respect, including any such change in:
(a) The number or relations of the parties; or
(b) An incomplete instrument, by completing it otherwise than as authorized; or
(c) The writing as signed, by adding to it or by removing any part of it.
2. As against any person other than a subsequent holder in due course:
(a) Alteration by the holder which is both fraudulent and material discharges any party whose contract is thereby changed unless that party assents or is precluded from asserting the defense.
(b) No other alteration discharges any party and the instrument may be enforced according to its original tenor, or as to incomplete instruments according to the authority given.
3. A subsequent holder in due course may in all cases enforce the instrument according to its original tenor, and when an incomplete instrument has been completed, he may enforce it as completed.
Sec. 3-408. Want or failure of consideration is a defense as against any person not having the rights of a holder in due course (section 3-305), except that no consideration is necessary for an instrument or obligation thereon given in payment of or as security for an antecedent obligation of any kind. Nothing in this section shall be taken to displace any statute outside this chapter under which a promise is enforcible notwithstanding lack or failure of consideration. Partial failure of consideration is a defense pro tanto whether or not the failure is in an ascertained or liquidated amount.
κ1965 Statutes of Nevada, Page 829 (CHAPTER 353, SB 15)κ
Sec. 3-409. 1. A check or other draft does not of itself operate as an assignment of any funds in the hands of the drawee available for its payment, and the drawee is not liable on the instrument until he accepts it.
2. Nothing in this section shall affect any liability in contract, tort or otherwise arising from any letter of credit or other obligation or representation which is not an acceptance.
Sec. 3-410. 1. Acceptance is the drawees signed engagement to honor the draft as presented. It must be written on the draft, and may consist of his signature alone. It becomes operative when completed by delivery or notification.
2. A draft may be accepted although it has not been signed by the drawer or is otherwise incomplete or is overdue or has been dishonored.
3. Where the draft is payable at a fixed period after sight and the acceptor fails to date his acceptance the holder may complete it by supplying a date in good faith.
Sec. 3-411. 1. Certification of a check is acceptance. Where a holder procures certification the drawer and all prior endorsers are discharged.
2. Unless otherwise agreed a bank has no obligation to certify a check.
3. A bank may certify a check before returning it for lack of proper endorsement. If it does so the drawer is discharged.
Sec. 3-412. 1. Where the drawees proffered acceptance in any manner varies the draft as presented the holder may refuse the acceptance and treat the draft as dishonored in which case the drawee is entitled to have his acceptance canceled.
2. The terms of the draft are not varied by an acceptance to pay at any particular bank or place in the United States, unless the acceptance states that the draft is to be paid only at such bank or place.
3. Where the holder assents to an acceptance varying the terms of the draft each drawer and endorser who does not affirmatively assent is discharged.
Sec. 3-413. 1. The maker or acceptor engages that he will pay the instrument according to its tenor at the time of his engagement or as completed pursuant to section 3-115 on incomplete instruments.
2. The drawer engages that upon dishonor of the draft and any necessary notice of dishonor or protest he will pay the amount of the draft to the holder or to any endorser who takes it up. The drawer may disclaim this liability by drawing without recourse.
3. By making, drawing or accepting the party admits as against all subsequent parties including the drawee the existence of the payee and his then capacity to endorse.
Sec. 3-414. 1. Unless the endorsement otherwise specifies (as by such words as without recourse) every endorser engages that upon dishonor and any necessary notice of dishonor and protest he will pay the instrument according to its tenor at the time of his endorsement to the holder or to any subsequent endorser who takes it up, even though the endorser who takes it up was not obligated to do so.
2. Unless they otherwise agree endorsers are liable to one another in the order in which they endorse, which is presumed to be the order in which their signatures appear on the instrument.
κ1965 Statutes of Nevada, Page 830 (CHAPTER 353, SB 15)κ
in the order in which they endorse, which is presumed to be the order in which their signatures appear on the instrument.
Sec. 3-415. 1. An accommodation party is one who signs the instrument in any capacity for the purpose of lending his name to another party to it.
2. When the instrument has been taken for value before it is due the accommodation party is liable in the capacity in which he has signed even though the taker knows of the accommodation.
3. As against a holder in due course and without notice of the accommodation oral proof of the accommodation is not admissible to give the accommodation party the benefit of discharges dependent on his character as such. In other cases the accommodation character may be shown by oral proof.
4. An endorsement which shows that it is not in the chain of title is notice of its accommodation character.
5. An accommodation party is not liable to the party accommodated, and if he pays the instrument has a right of recourse on the instrument against such party.
Sec. 3-416. 1. Payment guaranteed or equivalent words added to a signature mean that the signer engages that if the instrument is not paid when due he will pay it according to its tenor without resort by the holder to any other party.
2. Collection guaranteed or equivalent words added to a signature mean that the signer engages that if the instrument is not paid when due he will pay it according to its tenor, but only after the holder has reduced his claim against the maker or acceptor to judgment and execution has been returned unsatisfied, or after the maker or acceptor has become insolvent or it is otherwise apparent that it is useless to proceed against him.
3. Words of guaranty which do not otherwise specify guarantee payment.
4. No words of guaranty added to the signature of a sole maker or acceptor affect his liability on the instrument. Such words added to the signature of one of two or more makers or acceptors create a presumption that the signature is for the accommodation of the others.
5. When words of guaranty are used presentment, notice of dishonor and protest are not necessary to charge the user.
6. Any guaranty written on the instrument is enforcible notwithstanding any statute of frauds.
Sec. 3-417. 1. Any person who obtains payment or acceptance and any prior transferor warrants to a person who in good faith pays or accepts that:
(a) He has a good title to the instrument or is authorized to obtain payment or acceptance on behalf of one who has a good title; and
(b) He has no knowledge that the signature of the maker or drawer is unauthorized, except that this warranty is not given by a holder in due course acting in good faith:
(1) To a maker with respect to the makers own signature; or
(2) To a drawer with respect to the drawers own signature, whether or not the drawer is also the drawee; or
κ1965 Statutes of Nevada, Page 831 (CHAPTER 353, SB 15)κ
(3) To an acceptor of a draft if the holder in due course took the draft after the acceptance or obtained the acceptance without knowledge that the drawers signature was unauthorized; and
(c) The instrument has not been materially altered, except that this warranty is not given by a holder in due course acting in good faith:
(1) To the maker of a note; or
(2) To the drawer of a draft whether or not the drawer is also the drawee; or
(3) To the acceptor of a draft with respect to an alteration made prior to the acceptance if the holder in due course took the draft after the acceptance, even though the acceptance provided payable as originally drawn or equivalent terms; or
(4) To the acceptor of a draft with respect to an alteration made after the acceptance.
2. Any person who transfers an instrument and receives consideration warrants to his transferee and if the transfer is by endorsement to any subsequent holder who takes the instrument in good faith that:
(a) He has a good title to the instrument or is authorized to obtain payment or acceptance on behalf of one who has a good title and the transfer is otherwise rightful; and
(b) All signatures are genuine or authorized; and
(c) The instrument has not been materially altered; and
(d) No defense of any party is good against him; and
(e) He has no knowledge of any insolvency proceeding instituted with respect to the maker or acceptor or the drawer of an unaccepted instrument.
3. By transferring without recourse the transferor limits the obligation stated in paragraph (d) of subsection 2 to a warranty that he has no knowledge of such a defense.
4. A selling agent or broker who does not disclose the fact that he is acting only as such gives the warranties provided in this section, but if he makes such disclosure warrants only his good faith and authority.
Sec. 3-418. Except for recovery of bank payments as provided in the article on bank deposits and collections (article 4) and except for liability for breach of warranty on presentment under the preceding section, payment or acceptance of any instrument is final in favor of a holder in due course, or a person who has in good faith changed his position in reliance on the payment.
Sec. 3-419. 1. An instrument is converted when:
(a) A drawee to whom it is delivered for acceptance refuses to return it on demand; or
(b) Any person to whom it is delivered for payment refuses on demand either to pay or to return it; or
(c) It is paid on a forged endorsement.
2. In an action against a drawee under subsection 1 the measure of the drawees liability is the face amount of the instrument. In any other action under subsection 1 the measure of liability is presumed to be the face amount of the instrument.
3. Subject to the provisions of this chapter concerning restrictive endorsements a representative, including a depositary or collecting bank, who has in good faith and in accordance with the reasonable commercial standards applicable to the business of such representative dealt with an instrument or its proceeds on behalf of one who was not the true owner is not liable in conversion or otherwise to the true owner beyond the amount of any proceeds remaining in his hands.
κ1965 Statutes of Nevada, Page 832 (CHAPTER 353, SB 15)κ
bank, who has in good faith and in accordance with the reasonable commercial standards applicable to the business of such representative dealt with an instrument or its proceeds on behalf of one who was not the true owner is not liable in conversion or otherwise to the true owner beyond the amount of any proceeds remaining in his hands.
4. An intermediary bank or payor bank which is not a depositary bank is not liable in conversion solely by reason of the fact that proceeds of an item endorsed restrictively (sections 3-205 and 3-206) are not paid or applied consistently with the restrictive endorsement of an endorser other than its immediate transferor.
part 5
presentment, notice of dishonor and protest
Sec. 3-501. 1. Unless excused (section 3-511) presentment is necessary to charge secondary parties as follows:
(a) Presentment for acceptance is necessary to charge the drawer and endorsers of a draft where the draft so provides, or is payable elsewhere than at the residence or place of business of the drawee, or its date of payment depends upon such presentment. The holder may at his option present for acceptance any other draft payable at a stated date.
(b) Presentment for payment is necessary to charge any endorser.
(c) In the case of any drawer, the acceptor of a draft payable at a bank or the maker of a note payable at a bank, presentment for payment is necessary, but failure to make presentment discharges such drawer, acceptor or maker only as stated in paragraph (b) of subsection 1 of section 3-502.
2. Unless excused (section 3-511):
(a) Notice of any dishonor is necessary to charge any endorser.
(b) In the case of any drawer, the acceptor of a draft payable at a bank or the maker of a note payable at a bank, notice of any dishonor is necessary, but failure to give such notice discharges such drawer, acceptor or maker only as stated in paragraph (b) of subsection 1 of section 3-502.
3. Unless excused (section 3-511) protest of any dishonor is necessary to charge the drawer and endorsers of any draft which on its face appears to be drawn or payable outside of the states and territories of the United States and the District of Columbia. The holder may at his option make protest of any dishonor of any other instrument and in the case of a foreign draft may on insolvency of the acceptor before maturity make protest for better security.
4. Notwithstanding any provision of this section, neither presentment nor notice of dishonor nor protest is necessary to charge an endorser who has endorsed an instrument after maturity.
Sec. 3-502. 1. Where without excuse any necessary presentment or notice of dishonor is delayed beyond the time when it is due:
(a) Any endorser is discharged; and
(b) Any drawer or the acceptor of a draft payable at a bank or the maker of a note payable at a bank who because the drawee or payor bank becomes insolvent during the delay is deprived of funds maintained with the drawee or payor bank to cover the instrument may discharge his liability by written assignment to the holder of his rights against the drawee or payor bank in respect of such funds, but such drawer, acceptor or maker is not otherwise discharged.
κ1965 Statutes of Nevada, Page 833 (CHAPTER 353, SB 15)κ
maker of a note payable at a bank who because the drawee or payor bank becomes insolvent during the delay is deprived of funds maintained with the drawee or payor bank to cover the instrument may discharge his liability by written assignment to the holder of his rights against the drawee or payor bank in respect of such funds, but such drawer, acceptor or maker is not otherwise discharged.
2. Where without excuse a necessary protest is delayed beyond the time when it is due any drawer or endorser is discharged.
Sec. 3-503. 1. Unless a different time is expressed in the instrument the time for any presentment is determined as follows:
(a) Where an instrument is payable at or a fixed period after a stated date any presentment for acceptance must be made on or before the date it is payable.
(b) Where an instrument is payable after sight it must either be presented for acceptance or negotiated within a reasonable time after date or issue whichever is later.
(c) Where an instrument shows the date on which it is payable presentment for payment is due on that date.
(d) Where an instrument is accelerated presentment for payment is due within a reasonable time after the acceleration.
(e) With respect to the liability of any secondary party presentment for acceptance or payment of any other instrument is due within a reasonable time after such party becomes liable thereon.
2. A reasonable time for presentment is determined by the nature of the instrument, any usage of banking or trade and the facts of the particular case. In the case of an uncertified check which is drawn and payable within the United States and which is not a draft drawn by a bank the following are presumed to be reasonable periods within which to present for payment or to initiate bank collection:
(a) With respect to the liability of the drawer, 30 days after date or issue whichever is later; and
(b) With respect to the liability of an endorser, 7 days after his endorsement.
3. Where any presentment is due on a day which is not a full business day for either the person making presentment or the party to pay or accept, presentment is due on the next following day which is a full business day for both parties.
4. Presentment to be sufficient must be made at a reasonable hour, and if at a bank during its banking day.
Sec. 3-504. 1. Presentment is a demand for acceptance or payment made upon the maker, acceptor, drawee or other payor by or on behalf of the holder.
2. Presentment may be made:
(a) By mail, in which event the time of presentment is determined by the time of receipt of the mail; or
(b) Through a clearing house; or
(c) At the place of acceptance or payment specified in the instrument or if there be none at the place of business or residence of the party to accept or pay. If neither the party to accept or pay nor anyone authorized to act for him is present or accessible at such place presentment is excused.
κ1965 Statutes of Nevada, Page 834 (CHAPTER 353, SB 15)κ
3. It may be made:
(a) To any one of two or more makers, acceptors, drawees or other payors; or
(b) To any person who has authority to make or refuse the acceptance or payment.
4. A draft accepted or a note made payable at a bank in the United States must be presented at such bank.
5. In the cases described in section 4-210 presentment may be made in the manner and with the result stated in that section.
Sec. 3-505. 1. The party to whom presentment is made may without dishonor require:
(a) Exhibition of the instrument; and
(b) Reasonable identification of the person making presentment and evidence of his authority to make it if made for another; and
(c) That the instrument be produced for acceptance or payment at a place specified in it, or if there be none at any place reasonable in the circumstances; and
(d) A signed receipt on the instrument for any partial or full payment and its surrender upon full payment.
2. Failure to comply with any such requirement invalidates the presentment but the person presenting has a reasonable time in which to comply and the time for acceptance or payment runs from the time of compliance.
Sec. 3-506. 1. Acceptance may be deferred without dishonor until the close of the next business day following presentment. The holder may also in a good faith effort to obtain acceptance and without either dishonor of the instrument or discharge of secondary parties allow postponement of acceptance for an additional business day.
2. Except as a longer time is allowed in the case of documentary drafts drawn under a letter of credit, and unless an earlier time is agreed to by the party to pay, payment of an instrument may be deferred without dishonor pending reasonable examination to determine whether it is properly payable, but payment must be made in any event before the close of business on the day of presentment.
Sec. 3-507. 1. An instrument is dishonored when:
(a) A necessary or optional presentment is duly made and due acceptance or payment is refused or cannot be obtained within the prescribed time or in case of bank collections the instrument is seasonably returned by the midnight deadline (section 4-301); or
(b) Presentment is excused and the instrument is not duly accepted or paid.
2. Subject to any necessary notice of dishonor and protest, the holder has upon dishonor an immediate right of recourse against the drawers and endorsers.
3. Return of an instrument for lack of proper endorsement is not dishonor.
4. A term in a draft or an endorsement thereof allowing a stated time for re-presentment in the event of any dishonor of the draft by nonacceptance if a time draft of by nonpayment if a sight draft gives the holder as against any secondary party bound by the term an option to waive the dishonor without affecting the liability of the secondary party and he may present again up to the end of the stated time.
κ1965 Statutes of Nevada, Page 835 (CHAPTER 353, SB 15)κ
to waive the dishonor without affecting the liability of the secondary party and he may present again up to the end of the stated time.
Sec. 3-508. 1. Notice of dishonor may be given to any person who may be liable on the instrument by or on behalf of the holder or any party who has himself received notice, or any other party who can be compelled to pay the instrument. In addition an agent or bank in whose hands the instrument is dishonored may give notice to his principal or customer or to another agent or bank from which the instrument was received.
2. Any necessary notice must be given by a bank before its midnight deadline any by any other person before midnight of the third business day after dishonor or receipt of notice of dishonor.
3. Notice may be given in any reasonable manner. It may be oral or written and in any terms which identify the instrument and state that it has been dishonored. A misdescription which does not mislead the party notified does not vitiate the notice. Sending the instrument bearing a stamp, ticket or writing stating that acceptance or payment has been refused or sending a notice of debit with respect to the instrument is sufficient.
4. Written notice is given when sent although it is not received.
5. Notice to one partner is notice to each although the firm has been dissolved.
6. When any party is in insolvency proceedings instituted after the issue of the instrument notice may be given either to the party or to the representative of his estate.
7. When any party is dead or incompetent notice may be sent to his last-known address or given to his personal representative.
8. Notice operates for the benefit of all parties who have rights on the instrument against the party notified.
Sec. 3-509. 1. A protest is a certificate of dishonor made under the hand and seal of a United States consul or vice consul or a notary public or other person authorized to certify dishonor by the law of the place where dishonor occurs. It may be made upon information satisfactory to such person.
2. The protest must identify the instrument and certify either that due presentment has been made or the reason why it is excused and that the instrument has been dishonored by nonacceptance or nonpayment.
3. The protest may also certify that notice of dishonor has been given to all parties or to specified parties.
4. Subject to subsection 5 any necessary protest is due by the time that notice of dishonor is due.
5. If, before protest is due, an instrument has been noted for protest by the officer to make protest, the protest may be made at any time thereafter as of the date of the noting.
Sec. 3-510. The following are admissible as evidence and create a presumption of dishonor and of any notice of dishonor therein shown:
1. A document regular in form as provided in the preceding section which purports to be a protest.
2. The purported stamp or writing of the drawee, payor bank or presenting bank on the instrument or accompanying it stating that acceptance or payment has been refused for reasons consistent with dishonor.
κ1965 Statutes of Nevada, Page 836 (CHAPTER 353, SB 15)κ
presenting bank on the instrument or accompanying it stating that acceptance or payment has been refused for reasons consistent with dishonor.
3. Any book or record of the drawee, payor bank, or any collecting bank kept in the usual course of business which shows dishonor, even though there is no evidence of who made the entry.
Sec. 3-511. 1. Delay in presentment, protest or notice of dishonor is excused when the party is without notice that it is due or when the delay is caused by circumstances beyond his control and he exercises reasonable diligence after the cause of the delay ceases to operate.
2. Presentment or notice or protest, as the case may be, is entirely excused when:
(a) The party to be charged has waived it expressly or by implication either before or after it is due; or
(b) Such party has himself dishonored the instrument or has countermanded payment or otherwise has no reason to expect or right to require that the instrument be accepted or paid; or
(c) By reasonable diligence the presentment or protest cannot be made or the notice given.
3. Presentment is also entirely excused when:
(a) The maker, acceptor or drawee of any instrument except a documentary draft is dead or in insolvency proceedings instituted after the issue of the instrument; or
(b) Acceptance or payment is refused but not for want of proper presentment.
4. Where a draft has been dishonored by nonacceptance a later presentment for payment and any notice of dishonor and protest for nonpayment are excused unless in the meantime the instrument has been accepted.
5. A waiver of protest is also a waiver of presentment and of notice of dishonor even though protest is not required.
6. Where a waiver of presentment or notice or protest is embodied in the instrument itself it is binding upon all parties; but where it is written above the signature of an endorser it binds him only.
part 6
discharge
Sec. 3-601. 1. The extent of the discharge of any party from liability on an instrument is governed by the sections on:
(a) Payment or satisfaction (section 3-603); or
(b) Tender of payment (section 3-604); or
(c) Cancellation or renunciation (section 3-605); or
(d) Impairment of right of recourse or of collateral (section 3-606); or
(e) Reacquisition of the instrument by a prior party (section 3-208); or
(f) Fraudulent and material alteration (section 3-407); or
(g) Certification of a check (section 3-411); or
κ1965 Statutes of Nevada, Page 837 (CHAPTER 353, SB 15)κ
(h) Acceptance varying a draft (section 3-412); or
(i) Unexcused delay in presentment or notice of dishonor or protest (section 3-502).
2. Any party is also discharged from his liability on an instrument to another party by any other act or agreement with such party which would discharge his simple contract for the payment of money.
3. The liability of all parties is discharged when any party who has himself no right of action or recourse on the instrument:
(a) Reacquires the instrument in his own right; or
(b) Is discharged under any provision of this article, except as otherwise provided with respect to discharge for impairment of recourse or of collateral (section 3-606).
Sec. 3-602. No discharge of any party provided by this article is effective against a subsequent holder in due course unless he has notice thereof when he takes the instrument.
Sec. 3-603. 1. The liability of any party is discharged to the extent of his payment or satisfaction to the holder even though it is made with knowledge of a claim of another person to the instrument unless prior to such payment or satisfaction the person making the claim either supplies indemnity deemed adequate by the party seeking the discharge or enjoins payment or satisfaction by order of a court of competent jurisdiction in an action in which the adverse claimant and the holder are parties. This subsection does not, however, result in the discharge of the liability:
(a) Of a party who in bad faith pays or satisfies a holder who acquired the instrument by theft or who (unless having the rights of a holder in due course) holds through one who so acquired it; or
(b) Of a party (other than an intermediary bank or a payor bank which is not a depository bank) who pays or satisfies the holder of an instrument which has been restrictively endorsed in a manner not consistent with the terms of such restrictive endorsement.
2. Payment or satisfaction may be made with the consent of the holder by any person including a stranger to the instrument. Surrender of the instrument to such a person gives him the rights of a transferee (section 3-201).
Sec. 3-604. 1. Any party making tender of full payment to a holder when or after it is due is discharged to the extent of all subsequent liability for interest, costs and attorneys fees.
2. The holders refusal of such tender wholly discharges any party who has a right of recourse against the party making the tender.
3. Where the maker or acceptor of an instrument payable otherwise than on demand is able and ready to pay at every place of payment specified in the instrument when it is due, it is equivalent to tender.
Sec. 3-605. 1. The holder of an instrument may even without consideration discharge any party:
(a) In any manner apparent on the face of the instrument or the endorsement, as by intentionally canceling the instrument or the partys signature by destruction or mutilation, or by striking out the partys signature; or
κ1965 Statutes of Nevada, Page 838 (CHAPTER 353, SB 15)κ
(b) By renouncing his rights by a writing signed and delivered or by surrender of the instrument to the party to be discharged.
2. Neither cancellation nor renunciation without surrender of the instrument affects the title thereto.
Sec. 3-606. 1. The holder discharges any party to the instrument to the extent that without such partys consent the holder:
(a) Without express reservation of rights releases or agrees not to sue any person against whom the party has to the knowledge of the holder a right of recourse or agrees to suspend the right to enforce against such person the instrument or collateral or otherwise discharges such person, except that failure or delay in effecting any required presentment, protest or notice of dishonor with respect to any such person does not discharge any party as to whom presentment, protest or notice of dishonor is effective or unnecessary; or
(b) Unjustifiably impairs any collateral for the instrument given by or on behalf of the party or any person against whom he has a right of recourse.
2. By express reservation of rights against a party with a right of recourse the holder preserves:
(a) All his rights against such party as of the time when the instrument was originally due; and
(b) The rights of the party to pay the instrument as of that time; and
(c) All rights of such party to recourse against others.
part 7
advice of international sight draft
Sec. 3-701. 1. A letter of advice is a drawers communication to the drawee that a described draft has been drawn.
2. Unless otherwise agreed when a bank receives from another bank a letter of advice of an international sight draft the drawee bank may immediately debit the drawers account and stop the running of interest pro tanto. Such a debit and any resulting credit to any account covering outstanding drafts leaves in the drawer full power to stop payment or otherwise dispose of the amount and creates no trust or interest in favor of the holder.
3. Unless otherwise agreed and except where a draft is drawn under a credit issued by the drawee, the drawee of an international sight draft owes the drawer no duty to pay an unadvised draft but if it does so and the draft is genuine, may appropriately debit the drawers account.
κ1965 Statutes of Nevada, Page 839 (CHAPTER 353, SB 15)κ
part 8
miscellaneous
Sec. 3-801. 1. Where a draft is drawn in a set of parts, each of which is numbered and expressed to be an order only if no other part has been honored, the whole of the parts constitutes one draft but a taker of any part may become a holder in due course of the draft.
2. Any person who negotiates, endorses or accepts a single part of a draft drawn in a set thereby becomes liable to any holder in due course of that part as if it were the whole set, but as between different holders in due course to whom different parts have been negotiated the holder whose title first accrues has all rights to the draft and its proceeds.
3. As against the drawee the first presented part of a draft drawn in a set is the part entitled to payment, or if a time draft to acceptance and payment. Acceptance of any subsequently presented part renders the drawee liable thereon under subsection 2. With respect both to a holder and to the drawer payment of a subsequently presented part of a draft payable at sight has the same effect as payment of a check notwithstanding an effective stop order (section 4-407).
4. Except as otherwise provided in this section, where any part of a draft in a set is discharged by payment or otherwise the whole draft is discharged.
Sec. 3-802. 1. Unless otherwise agreed where an instrument is taken for an underlying obligation:
(a) The obligation is pro tanto discharged if a bank is drawer, maker or acceptor of the instrument and there is no recourse on the instrument against the underlying obligor; and
(b) In any other case the obligation is suspended pro tanto until the instrument in due or if it is payable on demand until its presentment. If the instrument is dishonored action may be maintained on either the instrument or the obligation; discharge of the underlying obligor on the instrument also discharges him on the obligation.
2. The taking in good faith of a check which is not postdated does not of itself extend the time on the original obligation as to discharge a surety.
Sec. 3-803. Where a defendant is sued for breach of an obligation for which a third person is answerable over under this article he may give the third person written notice of the litigation, and the person notified may then give similar notice to any other person who is answerable over to him under this article. If the notice states that the person notified may come in and defend and that if the person notified does not do so he will in any action against him by the person giving the notice be bound by any determination of fact common to the two litigations, then unless after seasonable receipt of the notice the person notified does come in and defend he is so bound.
Sec. 3-804. The owner of an instrument which is lost, whether by destruction, theft or otherwise, may maintain an action in his own name and recover from any party liable thereon upon due proof of his ownership, the facts which prevent his production of the instrument and its terms.
κ1965 Statutes of Nevada, Page 840 (CHAPTER 353, SB 15)κ
his ownership, the facts which prevent his production of the instrument and its terms. The court may require security indemnifying the defendant against loss by reason of further claims on the instrument.
Sec. 3-805. This article applies to any instrument whose terms do not preclude transfer and which is otherwise negotiable within this article but which is not payable to order or to bearer, except that there can be no holder in due course of such an instrument.
ARTICLE 4
BANK DEPOSITS AND COLLECTIONS
part 1
general provisions and definitions
Sec. 4-101. This article shall be known and may be cited as Uniform Commercial Code-Bank Deposits and Collections.
Sec. 4-102. 1. To the extent that items within this article are also within the scope of articles 3 and 8, they are subject to the provisions of those articles. In the event of conflict the provisions of this article govern those of article 3 but the provisions of article 8 govern those of this article.
2. The liability of a bank for action or nonaction with respect to any item handled by it for purposes of presentment, payment or collection is governed by the law of the place where the bank is located. In the case of action or nonaction by or at a branch or separate office of a bank, its liability is governed by the law of the place where the branch or separate office is located.
Sec. 4-103. 1. The effect of the provisions of this article may be varied by agreement except that no agreement can disclaim a banks responsibility for its own lack of good faith or failure to exercise ordinary care or can limit the measure of damages for such lack or failure; but the parties may by agreement determine the standards by which such responsibility is to be measured if such standards are not manifestly unreasonable.
2. Federal Reserve regulations and operating letters, clearing house rules, and the like, have the effect of agreements under subsection 1, whether or not specifically assented to by all parties interested in items handled.
3. Action or nonaction approved by this article or pursuant to Federal Reserve regulations or operating letters constitutes the exercise of ordinary care and, in the absence of special instructions, action or nonaction consistent with clearing house rules and the like or with a general banking usage not disapproved by this article, prima facie constitutes the exercise of ordinary care.
4. The specification or approval of certain procedures by this article does not constitute disapproval of other procedures which may be reasonable under the circumstances.
5. The measure of damages for failure to exercise ordinary care in handling an item is the amount of the item reduced by an amount which could not have been realized by the use of ordinary care, and where there is bad faith it includes other damages, if any, suffered by the party as a proximate consequence.
κ1965 Statutes of Nevada, Page 841 (CHAPTER 353, SB 15)κ
in handling an item is the amount of the item reduced by an amount which could not have been realized by the use of ordinary care, and where there is bad faith it includes other damages, if any, suffered by the party as a proximate consequence.
Sec. 4-104. 1. In this article unless the context otherwise requires:
(a) Account means any account with a bank and includes a checking, time, interest or savings account.
(b) Afternoon means the period of a day between noon and midnight.
(c) Banking day means that part of any day on which a bank is open to the public for carrying on substantially all of its banking functions.
(d) Clearing house means any association of banks or other payors regularly clearing items.
(e) Customer means any person having an account with a bank or for whom a bank has agreed to collect items and includes a bank carrying an account with another bank.
(f) Documentary draft means any negotiable or nonnegotiable draft with accompanying documents, securities or other papers to be delivered against honor of the draft.
(g) Item means any instrument for the payment of money even though it is not negotiable but does not include money.
(h) Midnight deadline with respect to a bank is midnight on its next banking day following the banking day on which it receives the relevant item or notice or from which the time for taking action commences to run, whichever is later.
(i) Property payable includes the availability of funds for payment at the time of decision to pay or dishonor.
(j) Settle means to pay in cash, by clearing house settlement, in a charge or credit or by remittance, or otherwise as instructed. A settlement may be either provisional or final.
(k) Suspends payments with respect to a bank means that it has been closed by order of the supervisory authorities, that a public officer has been appointed to take it over or that it ceases or refuses to make payments in the ordinary course of business.
2. Other definitions applying to this article and the sections in which they appear are:
Collecting bank. Section 4-105.
Depositary bank. Section 4-105.
Intermediary bank. Section 4-105.
Payor bank. Section 4-105.
Presenting bank. Section 4-105.
Remitting bank. Section 4-105.
3. The following definitions in other articles apply to this article:
Acceptance. Section 3-410.
Certificate of deposit. Section 3-104.
Certification. Section 3-411.
Check. Section 3-104.
Draft. Section 3-104.
κ1965 Statutes of Nevada, Page 842 (CHAPTER 353, SB 15)κ
Holder in due course. Section 3-302.
Notice of dishonor. Section 3-508.
Presentment. Section 3-504.
Protest. Section 3-509
Secondary party. Section 3-102.
4. In addition article 1 contains general definitions and principles of construction and interpretation applicable throughout this article.
Sec. 4-105. In this article unless the context otherwise requires:
1. Depository bank means the first bank to which an item is transferred for collection even though it is also the payor bank.
2. Payor bank means a bank by which an item is payable as drawn or accepted.
3. Intermediary bank means any bank to which an item is transferred in course of collection except the depositary or payor bank.
4. Collecting bank means any bank handling the item for collection except the payor bank.
5. Presenting bank means any bank presenting an item except a payor bank.
6. Remitting bank means any payor or intermediary bank remitting for an item.
7. Each branch or separate office of a bank shall be deemed a separate bank for the purpose of the definitions of this section.
Sec. 4-106. A branch or separate office of a bank is a separate bank for the purpose of computing the time within which and determining the place at or to which action may be taken or notices or orders shall be given under this article and under article 3, and the receipt of any notice or order by, or the knowledge of, one branch or separate office of a bank is not actual or constructive notice to or knowledge of any other branch or separate office of the same bank and does not impair the right of such other branch or separate office to be a holder in due course of an item.
Sec. 4-107. 1. For the purpose of allowing time to process items, prove balances and make the necessary entries on its books to determine its position for the day, a bank may fix an afternoon hour of 2 p.m. or later as a cutoff hour for the handling of money and items and the making of entries on its books.
2. Any item or deposit of money received on any day after a cutoff hour so fixed or after the close of the banking day may be treated as being received at the opening of the next banking day.
Sec. 4-108. 1. Unless otherwise instructed, a collecting bank in a good faith effort to secure payment may, in the case of specific items and with or without the approval of any person involved, waive, modify or extend time limits imposed or permitted by this chapter for a period not in excess of an additional banking day without discharge of secondary parties and without liability to its transferor or any prior party.
2. Delay by a collecting bank or payor bank beyond time limits prescribed or permitted by this chapter or by instructions is excused if caused by interruption of communication facilities, suspension of payments by another bank, war, emergency conditions or other circumstances beyond the control of the bank provided it exercises such diligence as the circumstances require.
κ1965 Statutes of Nevada, Page 843 (CHAPTER 353, SB 15)κ
payments by another bank, war, emergency conditions or other circumstances beyond the control of the bank provided it exercises such diligence as the circumstances require.
part 2
collection of items: depositary and collecting banks
Sec. 4-201. 1. Unless a contrary intent clearly appears and prior to the time that a settlement given by a collecting bank for an item is or becomes final (subsection 3 of section 4-211 and sections 4-212 and 4-213) the bank is an agent or subagent of the owner of the item and any settlement given for the item is provisional. This provision applies regardless of the form of endorsement or lack of endorsement and even though credit given for the item is subject to immediate withdrawal as of right or is in fact withdrawn; but the continuance of ownership of an item by its owner and any rights of the owner to proceeds of the item are subject to rights of a collecting bank such as those resulting from outstanding advances on the item and valid rights of setoff. When an item is handled by banks for purposes of presentment, payment and collection, the relevant provisions of this article apply even though action of parties clearly establishes that a particular bank has purchased the item and is the owner of it.
2. After an item has been endorsed with the words pay any bank or the like, only a bank may acquire the rights of a holder:
(a) Until the item has been returned to the customer initiating collection; or
(b) Until the item has been specially endorsed by a bank to a person who is not a bank.
Sec. 4-202. 1. A collecting bank must use ordinary care in:
(a) Presenting an item or sending it for presentment; and
(b) Sending notice of dishonor or nonpayment or returning an item other than a documentary draft to the banks transferor after learning that the item has not been paid or accepted, as the case may be; and
(c) Settling for an item when the bank receives final settlement; and
(d) Making or providing for any necessary protest; and
(e) Notifying its transferor of any loss or delay in transit within a reasonable time after discovery thereof.
2. A collecting bank taking proper action before its midnight deadline following receipt of an item, notice or payment acts seasonably; taking proper action within a reasonably longer time may be seasonable but the bank has the burden of so establishing.
3. Subject to paragraph (a) of subsection 1, a bank is not liable for the insolvency, neglect, misconduct, mistake or default of another bank or person or for loss or destruction of or inability to obtain repossession of an item in transit or in the possession of others.
Sec. 4-203. Subject to the provisions of article 3 concerning conversion of instruments (section 3-419) and the provisions of both article 3 and this article concerning restrictive endorsements only a collecting banks transferor can give instructions which affect the bank or constitute notice to it and a collecting bank is not liable to prior parties for any action taken pursuant to such instructions or in accordance with any agreement with its transferor.
κ1965 Statutes of Nevada, Page 844 (CHAPTER 353, SB 15)κ
article 3 and this article concerning restrictive endorsements only a collecting banks transferor can give instructions which affect the bank or constitute notice to it and a collecting bank is not liable to prior parties for any action taken pursuant to such instructions or in accordance with any agreement with its transferor.
Sec. 4-204. 1. A collecting bank must send items by reasonably prompt method taking into consideration any relevant instructions, the nature of the item, the number of such items on hand, and the cost of collection involved and the method generally used by it or others to present such items.
2. A collecting bank may send:
(a) Any item direct to the payor bank;
(b) Any item to any nonbank payor if authorized by its transferor;
(c) Any item other than documentary drafts to any nonbank payor, if authorized by Federal Reserve regulation or operating letter, clearing house rule or the like.
(d) Any item to any Federal Reserve bank; and
(e) Any item to any other bank or agency thereof.
Items may be sent to the place of business of, or to any place designated by, those to whom items may be sent under paragraphs (a), (b), (c), (d) or (e).
Sec. 4-205. 1. A depositary bank which has taken an item for collection may supply any endorsement of the customer which is necessary to title unless the item contains the words payees endorsement required or the like. In the absence of such a requirement a statement placed on the item by the depositary bank to the effect that the item was deposited by a customer or credited to his account is effective as the customers endorsement.
2. An intermediary bank, or payor bank which is not a depositary bank, is neither given notice nor otherwise affected by a restrictive endorsement of any person except the banks immediate transferor.
Sec. 4-206. Any agreed method which identifies the transferor bank is sufficient for the items further transfer to another bank.
Sec. 4-207. 1. Each customer or collecting bank who obtains payment or acceptance of an item and each prior customer and collecting bank warrants to the payor bank or other payor who in good faith pays or accepts the item that:
(a) He has a good title to the item or is authorized to obtain payment or acceptance on behalf of one who has a good title; and
(b) He has no knowledge that the signature of the maker or drawer is unauthorized, except that this warranty is not given by any customer or collecting bank that is a holder in due course and acts in good faith:
(1) To a maker with respect to the makers own signature; or
(2) To a drawer with respect to the drawers own signature, whether or not the drawer is also the drawee; or
(3) To an acceptor of an item if the holder in due course took the item after the acceptance or obtained the acceptance without knowledge that the drawers signature was unauthorized; and
κ1965 Statutes of Nevada, Page 845 (CHAPTER 353, SB 15)κ
(c) The item has not been materially altered, except that this warranty is not given by any customer or collecting bank that is a holder in due course and acts in good faith:
(1) To the maker of a note; or
(2) To the drawer of a draft whether or not the drawer is also the drawee; or
(3) To the acceptor of an item with respect to an alternation made prior to the acceptance if the holder in due course took the item after the acceptance, even though the acceptance provided payable as originally drawn or equivalent terms; or
(4) To the acceptor of an item with respect to an alteration made after the acceptance.
2. Each customer and collecting bank who transfers an item and receives a settlement or other consideration for it warrants to his transferee and to any subsequent collecting bank who takes the item in good faith that:
(a) He has a good title to the item or is authorized to obtain payment or acceptance on behalf of one who has a good title and the transfer is otherwise rightful; and
(b) All signatures are genuine or authorized; and
(c) The item has not been materially altered; and
(d) No defense of any party is good against him; and
(e) He has no knowledge of any insolvency proceeding instituted with respect to the maker or acceptor or the drawer of an unaccepted item.
In addition each customer and collecting bank so transferring an item and receiving a settlement or other consideration engages that upon dishonor and any necessary notice of dishonor and protest he will take up the item.
3. The warranties and the engagement to honor set forth in the two preceding subsections arise notwithstanding the absence of endorsement or words of guaranty or warranty in the transfer or presentment and a collecting bank remains liable for their breach despite remittance to its transferor. Damages for breach of such warranties or engagement to honor shall not exceed the consideration received by the customer or collecting bank responsible plus finance charges and expenses related to the item, if any.
4. Unless a claim for breach of warranty under this section is made within a reasonable time after the person claiming learns of the breach, the person liable is discharged to the extent of any loss caused by the delay in making claim.
Sec. 4-208. 1. A bank has a security interest in an item and any accompanying documents or the proceeds of either:
(a) In case of an item deposited in an account to the extent to which credit given for the item has been withdrawn or applied;
(b) In case of an item for which it has given credit available for withdrawal as of right, to the extent of the credit given whether or not the credit is drawn upon and whether or not there is a right of charge-back; or
(c) If it makes an advance on or against the item.
κ1965 Statutes of Nevada, Page 846 (CHAPTER 353, SB 15)κ
2. When credit which has been given for several items received at one time or pursuant to a single agreement is withdrawn or applied in part the security interest remains upon all the items, any accompanying documents or the proceeds of either. For the purpose of this section, credits first given are first withdrawn.
3. Receipt by a collecting bank of a final settlement for an item is a realization on its security interest in the item, accompanying documents and proceeds. To the extent and so long as the bank does not receive final settlement for the item or give up possession of the item or accompanying document for purposes other than collection, the security interest continues and is subject to the provisions of article 9 except that:
(a) No security agreement is necessary to make the security interest enforcible (paragraph (b) of subsection 1 of section 9-203); and
(b) No filing is required to perfect the security interest; and
(c) The security interest has priority over conflicting perfected security interests in the item, accompanying documents or proceeds.
Sec. 4-209. For purposes of determining its status as a holder in due course, the bank has given value to the extent that it has a security interest in an item provided that the bank otherwise complies with the requirements of section 3-302 on what constitutes a holder in due course.
Sec. 4-210. 1. Unless otherwise instructed, a collecting bank may present an item not payable by, through or at a bank by sending to the party to accept or pay a written notice that the bank holds the item for acceptance or payment. The notice must be sent in time to be received on or before the day when presentment is due and the bank must meet any requirement of the party to accept or pay under section 3-505 by the close of the banks next banking day after it knows of the requirement.
2. Where presentment is made by notice and neither honor nor request for compliance with a requirement under section 3-505 is received by the close of business on the day after maturity or in the case of demand items by the close of business on the third banking day after notice was sent, the presenting bank may treat the item as dishonored and charge any secondary party by sending him notice of the facts.
Sec. 4-211. 1. A collecting bank may take in settlement of an item:
(a) A check of the remitting bank or of another bank on any bank except the remitting bank; or
(b) A cashiers check or similar primary obligation of a remitting bank which is a member of or clears through a member of the same clearing house or group as the collecting bank; or
(c) Appropriate authority to charge an account of the remitting bank or of another bank with the collecting bank; or
(d) If the item is drawn upon or payable by a person other than a bank, a cashiers check, certified check or other bank check or obligation; or
(e) Credit on the books of any Federal Reserve bank or of any bank designated as a depositary by the collecting bank; or
(f) Money.
κ1965 Statutes of Nevada, Page 847 (CHAPTER 353, SB 15)κ
2. If before its midnight deadline the collecting bank properly dishonors a remittance check or authorization to charge on itself or presents or forwards for collection a remittance instrument of or on another bank which is of a kind approved by subsection 1 or has not been authorized by it, the collecting bank is not liable to prior parties in the event of the dishonor of such check, instrument or authorization.
3. A settlement for an item by means of a remittance instrument or authorization to charge is or becomes a final settlement as to both the person making and the person receiving the settlement:
(a) If the remittance instrument or authorization to charge is of a kind approved by subsection 1 or has not been authorized by the person receiving the settlement and in either case the person receiving the settlement acts seasonably before its midnight deadline in presenting, forwarding for collection or paying the instrument or authorization, at the time the remittance instrument or authorization is finally paid by the payor by which it is payable;
(b) If the person receiving the settlement has authorized remittance by a nonbank check or obligation or by a cashiers check or similar primary obligation of or a check upon the payor or other remitting bank which is not of a kind approved by paragraph (b) of subsection 1, at the time of the receipt of such remittance check or obligation; or
(c) If in a case not covered by paragraphs (a) or (b) the person receiving the settlement fails seasonably to present, forward for collection, pay or return a remittance instrument or authorization to it to charge before its midnight deadline, at such midnight deadline.
Sec. 4-212. 1. If a collecting bank has made provisional settlement with its customer for an item and itself fails by reason of dishonor, suspension of payments by a bank or otherwise to receive a settlement for the item which is or becomes final, the bank may revoke the settlement given by it, charge back the amount of any credit given for the item to its customers account or obtain refund from its customer whether or not it is able to return the items if by its midnight deadline or within a longer reasonable time after it learns the facts it returns the item or sends notification of the facts. These rights to revoke, charge-back and obtain refund terminate if and when a settlement for the item received by the bank is or becomes final (subsection 3 of section 4-211 and subsections 2 and 3 of section 4-213).
3. A depositary bank which is also the payor may charge-back the amount of an item to its customers account or obtain refund in accordance with the section governing return of an item received by a payor bank for credit on its books (section 4-301).
4. The right to charge-back is not affected by:
(a) Prior use of the credit given for the item; or
(b) Failure by any bank to exercise ordinary care with respect to the item but any bank so failing remains liable.
5. A failure to charge-back or claim refund does not affect other rights of the bank against the customer or any other party.
6. If credit is given in dollars as the equivalent of the value of an item payable in a foreign currency the dollar amount of any charge-back or refund shall be calculated on the basis of the buying sight rate for the foreign currency prevailing on the day when the person entitled to the charge-back or refund learns that it will not receive payment in ordinary course.
κ1965 Statutes of Nevada, Page 848 (CHAPTER 353, SB 15)κ
rate for the foreign currency prevailing on the day when the person entitled to the charge-back or refund learns that it will not receive payment in ordinary course.
Sec. 4-213. 1. An item is finally paid by a payor bank when the bank has done any of the following, whichever happens first:
(a) Paid the item in cash; or
(b) Settled for the item without having a right to revoke the settlement under statute, clearing house rule, agreement or reservation thereof; or
(d) Settled for the item having a right to revoke the settlement under statute, clearinghouse rule, agreement or reservation thereof, and failed to revoke the settlement in the time and manner permitted under such right.
Upon a final payment under paragraphs (b) or (d) the payor bank shall be accountable for the amount of the item.
2. If provisional settlement for an item between the presenting and payor banks is made through a clearing house or by debits or credits in an account between them, then to the extent that provisional debits or credits for the item are entered in accounts between the presenting and payor banks or between the presenting and successive prior collecting banks seriatim, they become final upon final payment of the item by the payor bank.
3. If a collecting bank receives a settlement for an item which is or becomes final (subsection 3 of section 4-211, subsection 2 of section 4-213) the bank is accountable to its customer for the amount of the item and any provisional credit given for the item in an account with its customer becomes final.
4. Subject to any right of the bank to apply the credit to an obligation of the customer, credit given by a bank for an item in an account with its customer becomes available for withdrawal as of right:
(a) In any case where the bank has received a provisional settlement for the item, when such settlement becomes final and the bank has had a reasonable time to learn that the settlement is final.
(b) In any case where the bank is both a depositary bank and a payor bank and the item is finally paid, at the opening of the banks second banking day following receipt of the item.
5. A deposit of money in a bank is final when made but, subject to any right of the bank to apply the deposit to an obligation of the customer, the deposit becomes available for withdrawal as of right at the opening of the banks next banking day following receipt of the deposit.
Sec. 4-214. 1. Any item in or coming into the possession of a payor or collecting bank which suspends payment and which item is not finally paid shall be returned by the receiver, trustee or agent in charge of the closed bank to the presenting bank or the closed banks customer.
2. If a payor bank finally pays an item and suspends payments without making a settlement for the item with its customer or the presenting bank which settlement is or becomes final, the owner of the item has a preferred claim against the payor bank.
κ1965 Statutes of Nevada, Page 849 (CHAPTER 353, SB 15)κ
3. If a payor bank gives or a collecting bank gives or receives a provisional settlement for an item and thereafter suspends payments, the suspension does not prevent or interfere with the settlement becoming final if such finality occurs automatically upon the lapse of certain time or the happening of certain events (subsection 3 of section 4-211, paragraph (d) of subsection 1 and subsections 2 and 3 of section 4-213).
4. If a collecting bank receives from subsequent parties settlement for an item which settlement is or becomes final and suspends payments without making a settlement for the item with its customer which is or becomes final, the owner of the item has a preferred claim against such collecting bank.
part 3
collection of items: payor banks
Sec. 4-301. 1. Where an authorized settlement for a demand item (other than a documentary draft) received by a payor bank otherwise than for immediate payment over the counter has been made before midnight of the banking day of receipt the payor bank may revoke the settlement and recover any payment if before it has made final payment (subsection 1 of section 4-213) and before its midnight deadline it:
(a) Returns the item; or
(b) Sends written notice of dishonor or nonpayment if the item is held for protest or is otherwise unavailable for return.
2. If a demand item is received by a payor bank for credit on its books it may return such item or send notice of dishonor and may revoke any credit given or recover the amount thereof withdrawn by its customer, if it acts within the time limit and in the manner specified in the preceding subsection.
3. Unless previous notice of dishonor has been sent an item is dishonored at the time when for purposes of dishonor it is returned or notice sent in accordance with this section.
4. An item is returned:
(a) As to an item received through a clearing house, when it is delivered to the presenting or last collecting bank or to the clearing house or is sent or delivered in accordance with its rules; or
(b) In all other cases, when it is sent or delivered to the banks customer or transferor or pursuant to his instructions.
Sec. 4-302. In the absence of a valid defense such as breach of a presentment warranty (subsection 1 of section 4-207), settlement effected or the like, if an item is presented on and received by a payor bank the bank is accountable for the amount of:
1. A demand item other than a documentary draft whether properly payable or not if the bank, in any case where it is not also the depositary bank, retains the item beyond midnight of the banking day of receipt without settling for it or, regardless of whether it is also the depository bank, does not pay or return the item or send notice of dishonor until after its midnight deadline; or
κ1965 Statutes of Nevada, Page 850 (CHAPTER 353, SB 15)κ
the depository bank, does not pay or return the item or send notice of dishonor until after its midnight deadline; or
2. Any other properly payable item unless within the time allowed for acceptance or payment of that item the bank either accepts or pays the item or returns it and accompanying documents.
Sec. 4-303. 1. Any knowledge, notice or stop-order received by, legal process served upon or setoff exercised by, a payor bank, whether or not effective under other rules of law to terminate, suspend or modify the banks right or duty to pay an item or to charge its customers account for the item, comes too late so to terminate, suspend or modify such right or duty if the knowledge, notice, stop-order or legal process is received or served and the bank does not have a reasonable time to act thereon before, or the setoff is exercised after, the happening of any of the following:
(a) The bank has accepted or certified the item;
(b) The bank has paid the item in cash;
(c) The bank has settled for the item without having a right to revoke the settlement under statute, clearing house rule, agreement or reservation thereof;
(d) The cutoff hour (section 4-107) or the close of the banking day if no cutoff hour is fixed of the day on which the bank received the item;
(e) The bank has become accountable for the amount of the item under paragraph (d) of subsection 1 of section 4-213 and section 4-302 dealing with the payor banks responsibility for late return of items; or
(f) The item has been deposited or received for deposit for credit in an account of a customer with the payor bank.
2. Subject to the provisions of subsection 1 items may be accepted, paid, certified or charged to the indicated account of its customer in any order convenient to the bank and before or after its regular banking hours. A bank is under no obligation to determine the time of day an item is received and without liability may withhold the amount thereof pending a determination of the effect, consequence or priority of any knowledge, notice, stop-order or legal process concerning the same, or interplead such amount and the claimants thereto.
part 4
relationship between payor bank and its customer
Sec. 4-401. 1. As against its customer, a bank may charge against his account any item which is otherwise properly payable from that account even through the charge creates an overdraft and in such event recover or obtain refund of the amount of the overdraft.
2. A bank which in good faith makes payment to a holder may charge the indicated account of it customer according to:
(a) The original tenor of his altered item; or
(b) The tenor of his completed item, even though the bank knows the item has been completed unless the bank has notice that the completion was improper.
κ1965 Statutes of Nevada, Page 851 (CHAPTER 353, SB 15)κ
the item has been completed unless the bank has notice that the completion was improper.
Sec. 4-402. A payor bank is liable to its customer for damages proximately caused by the wrongful dishonor of an item. When the dishonor occurs through mistake liability is limited to actual damages proved.
Sec. 4-403. 1. A customer, or any customer if there is more than one, or any person authorized to sign checks or make withdrawals thereon, may stop payment of any item payable for or drawn against such customers or customers account, but the bank may disregard the same unless the order is in writing, is signed by such customer or authorized person, describes with certainty the item on which payment is to be stopped, and is received by the bank in such time and in such manner as to afford the bank a reasonable opportunity to act on it prior to the happening of any of the events described in section 4-303.
2. An order may be disregarded by the bank 6 months after receipt unless renewed in writing.
3. The bank is liable to its customer for the actual loss incurred by him resulting from the payment of an item contrary to a binding stop payment order, not exceeding the amount of the item unless the bank is guilty of negligence. The burden of establishing the fact and amount of loss resulting from the payment of an item contrary to a binding stop payment order is on the customer.
Sec. 4-404. A bank is under no obligation to a customer having a checking account to pay a check, other than a certified check, which is presented more than 6 months after its date, but it may charge its customers account for a payment made thereafter.
Sec. 4-405. 1. A payor or collecting banks authority to accept, pay or collect an item or to account for proceeds of its collection if otherwise effective is not rendered ineffective by incompetence of a customer of either bank existing at the time the item is issued or its collection is undertaken if the bank does not know of an adjudication of incompetence. Neither death nor incompetence of a customer revokes such authority to accept, pay, collect or account until the bank knows of the fact of death or of an adjudication of incompetence and has reasonable opportunity to act on it.
2. Even with knowledge of the death of a customer or of any person authorized to sign checks or make withdrawals a bank may, for 10 days after the date of death, pay or certify checks drawn by the decedent on or prior to that date unless the bank has received notice pursuant to NRS 663.010 or notice of an adverse claim supported by a court order or by a surety bond acceptable to it which need not exceed double the amount claimed.
3. Even with knowledge of the incompetence of a customer, whether adjudicated or not, a bank may, if the item would have been effective prior to such incompetence, accept, pay, collect and account for the proceeds of any item drawn by any other customer or person authorized by such other customer, unless the bank has received notice pursuant to NRS 663.010 or notice of an adverse claim supported by a court order or by a surety bond acceptable to it which need not exceed double the amount claimed.
κ1965 Statutes of Nevada, Page 852 (CHAPTER 353, SB 15)κ
court order or by a surety bond acceptable to it which need not exceed double the amount claimed.
4. A bank may refuse to pay a check, draft or other order for the withdrawal of money from an account, whether commercial or savings, if it believes or receives an affidavit stating that the person drawing, endorsing or presenting the instrument is or was at the time of signing, endorsing or presenting it so under the influence of liquor or drugs or so mentally or physically disabled as to raise doubt whether such person is or was competent to transact business. No damages shall be awarded in any action against the bank, or its officers or other employees, for refusing in good faith to pay any such instrument for that reason or in relying upon such affidavit.
Sec. 4-406. 1. When a bank sends to its customer a statement of account accompanied by items paid in good faith in support of the debit entries or holds the statement and items pursuant to a request or instructions of its customer or otherwise in a reasonable manner makes the statement and items available to the customer, the customer must exercise reasonable care and promptness to examine the statement and items to discover his unauthorized signature or any alteration on an item and must notify the bank promptly after discovery thereof.
2. If the bank establishes that the customer failed with respect to an item to comply with the duties imposed on the customer by subsection 1 the customer is precluded from asserting against the bank:
(a) His unauthorized signature or any alteration on the item if the bank also establishes that it suffered a loss by reason of such failure; and
(b) An unauthorized signature or alteration by the same wrongdoer on any other item paid in good faith by the bank after the first item and statement was available to the customer for a reasonable period not exceeding 14 calendar days and before the bank receives notification from the customer of any such unauthorized signature or alteration.
3. The preclusion under subsection 2 does not apply if the customer establishes lack of ordinary care on the part of the bank in paying the item(s).
4. Without regard to care or lack of care of either the customer or the bank a customer who does not within 1 year from the time the statement and items are made available to the customer (subsection 1) discover and report his unauthorized signature or any alteration on the face or back of the item, and if the bank so requests exhibit the item to the bank for inspection, is precluded from asserting against the bank such unauthorized signature or endorsement or such alteration.
5. If under this section a payor bank has a valid defense against a claim of a customer upon or resulting from payment of an item and waives or fails upon request to assert the defense the bank may not assert against any collecting bank or other prior party presenting or transferring the item a claim based upon the unauthorized signature or alteration giving rise to the customers claim.
Sec. 4-407. If a payor bank has paid an item over the stop payment order of the drawer or maker or otherwise under circumstances giving a basis for objection by the drawer or maker, to prevent unjust enrichment and only to the extent necessary to prevent loss to the bank by reason of its payment of the item, the payor bank shall be subrogated to the rights:
κ1965 Statutes of Nevada, Page 853 (CHAPTER 353, SB 15)κ
giving a basis for objection by the drawer or maker, to prevent unjust enrichment and only to the extent necessary to prevent loss to the bank by reason of its payment of the item, the payor bank shall be subrogated to the rights:
(a) Of any holder in due course on the item against the drawer or maker; and
(b) Of the payee or any other holder of the item against the drawer or maker either on the item or under the transaction out of which the item arose; and
(c) Of the drawer or maker against the payee or any other holder of the item with respect to the transaction out of which the item arose.
part 5
collection of documentary drafts
Sec. 4-501. A bank which takes a documentary draft for collection must present or send the draft and accompanying documents for presentment and upon learning that the draft has not been paid or accepted in due course must seasonably notify its customer of such fact even though it may have discounted or bought the draft or extended credit available for withdrawal as of right.
Sec. 4-502. When a draft or the relevant instructions require presentment on arrival, when goods arrive or the like, the collecting bank need not present until in its judgment a reasonable time for arrival of the goods has expired. Refusal to pay or accept because the goods have not arrived is not dishonor; the bank must notify its transferor of such refusal but need not present the draft again until it is instructed to do so or learns of the arrival of the goods.
Sec. 4-503. Unless otherwise instructed and except as provided in article 5 a bank presenting a documentary draft:
1. Must deliver the documents to the drawee on acceptance of the draft if it is payable more than 3 days after presentment; otherwise, only on payment; and
2. Upon dishonor, either in the case of presentment for acceptance or presentment for payment, may seek and follow instructions from any referee in case of need designated in the draft or if the presenting bank does not choose to utilize his services if must use diligence and good faith to ascertain the reason for dishonor, must notify its transferor of the dishonor and of the results of its effort to ascertain the reasons therefor and must request instructions.
But the presenting bank is under no obligation with respect to goods represented by the documents except to follow any reasonable instruction seasonably received; it has a right to reimbursement for any expense incurred in following instructions and to prepayment of or indemnity for such expenses.
Sec. 4-504. 1. A presenting bank which, following the dishonor of a documentary draft, has seasonably requested instructions but does not receive them within a reasonable time may store, sell or otherwise deal with the goods in any reasonable manner.
κ1965 Statutes of Nevada, Page 854 (CHAPTER 353, SB 15)κ
2. For its reasonable expenses incurred by action under subsection 1 the presenting bank has a lien upon the goods or their proceeds, which may be foreclosed in the same manner as an unpaid sellers lien.
ARTICLE 5
LETTERS OF CREDIT
Sec. 5-101. This article shall be known and may be cited as Uniform Commercial Code-Letters of Credit.
Sec. 5-102. 1. This article applies:
(a) To a credit issued by a bank if the credit requires a documentary draft or a documentary demand for payment; and
(b) To a credit issued by a person other than a bank if the credit requires that the draft or demand for payment be accompanied by a document of title; and
(c) To a credit issued by a bank or other person if the credit is not within paragraphs (a) or (b) but conspicuously states that it is a letter of credit or is conspicuously so entitled.
2. Unless the engagement meets the requirements of subsection 1, this article does not apply to engagements to make advances or to honor drafts or demands for payment, to authorities to pay or purchase, to guarantees or to general agreements.
3. This article deals with some but not all of the rules and concepts of letters of credit as such rules or concepts have developed prior to this act or may hereafter develop. The fact that this article states a rule does not by itself require, imply or negate application of the same or a converse rule to a situation not provided for or to a person not specified by this article.
Sec. 5-103. 1. In this article unless the context otherwise requires:
(a) Credit or letter of credit means an engagement by a bank or other person made at the request of a customer and of a kind within the scope of this article (section 5-102) that the issuer will honor drafts or other demands for payment upon compliance with the conditions specified in the credit. A credit may be either revocable or irrevocable. The engagement may be either an agreement to honor or a statement that the bank or other person is authorized to honor.
(b) A documentary draft or a documentary demand for payment is one honor of which is conditioned upon the presentation of a document or documents. Document means any paper including document of title, security, invoice, certificate, notice of default and the like.
(c) An issuer is a bank or other person issuing a credit.
(d) A beneficiary of a credit is a person who is entitled under its terms to draw or demand payment.
(e) An advising bank is a bank which gives notification of the issuance of a credit by another bank.
(f) A confirming bank is a bank which engages either that it will itself honor a credit already issued by another bank or that such a credit will be honored by the issuer or a third bank.
κ1965 Statutes of Nevada, Page 855 (CHAPTER 353, SB 15)κ
(g) A customer is a buyer or other person who causes an issuer to issue a credit. The term also includes a bank which procures issuance or confirmation on behalf of that banks customer.
2. Other definitions applying to this article and the sections in which they appear are:
Notation of Credit. Section 5-108.
Presenter. Section 5-112, subsec. 3
3. Definitions in other articles applying to this article and the sections in which they appear are:
Accept or Acceptance. Section 3-410.
Contract for sale. Section 2-106.
Draft. Section 3-104.
Holder in due course. Section 3-302.
Midnight deadline. Section 4-104.
Security. Section 8-102.
4. In addition, article 1 contains general definitions and principles of construction and interpretation applicable throughout this article.
Sec. 5-104. 1. Except as otherwise required in paragraph (c) of subsection 1 of section 5-102 on scope, no particular form of phrasing is required for a credit. A credit must be in writing and signed by the issuer and a confirmation must be in writing and signed by the confirming bank. A modification of the terms of a credit or confirmation must be signed by the issuer or confirming bank.
2. A telegram may be a sufficient signed writing if it identifies its sender by an authorized authentication. The authentication may be in code and the authorized naming of the issuer in an advice of credit is a sufficient signing.
Sec. 5-105. No consideration is necessary to establish a credit or to enlarge or otherwise modify its terms.
Sec. 5-106. 1. Unless otherwise agreed a credit is established:
(a) As regards the customer as soon as a letter of credit is sent to him or the letter of credit or an authorized written advice of its issuance is sent to the beneficiary; and
(b) As regards the beneficiary when he receives a letter of credit or an authorized written advice of its issuance.
2. Unless otherwise agreed once an irrevocable credit is established as regards the customer it can be modified or revoked only with the consent of the customer and once it is established as regards the beneficiary it can be modified or revoked only with his consent.
3. Unless otherwise agreed after a revocable credit is established it may be modified or revoked by the issuer without notice to or consent from the customer or beneficiary.
4. Notwithstanding any modification or revocation of a revocable credit any person authorized to honor or negotiate under terms of the original credit is entitled to reimbursement for or honor of any draft or demand for payment duly honored or negotiated before receipt of notice of the modification or revocation and the issuer in turn is entitled to reimbursement from its customer.
Sec. 5-107. 1. Unless otherwise specified an advising bank by advising a credit issued by another bank does not assume any obligation to honor drafts drawn or demands for payment made under the credit but it does assume obligation for the accuracy of its own statement.
κ1965 Statutes of Nevada, Page 856 (CHAPTER 353, SB 15)κ
advising a credit issued by another bank does not assume any obligation to honor drafts drawn or demands for payment made under the credit but it does assume obligation for the accuracy of its own statement.
2. A confirming bank by confirming a credit becomes directly obligated on the credit to the extent of its confirmation as though it were its issuer and acquires the rights of an issuer.
3. Even though an advising bank incorrectly advises the terms of a credit it has been authorized to advise the credit is established as against the issuer to the extent of its original terms.
4. Unless otherwise specified the customer bears as against the issuer all risks of transmission and reasonable translation or interpretation of any message relating to a credit.
Sec. 5-108. 1. A credit which specifies that any person purchasing or paying drafts drawn or demands for payment made under it must note the amount of the draft or demand on the letter or advice of credit is a notation credit.
2. Under a notation credit:
(a) A person paying the beneficiary or purchasing a draft or demand for payment from him acquires a right to honor only if the appropriate notation is made and by transferring or forwarding for honor the documents under the credit such a person warrants to the issuer that the notation has been made; and
(b) Unless the credit or a signed statement that an appropriate notation has been made accompanies the draft or demand for payment the issuer may delay honor until evidence of notation has been procured which is satisfactory to it but its obligation and that of its customer continue for a reasonable time not exceeding 30 days to obtain such evidence.
3. If the credit is not a notation credit:
(a) The issuer may honor complying drafts or demands for payment presented to it in the order in which they are presented and is discharged pro tanto by honor of any such draft or demand.
(b) As between competing good faith purchasers of complying drafts or demands the person first purchasing has priority over a subsequent purchaser even though the later purchased draft or demand has been first honored.
Sec. 5-109. 1. An issuers obligation to its customer includes good faith and observance of any general banking usage but unless otherwise agreed does not include liability or responsibility:
(a) For performance of the underlying contract for sale or other transaction between the customer and the beneficiary; or
(b) For any act or omission of any person other than itself or its own branch or for loss or destruction of a draft, demand or document in transit or in the possession of others; or
(c) Based on knowledge or lack of knowledge of any usage of any particular trade.
2. An issuer must examine documents with care so as to ascertain that on their face they appear to comply with the terms of the credit but unless otherwise agreed assumes no liability or responsibility for the genuineness, falsification or effect on any document which appears on such examination to be regular on its face.
κ1965 Statutes of Nevada, Page 857 (CHAPTER 353, SB 15)κ
the genuineness, falsification or effect on any document which appears on such examination to be regular on its face.
3. A nonbank issuer is not bound by any banking usage of which it has no knowledge.
Sec. 5-110. 1. Unless otherwise specified a credit may be used in portions in the discretion of the beneficiary.
2. Unless otherwise specified a person by presenting a documentary draft or demand for payment under a credit relinquishes upon its honor all claims to the documents and a person by transferring such draft or demand or causing such presentment authorizes such relinquishment. An explicit reservation of claim makes the draft or demand noncomplying.
Sec. 5-111. 1. Unless otherwise agreed the beneficiary by transferring or presenting a documentary draft or demand for payment warrants to all interested parties that the necessary conditions of the credit have been complied with. This is in addition to any warranties arising under articles 3, 4, 7 and 8.
2. Unless otherwise agreed a negotiating, advising, confirming, collecting or issuing bank presenting or transferring a draft or demand for payment under a credit warrants only the matters warranted by a collecting bank under article 4 and any such bank transferring a document warrants only the matters warranted by an intermediary under articles 7 and 8.
Sec. 5-112. 1. A bank to which a documentary draft or demand for payment is presented under a credit may without dishonor of the draft, demand or credit:
(a) Defer honor until the close of the third banking day following receipt of the documents; and
(b) Further defer honor if the presenter has expressly or impliedly consented thereto.
Failure to honor within the time here specified constitutes dishonor of the draft or demand and of the credit.
2. Upon dishonor the bank may unless otherwise instructed fulfill its duty to return the draft or demand and the documents by holding them at the disposal of the presenter and sending him an advice to that effect.
3. Presenter means any person presenting a draft or demand for payment for honor under a credit even though that person is a confirming bank or other correspondent which is acting under an issuers authorization.
Sec. 5-113. 1. A bank seeking to obtain (whether for itself or another) honor, negotiation or reimbursement under a credit may give an indemnity to induce such honor, negotiation or reimbursement.
2. An indemnity agreement inducing honor, negotiation or reimbursement unless otherwise explicitly agreed applies to defects in the documents but not in the goods.
Sec. 5-114. 1. An issuer must honor a draft or demand for payment which complies with the terms of the relevant credit regardless of whether the goods or documents conform to the underlying contract for sale or other contract between the customer and the beneficiary.
κ1965 Statutes of Nevada, Page 858 (CHAPTER 353, SB 15)κ
The issuer is not excused from honor of such a draft or demand by reason of an additional general term that all documents must be satisfactory to the issuer, but an issuer may require that specified documents must be satisfactory to it.
2. Unless otherwise agreed when documents appear on their face to comply with the terms of a credit but a required document does not in fact conform to the warranties made on negotiation or transfer of a document of title (section 7-507) or of a security (section 8-306) or is forged or fraudulent or there is fraud in the transaction:
(a) The issuer must honor the draft or demand for payment if honor is demanded by a negotiating bank or other holder of the draft or demand which has taken the draft or demand under the credit and under circumstances which would make it a holder in due course (section 3-302) and in an appropriate case would make it a person to whom a document of title has been duly negotiated (section 7-502) or a bona fide purchaser of a security (section 8-302); and
(b) In all other cases as against its customer, an issuer acting in good faith may honor the draft or demand for payment despite notification from the customer of fraud, forgery or other defect not apparent on the face of the documents.
3. Unless otherwise agreed an issuer which has duly honored a draft or demand for payment is entitled to immediate reimbursement of any payment made under the credit and to be put in effectively available funds not later than the day before maturity of any acceptance made under the credit.
Sec. 5-115. 1. When an issuer wrongfully dishonors a draft or demand for payment presented under a credit the person entitled to honor has with respect to any documents the rights of a person in the position of a seller (section 2-707) and may recover from the issuer the face amount of the draft or demand together with incidental damages under section 2-710 on sellers incidental damages and interest but less any amount realized by resale or other use or disposition of the subject matter of the transaction. In the event no resale or other utilization is made the documents, goods or other subject matter involved in the transaction must be turned over to the issuer on payment of judgment.
2. When an issuer wrongfully cancels or otherwise repudiates a credit before presentment of a draft or demand for payment drawn under it the beneficiary has the rights of a seller after anticipatory repudiation by the buyer under section 2-610 if he learns of the repudiation in time reasonably to avoid procurement of the required documents. Otherwise the beneficiary has an immediate right of action for wrongful dishonor.
Sec. 5-116. 1. The right to draw under a credit can be transferred or assigned only when the credit is expressly designated as transferable or assignable.
2. Even though the credit specifically states that it is nontransferable or nonassignable the beneficiary may before performance of the conditions of the credit assign his right to proceeds. Such an assignment is an assignment of a contract right under article 9 on secured transactions and is governed by that article except that:
κ1965 Statutes of Nevada, Page 859 (CHAPTER 353, SB 15)κ
(a) The assignment is ineffective until the letter of credit or advice of credit is delivered to the assignee which delivery constitutes perfection of the security interest under article 9; and
(b) The issuer may honor drafts or demands for payment drawn under the credit until it receives a notification of the assignment signed by the beneficiary which reasonably identifies the credit involved in the assignment and contains a request to pay the assignee; and
(c) After what reasonably appears to be such a notification has been received the issuer may without dishonor refuse to accept or pay even to a person otherwise entitled to honor until the letter of credit or advice of credit is exhibited to the issuer.
As used in paragraphs (b) and (c) of this subsection, the word issuer includes any confirming bank.
3. Except where the beneficiary has effectively assigned his right to draw or his right to proceeds, nothing in this section limits his right to transfer or negotiate drafts or demands drawn under the credit.
Sec. 5-117. 1. Where an issuer or an advising or confirming bank or a bank which has for a customer procured issuance of a credit by another bank becomes insolvent before final payment under the credit and the credit is one to which this article is made applicable by paragraph (a) or (b) of subsection 1 of section 5-102 on scope, the receipt or allocation of funds or collateral to secure or meet obligations under the credit shall have the following results:
(a) To the extent of any funds or collateral turned over after or before the insolvency as indemnity against or specifically for the purpose of payment of drafts or demands for payment drawn under the designated credit, the drafts or demands are entitled to payment in preference over depositors or other general creditors of the issuer or bank; and
(b) On expiration of the credit or surrender of the beneficiarys rights under it unused any per person who has given such funds or collateral is similarly entitled to return thereof; and
(c) A change to a general or current account with a bank if specifically consented to for the purpose of indemnity against or payment of drafts or demands for payment drawn under the designated credit falls under the same rules as if the funds had been drawn out in cash and then turned over with specific instructions.
2. After honor or reimbursement under this section the customer or other person for whose account the insolvent bank has acted is entitled to receive the documents involved.
ARTICLE 6
BULK TRANSFERS
Sec. 6-101. This article shall be known and may be cited as Uniform Commercial Code-Bulk Transfers.
Sec. 6-102. 1. A bulk transfer is any transfer in bulk and not in the ordinary course of the transferors business of a major part of the materials, supplies, merchandise or other inventory (section 9-109) of an enterprise subject to this article.
κ1965 Statutes of Nevada, Page 860 (CHAPTER 353, SB 15)κ
materials, supplies, merchandise or other inventory (section 9-109) of an enterprise subject to this article.
2. A transfer of a substantial part of the equipment (section 9-109) of such an enterprise is a bulk transfer if it is made in connection with a bulk transfer of inventory, but not otherwise.
3. The enterprises subject to this article are all those whose principal business is the sale of merchandise from stock, including those who manufacture what they sell.
4. Except as limited by the following section all bulk transfers of goods located within this state are subject to this article.
Sec. 6-103. The following transfers are not subject to this article:
1. Those made to give security for the performance of an obligation.
2. General assignments for the benefit of all the creditors of the transferor, and subsequent transfers by the assignee thereunder.
3. Transfers in settlement or realization of a lien or other security interest.
4. Sales by executors, administrators, receivers, trustees in bankruptcy, or any public officer under judicial process.
5. Sales made in the course of judicial or administrative proceedings for the dissolution or reorganization of a corporation and of which notice is sent to the creditors of the corporation pursuant to order of the court or administrative agency.
6. Transfers to a person maintaining a known place of business in this state who becomes bound to pay the debts of the transferor in full and gives public notice of that fact, and who is solvent after becoming so bound.
7. A transfer to a new business enterprise organized to take over and continue the business, if public notice of the transaction is given and the new enterprise assumes the debts of the transferor and he receives nothing from the transaction except an interest in the new enterprise junior to the claims of creditors.
8. Transfers of property which is exempt from execution.
Public notice under subsection 6 or subsection 7 may be given by publishing once a week for 2 consecutive weeks in a newspaper of general circulation where the transferor had its principal place of business in this state an advertisement including the names and addresses of the transferor and transferee and the effective date of the transfer.
Sec. 6-104. 1. Except as provided with respect to auction sales (section 6-108), a bulk transfer subject to this article is ineffective against any creditor of the transferor unless:
(a) The transferee requires the transferor to furnish a list of his existing creditors prepared as stated in this section; and
(b) The parties prepare a schedule of the property transferred sufficient to identify it; and
(c) The transferee preserves the list and schedule for 6 months next following the transfer and permits inspection of either or both and copying therefrom at all reasonable hours by any creditor of the transferor, or files the list and schedule in the office of the county recorder of the county in which the principal place of business sold is located.
2. The list of creditors must be signed and sworn to or affirmed by the transferor or his agent. It must contain the names and business addresses of all creditors of the transferor, with the amounts when known, and also the names of all persons who are known to the transferor to assert claims against him even though such claims are disputed.
κ1965 Statutes of Nevada, Page 861 (CHAPTER 353, SB 15)κ
addresses of all creditors of the transferor, with the amounts when known, and also the names of all persons who are known to the transferor to assert claims against him even though such claims are disputed. If the transferor is the obligor of an outstanding issue of bonds, debentures or the like as to which there is an indenture trustee, the list of creditors need include only the name and address of the indenture trustee and the aggregate outstanding principal amount of the indenture.
3. Responsibility for the completeness and accuracy of the list of creditors rests on the transferor, and the transfer is not rendered ineffective by errors or omissions therein unless the transferee is shown to have had knowledge.
Sec. 6-105. In addition to the requirements of the preceding section, any bulk transfer subject to this article except one made by auction sale (section 6-108) is ineffective against any creditor of the transferor unless at least 10 days before he takes possession of the goods or pays for them, whichever happens first, the transferee gives notice of the transfer in the manner and to the persons hereafter provided (section 6-107).
Sec. 6-107. 1. The notice to creditors (section 6-105) shall state:
(a) That a bulk transfer is about to be made; and
(b) The names and business addresses of the transferor and transferee, and all other business names and addresses used by the transferor within 3 years last past so far as known to the transferee; and
(c) Whether or not all the debts of the transferor are to be paid in full as they fall due as a result of the transaction, and if so, the address to which creditors should send their bills.
2. If the debts of the transferor are not to be paid in full as they fall due or if the transferee is in doubt on that point then the notice shall state further:
(a) The location and general description of the property to be transferred and the estimated total of the transferors debts;
(b) The address where the schedule of property and list of creditors (section 6-104) may be inspected;
(c) Whether the transfer is to pay exiting debts and if so the amount of such debts and to whom owing; and
(d) Whether the transfer is for new consideration and if so the amount of such consideration and the time and place of payment.
3. The notice in any case shall be delivered personally or sent by registered or certified mail to all the persons shown on the list of creditors furnished by the transferor (section 6-104) and to all other persons who are known to the transferee to hold or assert claims against the transferor.
Sec. 6-108. 1. A bulk transfer is subject to this article even though it is by sale at auction, but only in the manner and with the results stated in this section.
2. The transferor shall furnish a list of his creditors and assist in the preparation of a schedule of the property to be sold, both prepared as before stated (section 6-104).
3. The person or persons other than the transferor who direct, control or are responsible for the auction are collectively called the auctioneer. The auctioneer shall:
κ1965 Statutes of Nevada, Page 862 (CHAPTER 353, SB 15)κ
(a) Receive and retain the list of creditors and prepare and retain the schedule of property for the period stated in this article (section 6-104); and
(b) Give notice of the auction personally or by registered or certified mail at least 10 days before it occurs to all persons shown on the list of creditors and to all other persons who are known to him to hold or assert claims against the transferor.
4. Failure of the auctioneer to perform any of these duties does not affect the validity of the sale or the title of the purchasers, but if the auctioneer knows that the auction constitutes a bulk transfer such failure renders the auctioneer liable to the creditors of the transferor as a class for the sums owing to them from the transferor up to but not exceeding the net proceeds of the auction. If the auctioneer consists of several persons their liability is joint and several.
Sec. 6-109. The creditors of the transferor mentioned in this article are those holding claims based on transactions or events occurring before the bulk transfer, but creditors who become such after notice to creditors is given (section 6-105 and 6-107) are not entitled to notice.
Sec. 6-110. When the title of a transferee to property is subject to a defect by reason of his noncompliance with the requirements of his article, then:
1. A purchaser of any of such property from such transferee who pays no value or who takes with notice of such noncompliance takes subject to such defect; but
2. A purchaser for value in good faith and without such notice takes free of such defect.
Sec. 6-111. No action under this article shall be brought nor levy made more than 6 months after the date on which the transferee took possession of the goods unless the transfer has been concealed. If the transfer has been concealed, actions may be brought or levies made within 6 months after its discovery.
ARTICLE 7
WAREHOUSE RECEIPTS, BILLS OF LADING
AND OTHER DOCUMENTS OF TITLE
part 1
general
Sec. 7-101. This article shall be known and may be cited as Uniform Commercial Code-Documents of Title.
Sec. 7-102. 1. In this article, unless the context otherwise requires:
(a) Bailee means the person who by a warehouse receipt, bill of lading or other document of title acknowledges possession of goods and contracts to deliver them.
(b) Consignee means the person named in a bill to whom or to whose order the bill promises delivery.
κ1965 Statutes of Nevada, Page 863 (CHAPTER 353, SB 15)κ
(c) Consignor means the person named in a bill as the person from whom the goods have been received for shipment.
(d) Delivery order means a written order to deliver goods directed to a warehouseman, carrier or other person who in the ordinary course of business issues warehouse receipts or bills of lading.
(e) Document means document of title as defined in the general definitions in article 1 (section 1-201).
(f) Goods means all things which are treated as movable for the purposes of a contract of storage or transportation.
(g) Issuer means a bailee who issues a document except that in relation to an unaccepted delivery order it means the person who order the possessor of goods to deliver. Issuer includes any person for whom an agent or employee purports to act in issuing a document if the agent or employee has real or apparent authority to issue documents, notwithstanding that the issuer received no goods or that the goods were misdescribed or that in any other respect the agent or employee violated his instructions.
(h) Warehouseman is a person engaged in the business of storing goods for hire.
2. Other definitions applying to this article or to specified parts thereof, and the sections in which they appear are:
Duly negotiate. Section 7-501.
Person entitled under the document. Section 7-403, subsec. 4.
3. Definitions in other articles applying to this article and the sections in which they appear are:
Contract for sale. Section 2-106.
Overseas. Section 2-323.
Receipt of goods. Section 2-103.
4. In addition article 1 contains general definitions and principles of construction and interpretation applicable throughout this article.
Sec. 7-103. To the extent that any treaty or statute of the United States, regulatory statute of this state or tariff, classification or regulation filed or issued pursuant thereto is applicable, the provisions of this article are subject thereto.
Sec. 7-104. 1. A warehouse receipt, bill of lading or other document of title is negotiable:
(a) If by its terms the goods are to be delivered to bearer or to the order of a named person; or
(b) Where recognized in overseas trade, if it runs to a named person or assigns.
2. Any other document is nonnegotiable. A bill of lading in which it is stated that the goods are consigned to a named person is not made negotiable by a provisions that the goods are to be delivered only against a written order signed by the same or another named person.
Sec. 7-105. The omission from either part 2 or part 3 of this article of a provision corresponding to a provision made in the other part does not imply that a corresponding rule of law is not applicable.
κ1965 Statutes of Nevada, Page 864 (CHAPTER 353, SB 15)κ
part 2
warehouse receipts: special provisions
Sec. 7-201. 1. A warehouse receipt may be issued by any warehouseman.
2. Where goods including distilled spirits and agricultural commodities are stored under a statute requiring a bond against withdrawal or a license for the issuance of receipts in the nature of warehouse receipts, a receipt issued for the goods has like effect as a warehouse receipt even though issued by a person who is the owner of the goods and is not a warehouseman.
Sec. 7-202. 1. A warehouse receipt need not be in any particular form.
2. Unless a warehouse receipt embodies within its written or printed terms each of the following, the warehouseman is liable for damages caused by the omission to a person injured thereby:
(a) The location of the warehouse where the goods are stored;
(b) The date of issue of the receipt;
(c) The consecutive number of the receipt;
(d) A statement whether the goods received will be delivered to the bearer, to a specified person, or to a specified person or his order;
(e) The rate of storage and handling charges, except that where goods are stored under a field warehousing arrangement a statement of that fact is sufficient on a nonnegotiable receipt;
(f) A description of the goods or of the packages containing them;
(g) The signature of the warehouseman, which may be made by his authorized agent;
(h) If the receipt is issued for goods of which the warehouseman is owner, either solely or jointly or in common with others, the fact of such ownership; and
(i) A statement of the amount of advances made and of liabilities incurred for which the warehouseman claims a lien or security interest (section 7-209). If the precise amount of such advances made or of such liabilities incurred is, at the time of the issue of the receipt, unknown to the warehouseman or to his agent who issues it, a statement of the fact that advances have been made or liabilities incurred and the purpose thereof is sufficient.
3. A warehouseman may insert in his receipt any other terms which are not contrary to the provisions of this chapter and do not impair his obligation of delivery (section 7-403) or his duty of care (section 7-204). Any contrary provisions shall be ineffective.
Sec. 7-203. A party to or purchaser for value in good faith of a document of title other than a bill of lading relying in either case upon the description therein of the goods may recover from the issuer damages caused by the nonreceipt or misdescription of the goods, except to the extent that the document conspicuously indicates that the issuer does not know whether any part or all of the goods in fact were received or conform to the description, as where the description is in terms of marks or labels or kind, quantity or condition, or the receipt or description is qualified by contents, condition and quality unknown, said to contain or the like, if such indication be true, or the party or purchaser otherwise has notice.
κ1965 Statutes of Nevada, Page 865 (CHAPTER 353, SB 15)κ
unknown, said to contain or the like, if such indication be true, or the party or purchaser otherwise has notice.
Sec. 7-204. 1. A warehouseman is liable for damages for loss of or injury to the goods caused by his failure to exercise such care in regard to them as a reasonably careful man would exercise under like circumstances but unless otherwise agreed he is not liable for damages which could not have been avoided by the exercise of such care.
2. Damages may be limited by a term in the warehouse receipt or storage agreement limiting the amount of liability in case of loss or damage, and setting forth a specific liability per article or item, or value per unit of weight, beyond which the warehouseman shall not be liable; provided, however, that such liability may on written request of the bailor at the time of signing such storage agreement or within a reasonable time after receipt of the warehouse receipt be increased on part or all of the goods thereunder, in which event increased rates may be charged based on such increased valuation, but that no such increase shall be permitted contrary to a lawful limitation of liability contained in the warehousemans tariff, if any. No such limitation is effective with respect to the warehousemans liability for conversion to his own use.
3. Reasonable provisions as to the time and manner of presenting claims and instituting actions based on the bailment may be included in the warehouse receipt or tariff.
Sec. 7-205. A buyer in the ordinary course of business of fungible goods sold and delivered by a warehouseman who is also in the business of buying and selling such goods takes free of any claim under a warehouse receipt even though it has been duly negotiated.
Sec. 7-206. 1. A warehouseman may on notifying the person on whose account the goods are held and any other person known to claim an interest in the goods require payment of any charges and removal of the goods from the warehouse at the termination of the period of storage fixed by the document, or, if no period is fixed, within a stated period not less than 30 days after the notification. If the goods are not removed before the date specified in the notification, the warehouseman may sell them in accordance with the provisions of the section on enforcement of a warehousemans lien (section 7-210).
2. If a warehouseman in good faith believes that the goods are about to deteriorate or decline in value to less than the amount of his lien within the time prescribed in subsection 1 for notification, advertisement and sale, the warehouseman may specify in the notification any reasonable shorter time for removal of the goods and in case the goods are not removed, may sell them at public sale held not less than 1 week after a single advertisement or posting.
3. If as a result of the quality or condition of the goods of which the warehouseman had no notice at the time of deposit the goods are a hazard to other property or to the warehouse or to persons, the warehouseman may sell the goods at public or private sale without advertisement on reasonable notification to all persons known to claim an interest in the goods. If the warehouseman after a reasonable effort is unable to sell the goods he may dispose of them in any lawful manner and shall incur no liability by reason of such disposition.
κ1965 Statutes of Nevada, Page 866 (CHAPTER 353, SB 15)κ
4. The warehouseman must deliver the goods to any person entitled to them under this article upon due demand made at any time prior to sale or other disposition under this section.
5. The warehouseman may satisfy his lien from the proceeds of any sale or disposition under this section but must hold the balance for delivery on the demand of any person to whom he would have been bound to deliver the goods.
Sec. 7-207. 1. Unless the warehouse receipt otherwise provides, a warehouseman must keep separate the goods covered by each receipt so as to permit at all times identification and delivery of those goods except that different lots of fungible goods may be commingled.
2. Fungible goods so commingled are owned in common by the persons entitled thereto and the warehouseman is severally liable to each owner for that owners share. Where because of overissue a mass of fungible goods is insufficient to meet all the receipts which the warehouseman has issued against it, the persons entitled include all holders to whom overissued receipts have been duly negotiated.
Sec. 7-208. Where a blank in a negotiable warehouse receipt has been filled in without authority, a purchaser for value and without notice of the want of authority may treat the insertion as authorized. Any other unauthorized alteration leaves any receipt enforcible against the issuer according to its original tenor.
Sec. 7-209. 1. A warehouseman has a lien against the bailor on the goods covered by a warehouse receipt or on the proceeds thereof in his possession for charges for storage or transportation (including demurrage and terminal charges), insurance, labor, or charges present or future in relation to the goods, and for expenses necessary for preservation of the goods or reasonably incurred in their sale pursuant to law. If the person on whose account the goods are held is liable for like charges or expenses in relation to other goods whenever deposited and it is stated in the receipt that a lien is claimed for charges and expenses in relation to other goods, the warehouseman also has a lien against him for such charges and expenses whether or not the other goods have been delivered by the warehouseman. But against a person to whom a negotiable warehouse receipt is duly negotiated a warehousemans lien is limited to charges in an amount or at a rate specified on the receipt or if no charges are so specified then to a reasonable charge for storage of the goods covered by the receipt subsequent to the date of the receipt.
2. The warehouseman may also reserve a security interest against the bailor for a maximum amount specified on the receipt for charges other than those specified in subsection 1, such as for money advanced and interest. Such a security interest is governed by the article on secured transactions (article 9).
3. A warehousemans lien for charges and expenses under subsection 1 or a security interest under subsection 2 is also effective against any person who so entrusted the bailor with possession of the goods that a pledge of them by him to a good faith purchaser for value would have been valid but is not effective against a person as to whom the document confers no right in the goods covered by it under section 7-503.
κ1965 Statutes of Nevada, Page 867 (CHAPTER 353, SB 15)κ
4. A warehouseman loses his lien on any goods which he voluntarily delivers or which he unjustifiably refuses to deliver.
Sec. 7-210. 1. Except as provided in subsection 2, a warehousemans lien may be enforced by public or private sale of the goods in block or in parcels, at any time or place and on any terms which are commercially reasonable, after notifying all persons known to claim an interest in the goods. Such notification must include a statement of the amount due, the nature of the proposed sale and the time and place of any public sale. The fact that a better price could have been obtained by a sale at a different time or in a different method from that selected by the warehouseman is not of itself sufficient to establish that the sale was not made in a commercially reasonable manner. If the warehouseman either sells the goods in the usual manner in any recognized market therefor, or if he sells at the price current in such market at the time of his sale, or if he has otherwise sold in conformity with commercially reasonable practices among dealers in the type of goods sold, he has sold in a commercially reasonable manner. A sale of more goods than apparently necessary to be offered to insure satisfaction of the obligation is not commercially reasonable except in cases covered by the preceding sentence.
2. A warehousemans lien on goods other than goods stored by a merchant in the course of his business may be enforced only as follows:
(a) All persons known to claim an interest in the goods must be notified.
(b) The notification must be delivered in person or sent by registered or certified letter to the last-known address of any person to be notified.
(c) The notification must include an itemized statement of the claim, a description of the goods subject to the lien, a demand for payment within a specified time not less than 10 days after receipts of the notification, and a conspicuous statement that unless the claim is paid within that time the goods will be advertised for sale and sold by auction at a specified time and place.
(d) The sale must conform to the terms of the notification.
(e) The sale must be held at the nearest suitable place to that where the goods are held or stored.
(f) After the expiration of the time given in the notification, an advertisement of the sale must be published once a week for 2 weeks consecutively in a newspaper of general circulation where the sale is to be held. The advertisement must include a description of the goods, the name of the person on whose account they are being held, and the time and place of the sale. The sale must take place at least 15 days after the first publication. If there is no newspaper of general circulation where the sale is to be held, the advertisement must be posted at least 10 days before the sale in not less than six conspicuous places in the neighborhood of the proposed sale.
3. Before any sale pursuant to this section any person claiming a right in the goods may pay the amount necessary to satisfy the lien and the reasonable expenses incurred under this section. In that event the goods must not be sold, but must be retained by the warehouseman subject to the terms of the receipt and this article.
κ1965 Statutes of Nevada, Page 868 (CHAPTER 353, SB 15)κ
4. The warehouseman may buy at any public sale pursuant to this section.
5. A purchaser in good faith of goods sold to enforce a warehousemans lien takes the goods free of any rights of persons against whom the lien was valid, despite noncompliance by the warehouseman with the requirements of this section.
6. The warehouseman may satisfy his lien from the proceeds of any sale pursuant to this section but must hold the balance, if any, for delivery on demand to any person to whom he would have been bound to deliver the goods.
7. The rights provided by this section shall be in addition to all other rights allowed by law to a creditor against his debtor.
8. Where a lien is on goods stored by a merchant in the course of his business the lien may be enforced in accordance with either subsection 1 or 2.
9. The warehouseman is liable for damages caused by failure to comply with the requirements for sale under this section and in case of willful violation is liable for conversion.
part 3
bills of lading: special provisions
Sec. 7-301. 1. A consignee of a nonnegotiable bill who has given value in good faith or a holder to whom a negotiable bill has been duly negotiated relying in either case upon the description therein of the goods, or upon the date therein shown, may recover from the issuer damages caused by the misdating of the bill or the nonreceipt or misdescription of the goods, except to the extent that the document indicates that the issuer does not know whether any part or all of the goods in fact were received or conform to the description, as where the description is in terms of marks or labels or kind, quantity, or condition or the receipt or description is qualified by contents or condition of contents of packages unknown, said to contain, shippers weight, load and count or the like, if such indication be true.
2. When goods are loaded by an issuer who is a common carrier, the issuer must count the packages of goods if package freight and ascertain the kind and quantity if bulk freight. In such cases shippers weight, load and count or other words indicating that the description was made by the shipper are ineffective except as to freight concealed by packages.
3. When bulk freight is loaded by a shipper who makes available to the issuer adequate facilities for weighting such freight, an issuer who is a common carrier must ascertain the kind and quantity within a reasonable time after receiving the written request of the shipper to do so. In such cases shippers weight or other words of like purport are ineffective.
4. The issuer may by inserting in the bill the words shippers weight, load and count or other words of like purport indicate that the goods were loaded by the shipper; and if such statement be true the issuer shall not be liable for damages caused by the improper loading.
κ1965 Statutes of Nevada, Page 869 (CHAPTER 353, SB 15)κ
the goods were loaded by the shipper; and if such statement be true the issuer shall not be liable for damages caused by the improper loading. But their omission does not imply liability for such damages.
5. The shipper shall be deemed to have guaranteed to the issuer the accuracy at the time of shipment of the description, marks, labels, number, kind, quantity, condition and weight, as furnished by him; and the shipper shall indemnify the issuer against damage caused by inaccuracies in such particulars. The right of the issuer to such indemnity shall in no way limit his responsibility and liability under the contract of carriage to any person other than the shipper.
Sec. 7-302. 1. The issuer of a through bill of lading or other document embodying an undertaking to be performed in part by persons acting as its agents or by connecting carriers is liable to anyone entitled to recover on the document for any breach by such other persons or by a connecting carrier of its obligation under the document but to the extent that the bill covers an undertaking to be performed overseas or in territory not contiguous to the continental United States or an undertaking including matters other than transportation this liability may be varied by agreement of the parties.
2. Where goods covered by a through bill of lading or other document embodying an undertaking to be performed in part by persons other than the issuer are received by any such person, he is subject with respect to his own performance while the goods are in his possession to the obligation of the issuer. His obligation is discharged by delivery of the goods to another such person pursuant to the document, and does not include liability for breach by any other such persons or by the issuer.
3. The issuer of such through bill of lading or other document shall be entitled to recover from the connecting carrier or such other person in possession of the goods when the breach of the obligation under the document occurred, the amount it may be required to pay to anyone entitled to recover on the document therefor, as may be evidenced by any receipt, judgment, or transcript thereof, and the amount of any expense reasonably incurred by it in defending any action brought by anyone entitled to recover on the document therefor.
Sec. 7-303. 1. Unless the bill of lading otherwise provides, the carrier may deliver the goods to a person or destination other than that stated in the bill or may otherwise dispose of the goods on instructions from:
(a) The holder of a negotiable bill; or
(b) The consignor on a nonnegotiable bill notwithstanding contrary instructions from the consignee; or
(c) The consignee on a nonnegotiable bill in the absence of contrary instructions from the consignor, if the goods have arrived at the billed destination or if the consignee is in possession of the bill; or
(d) The consignee on a nonnegotiable bill if he is entitled as against the consignor to dispose of them.
2. Unless such instructions are noted on a negotiable bill of lading, a person to whom the bill is duly negotiated can hold the bailee according to the original terms.
Sec. 7-304. 1. Except where customary in overseas transportation, a bill of lading must not be issued in a set of parts.
κ1965 Statutes of Nevada, Page 870 (CHAPTER 353, SB 15)κ
a bill of lading must not be issued in a set of parts. The issuer is liable for damages caused by violation of this subsection.
2. Where a bill of lading is lawfully drawn in a set of parts, each of which is numbered and expressed to be valid only if the goods have not been delivered against any other part, the whole of the parts constitute one bill.
3. Where a bill of lading is lawfully issued in a set of parts and different parts are negotiated to different persons, the title of the holder to whom the first due negotiation is made prevails as to both the document and the goods even though any later holder may have received the goods from the carrier in good faith and discharged the carriers obligation by surrender of his part.
4. Any person who negotiates or transfers a single part of a bill of lading drawn in a set is liable to holders of that part as if it were the whole set.
5. The bailee is obliged to deliver in accordance with part 4 of this article against the first presented part of a bill of lading lawfully drawn in a set. Such delivery discharges the bailees obligation on the whole bill.
Sec. 7-305. 1. Instead of issuing a bill of lading to the consignor at the place of shipment a carrier may at the request of the consignor procure the bill to be issued at destination or at any other place designated in the request.
2. Upon request of anyone entitled as against the carrier to control the goods while in transit and on surrender of any outstanding bill of lading or other receipt covering such goods, the issuer may procure a substitute bill to be issued at any place designated in the request.
Sec. 7-306. An unauthorized alteration or filling in of a blank in a bill of lading leaves the bill enforcible according to its original tenor.
Sec. 7-307. 1. A carrier has a lien on the goods covered by a bill of lading for charges subsequent to the date of its receipt of the goods for storage or transportation (including demurrage and terminal charges) and for expenses necessary for preservation of the goods incident to their transportation or reasonably incurred in their sale pursuant to law. But against a purchaser for value of a negotiable bill of lading a carriers lien is limited to charges stated in the bill or the applicable tariffs, or if no charges are stated then to a reasonable charge.
2. A lien for charges and expenses under subsection 1 on goods which the carrier was required by law to receive for transportation is effective against the consignor or any person entitled to the goods unless the carrier had notice that the consignor lacked authority to subject the goods to such charges and expenses. Any other lien under subsection 1 is effective against the consignor and any person who permitted the bailor to have control or possession of the goods unless the carrier had notice that the bailor lacked such authority.
3. A carrier loses his lien on any goods which he voluntarily delivers or which he unjustifiably refuses to deliver.
Sec. 7-308. 1. A carriers lien may be enforced by public or private sale of the goods, in bloc or in parcels, at any time or place and on any terms which are commercially reasonable, after notifying all persons known to claim an interest in the goods.
κ1965 Statutes of Nevada, Page 871 (CHAPTER 353, SB 15)κ
known to claim an interest in the goods. Such notification must include a statement of the amount due, the nature of the proposed sale and the time and place of any public sale. The fact that a better price could have been obtained by a sale and the time and place of any public sale. The fact that a better price could have been obtained by a sale at a different time or in a different method from that selected by the carrier is not of itself sufficient to establish that the sale was not made in a commercially reasonable manner. If the carrier either sells the goods in the usual manner in any recognized market therefor of if he sells at the price current in such market at the time of his sale or if he has otherwise sold in conformity with commercially reasonable practices among dealers in the type of goods sold he has sold in a commercially reasonable manner. A sale of more goods than apparently necessary to be offered to ensure satisfaction of the obligation is not commercially reasonable except in cases covered by the preceding sentence.
2. Before any sale pursuant to this section any person claiming a right in the goods may pay the amount necessary to satisfy the lien and the reasonable expenses incurred under this section. In that event the goods must not be sold, but must be retained by the carrier subject to the terms of the bill and this article.
3. The carrier may buy at any public sale pursuant to this section.
4. A purchaser in good faith of goods sold to enforce a carriers lien takes the goods free of any rights of persons against whom the lien was valid, despite noncompliance by the carrier with the requirements of this section.
5. The carrier must satisfy his lien from the proceeds of any sale pursuant to this section but must hold the balance, if any, for delivery on demand to any person to whom he would have been bound to deliver the goods.
6. The rights provided by this section shall be in addition to all other rights allowed by law to a creditor against his debtor.
7. A carriers lien may be enforced in accordance with either subsection 1 or the procedure set forth in subsection 2 of section 7-210.
8. The carrier is liable for damages caused by failure to comply with the requirements for sale under this section and in case of willful violation is liable for conversion.
Sec. 7-309. 1. A carrier who issues a bill of lading whether negotiable or nonnegotiable must exercise the degree of care in relation to the goods which a reasonably careful man would exercise under like circumstances. This subsection does not repeal or change any law or rule of law which imposes liability upon a common carrier for damages not caused by its negligence.
2. Damages may be limited by a provision that the carriers liability shall not exceed a value stated in the document if the carriers rates are dependent upon value and the consignor by the carriers tariff is afforded an opportunity to declare a higher value or a value as lawfully provided in the tariff, or where no tariff is filed he is otherwise advised of such opportunity; but no such limitation is effective with respect to the carriers liability for conversion to its own use.
3. Reasonable provisions as to the time and manner of presenting claims and instituting actions based on the shipment may be included in a bill of lading or tariff.
κ1965 Statutes of Nevada, Page 872 (CHAPTER 353, SB 15)κ
part 4
warehouse receipts and bills of lading:
general obligations
Sec. 7-401. The obligations imposed by this article on an issuer apply to a document of title regardless of the fact that:
1. The document may not comply with the requirements of this article or of any other law or regulation regarding its issue, form or content; or
2. The issuer may have violated laws regulating the conduct of his business; or
3. The goods covered by the document were owned by the bailee at the time the document was issued; or
4. The person issuing the document does not come within the definition of warehouseman if it purports to be a warehouse receipt.
Sec. 7-402. Neither a duplicate nor any other document of title purporting to cover goods already represented by an outstanding document of the same issuer confers any right in the goods, except as provided in the case of bills in a set, overissue of documents for fungible goods and substitutes for lost, stolen or destroyed documents. But the issuer is liable for damages caused by his overissue or failure to identify a duplicate document as such by conspicuous notation on its face.
Sec. 7-403. 1. The bailee must deliver the goods to a person entitled under the document who complies with subsections 2 and 3, unless and to the extent that the bailee establishes any of the following:
(a) Delivery of the goods to a person whose receipt was rightful as against the claimant.
(b) Damage to or delay, loss or destruction of the goods for which the bailee is not liable, but the burden of establishing negligence in such cases is on the person entitled under the document.
(c) Previous sale or other disposition of the goods in lawful enforcement of a lien or on warehousemans lawful termination of storage.
(d) The exercise by a seller of his right to stop delivery pursuant to the provisions of the article on sales (section 2-705).
(e) A diversion, reconsignment or other disposition pursuant to the provisions of this article (section 7-303) or tariff regulating such right.
(f) Release, satisfaction or any other fact affording a personal defense against the claimant.
(g) Any other lawful excuse.
2. A person claiming goods covered by a document of title must satisfy the bailees lien where the bailee so requests or where the bailee is prohibited by law from delivering the goods until the charges are paid.
3. Unless the person claiming is one against whom the document confers no right under subsection 1 of section 7-503, he must surrender for cancellation or notation of partial deliveries any outstanding negotiable document covering the goods, and the bailee must cancel the document or conspicuously note the partial delivery thereon or be liable to any person to whom the document is duly negotiated.
κ1965 Statutes of Nevada, Page 873 (CHAPTER 353, SB 15)κ
document or conspicuously note the partial delivery thereon or be liable to any person to whom the document is duly negotiated.
4. Person entitled under the document means holder in the case of a negotiable document, or the person to whom delivery is to be made by the terms of or pursuant to written instructions under a nonnegotiable document.
Sec. 7-404. A bailee who in good faith including observance of reasonable commercial standards has received goods and delivered or otherwise disposed of them according to the terms of the document of title or pursuant to this article is not liable therefor. This rule applies even though the person from whom he received the goods had no authority to procure the document or to dispose of the goods and even though the person to whom he delivered the goods had no authority to receive them.
part 5
warehouse receipts and bills of lading:
negotiation and transfer
Sec. 7-501. 1. A negotiable document of title running to the order of a named person is negotiated by his endorsement and delivery. After his endorsement in blank or to bearer any person can negotiate it by delivery alone.
2. (a) A negotiable document of title is also negotiated by delivery alone when by its original terms it runs to bearer.
(b) When a document running to the order of a named person is delivered to him the effect is the same as if the document had been negotiated.
3. Negotiation of a negotiable document of title after it has been endorsed to a specified person requires endorsement by the special endorsee as well as delivery.
4. A negotiable document of title is duly negotiated when it is negotiated in the manner stated in this section to a holder who purchases it in good faith without notice of any defense against or claim to it on the part of any person and for value, unless it is established that the negotiation is not in the regular course of business or financing or involves receiving the document in settlement or payment of a money obligation.
5. Endorsement of a nonnegotiable document neither makes it negotiable nor adds to the transferees rights.
6. The naming in a negotiable bill of a person to be notified of the arrival of the goods does not limit the negotiability of the bill nor constitute notice to a purchaser thereof of any interest of such person in the goods.
Sec. 7-502. 1. Subject to the following section and to the provisions of section 7-205 on fungible goods, a holder to whom a negotiable document of title has been duly negotiated acquires thereby:
(a) Title to the document;
(b) Title to the goods;
κ1965 Statutes of Nevada, Page 874 (CHAPTER 353, SB 15)κ
(c) All rights accruing under the law of agency or estoppel, including rights to goods delivered to the bailee after the document was issued; and
(d) The direct obligation of the issuer to hold or deliver the goods according to the terms of the document free of any defense or claim by him except those arising under the terms of the document or under this article. In the case of a delivery order the bailees obligation accrues only upon acceptance and the obligation acquired by the holder is that the issuer and any endorser will procure the acceptance of the bailee.
2. Subject to the following section, title and rights so acquired are not defeated by any stoppage of the goods represented by the document or by surrender of such goods by the bailee, and are not impaired even though the negotiation or any prior negotiation constituted a breach of duty or even though any person has been deprived of possession of the document by misrepresentation, fraud, accident, mistake, duress, loss, theft or conversion, or even though a previous sale or other transfer of the goods or document has been made to a third person.
Sec. 7-503. 1. A document of title confers no right in goods against a person who before issuance of the document had a legal interest or a perfected security interest in them and who neither:
(a) Delivered or entrusted them or any document of title covering them to the bailor or his nominee with actual or apparent authority to ship, store or sell or with power to obtain delivery under this article (section 7-403) or with power of disposition under this chapter (sections 2-403 and 9-307) or other statute or rule of law; nor
(b) Acquiesced in the procurement by the bailor or his nominee of any document of title.
2. Title to goods based upon an unaccepted delivery order is subject to the rights of anyone to whom a negotiable warehouse receipt or bill of lading covering the goods has been duly negotiated. Such a title may be defeated under the next section to the same extent as the rights of the issuer or a transferee from the issuer.
3. Title to goods based upon a bill of lading issued to a freight forwarder is subject to the rights of anyone to whom a bill issued by the freight forwarder is duly negotiated; but delivery by the carrier in accordance with part 4 of this article pursuant to its own bill of lading discharges the carriers obligation to deliver.
Sec. 7-504. 1. A transferee of a document, whether negotiable or nonnegotiable, to whom the document has been delivered but not duly negotiated, acquires the title and rights which his transferor had or had actual authority to convey.
2. In the case of a nonnegotiable document, until but not after the bailee receives notification of the transfer, the rights of the transferee may be defeated:
(a) By those creditors of the transferor who could treat the sale as void under section 2-402; or
(b) By a buyer from the transferor in ordinary course of business if the bailee has delivered the goods to the buyer or received notification of his rights; or
κ1965 Statutes of Nevada, Page 875 (CHAPTER 353, SB 15)κ
(c) As against the bailee by good faith dealings of the bailee with the transferor.
3. A diversion or other change of shipping instructions by the consignor in a nonnegotiable bill of lading which causes the bailee not to deliver to the consignee defeats the consignees title to the goods if they have been delivered to a buyer in ordinary course of business and in any event defeats the consignees rights against the bailee.
4. Delivery pursuant to a nonnegotiable document may be stopped by a seller under section 2-705, and subject to the requirement of due notification there provided. A bailee honoring the sellers instructions is entitled to be indemnified by the seller against any resulting loss or expense.
Sec. 7-505. The endorsement of a document of title issued by a bailee does not make the endorser liable for any default by the bailee or by previous endorsers.
Sec. 7-506. The transferee of a negotiable document of title has a specifically enforcible right to have his transferor supply any necessary endorsement but the transfer becomes a negotiation only as of the time the endorsement is supplied.
Sec. 7-507. Where a person negotiates or transfers a document of title for value otherwise than as a mere intermediary under the next following section, then unless otherwise agreed he warrants to his immediate purchaser only in addition to any warranty made in selling the goods:
1. That the document is genuine; and
2. That he has no knowledge of any fact which would impair its validity or worth; and
3. That his negotiation or transfer is rightful and fully effective with respect to the title to the document and the goods it represents.
Sec. 7-508. A collecting bank or other intermediary known to be entrusted with documents on behalf of another or with collection of a draft or other claim against delivery of documents warrants by such delivery of the documents only its own good faith and authority. This rule applies even though the intermediary has purchased or made advances against the claim or draft to be collected.
Sec. 7-509. The question whether a document is adequate to fulfill the obligations of a contract for sale or the conditions of a credit is governed by the articles on sales (article 2) and on letters of credit (article 5).
part 6
warehouse receipts and bills of lading:
miscellaneous provisions
Sec. 7-601. 1. If a document has been lost, stolen or destroyed, a court may order delivery of the goods or issuance of a substitute document and the bailee may without liability to any person comply with such order. If the document was negotiable the claimant must post security approved by the court to indemnify any person who may suffer loss as a result of nonsurrender of the document.
κ1965 Statutes of Nevada, Page 876 (CHAPTER 353, SB 15)κ
suffer loss as a result of nonsurrender of the document. If the document was not negotiable, such security may be required at the discretion of the court. The court may also in its discretion order payment of the bailees reasonable costs and counsel fees.
2. A bailee who without court orders delivers goods to a person claiming under a missing negotiable document is liable to any person injured thereby, and if the delivery is not in good faith becomes liable for conversion. Delivery in good faith is not conversion if made in accordance with a filed classification or tariff or, where no classification or tariff is filed, if the claimant posts security with the bailee in an amount at least double the value of the goods at the time of posting to indemnify any person injured by the delivery who files a notice of claim within 1 year after the delivery.
Sec. 7-602. Except where the document was originally issued upon delivery of the goods by a person who had no power to dispose of them, no lien attaches by virtue of any judicial process to goods in the possession of a bailee for which a negotiable document of title is outstanding unless the document be first surrendered to the bailee or its negotiation enjoined, and the bailee shall not be compelled to deliver the goods pursuant to process until the document is surrendered to him or impounded by the court. One who purchases the document for value without notice of the process or injunction takes free of the lien imposed by judicial process.
Sec. 7-603. If more than one person claims title or possession of the goods, the bailee is excused from delivery until he has had a reasonable time to ascertain the validity of the adverse claims or to bring an action to compel all claimants to interplead and may compel such interpleader, either in defending an action for nondelivery of the goods, or by original action, whichever is appropriate.
ARTICLE 8
INVESTMENT SECURITIES
part 1
short title and general matters
Sec. 8-101. This article shall be known and may be cited as Uniform Commercial Code-Investment Securities.
Sec. 8-102. 1. In this article unless the context otherwise requires:
(a) A security is an instrument which:
(1) Is issued in bearer or registered form; and
(2) Is of a type commonly dealt in upon securities exchanges or markets or commonly recognized in any area in which it is issued or dealt in as a medium for investment; and
(3) Is either one of a class or series or by its terms is divisible into a class or series of instruments; and
(4) Evidences a share, participation or other interest in property or in an enterprise or evidences an obligation of the issuer.
κ1965 Statutes of Nevada, Page 877 (CHAPTER 353, SB 15)κ
(b) A writing which is a security is governed by this article and not by Uniform Commercial Code-Commercial Paper even though it also meets the requirements of that article. This article does not apply to money.
(c) A security is in registered form when it specifies a person entitled to the security or to the rights it evidences and when its transfer may be registered upon books maintained for that purpose by or on behalf of an issuer or the security so states.
(d) A security is in bearer form when it runs to bearer according to its terms and not by reason of any endorsement.
2. A subsequent purchaser is a person who takes other than by original issue.
3. A clearing corporation is a corporation all of the capital stock of which is held by or for a national securities exchange or association registered under a statute of the United States such as the Securities Exchange Act of 1934.
4. A custodian bank is any bank or trust company which is supervised and examined by state or federal authority having supervision over banks and which is acting as custodian for a clearing corporation.
5. Other definitions applying to this article or to specified parts thereof and the sections in which they appear are:
Adverse claim. Section 8-301.
Bona fide purchaser. Section 8-302.
Broker. Section 8-303.
Guarantee of the signature. Section 8-402.
Intermediary bank. Section 4-105.
Issuer. Section 8-201.
Overissue. Section 8-104.
6. In addition article 1 contains general definitions and principles of construction and interpretation applicable throughout this article.
Sec. 8-103. A lien upon a security in favor of an issuer thereof is valid against a purchaser only if the right of the issuer to such lien is notes conspicuously on the security.
Sec. 8-104. 1. The provisions of this article which validate a security or compel its issue or reissue do not apply to the extent that validation, issue or reissue would result in overissue; but:
(a) If an identical security which does not constitute an overissue is reasonably available for purchase, the person entitled to issue or validation may compel the issuer to purchase and deliver such a security to him against surrender of the security, if any, which he holds; or
(b) If a security is not so available for purchase, the person entitled to issue or validation may recover from the issuer the price he or the last purchaser for value paid for it with interest from the date of his demand.
2. Overissue means the issue of securities in excess of the amount which the issuer has corporate power to issue.
Sec. 8-105. 1. Securities governed by this article are negotiable instruments.
κ1965 Statutes of Nevada, Page 878 (CHAPTER 353, SB 15)κ
2. In any action on a security:
(a) Unless specifically denied in the pleadings, each signature on the security or in a necessary endorsement is admitted;
(b) When the effectiveness of a signature is put in issue the burden of establishing it is on the party claiming under the signature but the signature is presumed to be genuine or authorized;
(c) When signatures are admitted or established production of the instrument entitles a holder to recover on it unless the defendant establishes a defense or a defect going to the validity of the security; and
(d) After it is shown that a defense or defect exists the plaintiff has the burden of establishing that he or some person under whom he claims is a person against whom the defense or defect is ineffective (section 8-202).
Sec. 8-106. The validity of a security and the rights and duties of the issuer with respect to registration of transfer are governed by the law (including the conflict of laws rules) of the jurisdiction of organization of the issuer.
Sec. 8-107. 1. Unless otherwise agreed and subject to any applicable law or regulation respecting short sales, a person obligated to deliver securities may deliver any security of the specified issue in bearer form or registered in the name of the transferee or endorsed to him or in blank.
2. When the buyer fails to pay the price as it comes due under a contract of sale the seller may recover the price:
(a) Of securities accepted by the buyer; and
(b) Of other securities if efforts at their resale would be unduly burdensome or if there is no readily available market for their resale.
Sec. 8-108. This chapter does not repeal NRS 162.150 to 162.250, inclusive, cited as the Uniform Act for the Simplification of Fiduciary Security Transfers, and if in any respect there is an inconsistency between that act and this article the provisions of NRS 162.150 to 162.250, inclusive, shall control.
part 2
issue-issuer
Sec. 8-201. 1. With respect to obligations on or defenses to a security issuer includes a person who:
(a) Places or authorizes the placing of his name on a security (otherwise than as authenticating trustee, registrar, transfer agent or the like) to evidence that it represents a share, participation or other interest in his property or in an enterprise or to evidence his duty to perform an obligation evidence by the security; or
(b) Directly or indirectly creates fractional interests in his rights or property which fractional interests are evidenced by securities; or
(c) Becomes responsible for or in place of any other person described as an issuer in this section.
2. With respect to obligations on or defenses to a security a guarantor is an issuer to the extent of his guaranty whether or not his obligation is noted on the security.
κ1965 Statutes of Nevada, Page 879 (CHAPTER 353, SB 15)κ
3. With respect to registration of transfer (part 4 of this article) issuer means a person on whose behalf transfer books are maintained.
Sec. 8-202. 1. Even against a purchaser for value and without notice, the terms of a security include those stated on the security and those made part of the security by reference to another instrument, indenture or document or to a constitution, statute, ordinance, rule, regulation, order or the like to the extent that the terms so referred to do not conflict with the stated terms. Such a reference does not of itself charge a purchaser for value with notice of a defect going to the validity of the security even though the security expressly states that a person accepting it admits such notice.
2. (a) A security other than one issued by a government or governmental agency or unit even though issued with a defect going to its validity is valid in the hands of a purchaser for value and without notice of the particular defect unless the defect involves a violation of constitutional provisions, in which case the security is valid in the hands of a subsequent purchaser for value and without notice of the defect.
(b) The rule of paragraph (a) applies to an issuer which is a government or governmental agency or unit only if either there has been substantial compliance with the legal requirements governing the issue or the issuer has received a substantial consideration for the issue as a whole or for the particular security and a stated purpose of the issue is one for which the issuer has power to borrow money or issue the security.
3. Except as otherwise provided in the case of certain unauthorized signatures on an issue (section 8-205), lack of genuineness of a security is a complete defense even against a purchaser for value and without notice.
4. All other defenses of the issuer including nondelivery and conditional deliver of the security are ineffective against a purchaser for value who has taken without notice of the particular defense.
5. Nothing in this section shall be construed to affect the right of a party to a when, as and if issued or a when distributed contract to cancel the contract in the event of a material change in the character of the security which is the subject of the contract or in the plan or arrangement pursuant to which such security is to be issued or distributed.
Sec. 8-203. 1. After an act or event which creates a right to immediate performance of the principal obligation evidenced by the security or which sets a date on or after which the security is to be presented or surrendered for redemption or exchange, a purchaser is charged with notice of any defect in its issue or defense of the issuer:
(a) If the act or event is one requiring the payment of money or the delivery of securities or both on presentation or surrender of the security and such funds or securities are available on the date set for payment or exchange and he takes the security more than 1 year after that date; and
(b) If the act or event is not covered by paragraph (a) and he takes the security more than 2 years after the date set for surrender or presentation or the date on which such performance became due.
κ1965 Statutes of Nevada, Page 880 (CHAPTER 353, SB 15)κ
2. A call which has been revoked is not within subsection 1.
Sec. 8-204. Unless noted conspicuously on the security a restriction on transfer imposed by the issuer even though otherwise lawful is ineffective except against a person with actual knowledge of it.
Sec. 8-205. An unauthorized signature placed on a security prior to or in the course of issue is ineffective except that the signature is effective in favor of a purchaser for value and without notice of the lack of authority if the signing has been done by:
(a) An authenticating trustee, registrar, transfer agent or other person entrusted by the issuer with the signing of the security or of similar securities or their immediate preparation for signing; or
(b) An employee of the issuer or of any of the foregoing entrusted with responsible handling of the security.
Sec. 8-206. 1. Where a security contains the signatures necessary to its issue or transfer but is incomplete in any other respect:
(a) Any person may complete it by filling in the blanks as authorized; and
(b) Even though the blanks are incorrectly filled in, the security as completed is enforcible by a purchaser who took it for value and without notice of such incorrectness.
2. A complete security which has been improperly altered even though fraudulently remains enforcible but only according to its original terms.
Sec. 8-207. 1. Prior to due presentment for registration of transfer of a security in registered form the issuer or indenture trustee may treat the registered owner as the person exclusively entitled to vote, to receive notifications and otherwise to exercise all the rights and powers of an owner.
2. Nothing in this article shall be construed to affect the liability of the registered owner of a security for calls, assessments or the like.
Sec. 8-208. 1. A person placing his signature upon a security as authenticating trustee, registrar, transfer agent or the like warrants to a purchaser for value without notice of the particular defect that:
(a) The security is genuine; and
(b) His own participation in the issue of the security is within his capacity and within the scope of the authorization received by him from the issuer; and
(c) He has reasonable grounds to believe that the security is in the form and within the amount the issuer is authorized to issue.
2. Unless otherwise agreed, a person by so placing his signature does not assume responsibility for the validity of the security in other respects.
part 3
purchase
Sec. 8-301. 1. Upon delivery of a security the purchaser acquires the rights in the security which his transferor had or had actual authority to convey except that a purchaser who has himself been a party to any fraud or illegality affecting the security or who as a prior holder had notice of an adverse claim cannot improve his position by taking from a later bona fide purchaser.
κ1965 Statutes of Nevada, Page 881 (CHAPTER 353, SB 15)κ
party to any fraud or illegality affecting the security or who as a prior holder had notice of an adverse claim cannot improve his position by taking from a later bona fide purchaser. Adverse claim includes a claim that a transfer was or would be wrongful or that a particular adverse person is the owner of or has an interest in the security.
2. A bona fide purchaser in addition to acquiring the rights of a purchaser also acquires the security free of any adverse claim.
3. A purchaser of a limited interest acquires rights only to the extent of the interest purchased.
Sec. 8-302. A bona fide purchaser is a purchaser for value in good faith and without notice of any adverse claim who takes delivery of a security in bearer form or of one in registered form issued to him or endorsed to him or in blank.
Sec. 8-303. Broker means a person engaged for all or part of his time in the business of buying and selling securities, who in the transaction concerned acts for, or buys a security from or sells a security to a customer. Nothing in this article determines the capacity in which a person acts for purposes of any other statute or rule to which such person is subject.
Sec. 8-304. 1. A purchaser (including a broker for the seller or buyer but excluding an intermediary bank) of a security is charged with notice of adverse claims if:
(a) The security whether in bearer or registered form has been endorsed for collection or for surrender or for some other purpose not involving transfer; or
(b) The security is in bearer form and has on it an unambiguous statement that it is the property of a person other than the transferor. The mere writing of a name on a security is not such a statement.
2. The fact that the purchaser (including a broker for the seller or buyer) has notice that the security is held for a third person or is registered in the name of or endorsed by a fiduciary does not create a duty of inquiry into the rightfulness of the transfer or constitute notice of adverse claims. If, however, the purchaser (excluding an intermediary bank) has knowledge that the proceeds are being used or that the transaction is for the individual benefit of the fiduciary or otherwise in breach of duty, the purchaser is charged with notice of adverse claims.
Sec. 8-305. An act or event which creates a right to immediate performance of the principal obligation evidenced by the security or which sets a date on or after which the security is to be presented or surrendered for redemption or exchange does not of itself constitute any notice of adverse claims except in the case of a purchase:
1. After 1 year from any date set for such presentment or surrender for redemption or exchange; or
2. After 6 months from any date set for payment of money against presentation or surrender of the security if funds are available for payment on that date.
Sec. 8-306. 1. A person who presents a security for registration of transfer or for payment or exchange warrants to the issuer that he is entitled to the registration, payment or exchange. But a purchaser for value without notice of adverse claims who receives a new, reissued or reregistered security on registration of transfer warrants only that he has no knowledge of any unauthorized signature (section 8-311) in a necessary endorsement.
κ1965 Statutes of Nevada, Page 882 (CHAPTER 353, SB 15)κ
reregistered security on registration of transfer warrants only that he has no knowledge of any unauthorized signature (section 8-311) in a necessary endorsement.
2. A person by transferring a security to a purchaser for value warrants only that:
(a) His transfer is effective and rightful; and
(b) The security is genuine and has not been materially altered; and
(c) He knows no fact which might impair the validity of the security.
3. Where a security is delivered by an intermediary known to be entrusted with delivery of the security on behalf of another or with collection of a draft or other claim against such delivery, the intermediary by such delivery warrants only his own good faith and authority even though he has purchased or made advances against the claim to be collected against the delivery.
4. A pledgee or other holder for security who redelivers the security received, or after payment and on order of the debtor delivers that security to a third person makes only the warranties of an intermediary under subsection 3.
5. A broker gives to his customer and to the issuer and a purchaser the warranties provided in this section and has the rights and privileges of a purchaser under this section. The warranties of and in favor of the broker acting as an agent are in addition to applicable warranties given by and in favor of his customer.
Sec. 8-307. Where a security in registered form has been delivered to a purchaser without a necessary endorsement he may become a bona fide purchaser only as of the time the endorsement is supplied, but against the transferor the transfer is complete upon delivery and the purchaser has a specifically enforcible right to have any necessary endorsement supplied.
Sec. 8-308. 1. An endorsement of a security in registered form is made when an appropriate person signs on it or on a separate document an assignment or transfer of the security or a power to assign or transfer it or when the signature of such person is written without more upon the back of the security.
2. An endorsement may be blank or special. An endorsement in blank includes an endorsement to bearer. A special endorsement specifies the person to whom the security is to be transferred, or who has power to transfer it. A holder may convert a blank endorsement into a special endorsement.
3. An appropriate person in subsection 1 means:
(a) The person specified by the security or by special endorsement to be entitled to the security; or
(b) Where the person so specified is described as a fiduciary but is no longer serving in the described capacity, either that person or his successor; or
(c) Where the security or endorsement so specifies more than one person as fiduciaries and one or more are no longer serving in the described capacity, the remaining fiduciary or fiduciaries, whether or not a successor has been appointed or qualified; or
κ1965 Statutes of Nevada, Page 883 (CHAPTER 353, SB 15)κ
(d) Where the person so specified is an individual and is without capacity to act by virtue of death, incompetence, infancy or otherwise, his executor, administrator, guardian or like fiduciary; or
(e) Where the security or endorsement so specifies more than one person as tenants by the entirety or with right of survivorship and by reason of death all cannot sign, the survivor or survivors; or
(f) A person having power to sign under applicable law or controlling instrument; or
(g) To the extent that any of the foregoing persons may act through an agent, his authorized agent.
4. Unless otherwise agreed the endorser by his endorsement assumes no obligation that the security will be honored by the issuer.
5. An endorsement purporting to be only of part of a security representing units intended by the issuer to be separately transferable is effective to the extent of the endorsement.
6. Whether the person signing is appropriate is determined as of the date of signing and an endorsement by such a person does not become unauthorized for the purposes of this article by virtue of any subsequent change of circumstances.
7. Failure of a fiduciary to comply with a controlling instrument or with the law of the state having jurisdiction of the fiduciary relationship, including any law requiring the fiduciary to obtain court approval of the transfer, does not render his endorsement unauthorized for the purposes of this article.
Sec. 8-309. An endorsement of a security whether special or in blank does not constitute a transfer until delivery of the security on which it appears or if the endorsement is on a separate document until delivery of both the document and the security.
Sec. 8-310. An endorsement of a security in bearer form may give notice of adverse claims (section 8-304) but does not otherwise affect any right to registration the holder may possess.
Sec. 8-311. Unless the owner has ratified an unauthorized endorsement or is otherwise precluded from asserting its ineffectiveness:
1. He may assert its ineffectiveness against the issuer or any purchaser other than a purchaser for value and without notice of adverse claims who has in good faith received a new, reissued or reregistered security on registration of transfer; and
2. An issuer who registers the transfer of a security upon the unauthorized endorsement is subject to liability for improper registration (section 8-404).
Sec. 8-312. 1. Any person guaranteeing a signature of an endorser of a security warrants that at the time of signing:
(a) The signature was genuine; and
(b) The signer was an appropriate person to endorse (section 8-308); and
(c) The signer has legal capacity to sign.
But the guarantor does not otherwise warrant the rightfulness of the particular transfer.
2. Any person may guarantee an endorsement of a security and by so doing warrants not only the signature (subsection 1) but also the rightfulness of the particular transfer in all respects.
κ1965 Statutes of Nevada, Page 884 (CHAPTER 353, SB 15)κ
rightfulness of the particular transfer in all respects. But no issuer may require a guarantee of endorsement as a condition to registration of transfer.
3. The foregoing warranties are made to any person taking or dealing with the security in reliance on the guarantee and the guarantor is liable to such person for any loss resulting from breach of the warranties.
Sec. 8-313. 1. Delivery to a purchaser occurs when:
(a) He or a person designated by him acquires possession of a security; or
(b) His broker acquires possession of a security specially endorsed to or issued in the name of the purchaser; or
(c) His broker sends him confirmation of the purchase and also by book entry or otherwise identifies a specific security in the brokers possession as belonging to the purchaser; or
(d) With respect to an identified security to be delivered while still in the possession of a third person when that person acknowledges that he holds for the purchaser; or
(e) Appropriate entries on the books of a clearing corporation are made under section 8-320.
2. The purchaser is the owner of a security held for him by his broker, but is not the holder except as specified in paragraphs (b), (c) and (e) of subsection 1. Where a security is part of a fungible bulk the purchaser is the owner of a proportionate property interest in the fungible bulk.
3. Notice of an adverse claim received by the broker or by the purchaser after the broker takes delivery as a holder for value is not effective either as to the broker or as to the purchaser. However, as between the broker and the purchaser the purchaser may demand delivery of an equivalent security as to which no notice of an adverse claim has been received.
Sec. 8-314. 1. Unless otherwise agreed where a sale of security is made on an exchange or otherwise through brokers:
(a) The selling customer fulfills his duty to deliver when he places such a security in the possession of the selling broker or of a person designated by the broker or if requested causes an acknowledgment to be made to the selling broker that it is held for him; and
(b) The selling broker, including a correspondent broker acting for a selling customer, fulfills his duty to deliver by placing the security or a like security in the possession of the buying broker or a person designated by him or by effecting clearance of the sale in accordance with the rules of the exchange on which the transaction took place.
2. Except as otherwise provided in this section and unless otherwise agreed, a transferors duty to deliver a security under a contract of purchase is not fulfilled until he places the security in form to be negotiated by the purchaser in the possession of the purchaser or of a person designated by him or at the purchasers request causes an acknowledgment to be made to the purchaser that it is held for him. Unless made on an exchange a sale to a broker purchasing for his own account is within this subsection and not within subsection 1.
κ1965 Statutes of Nevada, Page 885 (CHAPTER 353, SB 15)κ
Sec. 8-315. 1. Any person against whom the transfer of a security is wrongful for any reason, including his incapacity, may against anyone except a bona fide purchaser reclaim possession of the security or obtain possession of any new security evidencing all or part of the same rights or have damages.
2. If the transfer is wrongful because of an unauthorized endorsement, the owner may also reclaim or obtain possession of the security or new security even from a bona fide purchaser if the ineffectiveness of the purported endorsement can be asserted against him under the provisions of this article on unauthorized endorsements (section 8-311).
3. The right to obtain or reclaim possession of a security may be specifically enforced and its transfer enjoined and the security impounded pending the litigation.
Sec. 8-316. Unless otherwise agreed the transferor must on due demand supply his purchaser with any proof of his authority to transfer or with any other requisite which may be necessary to obtain registration of the transfer of the security but if the transfer is not for value a transferor need not do so unless the purchaser furnishes the necessary expenses. Failure to comply with a demand made within a reasonable time gives the purchaser the right to reject or rescind the transfer.
Sec. 8-317. 1. No attachment or levy upon a security or any share or other interest evidenced thereby which is outstanding shall be valid until the security is actually seized by the officer making the attachment or levy but a security which has been surrendered to the issuer may be attached or levied upon at the source.
2. A creditor whose debtor is the owner of a security shall be entitled to such aid from courts of appropriate jurisdiction, by injunction or otherwise, in reaching such security or in satisfying the claim by means thereof as is allowed at law or in equity in regard to property which cannot be readily be attached or levied upon by ordinary legal process.
Sec. 8-318. An agent or bailee who in good faith (including observance of reasonable commercial standards if he is in the business of buying, selling or otherwise dealing with securities) has received securities and sold, pledged or delivered them according to the instructions of his principal is not liable for conversion or for participation in breach of fiduciary duty although the principal had no right to dispose of them.
Sec. 8-319. A contract for the sale of securities is not enforcible by way of action or defense unless:
1. There is some writing signed by the party against whom enforcement is sought or by his authorized agent or broker sufficient to indicate that a contract has been made for sale of a stated quantity of described securities at a defined or stated price; or
2. Delivery of the security has been accepted or payment has been made but the contract is enforcible under this provision only to the extent of such delivery or payment; or
3. Within a reasonable time a writing in confirmation of the sale or purchase and sufficient against the sender under subsection 1 has been received by the party against whom enforcement is sought and he has failed to send written objection to its contents within 10 days after its receipt; or
κ1965 Statutes of Nevada, Page 886 (CHAPTER 353, SB 15)κ
been received by the party against whom enforcement is sought and he has failed to send written objection to its contents within 10 days after its receipt; or
4. The party against whom enforcement is sought admits in his pleading, testimony or otherwise in court that a contract was made for sale of a stated quantity of described securities at a defined or stated price.
Sec. 8-320. 1. If a security:
(a) Is in the custody of a clearing corporation or of a custodian bank or a nominee of either subject to the instructions of the clearing corporation; and
(b) Is in bearer form or endorsed in blank by an appropriate person or registered in the name of the clearing corporation or custodian bank or a nominee of either; and
(c) Is shown on the account of a transferor or pledger on the books of the clearing corporation,
then, in addition to other methods, a transfer or pledge of the security or any interest therein may be effected by the making of appropriate entries on the books of the clearing corporation reducing the account of the transferor or pledgor and increasing the account of the transferee or pledgee by the amount of the obligation or the number of shares or rights transferred or pledged.
2. Under this section entries may be with respect to like securities or interest therein as a part of a fungible bulk and may refer merely to a quantity of a particular security without reference to the name of the registered owner, certificate or bond number or the like and, in appropriate cases, may be on a net basis taking into account other transfers or pledges of the same security.
3. A transfer or pledge under this section has the effect of a delivery of a security in bearer form or duly endorsed in blank (section 8-301) representing the amount of the obligation or the number of shares or rights transferred or pledged. If a pledge or the creation of a security interest is intended, the making of entries has the effect of a taking of delivery by the pledgee or a secured party (sections 9-304 and 9-305). A transferee or pledgee under this section is a holder.
4. A transfer or pledge under this section does not constitute a registration of transfer under part 4 of this article.
5. That entries made on the books of the clearing corporation as provided in subsection 1 are not appropriate does not affect the validity or effect of the entries nor the liabilities or obligations of the clearing corporation to any person adversely affected thereby.
part 4
registration
Sec. 8-401. 1. Where a security in registered form is presented to the issuer with a request to register transfer, the issuer is under a duty to register the transfer as requested if:
κ1965 Statutes of Nevada, Page 887 (CHAPTER 353, SB 15)κ
(a) The security is endorsed by the appropriate person or persons (section 8-308); and
(b) Reasonable assurance is given that those endorsements are genuine and effective (section 8-402); and
(c) The issuer has no duty to inquire into adverse claims or has discharged any such duty (section 8-403); and
(d) Any applicable law relating to the collection of taxes has been complied with; and
(e) The transfer is in fact rightful or is to a bona fide purchaser.
2. Where an issuer is under a duty to register a transfer of a security the issuer is also liable to the person presenting it for registration or his principal for loss resulting from any unreasonable delay in registration or from failure or refusal to register the transfer.
Sec. 8-402. 1. The issuer may require the following assurance that each necessary endorsement (section 8-308) is genuine and effective:
(a) In all cases, a guarantee of the signature (subsection 1 of section 8-312) of the person endorsing; and
(b) Where the endorsement is by an agent, appropriate assurance of authority to sign; or
(c) Where the endorsement is by a fiduciary, appropriate evidence of appointment or incumbency; or
(d) Where there is more than one fiduciary, reasonable assurance that all who are required to sign have done so; or
(e) Where the endorsement is by a person not covered by any of the foregoing, assurance appropriate to the case corresponding as nearly as may be to the foregoing.
2. A guarantee of the signature is subsection 1 means a guarantee signed by or on behalf of a person reasonably believed by the issuer to be responsible. The issuer may adopt standards with respect to responsibility provided such standards are not manifestly unreasonable.
3. Appropriate evidence of appointment or incumbency in subsection 1 means:
(a) In the case of a fiduciary appointed or qualified by a court, a certificate issued by or under the direction or supervision of that court or an officer thereof and dated within 60 days before the date of presentment for transfer; or
(b) In any other case, a copy of a document showing the appointment or a certificate issued by or behalf of a person reasonably believed by the issuer to be responsible or, in the absence of such a document or certificate, other evidence reasonably deemed by the issuer to be appropriate. The issuer may adopt standards with respect to such evidence provided such standards are not manifestly unreasonable. The issuer is not charged with notice of the contents of any document obtained pursuant to this paragraph (b) except to the extent that the contents relate directly to the appointment or incumbency.
4. The issuer may elect to require reasonable assurance beyond that specified in this section but if it does so and for a purpose other than that specified in paragraph (b) of subsection 3 both requires and obtains a copy of a will, trust, indenture, articles of copartnership, bylaws or other controlling instrument it is charged with notice of all matters contained therein affecting the transfer.
κ1965 Statutes of Nevada, Page 888 (CHAPTER 353, SB 15)κ
bylaws or other controlling instrument it is charged with notice of all matters contained therein affecting the transfer.
Sec. 8-403. 1. An issuer to whom a security is presented for registration is under a duty to inquire into adverse claims if:
(a) A written notification of an adverse claim is received at a time and in a manner which affords the issuer a reasonable opportunity to act on it prior to the issuance of a new, reissued or reregistered security and the notification identifies the claimant, the registered owner and the issue of which the security is a part and provides an address for communications directed to the claimant; or
(b) The issuer is charged with notice of an adverse claim from a controlling instrument which it has elected to require under subsection 4 of section 8-402.
2. The issuer may discharge any duty of inquiry by any reasonable means, including notifying an adverse claimant by registered or certified mail at the address furnished by him or if there be no such address at his residence or regular place of business that the security has been presented for registration of transfer by a named person, and that the transfer will be registered unless within 30 days from the date of mailing the notification, either:
(a) An appropriate restraining order, injunction or other process issues from a court of competent jurisdiction; or
(b) An indemnity bond sufficient in the issuers judgment to protect the issuer and any transfer agent, registrar or other agent of the issuer involved, from any loss which it or they may suffer by complying with the adverse claim is filed with the issuer.
3. Unless an issuer is charged with notice of an adverse claim from a controlling instrument which it has elected to require under subsection 4 of section 8-402 or receives notification of an adverse claim under subsection 1 of this section, where a security presented for registration is endorsed by the appropriate person or persons the issuer is under no duty to inquire into adverse claims. In particular:
(a) An issuer registering a security in the name of a person who is a fiduciary or who is described as a fiduciary is not bound to inquire into existence, extent or correct description of the fiduciary relationship and thereafter the issuer may assume without inquiry that the newly registered owner continues to be the fiduciary until the issuer receives written notice that the fiduciary is no longer acting as such with respect to the particular security;
(b) An issuer registering transfer on an endorsement by a fiduciary is not bound to inquire whether the transfer is made in compliance with a controlling instrument or with the law of the state having jurisdiction of the fiduciary relationship, including any law requiring the fiduciary to obtain court approval of the transfer; and
(c) The issuer is not charged with notice of the contents of any court record or file or other recorded or unrecorded document even though the document is in its possession and even though the transfer is made on the endorsement of a fiduciary to the fiduciary himself or to his nominee.
Sec. 8-404. 1. Except as otherwise provided in any law relating to the collection of taxes, the issuer is not liable to the owner or any other person suffering loss as a result of the registration of a transfer of a security if:
κ1965 Statutes of Nevada, Page 889 (CHAPTER 353, SB 15)κ
the collection of taxes, the issuer is not liable to the owner or any other person suffering loss as a result of the registration of a transfer of a security if:
(a) There were on or with the security the necessary endorsements (section 8-308); and
(b) The issuer had no duty to inquire into adverse claims or has discharged any such duty (section 8-403).
2. Where an issuer has registered a transfer of a security to a person not entitled to it the issuer on demand must deliver a like security to the true owner unless:
(a) The registration was pursuant to subsection 1; or
(b) The owner is precluded from asserting any claim for registering the transfer under subsection 1 of the following section; or
(c) Such delivery would result in overissue, in which case the issuers liability is governed by section 8-104.
Sec. 8-405. 1. Where a security has been lost, apparently destroyed or wrongfully taken and the owner fails to notify the issuer of that fact within a reasonable time after he has notice of it and the issuer registers a transfer of the security before receiving such a notification, the owner is precluded from asserting against the issuer any claim for registering the transfer under the preceding section or any claim to a new security under this section.
2. Where the owner of a security claims that the security has been lost, destroyed or wrongfully taken, the issuer must issue a new security in place of the original security if the owner:
(a) So requests before the issuer has notice that the security has been acquired by a bona fide purchaser; and
(b) Files with the issuer a sufficient indemnity bond; and
(c) Satisfies any other reasonable requirements imposed by the issuer.
3. If, after the issue of the new security, a bona fide purchaser of the original security presents it for registration of transfer, the issuer must register the transfer unless registration would result in overissue, in which event the issuers liability is governed by section 8-104. In addition to any rights on the indemnity bond, the issuer may recover the new security from the person to whom it was issued or any person taking under him except a bona fide purchaser.
Sec. 8-406. 1. Where a person acts as authenticating trustee, transfer agent, registrar, or other agent for an issuer in the registration of transfers of its securities or in the issue of new securities or in the cancellation of surrendered securities:
(a) He is under a duty to the issuer to exercise good faith and due diligence in performing his functions; and
(b) He has with regard to the particular functions he performs the same obligation to the holder or owner of the security and has the same rights and privileges as the issuer has in regard to those functions.
2. Notice to an authenticating trustee, transfer agent, registrar or other such agent is notice to the issuer with respect to the functions performed by the agent.
κ1965 Statutes of Nevada, Page 890 (CHAPTER 353, SB 15)κ
ARTICLE 9
SECURED TRANSACTIONS; SALES OF ACCOUNTS,
CONTRACT RIGHTS AND CHATTEL PAPER
part 1
short title, applicability and definitions
Sec. 9-101. This article shall be known and may be cited as Uniform Commercial Code-Secured Transactions.
Sec. 9-102. 1. Except as otherwise provided in section 9-103 on multiple state transactions and in section 9-104 on excluded transactions, this article applies so far as concerns any personal property and fixtures within the jurisdiction of this state:
(a) To any transaction (regardless of its form) which is intended to create a security interest in personal property or fixtures including goods, documents, instruments, general intangibles, chattel paper, accounts or contract rights; and also
(b) To any sale of accounts, contract rights or chattel paper.
2. This article applies to security interests created by contract including pledge, assignment, chattel mortgage, chattel trust, trust deed, factors lien, equipment trust, conditional sale, trust receipt, other lien or title retention contract and lease or consignment intended as security. This article does not apply to statutory liens except as provided in section 9-310.
3. The application of this article to a security interest in a secured obligation is not affected by the fact that the obligation is itself secured by a transaction or interest to which this article does not apply.
Sec. 9-103. 1. If the office where the assignor of accounts or contract rights keeps his records concerning them is in this state, the validity and perfection of a security interest therein and the possibility and effect of proper filing is governed by this article; otherwise by the law (including the conflict of laws rule) of the jurisdiction where such office is located.
2. If the chief place of business of a debtor is in this state, this article governs the validity and perfection of a security interest and the possibility and effect of proper filing with regard to general intangibles or with regard to goods of a type which are normally used in more than one jurisdiction (such as automotive equipment, rolling stock, airplanes, roadbuilding equipment, commercial harvesting equipment, construction machinery and the like) if such goods are classified as equipment or classified as inventory by reason of their being leased by the debtor to others. Otherwise, the law (including the conflict of laws rules) of the jurisdiction where such chief place of business is located shall govern. If the chief place of business is located in a jurisdiction which does not provide for perfection of the security interest by filing or recording in that jurisdiction, then the security interest may be perfected by filing in this state. For the purpose of determining the validity and perfection of a security interest in an airplane, the chief place of business of a debtor who is a foreign air carrier under the Federal Aviation Act of 1958, as amended, is the designated office of the agent upon whom service of process may be made on behalf of the debtor.
κ1965 Statutes of Nevada, Page 891 (CHAPTER 353, SB 15)κ
the Federal Aviation Act of 1958, as amended, is the designated office of the agent upon whom service of process may be made on behalf of the debtor.
3. If personal property other than that governed by subsections 1 and 2 is already subject to a security interest when it is brought into this state, the validity of the security interest in this state is to be determined by the law (including the conflict of laws rules) of the jurisdiction where the property was when the security interest attached. However, if the parties to the transaction understood at the time that the security interest attached that the property would be kept in this state and it was brought into this state within 30 days after the security interest attached for purposes other than transportation through this state, then the validity of the security interest in this state is to be determined by the law of this state. If the security interest was already perfected under the law of the jurisdiction where the property was when the security interest attached and before being brought into this state, the security interest continues perfected in this state for 4 months and also thereafter if within the 4-month period it is perfected in this state. The security interest may also be perfected in this state after the expiration of the 4-month period; in such case perfection dates from the time of perfection in this state. If the security interest was not perfected under the law of the jurisdiction where the property was when the security interest attached and before being brought into this state, it may be perfected in this state; in such case perfection dates from the time of perfection in this state.
4. Notwithstanding subsections 2 and 3, if personal property is covered by a certificate of title issued under a statute of this state or any other jurisdiction which requires indication on a certificate of title of any security interest in the property as a condition of perfection, then the perfection is governed by the law of the jurisdiction which issued the certificate.
5. Notwithstanding subsection 1 and section 9-302, if the office where the assignor of accounts or contract rights keeps his records concerning them is not located in a jurisdiction which is a part of the United States, its territories or possessions, and the accounts or contract rights are within the jurisdiction of this state or the transaction which creates the security interest otherwise bears an appropriate relation to this state, this article governs the validity and perfection of the security interest and the security interest may only be perfected by notification to the account debtor.
Sec. 9-104. This article does not apply:
1. To a security interest subject to any statute of the United States such as the Ship Mortgage Act, 1920, to the extent that such statute governs the rights of parties to and third parties affected by transactions in particular types of property; or
2. To a landlords lien; or
3. To a lien given by statute or other rule of law for services or materials except as provided in section 9-310 on priority of such liens; or
4. To a transfer of a claim for wages, salary or other compensation of an employee; or
κ1965 Statutes of Nevada, Page 892 (CHAPTER 353, SB 15)κ
5. To an equipment trust covering railway rolling stock; or
6. To a sale of accounts, contract rights or chattel paper as part of a sale of the business out of which they arose, or an assignment of accounts, contract rights or chattel paper which is for the purpose of collection only, or a transfer of a contract right to an assignee who is also to do the performance under the contract; or
7. To a transfer of an interest or claim in or under any policy of insurance; or
8. To a right represented by a judgment; or
9. To any right of setoff; or
10. Except to the extent that provision is made for fixtures in section 9-313, to the creation or transfer of an interest in or lien on real estate, including a lease or rents thereunder; or
11. To a transfer in whole or in part of any of the following: Any claim arising out of tort; any deposit, savings, passbook or like account maintained with a bank, savings and loan association, credit union or like organization.
Sec. 9-105. 1. In this article unless the context otherwise requires:
(a) Account debtor means the person who is obligated on an account, chattel paper, contract right or general intangible.
(b) Chattel paper means a writing or writings which evidence both a monetary obligation and a security interest in or a lease of specific goods. When a transaction is evidenced both by such a security agreement or a lease and by an instrument or a series of instruments, the group of writings taken together constitutes chattel paper.
(c) Collateral means the property subject to a security interest, and includes accounts, contract rights and chattel paper which have been sold.
(d) Debtor means the person who owes payment or other performance of the obligation secured, whether or not he owns or has rights in the collateral, and includes the seller of accounts, contract rights or chattel paper. Where the debtor and the owner of the collateral are not the same person, the term debtor means the owner of the collateral in any provision of the article dealing with the collateral, the obligor in any provision dealing with the obligation, and may include both where the context so requires.
(e) Document means document of title as defined in the general definitions of article 1 (section 1-201).
(f) Goods includes all things which are movable at the time the security interest attaches or which are fixtures (section 9-313), but does not include money, documents, instruments, accounts, chattel paper, general intangibles, contract rights and other things in action. Goods also include the unborn young of animals and growing crops.
(g) Instrument means a negotiable instrument (defined in section 3-104), or a security (defined in section 8-102) or any other writing which evidences a right to the payment of money and is not itself a security agreement or lease and is of a type which is in ordinary course of business transferred by delivery with any necessary endorsement or assignment.
(h) Security agreement means an agreement which creates or provides for a security interest.
κ1965 Statutes of Nevada, Page 893 (CHAPTER 353, SB 15)κ
(i) Secured party means a lender, seller or other person in whose favor there is a security interest, including a person to whom accounts, contract rights or chattel paper have been sold. When the holders of obligations issued under a indenture of trust, equipment trust agreement or the like are represented by a trustee or other person, the representative is the secured party.
2. Other definitions applying to this article and the sections in which they appear are:
Account. Section 9-106.
Consumer goods. Section 9-109, subsec. 1.
Contract right. Section 9-106.
Equipment. Section 9-109, subsec. 2.
Farm products. Section 9-109, subsec. 3.
General intangibles. Section 9-106.
Inventory. Section 9-109, subsec. 4.
Lien creditor. Section 9-301, subsec. 5.
Proceeds. Section 9-306, subsec 1.
Purchase money security interest. Section 9-107.
3. The following definitions in other articles apply to this article:
Check. Section 3-104.
Contract for sale. Section 2-106.
Holder in due course. Section 3-302.
Note. Section 3-104.
Sale. Section 2-106.
4. In addition article 1 contains general definitions and principles of construction and interpretation applicable throughout this article.
Sec. 9-106. Account means any right to payment for goods sold or leased or for services rendered which is not evidenced by an instrument or chattel paper. Contract right means any right to payment under a contract not yet earned by performance and not evidenced by an instrument or chattel paper. General intangibles means any personal property (including things in action) other than goods, accounts, contract rights, chattel paper, documents and instruments.
Sec. 9-107. A security interest is a purchase money security interest to the extent that it is:
1. Taken or retained by the seller of the collateral to secure all or part of its price; or
2. Taken by a person who by making advances or incurring an obligation gives value to enable the debtor to acquire rights in or the use of collateral if such value is in fact so used.
Sec. 9-108. Where a secured party makes an advance, incurs an obligation, releases a perfected security interest, or otherwise gives new value which is to be secured in whole or in part by after-acquired property his security interest in the after-acquired collateral shall be deemed to be taken for new value and not as security for an antecedent debt if the debtor acquires his rights in such collateral either in the ordinary course of his business or under a contract of purchase made pursuant to the security agreement within a reasonable time after new value is given.
κ1965 Statutes of Nevada, Page 894 (CHAPTER 353, SB 15)κ
Sec. 9-109. Goods are:
1. Consumer goods if they are used or bought for use primarily for personal, family or household purposes.
2. Equipment if they are used or bought for use primarily in business (including farming or a profession) or by a debtor who is a nonprofit organization or a governmental subdivision or agency or if the goods are not included in the definitions of inventory, farm products or consumer goods.
3. Farm products if they are crops or livestock or supplies used or produced in farming operations or if they are products of crops or livestock in their unmanufactured states (such as ginned cotton, wool-clip, maple syrup, milk and eggs), and if they are in the possession of a debtor engaged in raising, fattening, grazing or other farming operations. If goods are farm products they are neither equipment nor inventory.
4. Inventory if they are held by a person who holds them for sale or lease or to be furnished under contracts of service or if he has so furnished them, or if they are raw materials, work in process or materials used or consumed in a business. Inventory of a person is not to be classified as his equipment.
Sec. 9-110. For the purposes of this article any description of personal property or real estate is sufficient whether or not it is specific if it reasonably identifies what is described.
Sec. 9-111. The creation of a security interest is not a bulk transfer under article 6 (see section 6-103).
Sec. 9-112. Unless otherwise agreed, when a secured party knows that collateral is owned by a person who is not the debtor, the owner of the collateral is entitled to receive from the secured party any surplus under subsection 2 of section 9-502 or under subsection 1 of section 9-504, and is not liable for the debt or for any deficiency after resale, and he has the same right as the debtor:
1. To receive statements under section 9-208;
2. To receive notice of and to object to a secured partys proposal to retain the collateral in satisfaction of the indebtedness under section 9-505;
3. To redeem the collateral under section 9-506;
4. To obtain injunctive or other relief under subsection 1 of section 9-507; and
5. To recover losses caused to him under subsection 2 of section 9-208.
Sec. 9-113. A security interest arising solely under the article on sales (article 2) is subject to the provisions of this article except that to the extent that and so long as the debtor does not have or does not lawfully obtain possession of the goods:
1. No security agreement is necessary to make the security interest enforcible; and
2. No filing is required to perfect the security interest; and
3. The rights of the secured party on default by the debtor are governed by the article on sales (article 2).
κ1965 Statutes of Nevada, Page 895 (CHAPTER 353, SB 15)κ
part 2
validity of security agreement and rights
of parties thereto
Sec. 9-201. Except as otherwise provided by this chapter a security agreement is effective according to its terms between the parties, against the purchasers of the collateral and against creditors. Nothing in this article validates any charge or practice illegal under any statute or regulation thereunder governing usury, small loans, retail installment sales, or the like, or extends the application of any such statute or regulation to any transaction not otherwise subject thereto.
Sec. 9-202. Each provision of this article with regard to rights, obligations and remedies applies whether title to collateral is in the secured party or in the debtor.
Sec. 9-203. 1. Subject to the provisions of section 4-208 on the security interest of a collecting bank and section 9-113 on a security interest arising under the article on sales, a security interest is not enforcible against the debtor or third parties unless:
(a) The collateral is in the possession of the secured party; or
(b) The debtor has signed a security agreement which contains a description of the collateral and in addition, when the security interest covers crops or oil, gas or minerals to be extracted or timber to be cut, a description of the land concerned. In describing collateral, the word proceeds is sufficient without further description to cover proceeds of any character.
2. A transaction, although subject to this article, is also subject to chapter 97, 646, 649, and 675 or NRS, and any statute regulating retail installment sales, and in the case of conflict between the provisions of this article and any such statute, the provisions of such statute control. Failure to comply with any applicable statute has only the effect which is specified therein.
Sec. 9-204. 1. A security interest cannot attach until there is agreement (subsection 3 of section 1-201) that it attach and value is given and the debtor has rights in the collateral. It attaches as soon as all of the events in the preceding sentence have taken place unless explicit agreement postpones the time of attaching.
2. For the purposes of this section the debtor has no rights:
(a) In crops until they are planted or otherwise become growing crops, in the young of livestock until they are conceived.
(b) In fish until caught, in oil, gas or minerals until they are extracted, in timber until it is cut.
(c) In a contract right until the contract has been made.
(d) In an account until it comes into existence.
3. Except as provided in subsection 4 a security agreement may provide that collateral, whenever acquired, shall secure all obligations covered by the security agreement.
4. No security interest attaches under an after-acquired property clause:
(a) To crops which become such more than 1 year after the security agreement is executed except that a security interest in crops which is given in conjunction with a lease or a land purchase or improvement transaction evidenced by a contract, mortgage or deed of trust may if so agreed attach to crops to be grown on the land concerned during the period of such real estate transaction.
κ1965 Statutes of Nevada, Page 896 (CHAPTER 353, SB 15)κ
given in conjunction with a lease or a land purchase or improvement transaction evidenced by a contract, mortgage or deed of trust may if so agreed attach to crops to be grown on the land concerned during the period of such real estate transaction.
(b) To consumer goods other than accessions (section 9-314) when given as additional security unless the debtor acquires rights in them within 10 days after the secured party gives value.
5. Obligations covered by a security agreement may include future advances or other value whether or not the advances or value are given pursuant to commitment.
Sec. 9-205. A security interest is not invalid or fraudulent against creditors by reason of liberty in the debtor to use, commingle or dispose of all or part of the collateral (including returned or repossessed goods) or to collect or compromise accounts, contract rights or chattel paper, or to accept the return of goods or make repossessions, or to use, commingle or dispose of proceeds, or by reason of the failure of the secured party to require the debtor to account for proceeds or replace collateral. This section does not relax the requirements of possession where perfection of a security interest depends upon possession of the collateral by the secured party or by a bailee.
Sec. 9-206. 1. Subject to any statute or decision which establishes a different rule for buyers or lessees of consumer goods, an agreement by a buyer or lessee that he will not assert against an assignee any claim or defense which he may have against the seller or lessor is enforcible by an assignee who takes his assignment for value, in good faith and without notice of a claim or defense, except as to defenses of a type which may be asserted against a holder in due course of a negotiable instrument under the article on commercial paper (article 3). A buyer who as part of one transaction signs both a negotiable instrument and a security agreement makes such an agreement.
2. When a seller retains a purchase money security interest in goods the article on sales (article 2) governs the sale and any disclaimer, limitation or modification of the sellers warranties.
Sec. 9-207. 1. A secured party must use reasonable care in the custody and preservation of collateral in his possession. In the case of an instrument or chattel paper reasonable care includes taking necessary steps to preserve rights against prior parties unless otherwise agreed.
2. Unless otherwise agreed, when collateral is in the secured partys possession:
(a) Reasonable expenses (including the cost of any insurance and payment of taxes or other charges) incurred in the custody, preservation, use or operation of the collateral are chargeable to the debtor and are secured by the collateral.
(b) The risk of accidental loss or damage is on the debtor to the extent of any deficiency in any effective insurance coverage.
(c) The secured party may hold as additional security any increase or profits (except money) received from the collateral, but money so received, unless remitted to the debtor, shall be applied in reduction of the secured obligation.
κ1965 Statutes of Nevada, Page 897 (CHAPTER 353, SB 15)κ
(d) The secured party must keep the collateral identifiable but fungible collateral may be commingled.
(e) The secured party may repledge the collateral upon terms which do not impair the debtors right to redeem it.
3. A secured party is liable for any loss caused by his failure to meet any obligation imposed by the preceding subsections but does not lose his security interest.
4. A secured party may use or operate the collateral for the purpose of preserving the collateral or its value or pursuant to the order of a court of appropriate jurisdiction or, except in the case of consumer goods, in the manner and to the extent provided in the security agreements.
Sec. 9-208. 1. A debtor may sign a statement indicating what he believes to be the aggregate amount of unpaid indebtedness as of a specified date and may send it to the secured party with a request that the statement be approved or corrected and returned to the debtor. When the security agreement or any other record kept by the secured party identifies the collateral a debtor may similarly request the secured party to approve or correct a list of the collateral.
2. The secured party must comply with such a request within 2 weeks after receipt by sending a written correction or approval. If the secured party claims a security interest in all of a particular type of collateral owned by the debtor he may indicate that fact in his reply and need not approve or correct an itemized list of such collateral. If the secured party without reasonable excuse fails to comply he is liable for any loss caused to the debtor thereby; and if the debtor has properly included in his request a good faith statement of the obligation or a list of the collateral or both the secured party may claim a security interest only as shown in the statement against persons misled by his failure to comply. If he no longer has an interest in the obligation or collateral at the time the request is received he must disclose the name and address of any successor in interest known to him and he is liable for any loss caused to the debtor as a result of failure to disclose. A successor in interest is not subject to this section until a request is received by him.
3. A debtor is entitled to such a statement once every 6 months without charge. The secured party may require payment of a charge not exceeding $10 for each additional statement furnished.
part 3
right of third parties; perfected and unperfected
security interests; rules of priority
Sec. 9-301. 1. Except as otherwise provided in subsection 2, an unperfected security interest is subordinate to the rights of:
(a) Persons entitled to priority under section 9-312.
(b) A person who becomes a lien creditor without knowledge of the security interest and before it is perfected.
κ1965 Statutes of Nevada, Page 898 (CHAPTER 353, SB 15)κ
(c) In the case of goods, instruments, documents and chattel paper, a person who is not a secured party and who is a transferee in bulk or other buyer not in ordinary course of business to the extent that he gives value and receives delivery of the collateral without knowledge of the security interest and before it is perfected.
(d) In the case of accounts, contract rights and general intangibles, a person who is not a secured party and who is a transferee to the extent that he gives value without knowledge of the security interest and before it is perfected.
2. If the secured party files with respect to a purchase money security interest before or within 10 days after the collateral comes into possession of the debtor, he takes priority over the rights of a transferee in bulk or of a lien creditor which arise between the time the security interest attaches and the time of filing.
3. A lien creditor means a creditor who has acquired a lien on the property involved by attachment, levy or the like and includes an assignee for benefit of creditors from the time of assignment, and a trustee in bankruptcy from the date of the filing of the petition or a receiver in equity from the time of appointment. Unless all the creditors represented had knowledge of the security interest such a representative of creditors is a lien creditor without knowledge even though he personally has knowledge of the security interest.
Sec. 9-302. 1. A financing statement must be filed to perfect all security interests except the following:
(a) A security interest in collateral in possession of the secured party under section 9-305.
(b) A security interest temporarily perfected in instruments or documents without delivery under section 9-304 or in proceeds for a 10-day period under section 9-306.
(c) A purchase money security interest in farm equipment having a purchase price not in excess of $2,500; but filing is required for a fixture under section 9-313 or for a motor vehicle required to be licensed.
(d) A purchase money security interest in consumer goods; but filing is required for a fixture under section 9-313 or for a motor vehicle required to be licensed.
(e) An assignment of accounts or contract rights which does not alone or in conjunction with other assignments to the same assignee transfer a significant part of the outstanding accounts or contract rights of the assignor.
(f) A security interest of a collecting bank (section 4-208) or arising under the article on sales (see section 9-113) or covered in subsection 3 of this section.
2. If a secured party assigns a perfected security interest, no filing under this article is required in order to continue the perfected status of the security interest against creditors of and transferees from the original debtor.
3. The filing provisions of this article do not apply to a security interest in property subject to a statute:
(a) Of the United States which provides for a national registration or filing of all security interests in such property; or
(b) Of this state which provides for central filing of, or which requires indication on a certificate of title of, such security interests in such property.
κ1965 Statutes of Nevada, Page 899 (CHAPTER 353, SB 15)κ
requires indication on a certificate of title of, such security interests in such property.
Sec. 9-303. 1. A security interest is perfected when it has attached and when all of the applicable steps required for perfection have been taken. Such steps are specified in sections 9-302, 9-304, 9-305 and 9-306. If such steps are taken before the security interest attaches, it is perfected at the time when it attaches.
2. If a security interest is originally perfected in any way permitted under this article and is subsequently perfected in some other way under this article, without an intermediate period when it was unperfected, the security interest shall be deemed to be perfected continuously for the purposes of this article.
Sec. 9-304. 1. A security interest in chattel paper or negotiable documents may be perfected by filing. A security interest in instruments (other than instruments which constitute part of chattel paper) can be perfected only by the secured partys taking possession, except as provided in subsections 4 and 5.
2. During the period that goods are in the possession of the issuer of a negotiable document therefor, a security interest in the goods is perfected by perfecting a security interest in the document, and any security interest in the goods otherwise perfected during such period is subject thereto.
3. A security interest in goods in the possession of the bailee other than one who has issued a negotiable document therefor is perfected by issuance of a document in the name of the secured party or by the bailees receipt of notification of the secured partys interest or by filing as to the goods.
4. A security interest in instruments or negotiable documents is perfected without filing or the taking of possession for a period of 21 days from the time it attaches to the extent that it arises for new value given under a written security agreement.
5. A security interest remains perfected for a period of 21 days without filing where a secured party having a perfected security interest in an instrument, a negotiable document or goods in possession of a bailee other than one who has issued a negotiable document therefor:
(a) Makes available to the debtor the goods or documents representing the goods for the purpose of ultimate sale or exchange or for the purpose of loading, unloading, storing, shipping, transshipping, manufacturing, processing or otherwise dealing with them in a manner preliminary to their sale or exchange; or
(b) Delivers the instrument to the debtor for the purpose of ultimate sale or exchange or of presentation, collection, renewal or registration of transfer.
6. After the 21-day period in subsections 4 and 5 perfection depends upon compliance with applicable provisions of this article.
Sec. 9-305. A security interest in letters of credit and advices of credit (paragraph (a) of subsection 2 of section 5-116), goods, instruments, negotiable documents or chattel paper may be perfected by the secured partys taking possession of the collateral. If such collateral other than goods covered by a negotiable document is held by a bailee, the secured party is deemed to have possession from the time the bailee receives notification of the secured partys interest.
κ1965 Statutes of Nevada, Page 900 (CHAPTER 353, SB 15)κ
receives notification of the secured partys interest. A security interest is perfected by possession from the time possession is taken without relation back and continues only so long as possession is retained, unless otherwise specified in this article. The security interest may be otherwise perfected as provided in this article before or after the period of possession by the second party.
Sec. 9-306. 1. Proceeds includes whatever is received when collateral or proceeds is sold, exchanged, collected or otherwise disposed of. The term also includes the account arising when the right to payment is earned under a contract right. Money, checks and the like are cash proceeds. All other proceeds are noncash proceeds.
2. Except where this article otherwise provides, a security interest continues in collateral notwithstanding sale, exchange or other disposition thereof by the debtor unless his action was authorized by the secured party in the security agreement or otherwise, and also continues in any identifiable proceeds including collections received by the debtor.
3. The security interest in proceeds is a continuously perfected security interest if the interest in the original collateral was perfected but it ceases to be a perfected security interest and becomes unperfected 10 days after receipt of the proceeds by the debtor unless:
(a) A filed financing statement covering the original collateral also covers proceeds; or
(b) The security interest in the proceeds is perfected before the expiration of the 10-day period.
4. In the event of insolvency proceedings instituted by or against a debtor, a secured party with a perfected security interest in proceeds has a perfected security interest:
(a) In identifiable noncash proceeds;
(b) In identifiable cash proceeds in the form of money which is not commingled with other money or deposited in a bank account prior to the insolvency proceedings;
(c) In identifiable cash proceeds in the form of checks and the like which are not deposited in a bank account prior to the insolvency proceedings; and
(d) In all cash and bank accounts of the debtor, if other cash proceeds have been commingled or deposited in a bank account, but the perfected security interest under this paragraph (d) is:
(1) Subject to any right of setoff; and
(2) Limited to an amount not greater than the amount of any cash proceeds received by the debtor within 10 days before the institution of the insolvency proceedings and commingled or deposited in a bank account prior to the insolvency proceedings less the amount of cash proceeds received by the debtor and paid over to the secured party during the 10-day period.
5. If a sale of goods results in an account or chattel paper which is transferred by the seller to a secured party, and if the goods are returned to or are repossessed by the seller or the secured party, the following rules determine priorities:
(a) If the goods were collateral at the time of sale for an indebtedness of the seller which his still unpaid, the original security interest attaches again to the goods and continues as a perfected security interest if it was perfected at the time when the goods were sold.
κ1965 Statutes of Nevada, Page 901 (CHAPTER 353, SB 15)κ
attaches again to the goods and continues as a perfected security interest if it was perfected at the time when the goods were sold. If the security interest was originally perfected by a filing which is still effective, nothing further is required to continue the perfected status; in any other case, the secured party must take possession of the returned or repossessed goods or must file.
(b) An unpaid transferee of the chattel paper has a security interest in the goods against the transferor. Such security interest is prior to a security interest asserted under paragraph (a) to the extent that the transferee of the chattel paper was entitled to priority under section 9-308.
(c) An unpaid transferee of the account has a security interest in the goods against the transferor. Such security interest is subordinate to a security interest asserted under paragraph (a).
(d) A security interest of an unpaid transferee asserted under paragraph (b) or (c) must be perfected for protection against creditors of the transferor and purchasers of the returned or repossessed goods.
Sec. 9-307. 1. A buyer in ordinary course of business (subsection 9 of section 1-201) other than a person buying farm products from a person engaged in farming operations takes free of a security interest created by his seller even though the security interest is perfected and even though the buyer knows of its existence.
2. In the case of consumer goods and in the case of farm equipment having an original purchase price not in excess of $2,500 (other than fixtures, see section 9-313), a buyer takes free of a security interest even though perfected if he buys without knowledge of the security interest, for value and for his own personal, family or household purposes or his own farming operations unless prior to the purchase the secured party has filed a financing statement covering such goods.
Sec. 9-308. A purchaser of chattel paper or a nonnegotiable instrument who gives new value and takes possession of it in the ordinary course of his business and without knowledge that the specific paper or instrument is subject to a security interest has priority over a security interest which is perfected under section 9-304 (permissive filing and temporary perfection). A purchaser of chattel paper who gives new value and takes possession of it in the ordinary course of his business has priority over a security interest in chattel paper which is claimed merely as proceeds of inventory subject to a security interest (section 9-306), even though he knows that the specific paper is subject to the security interest.
Sec. 9-309. Nothing in this article limits the rights of a holder in due course of a negotiable instrument (section 3-302) or a holder to whom a negotiable document of title has been duly negotiated (section 7-501) or a bona fide purchaser of a security (section 8-301) and such holder or purchasers take priority over an earlier security interest even though perfected. Filing under this article does not constitute notice of the security interest to such holders or purchasers.
Sec. 9-310. When a person in the ordinary course of his business furnishes services or materials with respect to goods subject to a security interest, a lien upon goods in the possession of such person given by statute or rule of law for such materials or services takes priority over a perfected security interest unless the lien is statutory and the statute expressly provides otherwise.
κ1965 Statutes of Nevada, Page 902 (CHAPTER 353, SB 15)κ
over a perfected security interest unless the lien is statutory and the statute expressly provides otherwise.
Sec. 9-311. The debtors rights in collateral may be voluntarily or involuntarily transferred (by way of sale, creation of a security interest, attachment, levy, garnishment or other judicial process) notwithstanding a provision in the security agreement prohibiting any transfer or making the transfer constitute a default.
Sec. 9-312. 1. The rules of priority stated in the following sections shall govern where applicable: Section 4-208 with respect to the security interest of collecting banks in items being collected, accompanying documents and proceeds; section 9-301 on certain priorities; section 9-304 on goods covered by documents; section 9-306 on proceeds and repossessions; section 9-307 on buyers of goods; section 9-308 on possessory against nonpossessory interests in chattel paper or nonnegotiable instruments; section 9-309 on security interests in negotiable instruments, documents or securities; section 9-310 on priorities between perfected security interests and liens by operation of law; section 9-313 on security interests in fixtures as against interests in real estate; section 9-314 on security interests in accessions as against interest in goods; section 9-315 on conflicting security interests where goods lose their identity or become part of a product; and section 9-316 on contractual subordination.
2. A perfected security interest in crops for new value given to enable the debtor to produce the crops during the production season and given not more than 3 months before the crops become growing crops by planting or otherwise takes priority over an earlier perfected security interest to the extent that such earlier interest secures obligations due more than 6 months before the crops become growing crops by planting or otherwise, even though the person giving new value had knowledge of the earlier security interest.
3. A purchase money security interest in inventory collateral has priority over a conflicting security interest in the same collateral if:
(a) The purchase money security interest is perfected at the time the debtor receives possession of the collateral; and
(b) Any secured party whose security interest is known to the holder of the purchase money security interest or who, prior to the date of the filing made by the holder of the purchase money security interest, had filed a financing statement covering the same items or type of inventory, has received notification of the purchase money security interest before the debtor receives possession of the collateral covered by the purchase money security interest; and
(c) Such notification states that the person giving the notice has or expects to acquire a purchase money security interest in inventory of the debtor, describing such inventory by item or type.
4. A purchase money security interest in collateral other than inventory has priority over a conflicting security interest in the same collateral if the purchase money security interest is perfected at the time the debtor receives possession of the collateral or within 10 days thereafter.
5. In all cases not governed by other rules stated in this section (including cases of purchase money security interests which do not qualify for the special priorities set forth in subsections 3 and 4 of this section), priority between conflicting security interests in the same collateral shall be determined as follows:
κ1965 Statutes of Nevada, Page 903 (CHAPTER 353, SB 15)κ
qualify for the special priorities set forth in subsections 3 and 4 of this section), priority between conflicting security interests in the same collateral shall be determined as follows:
(a) In the order of filing if both are perfected by filing, regardless of which security interest attached first under subsection 1 of section 9-204 and whether it attached before or after filing;
(b) In the order of perfection unless both are perfected by filing, regardless of which security interest attached first under subsection 1 of section 9-204 and, in the case of a filed security interest, whether it attached before or after filing; and
(c) In the order of attachment under subsection 1 of section 9-204 so long as neither is perfected.
6. For the purpose of the priority rules of the immediately preceding subsection, a continuously perfected security interest shall be treated at all times as if perfected by filing if it was originally so perfected and it shall be treated at all times as if perfected otherwise than by filing if it was originally perfected otherwise than by filing.
Sec. 9-313. 1. The rules of this section do not apply to goods incorporated into a structure in the manner of lumber, bricks, tile, cement, glass, metal work and the like and no security interest in them exists under this article unless the structure remains personal property under applicable law. The law of this state other than this chapter determines whether and when other goods become fixtures. This chapter does not prevent creation of an encumbrance upon fixtures or real estate pursuant to the law applicable to real estate.
2. A security interest which attaches to goods before they become fixtures takes priority as to the goods over the claims of all persons who have an interest in the real estate except as stated in subsection 4.
3. A security interest which attaches to goods after they become fixtures is valid against all persons subsequently acquiring interests in the real estate except as stated in subsection 4 but is invalid against any person with an interest in the real estate at the time the security interest attaches to the goods who has not in writing consented to the security interest or disclaimed an interest in the goods as fixtures.
4. The security interests described in subsections 2 and 3 do not take priority over:
(a) A subsequent purchaser for value of any interest in the real estate; or
(b) A creditor with a lien on the real estate subsequently obtained by judicial proceedings; or
(c) A creditor with a prior encumbrance of record on the real estate to the extent that he makes subsequent advances,
if the subsequent purchase is made, the lien by judicial proceedings is obtained, or the subsequent advance under the prior encumbrance is made or contracted for without knowledge of the security interest and before it is perfected. A purchaser of the real estate at a foreclosure sale other than an encumbrancer purchasing at his own foreclosure sale is a subsequent purchaser within this section.
5. When under subsections 2 or 3 and 4 a secured party has priority over the claims of all persons who have interests in the real estate, he may, on default, subject to the provisions of part 5, remove his collateral from the real estate but he must reimburse any encumbrancer or owner of the real estate who is not the debtor and who has not otherwise agreed for the cost of repair of any physical injury, but not for any diminution in value of the real estate caused by the absence of the goods removed or by any necessity for replacing them.
κ1965 Statutes of Nevada, Page 904 (CHAPTER 353, SB 15)κ
his collateral from the real estate but he must reimburse any encumbrancer or owner of the real estate who is not the debtor and who has not otherwise agreed for the cost of repair of any physical injury, but not for any diminution in value of the real estate caused by the absence of the goods removed or by any necessity for replacing them. A person entitled to reimbursement may refuse permission to remove until the secured party gives adequate security for the performance of this obligation.
Sec. 9-314. 1. A security interest in goods which attaches before they are installed in or affixed to other goods takes priority as to the goods installed or affixed (called in this section accessions) over the claims of all persons to the whole except as stated in subsection 3 and subject to subsection 1 of section 9-315.
2. A security interest which attaches to goods after they become part of a whole is valid against all persons subsequently acquiring interests in the whole except as stated in subsection 3 but is invalid against any person with an interest in the whole at the time the security interest attaches to the goods who has not in writing consented to the security interest or disclaimed an interest in the goods as part of the whole.
3. The security interests described in subsections 1 and 2 do not take priority over:
(a) A subsequent purchaser for value of any interest in the whole; or
(b) A creditor with a lien on the whole subsequently obtained by judicial proceedings; or
(c) A creditor with a prior perfected security interest in the whole to the extent that he makes subsequent advances,
if the subsequent purchase is made, the lien by judicial proceedings obtained or the subsequent advance under the prior perfected security interest is made or contracted for without knowledge of the security interest and before it is perfected. A purchaser of the whole at a foreclosure sale other than the holder of a perfected security interest purchasing at his own foreclosure sale and is a subsequent purchaser within this section.
4. When under subsections 1 or 2 and 3 a secured party has an interest in accessions which has priority over the claims of all persons who have interests in the whole, he may on default subject to the provisions of part 5 remove his collateral from the whole but he must reimburse any encumbrancer or owner of the whole who is not the debtor and who has not otherwise agreed for the cost of repair of any physical injury but not for any diminution in value of the whole caused by the absence of the goods removed or by any necessity for replacing them. A person entitled to reimbursement may refuse permission to remove until the secured party gives adequate security for the performance of this obligation.
Sec. 9-315. 1. If a security interest in goods was perfected and subsequently the goods or a part thereof have become part of a product or mass, the security interest continues in the product or mass if:
(a) The goods are so manufactured, processed, assembled or commingled that their identity is lost in the product or mass; or
κ1965 Statutes of Nevada, Page 905 (CHAPTER 353, SB 15)κ
(b) A financing statement covering the original goods also covers the product into which the goods have been manufactured, processed or assembled.
In a case to which paragraph (b) applies, no separate security interest in that part of the original goods which has been manufactured, processed or assembled into the product may be claimed under section 9-314.
2. When under subsection 1 more than one security interest attaches to the product or mass, they rank equally according to the ratio that the cost of the goods to which each interest originally attached bears to the cost of the total product or mass.
Sec. 9-316. Nothing in this article prevents subordination by agreement by any person entitled to priority.
Sec. 9-317. The mere existence of a security interest or authority given to the debtor to dispose of or use collateral does not impose contract or tort liability upon the secured party for the debtors acts or omissions.
Sec. 9-318. 1. Unless an account debtor has made an enforcible agreement not to assert defenses or claims arising out of a sale as provided in section 9-206 the rights of an assignee are subject to:
(a) All the terms of the contract between the account debtor and assignor and any defense or claim arising therefrom; and
(b) Any other defense or claim of the account debtor against the assignor which accrues before the account debtor receives notification of the assignment.
2. So far as the right to payment under an assigned contract right has not already become an account, and notwithstanding notification of the assignment, any modification of or substitution for the contract made in good faith and in accordance with reasonable commercial standards is effective against an assignee unless the account debtor has otherwise agreed but the assignee acquires corresponding rights under the modified or substituted contract. The assignment may provide that such modification or substitution is a breach by the assignor.
3. The account debtor is authorized to pay the assignor until the account debtor receives notification that the account has been assigned and that payment is to be made to the assignee. A notification which does not reasonably identify the rights assigned is ineffective. If requested by the account debtor, the assignee must seasonably furnish reasonable proof that the assignment has been made and unless he does so the account debtor may pay the assignor.
4. A term in any contract between an account debtor and an assignor which prohibits assignment of an account or contract right to which they are parties is ineffective.
κ1965 Statutes of Nevada, Page 906 (CHAPTER 353, SB 15)κ
part 4
filing
Sec. 9-401. 1. The proper place to file in order to perfect a security interest is as follows:
(a) When the collateral is equipment used in farming operations, or farm products, or accounts, contract rights or general intangibles arising from or relating to the sale of farm products by a farmer, or consumer goods, then in the office of the county recorder in the county of the debtors residence or if the debtor is not a resident of this state then in the office of the county recorder in the county where the goods are kept, and in addition when the collateral is crops in the office of the county recorder in the county where the land on which the crops are growing or to be grown is located.
(b) When the collateral is goods which at the time the security interest attaches are or are to become fixtures, then in the office where a mortgage on the real estate concerned would be filed or recorded.
(c) In all other cases, in the office of the secretary of state and in addition, if the debtor has a place of business in only one county of this state, also in the office of the county recorder of such county, or, if the debtor has no place of business in this state, but resides in the state, also in the office of the county recorder of the county in which he resides.
2. A filing which is made in good faith in an improper place or not in all of the places required by this section is nevertheless effective with regard to any collateral as to which the filing complied with the requirements of this article and is also effective with regard to collateral covered by the financing statement against any person who has knowledge of the contents of such financing statement.
3. A filing which is made in the proper place in this state continues effective even though the debtors residence or place of business or the location of the collateral or its use, whichever controlled the original filing, is thereafter changed.
Sec. 9-402. 1. A financing statement is sufficient if it is signed by the debtor and the secured party, gives an address of the secured party from which information concerning the security interest may be obtained, gives a mailing address of the debtor and contains a statement indicating the types, or describing the items, of collateral. A financing statement may be filed before a security agreement is made or a security interest otherwise attaches. When the financing statement covers crops growing or to be grown or goods which are or are to become fixtures, the statement must also contain a description of the real estate concerned. A copy of the security agreement is sufficient as a financing statement if it contains the above information and is signed by both parties.
2. A financing statement which otherwise complies with subsection 1 is sufficient although it is signed only by the secured party when it is filed to perfect a security interest in:
(a) Collateral already subject to a security interest in another jurisdiction when it is brought into this state. Such a financing statement must state that the collateral was brought into this state under such circumstances.
κ1965 Statutes of Nevada, Page 907 (CHAPTER 353, SB 15)κ
must state that the collateral was brought into this state under such circumstances.
(b) Proceeds under section 9-306 if the security interest in the original collateral was perfected. Such a financing statement must describe the original collateral.
3. A form substantially as follows is sufficient to comply with subsection 1:
Name of debtor (or assignor)....................................................................................................
Address........................................................................................................................................
Name of secured party (or assignee).......................................................................................
Address........................................................................................................................................
1. This financing statement covers the following types (or items) of property:
(Describe).....................................................................................................................................
2. (If collateral is crops) The above described crops are growing or are to be grown on:
(Describe real estate)..................................................................................................................
3. (If collateral is goods which are or are to become fixtures) The above described goods are affixed or to be affixed to:
(Describe real estate)..................................................................................................................
4. (If proceeds or products of collateral are claimed) Proceeds-Products of the collateral are also covered.
Signature of Debtor (or Assignor)...........................................................................................
Signature of Secured Party (or Assignee)..............................................................................
4. The term financing statement as used in this article means the original financing statement and any amendments but if any amendment adds collateral, it is effective as to the added collateral only from the filing date of the amendment.
5. A financing statement substantially complying with the requirements of this section is effective even though it contains minor errors which are not seriously misleading.
Sec. 9-403. 1. Presentation for filing of a financing statement and tender of the filing fee or acceptance of the statement by the filing officer constitutes filing under this article.
2. A filed financing statement which states a maturity date of the obligation secured of 5 years or less is effective until such maturity date and thereafter for a period of 60 days. Any other filed financing statement is effective for a period of 5 years from the date of filing. The effectiveness of a filed financing statement lapses on the expiration of such 60-day period after a stated maturity date or on the expiration of such 5-year period, as the case may be, unless a continuation statement is filed prior to the lapse. Upon such lapse the security interest becomes unperfected. A filed financing statement which states that the obligation secured is payable on demand is effective for 5 years from the date of filing.
3. A continuation statement may be filed by the secured party:
(a) Within 6 months before and 60 days after a stated maturity date of 5 years or less; and
(b) Otherwise within 6 months prior to the expiration of the 5-year period specified in subsection 2. Any such continuation statement must be signed by the secured party, identify the original statement by file number and state that the original statement is still effective.
κ1965 Statutes of Nevada, Page 908 (CHAPTER 353, SB 15)κ
number and state that the original statement is still effective. Upon timely filing of the continuation statement, the effectiveness of the original statement is continued for 5 years after the last date to which the filing was effective whereupon it lapses in the same manner as provided in subsection 2 unless another continuation statement is filed prior to such lapse. Succeeding continuation statements may be filed in the same manner to continue the effectiveness of the original statement. Unless a statute on disposition of public records provides otherwise, the filing officer may remove a lapsed statement from the files and destroy it.
4. A filing officer shall mark each statement with a consecutive file number and with the date and hour of filing and shall hold the statement for public inspection. In addition the filing officer shall index the statements according to the name of the debtor and shall note in the index the same file number and the address of the debtor given in the statement.
5. The uniform fee for filing, indexing and furnishing filing data for an original or a continuation statement shall be $1.
Sec. 9-404. 1. Whenever there is not outstanding secured obligation and no commitment to make advances, incur obligations or otherwise give value, the secured party must on written demand by the debtor send the debtor a statement that he no longer claims a security interest under the financing statement, which shall be identified by file number. A termination statement signed by a person other than the secured party of record must include or be accompanied by the assignment or a statement by the secured party of record that he has assigned the security interest to the signer of the termination statement. The uniform fee for filing and indexing such an assignment or statement thereof shall be $0.50. If the affected secured party fails to send such a termination statement within 10 days after proper demand therefor he shall be liable to the debtor for $100, and in addition for any loss caused to the debtor by such failure.
2. On presentation to the filing officer of such a termination statement he must note it in the index. The filing officer shall remove from the files, mark terminated and send or deliver to the secured party the financing statement and any continuation statement, statement of assignment or statement of release pertaining thereto.
3. The uniform fee for filing and indexing a termination statement, including sending or delivering the financing statement, shall be $0.50.
Sec. 9-405. 1. A financing statement may disclose an assignment of a security interest in the collateral described in the statement by indication in the statement of the name and address of the assignee or by an assignment itself or a copy thereof on the face or back of the statement. Either the original secured party or the assignee may sign this statement as the secured party. On presentation to the filing officer of such a financing statement the filing officer shall mark the same as provided in subsection 4 of section 9-403. The uniform fee for filing, indexing and furnishing filing data for a financing statement so indicating an assignment shall be $1.
2. A secured party may assign of record all or a part of his rights under a financing statement by the filing of a separate written statement of assignment signed by the secured party of record and setting forth the name of the secured party of record and the debtor, the file number and the date of filing of the financing statement and the name and address of the assignee and containing a description of the collateral assigned.
κ1965 Statutes of Nevada, Page 909 (CHAPTER 353, SB 15)κ
under a financing statement by the filing of a separate written statement of assignment signed by the secured party of record and setting forth the name of the secured party of record and the debtor, the file number and the date of filing of the financing statement and the name and address of the assignee and containing a description of the collateral assigned. A copy of the assignment is sufficient as a separate statement if it complies with the preceding sentence. On presentation to the filing officer of such a separate statement, the filing officer shall mark such separate statement with the date and hour of filing. He shall note the assignment on the index of the financing statement. The uniform fee for filing, indexing and furnishing filing data about such a separate statement of assignment shall be $1.
3. After the disclosure or filing of an assignment under this section, the assignee is the secured party of record.
Sec. 9-406. A secured party of record may by his signed statement release all or a part of any collateral described in a filed financing statement. The statement of release is sufficient if it contains a description of the collateral being released, the name and address of the debtor, the name and address of the secured party, and the file number of the financing statement. Upon presentation of such a statement to the filing officer he shall mark the statement with the hour and date of filing and shall note the same upon the margin of the index of the filing of the financing statement. The uniform fee for filing and noting such a statement of release shall be $0.50.
Sec. 9-407. 1. If the person filing any financing statement, termination statement, statement of assignment, or statement of release, furnishes the filing officer a copy thereof, the filing officer shall upon request note upon the copy the file number and date and hour of the filing of the original and deliver or send the copy to such person.
2. Upon request of any person, the filing officer shall issue his certificate showing whether there is on file on the date and hour stated therein, any presently effective financing statement naming a particular debtor and any statement of assignment thereof and if there is, giving the date and hour of filing of each such statement and the names and addresses of each secured party therein. The uniform fee for such a certificate shall be $1 plus $0.50 for each financing statement and for each statement of assignment reported therein. Upon request the filing officer shall furnish a copy of any filed financing statement or statement of assignment for a uniform fee of $0.50 per page.
part 5
default
Sec. 9-501. 1. When a debtor is in default under a security agreement, a secured party has the rights and remedies provided in this part and except as limited by subsection 3 those provided in the security agreement. He may reduce his claim to judgment, foreclose or otherwise enforce the security interest by any available judicial procedure. If the collateral is documents the secured party may proceed either as to the documents or as to the goods covered thereby.
κ1965 Statutes of Nevada, Page 910 (CHAPTER 353, SB 15)κ
either as to the documents or as to the goods covered thereby. A secured party in possession has the rights, remedies and duties provided in section 9-207. The rights and remedies referred to in this subsection are cumulative.
2. After default, the debtor has the rights and remedies provided in this part, those provided in the security agreement and those provided in section 9-207.
3. To the extent that they give rights to the debtor and impose duties on the secured party, the rules stated in the subsections referred to below may not be waived or varied except as provided with respect to compulsory disposition of collateral (subsection 1 of section 9-505) and with respect to redemption of collateral (section 9-506) but the parties may by agreement determine the standards by which the fulfillment of these rights and duties is to be measured if such standards are not manifestly unreasonable:
(a) Subsection 2 of section 9-502 and subsection 2 of section 9-504 insofar as they require accounting for surplus proceeds of collateral;
(b) Subsection 3 of section 9-504 and subsection 1 of section 9-505 which deal with disposition of collateral;
(c) Subsection 2 of section 9-505 which deals with acceptance of collateral as discharge of obligation;
(d) Section 9-506 which deals with redemption of collateral; and
(e) Subsection 1 of section 9-507 which deals with the secured partys liability for failure to comply with this part.
4. If the security agreement covers both real and personal property, the secured party may proceed under this part as to the personal property or he may proceed as to both the real and the personal property in accordance with his rights and remedies in respect of the real property in which case the provisions of this part do not apply.
5. When a secured party has reduced his claim to judgment the lien of any levy which may be made upon his collateral by virtue of any execution based upon the judgment shall relate back to the date of the perfection of the security interest in such collateral. A judicial sale, pursuant to such execution, is a foreclosure of the security interest by judicial procedure within the meaning of this section, and the secured party may purchase at the sale and thereafter hold the collateral free of any other requirements of this article.
Sec. 9-502. 1. When so agreed and in any event on default the secured party is entitled to notify an account debtor or the obligor on an instrument to make payment to him whether or not the assignor was theretofore making collections on the collateral, and also to take control of any proceeds to which he is entitled under section 9-306.
2. A secured party who by agreement is entitled to charge back uncollected collateral or otherwise to full or limited recourse against the debtor and who undertakes to collect from the account debtors or obligors must proceed in a commercially reasonable manner and may deduct his reasonable expenses of realization from the collections. If the security agreement secures an indebtedness, the secured party must account to the debtor for any surplus, and unless otherwise agreed, the debtor is liable for any deficiency. But, if the underlying transaction was a sale of accounts, contract rights or chattel paper, the debtor is entitled to any surplus or is liable for any deficiency only if the security agreement so provides.
κ1965 Statutes of Nevada, Page 911 (CHAPTER 353, SB 15)κ
entitled to any surplus or is liable for any deficiency only if the security agreement so provides.
Sec. 9-503. Unless otherwise agreed a secured party has on default the right to take possession of the collateral. In taking possession a secured party may proceed without judicial process if this can be done without breach of the peace or may proceed by action. If the security agreement so provides the secured party may require the debtor to assemble the collateral and make it available to the secured party at a place to be designated by the secured party which is reasonably convenient to both parties. Without removal a secured party may render equipment unusable, and may dispose of collateral on the debtors premises under section 9-504.
Sec. 9-504. 1. A secured party after default may sell, lease or otherwise dispose of any or all of the collateral in its then condition or following any commercially reasonable preparation or processing. Any sale of goods is subject to the article on sales (article 2). The proceeds of disposition shall be applied in the order following to:
(a) The reasonable expenses of retaking, holding, preparing for sale, selling and the like and, to the extent provided for in the agreement and not prohibited by law, the reasonable attorneys fees and legal expenses incurred by the secured party.
(b) The satisfaction of indebtedness secured by the security interest under which the disposition is made.
(c) The satisfaction of indebtedness secured by any subordinate security interest in the collateral if written notification of demand therefor is received before distribution of the proceeds is completed. If requested by the secured party, the holder of a subordinate security interest must seasonably furnish reasonable proof of his interest, and unless he does so, the secured party need not comply with his demand.
2. If the security interest secures an indebtedness, the secured party must account to the debtor for any surplus, and, unless otherwise agreed, the debtor is liable for any deficiency. But if the underlying transaction was a sale of accounts, contract rights or chattel paper, the debtor is entitled to any surplus or is liable for any deficiency only if the security agreement so provides.
3. Disposition of the collateral may be by public or private proceedings and may be made by way of one or more contracts. Sale or other disposition may be as a unit or in parcels and at any time and place and on any terms but every aspect of the disposition including the method, manner, time, place and terms must be commercially reasonable. Unless collateral is perishable or threatens to decline speedily in value or is of a type customarily sold on a recognized market, reasonable notification of the time and place of any public sale or reasonable notification of the time after which any private sale or other intended disposition is to be made shall be sent by the secured party to the debtor, and except in the case of consumer goods to any other person who has a security interest in the collateral and who has duly filed a financing statement indexed in the name of the debtor in this state or who is known by the secured party to have a security interest in the collateral. The secured party may buy at any public sale and if the collateral is of a type customarily sold in a recognized market or is of a type which is the subject of widely distributed standard price quotations he may buy at private sale.
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a type which is the subject of widely distributed standard price quotations he may buy at private sale.
4. When collateral is disposed of by a secured party after default, the disposition transfers to a purchaser for value all of the debtors rights therein, discharges the security interest under which it is made and any security interest or lien subordinate thereto. The purchaser takes free of all such rights and interests even though the secured party fails to comply with the requirements of this part or of any judicial proceedings:
(a) In the case of a public sale, if the purchaser has no knowledge of any defects in the sale and if he does not buy in collusion with the secured party, other bidders or the person conducting the sale; or
(b) In any other case, if the purchaser acts in good faith.
5. A person who is liable to a secured party under a guaranty, endorsement, repurchase agreement or the like and who receives a transfer of collateral from the secured party or is subrogated to his rights has thereafter the rights and duties of the secured party. Such a transfer of collateral is not a sale or disposition of the collateral under this article.
Sec. 9-505. 1. If the debtor has paid 60 percent of the cash price in the case of a purchase money security interest in consumer goods or 60 percent of the loan in the case of another security interest in consumer goods, and has not signed after default a statement renouncing or modifying his rights under this part a secured party who has taken possession of collateral must dispose of it under section 9-504 and if he fails to do so within 90 days after he takes possession the debtor at his option may recover in conversion or under subsection 1 of section 9-507 on secured partys liability.
2. In any other case involving consumer goods or any other collateral a secured party in possession may, after default, propose to retain the collateral in satisfaction of the obligation. Written notice of such proposal shall be sent to the debtor and except in the case of consumer goods to any other secured party who has a security interest in the collateral and who has duly filed a financing statement indexed in the name of debtor in this state or is known by the secured party in possession to have a security interest in it. If the debtor or other person entitled to receive notification objects in writing within 30 days from the receipt of the notification or if any other secured party objects in writing within 30 days after the secured party obtains possession the secured party must dispose of the collateral under section 9-504. In the absence of such written objection the secured party may retain the collateral in satisfaction of the debtors obligation.
Sec. 9-506. At any time before the secured party has disposed of collateral or entered into a contract for its disposition under section 9-504 or before the obligation has been discharged under subsection 2 of section 9-505, the debtor or any other secured party may unless otherwise agreed in writing after default redeem the collateral by tendering fulfillment of all obligations secured by the collateral as well as the expenses reasonably incurred by the secured party in retaking, holding and preparing the collateral for disposition, in arranging for the sale, and to the extent provided in the agreement and not prohibited by law, his reasonable attorneys fees and legal expenses.
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the sale, and to the extent provided in the agreement and not prohibited by law, his reasonable attorneys fees and legal expenses.
Sec. 9-507. 1. If it is established that the secured party is not proceeding in accordance with the provisions of this part disposition may be ordered or restrained on appropriate terms and conditions. If the disposition has occurred the debtor or any person entitled to notification or whose security interest has been made known to the secured party prior to the disposition has a right to recover from the secured party any loss caused by a failure to comply with the provisions of this part. If the collateral is consumer goods, the debtor has a right to recover in any event an amount not less than the credit service charge plus 10 percent of the principal amount of the debt or the time price differential plus 10 percent of the cash price.
2. The fact that a better price could have been obtained by a sale at a different time or in a different method from that selected by the secured party is not of itself sufficient to establish that the sale was not made in a commercially reasonable manner. If the secured party either sells the collateral in the usual manner in any recognized market therefor or if he sells at the price current in such market at the time of his sale or if he has otherwise sold in conformity with reasonable commercial practices among dealers in the type of property sold he has sold in a commercially reasonable manner. The principles stated in the two preceding sentences with respect to sales also apply as may be appropriate to other types of disposition. A disposition which has been approved in any judicial proceeding or by any bona fide creditors committee or representative of creditors shall conclusively be deemed to be commercially reasonable, but this sentence does not indicate that any such approval must be obtained in any case nor does it indicate that any disposition not so approved is not commercially reasonable.
Sec. 2. NRS 12.010 is hereby amended to read as follows:
12.010 [In] Except as provided for secured transactions in section 1 of this act, in the case of an assignment of a thing in action, the action by the assignee shall be without prejudice to any setoff or other defense existing at the time of, or before notice of, the assignment; but this section shall not apply to a negotiable promissory note, or bill of exchange, transferred in good faith and upon good consideration before due.
Sec. 3. NRS 21.080 is hereby amended to read as follows:
21.080 1. All goods, chattels, moneys and other property, real and personal, of the judgment debtor, or any interest therein of the judgment debtor not exempt by law, and all property and rights of property seized and held under attachment in the action, shall be liable to execution. [Shares] Subject to the provisions of section 1 of this act, shares and interests in any corporation or company, and debts and credits and other property not capable of manual delivery, may be attached in execution in like manner as upon writs of attachments. Gold dust and bullion shall be returned by the officer as so much money collected, at its current value, without exposing the same to sale. Until a levy, property shall not be affected by the execution.
2. This chapter does not authorize the seizure of, or other interference with, any money, thing in action, lands or other property held in spendthrift trust for a judgment debtor, or held in such trust for any beneficiary, pursuant to any judgment, order or process of any bankruptcy or other court directed against any such beneficiary or his trustee, where the trust has been created by, or the fund so held in trust has proceeded from, any person other than the judgment debtor or beneficiary himself.
κ1965 Statutes of Nevada, Page 914 (CHAPTER 353, SB 15)κ
in spendthrift trust for a judgment debtor, or held in such trust for any beneficiary, pursuant to any judgment, order or process of any bankruptcy or other court directed against any such beneficiary or his trustee, where the trust has been created by, or the fund so held in trust has proceeded from, any person other than the judgment debtor or beneficiary himself.
Sec. 4. NRS 31.050 is hereby amended to read as follows:
31.050 [The] Subject to the provisions of section 1 of this act, the rights of shares which the defendant may have in the stock of any corporation or company, together with the interest and profits therein, and all debts due such defendant, and all other property in this state of such defendant not exempt from execution, may be attached, and if judgment be recovered, be sold to satisfy the judgment and execution.
Sec. 5. NRS 31.060 is hereby amended to read as follows:
31.060 The sheriff to whom the writ is directed and delivered shall execute the same without delay, and if the undertaking mentioned in NRS 31.040 be not given, as follows:
1. Real property shall be attached by leaving a copy of the writ with the occupant thereof, or, if there be no occupant, by posting a copy in a conspicuous place thereon, and filing a copy, together with a description of the property attached, with the recorder of the county.
2. Personal property capable of manual delivery shall be attached by taking it into custody.
3. [Subject to the provisions of NRS 79.170, stock or shares, or interest in stock or shares, of any corporation or company, domestic or foreign, shall be attached by leaving with the president or other head of the corporation or company, or secretary, cashier or managing agent thereof, a copy of the writ and a notice stating the stock or interest of the defendant is attached in pursuance of such writ. If the corporation or company is doing business in this state and has no president or other head, or secretary, cashier or managing agent in this state with whom a copy of the writ and notice may be left, the attachment may be made by service of the writ and notice in the manner allowed for the service of summons. Any transfer or attempt to transfer stock so attached shall be deemed a contempt of court and punished accordingly.
4.] Debts and credits, due or to become due, and other personal property, not capable of manual delivery, shall be attached by leaving with the person owing such debts, or having in his possession, or under his control, such credits or other personal property, a copy of the writ, and a notice that the debts owing by him to the defendant, or the credits and other personal property in his possession or under his control, belonging to the defendant, are attached in pursuance of such writ.
[5.] 4. Debts and credits, due or to become due, from a bank incorporated under the laws of the State of Nevada or the laws of the United States of America, or other personal property held by such bank not capable of manual delivery, shall be attached, garnisheed or executed upon by serving a copy of the writ and a notice that the debts owing by it to the defendant, or the credits and other personal property in its possession, or under its control, belonging to the defendant, are attached, garnisheed or executed upon in pursuance of such writ.
κ1965 Statutes of Nevada, Page 915 (CHAPTER 353, SB 15)κ
attached, garnisheed or executed upon in pursuance of such writ. The writ and notice shall be served on one of the following officers of the bank:
(a) If the bank has no branches, trust department or military facility, service shall be effected by leaving a copy of the writ and notice with the president, vice president, assistant vice president, cashier, assistant cashier, manager or other managing officer in charge of the bank owing such debts, or having in its possession or under its control such credits or other personal property.
(b) If the bank has branches or military facilities owing such debts or having in its possession or under its control such credits or other personal property, service shall be effected by leaving a copy of the writ and notice with the vice president, assistant vice president, assistant cashier, manager or other managing officer in charge of the branch or in charge of the military facility. Service on such officer or agent shall not constitute a valid levy on any debt, credit or other personal property owing by any other branch or military facility.
(c) If the bank has a trust department owing such debts or having in its possession or under its control such credits or other personal property, then service shall be effected by leaving a copy of the writ and notice with the vice president and trust officer, trust officer, assistant trust officer or other managing officer of the trust department.
Sec. 6. NRS 31.400 is hereby amended to read as follows:
31.400 When any personal property, choses in action or effects of the defendant in the hands of a garnishee are [mortgaged or pledged,] subject to a security interest, or in any way liable for the payment of a debt to him, the plaintiff may, under an order of the court for that purpose, pay or tender the amount due to the garnishee, and thereupon the garnishee shall deliver the personal property, choses in action and effects to the sheriff as in other cases.
Sec. 7. NRS 40.430 is hereby amended to read as follows:
40.430 [There] Except as provided in section 1 of this act, there shall be but one action for the recovery of any debt, or for the enforcement of any right secured by mortgage or lien upon real estate, [or personal property,] which action shall be in accordance with the provisions of the this section, and NRS 40.440 and 40.450. In such action, the judgment shall be rendered for the amount found due the plaintiff, and the court shall have power, but its decree or judgment, to direct a sale of the encumbered property, or such part thereof as shall be necessary, and apply the proceeds of the sale to the payment of the costs and expenses of the sale, the costs of the suit, and the amount due to the plaintiff. If the land mortgaged consists of a single parcel, or two or more contiguous parcels, situated in two or more counties, the court may, in its judgment, direct the whole thereof to be sold in one of such counties by the sheriff, and upon such proceedings, and with like effect, as if the whole of the property were situated in that county. If it shall appear from the sheriffs return that there is a deficiency of such proceeds and balance still due to the plaintiff, the judgment shall then be docketed for such balance against the defendant or defendants personally liable for the debts, and shall, from the time of such docketing, be a lien upon the real estate of the judgment debtor, and an execution may thereupon be issued by the clerk of the court, in like manner and form as upon other judgments, to collect such balance or deficiency from the property of the judgment debtor.
κ1965 Statutes of Nevada, Page 916 (CHAPTER 353, SB 15)κ
may thereupon be issued by the clerk of the court, in like manner and form as upon other judgments, to collect such balance or deficiency from the property of the judgment debtor.
Sec. 8. NRS 41.460 is hereby amended to read as follows:
41.460 If a motor vehicle is sold under a contract of conditional sale or secured transaction whereby the title to the motor vehicle remains in the vendor, the vendor or his assignee shall not be deemed an owner within the provisions of NRS 41.440 to 41.460, inclusive, but the vendee or his assignee shall be deemed the owner notwithstanding the terms of such contract, until the vendor or his assignee retake possession of the motor vehicle. A [chattel mortgagee of a motor vehicle] secured party out of possession of a motor vehicle shall not be deemed an owner within the provisions of NRS 41.440 to 41.460, inclusive.
Sec. 9. NRS 52.030 is hereby amended to read as follows:
52.030 [A] Except as used in section 1 of this act, a presumption is a deduction which the law expressly directs to be made from particular facts.
Sec. 10. NRS 52.070 is hereby amended to read as follows:
52.070 All other presumptions are satisfactory, if uncontradicted. They are denominated disputable presumptions, and may be controverted by other evidence. The following are of that kind:
1. That a person is innocent of crime or wrong.
2. That an unlawful act was done with an unlawful intent.
3. That a person intends the ordinary consequences of his voluntary act.
4. That a person takes ordinary care of his own concerns.
5. That evidence willfully suppressed would be adverse if produced.
6. That higher evidence would be adverse from inferior being produced.
7. That money paid by one to another was due to the latter.
8. That a thing delivered by one to another belonged to the latter.
9. [That an obligation delivered up to the debtor has been paid.
10.] That former rent or installments have been paid when a receipt for the latter is produced.
[11.] 10. That things which a person possesses are owned by him.
[12.] 11. That a person is the owner of property from exercising acts of ownership over it, or from common reputation of his ownership.
[13. That a person in possession of an order on himself for the payment of money, or the delivery of a thing, has paid the money or delivered the thing accordingly.
14.] 12. That a person acting in a public office was regularly appointed to it.
[15.] 13. That official duty has been regularly performed.
[16.] 14. That a court or judge, acting as such, whether in this state or any other state or country, was acting in the lawful exercise of his jurisdiction.
[17.] 15. That a judicial record, when not conclusive, does still correctly determine or set forth the rights of the parties.
[18.] 16. That all matters within an issue were laid before the jury and passed upon by them; and in like manner, that all matters within a submission to arbitration where laid before the arbitrators passed upon by them.
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a submission to arbitration where laid before the arbitrators passed upon by them.
[19. That private transactions have been fair and regular.
20. That the ordinary course of business has been followed.
21. That a promissory note or bill of exchange was given or endorsed for a sufficient consideration.
22. That an endorsement of a negotiable promissory note or bill of exchange was made at the time and place of making the note or bill.
23.] 17. That a writing is truly dated.
[24.] 18. That a letter duly directed and mailed was received in the regular course of the mail.
[25.] 19. Identity of a person from the identity of name.
[26.] 20. That a person not heard from in 7 years is dead.
[27.] 21. That acquiescence followed from a belief that a thing acquiesced in was conformable to the right or fact.
[28.] 22. That the thing happened according to the ordinary course of nature and the ordinary habits of life.
[29.] 23. That persons acting as copartners have entered into a contract of copartnership.
[30.] 24. That a man and woman deporting themselves as husband and wife have entered into a lawful contract of marriage.
[31.] 25. That a child born in lawful wedlock, there being no divorce from bed and board, is legitimate.
[32.] 26. That a thing once proved to exist continues as long as usual with things of that nature.
[33.] 27. That the law has been obeyed.
[34.] 28. That a document or writing more than 30 years old is genuine when the same has been since generally acted upon as genuine by persons having an interest in the question, and its custody has been satisfactorily explained.
[35.] 29. That a printed and published book, purporting to be printed or published by public authority, was so printed or published.
[36.] 30. That a printed and published book, purporting to contain reports of cases adjudged in the tribunals of the state or country where the book is published, contains correct reports of such cases.
[37.] 31. That a trustee or other person, whose duty it was to convey real property to a particular person, has actually conveyed to him, when such presumption is necessary to perfect the title of such person or his successor in interest.
[38.] 32. That the uninterrupted use by the public of land for a burial ground for 5 years, with the consent of the owner and without a reservation of his rights, is presumptive evidence of his intention to dedicate it to the public for that purpose.
[39. That there was a good and sufficient consideration for a written contract.]
Sec. 11. NRS 78.240 is hereby amended to read as follows:
78.240 [1.] The shares of stock in every corporation shall be personal property and shall be transferable on the books of the corporation, in such manner and under such regulations as may be provided in the bylaws [. The delivery of a certificate of stock in a corporation to a bona fide purchaser or pledgee, for value, together with a written transfer of the same, or a written power of attorney to sell, assign and transfer the same, signed by the owner of the certificate, shall be a sufficient delivery to transfer the title against all persons except the corporation.
κ1965 Statutes of Nevada, Page 918 (CHAPTER 353, SB 15)κ
to a bona fide purchaser or pledgee, for value, together with a written transfer of the same, or a written power of attorney to sell, assign and transfer the same, signed by the owner of the certificate, shall be a sufficient delivery to transfer the title against all persons except the corporation.
2. No transfer of stock shall be valid against the corporation until it shall have been registered upon the books of the corporation.] , and as provided in section 1 of this act.
Sec. 11.5. NRS 106.010 is hereby amended to read as follows:
106.010 In NRS 106.020 to 106.050, inclusive [:] , and in section 12.5 of this act:
1. Words used in any gender include all other genders.
2. The singular number includes the plural, and the plural the singular.
Sec. 12. NRS 106.020 is hereby amended to read as follows:
106.020 In any mortgage of real or personal, or real and personal property, [hereafter] made [,] prior to January 1, 1966, the parties may adopt by reference all or any of the following covenants, agreement, obligations, rights and remedies:
1. Covenant No. 1. That the mortgagor will perform each and all of the promises and obligations of the mortgage and all covenants thereof, adopted by reference as provided herein, and will pay the indebtedness therein described with interest as therein provided.
2. Covenant No. 2. That the mortgagor will pay a reasonable attorney fee in case suit is started for the collection of the mortgage debt or any part thereof, and will pay all costs and expenses of the suit, whether the suit be prosecuted to judgment or not, and will also pay all costs of any sale made thereunder without court proceedings, including in case of such sale an attorney fee equal to .......... percent of the amount due at the date of the sale upon the principal and interest of the mortgage debt.
3. Covenant No. 3. That the mortgagor will pay, in lawful money of the United States, all sums expended or advanced by the mortgagee for taxes or assessments levied or assessed against the mortgaged property, fire insurance upon the same, or advanced for any other purpose provided for by the terms of the mortgage or the covenants thereof adopted by reference, together with interest upon any such sums from the date of the payment by the mortgagee until repaid, at the rate of .......... percent per annum.
4. Covenant No. 4. That this mortgage will be security for the payment in lawful money of the United States of any and all moneys that may hereafter become due or payable from the mortgagor to the mortgagee, from any cause whatsoever.
5. Covenant No. 5. That this mortgage shall be security for any and all renewals of the mortgage debt or of the promissory note or notes evidencing the same, which may be executed and delivered by the mortgagor to the mortgagee, and any and all additional or future advances or loans which may be made by the mortgagee to the mortgagor.
6. Covenant No. 6. That the mortgagor agrees to pay and discharge at maturity all taxes and assessments and all other charges and encumbrances which are, or shall hereafter be, or appear to be, a lien upon the mortgaged property, or any part thereof, and he will pay all interest or installments due on any prior encumbrance.
κ1965 Statutes of Nevada, Page 919 (CHAPTER 353, SB 15)κ
encumbrances which are, or shall hereafter be, or appear to be, a lien upon the mortgaged property, or any part thereof, and he will pay all interest or installments due on any prior encumbrance. And in default thereof, the mortgagee may, without demand or notice, pay the same and the mortgagee shall be the sole judge of the legality or validity of such taxes, assessments, charges or encumbrances and the amount necessary to be paid in the satisfaction or discharge thereof.
7. Covenant No. 7. That the mortgagor will at all times keep the buildings and improvements, which are now or which shall hereafter be erected upon the mortgaged premises, insured against loss or damage by fire to the amount of at least $ .......... in some reliable insurance company to companies, approved by the mortgagee, and will deliver the policies therefor to the mortgagee to be held by the mortgagee as further security. In default of the mortgagor to obtain such insurance, the mortgagee may procure the same, not exceeding the amount aforesaid, and may pay and expend for premiums for such insurance such sums of money as the mortgagee shall deem necessary.
8. Covenant No. 8. That if there be more than one mortgagor in a mortgage, all covenants, terms, promises and obligations set forth in the mortgage or adopted by reference are agreed to be joint and several covenants, terms, conditions, promises and obligations of each of the mortgagors thereto.
9. Covenant No. 9. That this mortgage is made upon the express condition that if all sums secured hereby shall be paid at the time, place and manner mentioned in the mortgage, or in any of the covenants provided by this section which shall be adopted by reference, the mortgage and the estate therein mentioned and described shall cease, determine and be void, and the mortgagor, for himself, his heirs, executors, administrators, successors and assigns, covenants and agrees to pay in lawful money of the United States to the mortgagee all sums secured by the mortgage, or by the terms of the covenants adopted by reference at the time and in the manner therein provided, and if default be made in the payment of the principal or interest or any part thereof described in the mortgage, or of any promissory note or other instrument or obligation for which such mortgage is given as security, the whole of the principal sum for which the mortgage is given, which shall be then unpaid, shall become forthwith payable, although the time expressed in the promissory note or notes or other obligation or obligations shall not have arrived.
10. Covenant No. 10. That it is understood and agreed that all the natural increase, during the existence of this mortgage, of any livestock which shall at any time be subject to the lien hereof, and all other livestock of the same kind as that described in the mortgage which in any manner is acquired by the mortgagor during the life of the mortgage, and all wool grown upon or produced by any sheep which shall at any time be subject to the lien of the mortgage, is property mortgaged hereunder and subject to the lien of the mortgage.
11. Covenant No. 11. That the mortgagor covenants and agrees to keep all livestock mortgaged or subject to the lien of the mortgage in good condition, and care for, inspect and protect the same, and provide and maintain sufficient blooded, graded breeding stock to properly serve any female livestock at any time subject to the lien of the mortgage, and in general to exercise such care in rearing, branding, ranging and feeding all livestock subject to the lien of the mortgage as is consistent and in accord with good business, and with the customary manner of handling that kind of livestock which is subject to the lien hereof.
κ1965 Statutes of Nevada, Page 920 (CHAPTER 353, SB 15)κ
properly serve any female livestock at any time subject to the lien of the mortgage, and in general to exercise such care in rearing, branding, ranging and feeding all livestock subject to the lien of the mortgage as is consistent and in accord with good business, and with the customary manner of handling that kind of livestock which is subject to the lien hereof. Should the livestock or any part thereof at any time, in the opinion of the mortgagee, require care, attention or protection other than that provided by the mortgagor, then the mortgagee may enter or cause entry to be made upon any property where the mortgaged livestock or any part thereof may be found, and assume control, custody and possession of the same, and at the expense of the mortgagor care for, protect, and attend to the same in such manner as it may deem necessary.
12. Covenant No. 12. That it is further understood and agreed that the mortgagee, its agents or attorneys, shall have the right at all times to inspect and examine any property which may at any time be subject to the lien of the mortgage, for the purpose of ascertaining whether or not the security given is being lessened, diminished, depleted or impaired, and if such inspection or examination shall disclose, in the judgment of the mortgagee, that the security given or the property mortgaged is being lessened or impaired, such condition shall be deemed a breach of the covenants of the mortgage on the part of the mortgagor.
13. Covenant No. 13. That upon default of any of the terms, conditions, covenants or agreements of any chattel mortgage whereby livestock in mortgaged, it is agreed that the mortgagee may, without foreclosure and without legal proceedings and without any previous demand therefore, with the aid or assistance of any person or persons, enter upon the premises and ranges of the mortgagor or such place or places as any of the property subject to the lien of the mortgage is or may be found, and take, lead, drive or carry away the mortgaged property or any part thereof, and with or without notice to the mortgagor, at either public or private sale, sell and dispose of the same or so much thereof as may be necessary to pay the amount and sums secured by the mortgage, for the best price it can obtain, and out of the moneys arising therefrom it shall retain and pay the sum or sums then due or payable under the lien of the mortgage, and interest thereon, and all charges and expenses incurred in gathering, feeding, caring for, and selling the property or any part thereof, and any other expenses and charges incurred by the mortgagee, and all other sums secured by any of the terms of the mortgage, and any overplus shall be paid to the mortgagor. The mortgagee is expressly authorized and empowered, upon any such sale, to make and execute such bills of sale or other conveyances necessary to convey to the purchaser or purchasers thereof an absolute title in the property so sold. It shall not be necessary for the purchaser or purchasers at any such sale or sales purported to be made under the powers granted hereunder to inquire into or in any way be or become responsible for the actual existence of the contingency or contingencies upon which such sale or sales shall be made by the mortgagee, and title to the purchaser or purchasers of the property so sold shall be good and sufficient; and the mortgagor agrees that the decision of the mortgagee as to the actual existence of the contingency or contingencies upon which the sale or sales as aforesaid is or may be predicated shall be conclusive and binding upon the mortgagor.
κ1965 Statutes of Nevada, Page 921 (CHAPTER 353, SB 15)κ
property so sold shall be good and sufficient; and the mortgagor agrees that the decision of the mortgagee as to the actual existence of the contingency or contingencies upon which the sale or sales as aforesaid is or may be predicated shall be conclusive and binding upon the mortgagor.
14. Covenant No. 14. That it is expressly agreed by and between the mortgagor and mortgagee that, in the event suit shall be instituted for the foreclosure of the mortgage, the mortgagee may, at its option and without notice, apply for the appointment of a receiver for the purpose of taking possession of the mortgaged property pending foreclosure, and with the approval of the court wherein such suit is instituted, such receiver as may be designated by the mortgagee shall be appointed. All costs in connection with the appointment of a receiver or in connection with the discharge of the duties of the receiver shall be taxed as costs in the suit.
15. Covenant No. 15. That it is expressly agreed and understood that in any sale of any of the property at any time subject to the lien of the mortgage, under the terms of the mortgage or any of the covenants adopted by reference, the property may, at the option of the mortgagee, be sold in one lot or parcel or in such other lots or parcels as may be designated by the mortgagee; and it is further covenanted and agreed that the mortgagee may become the purchaser of the property or any part thereof at any sale made under any of the terms of the mortgage, or upon foreclosure.
Sec. 12.5 Chapter 106 of NRS is hereby amended by adding thereto a new section which shall read as follows:
In any mortgage of real property, made on or after January 1, 1966, the parties may adopt by reference all or any of the following covenants, agreements, obligations, rights and remedies:
1. Covenant No. 1. That the mortgagor will perform each and all of the promises and obligations of the mortgage and all covenants thereof, adopted by reference as provided herein, and will pay the indebtedness therein described with interest and therein provided.
2. Covenant No. 2. That the mortgagor will pay a reasonable attorney fee in case suit is started for the collection of the mortgage debt or any part thereof, and will pay all costs and expenses of the suit, whether the suit be prosecuted to judgment or not, and will also pay all costs of any sale made thereunder without court proceedings, including in case of such sale an attorney fee equal to .......... percent of the amount due at the date of the sale upon the principal and interest of the mortgage debt.
3. Covenant No. 3. That the mortgagor will pay, in lawful money of the United States, all sums expended or advanced by the mortgagee for taxes or assessments levied or assessed against the mortgaged property, fire insurance upon the same, or advanced for any other purpose provided for by the terms of the mortgage or the covenants thereof adopted by reference, together with interest upon any such sums from the date of the payment by the mortgage until repaid, at the rate of .......... percent per annum.
4. Covenant No. 4. That this mortgage will be security for the payment in lawful money of the United States of any and all moneys that may hereafter become due or payable from the mortgagor to the mortgagee, from any cause whatsoever.
κ1965 Statutes of Nevada, Page 922 (CHAPTER 353, SB 15)κ
payment in lawful money of the United States of any and all moneys that may hereafter become due or payable from the mortgagor to the mortgagee, from any cause whatsoever.
5. Covenant No. 5. That this mortgage shall be security for any and all renewals of the mortgage debt or of the promissory note or notes evidencing the same, which may be executed and delivered by the mortgagor to the mortgagee, and any and all additional or future advances or loans which may be made by the mortgagee to the mortgagor.
6. Covenant No. 6. That the mortgagor agrees to pay and discharge at maturity all taxes and assessments and all other charges and encumbrances which are, or shall hereafter be, or appear to be, a lien upon the mortgaged property, or any part thereof, and he will pay all interest or installments due on any prior encumbrance. And in default thereof, the mortgagee may, without demand or notice, pay the same and the mortgagee shall be the sole judge of the legality or validity of such taxes, assessments, charges or encumbrances and the amount necessary to be paid in the satisfaction or discharge thereof.
7. Covenant No. 7. That the mortgagor will at all times keep the buildings and improvements, which are now or which shall hereafter be erected upon the mortgaged premises, insured against loss or damage by fire to the amount of at least $.......... in some reliable insurance company or companies, approved by the mortgagee, and will deliver the policies therefor to the mortgagee to be held by the mortgagee as further security. In default of the mortgagor to obtain such insurance, the mortgagee may procure the same, not exceeding the amount aforesaid, and may pay and expend for premiums for such insurance such sums of money as the mortgagee shall deem necessary.
8. Covenant No. 8. That if there be more than one mortgagor in a mortgage, all covenants, terms, promises and obligations set forth in the mortgage or adopted by reference are agreed to be joint and several covenants, terms, conditions, promises and obligations of each of the mortgagors thereto.
9. Covenant No. 9. That this mortgage is made upon the express condition that if all sums secured hereby shall be paid at the time, place and manner mentioned in the mortgage, or in any of the covenants provided by this section which shall be adopted by reference, the mortgage and the estate therein mentioned and described shall cease, determine and be void, and the mortgagor, for himself, his heirs, executors, administrators, successors and assigns, covenants and agrees to pay in lawful money of the United States to the mortgagee all sums secured by the mortgage, or by the terms of the covenants adopted by reference at the time and in the manner therein provided, and if default be made in the payment of the principal or interest or any part thereof described in the mortgage, or of any promissory note or other instrument or obligation for which such mortgage is given as security, the whole of the principal sum for which the mortgage is given, which shall be then unpaid, shall become forthwith payable, although the time expressed in the promissory note or notes or other obligation or obligations shall not have arrived.
10. Covenant No. 10. That it is further understood and agreed that the mortgagee, its agents or attorneys, shall have the right at all times to inspect and examine any property which may at any time be subject to the lien of the mortgage, for the purpose of ascertaining whether or not the security given is being lessened, diminished, depleted or impaired, and if such inspection or examination shall disclose, in the judgment of the mortgagee, that the security given or the property mortgaged is being lessened or impaired, such condition shall be deemed a breach of the covenants of the mortgage on the part of the mortgagor.
κ1965 Statutes of Nevada, Page 923 (CHAPTER 353, SB 15)κ
that the mortgagee, its agents or attorneys, shall have the right at all times to inspect and examine any property which may at any time be subject to the lien of the mortgage, for the purpose of ascertaining whether or not the security given is being lessened, diminished, depleted or impaired, and if such inspection or examination shall disclose, in the judgment of the mortgagee, that the security given or the property mortgaged is being lessened or impaired, such condition shall be deemed a breach of the covenants of the mortgage on the part of the mortgagor.
11. Covenant No. 11. That it is expressly agreed by and between the mortgagor and mortgagee that, in the event suit shall be instituted for the foreclosure of the mortgage, the mortgagee may, at its option and without notice, apply for the appointment of a receiver for the purpose of taking possession of the mortgaged property pending foreclosure, and with the approval of the court wherein such suit is instituted, such receiver as may be designated by the mortgagee shall be appointed. All costs in connection with the appointment of a receiver or in connection with the discharge of the duties of the receiver shall be taxed as costs in the suit.
12. Covenant No. 12. That it is expressly agreed and understood that in any sale of any of the property at any time subject to the lien of the mortgage, under the terms of the mortgage or any of the covenants adopted by reference, the property may, at the option of the mortgagee, be sold in one lot or parcel or in such other lots or parcels as may be designated by the mortgagee; and it is further covenanted and agreed that the mortgagee may become the purchaser of the property or any part thereof at any sale made under any of the terms of the mortgage, or upon foreclosure.
Sec. 12.6. NRS 106.030 is hereby amended to read as follows:
106.030 Whenever, by the terms of any mortgage, the covenants in NRS 106.020 or in section 12.5 of this act or any of them are adopted as a part thereof by reference, as provided in NRS 106.010 to 106.050, inclusive, and in section 12.5 of this act, the mortgage is intended to secure and does secure the performance of the terms and conditions of the mortgage and all of the covenants so adopted by reference.
Sec. 12.7. NRS 106.040 is hereby amended to read as follows:
106.040 1. In order to adopt by reference any of the covenants, agreements, obligations, rights and remedies in NRS 106.020 [,] or section 12.5 of this act, it shall only be necessary to state in the mortgage [the following:] whichever of the following is appropriate:
(a) The following covenant, Nos. .........., .......... and .......... (inserting the respective numbers) of NRS 106.020, are hereby adopted and made a part of this mortgage.
(b) The following covenants, Nos. .........., .......... and .......... (inserting the respective numbers) of section 12.5 of this act, are hereby adopted and made a part of this mortgage.
2. In order to fix the amount of counsel fees under Covenant No. 2 of NRS 106.020 [,] or section 12.5 of this act, it shall only be necessary to state in the mortgage: Covenant No. 2, and set out thereafter the percentage to be allowed.
3. In order to fix the rate of interest under Covenant No. 3 of NRS 106.020 [,] or section 12.5 of this act, it shall only be necessary to state in the mortgage: Covenant No.
κ1965 Statutes of Nevada, Page 924 (CHAPTER 353, SB 15)κ
106.020 [,] or section 12.5 of this act, it shall only be necessary to state in the mortgage: Covenant No. 3, and set out thereafter the rate of interest to be charged thereunder.
4. A mortgage, in order to fix the amount of insurance to be carried, need not reincorporate the provisions of Covenant No. 7 of NRS 106.020 [,] or section 12.5 of this act, but may merely state the following: Covenant No. 7, and set out thereafter the amount of insurance to be carried.
Sec. 12.8. NRS 106.050 is hereby amended to read as follows:
106.050 Nothing in NRS 106.010 to 106.040, inclusive, or section 12.5 of this act shall prevent the parties to any mortgage from entering into any other, different or additional covenants or agreement than those set out in NRS 106.020 [.] or section 12.5 of this act.
Sec. 12.9. NRS 106.190 is hereby amended to read as follows:
106.190 1. No [mortgage] security interest of livestock, or other animate chattels, and hay, grain or other feed materials shall be invalid or deemed fraudulent in any particular because provision is contained therein or otherwise, or because the [mortgagee] secured party or assignee consents, that the [mortgagor] debtor may use or permit the use or consumption of such feed, forage and fodder crops or materials in caring for, preserving or preparing for market or sale the livestock or other animate chattels covered thereby.
2. Notwithstanding the provisions of part 2 of article 9 of section 1 of this act relating to security interests in after-acquired property, such a security agreement may, if expressly so provided, attach to and cover crops and forage, both annual and perennial, which are to be so used, for a period not to exceed 5 years.
Sec. 13. NRS 106.200 is hereby amended to read as follows:
106.200 A mortgage for a good and valuable consideration upon possessory claims to public lands, all buildings and improvements upon such lands, and all quarts and mining claims, [and all such personal property as shall be fixed in its structure to the soil,] acknowledged in manner and form as mortgages upon real property are required by law to be acknowledged, and recorded in office of the recorder in the county in which the property is situated, shall have the same effect against third persons as mortgages upon real property. [, excepting, however, that for the purposes of mortgaging crops, fruits, berries, emblements and industrial crops, either annual or perennial, and either grown or growing, or to be planted, produced or grown within 2 years from the execution of any such mortgage, and things attached to or forming part of the land which may be severed therefrom under the terms of any such mortgage, shall be deemed to be personal property and mortgageable as such and in the manner provided by law.]
Sec. 14. NRS 106.210 is hereby amended to read as follows:
106.210 1. Any assignment of a mortgage of real property, or of a mortgage of personal property or crops recorded prior to March 27, 1935, and any assignment of the beneficial interest under a deed of trust may be recorded, [and any assignment or a copy thereof certified to be such by a notary public or other officer authorized to take acknowledgments, or an executed counterpart thereof, of a mortgage hereafter filed of personal property or crops, may be filed,] and from the time any of the same are so filed for record [, or filed, as the case may be,] shall operate as constructive notice of the contents thereof to all persons.
κ1965 Statutes of Nevada, Page 925 (CHAPTER 353, SB 15)κ
hereafter filed of personal property or crops, may be filed,] and from the time any of the same are so filed for record [, or filed, as the case may be,] shall operate as constructive notice of the contents thereof to all persons.
2. Each such filing or recording shall be properly indexed by the recorder.
Sec. 15. NRS 106.220 is hereby amended to read as follows:
106.220 1. Any instrument by which any mortgage or deed of trust of, lien upon or interest in real [or personal] property is subordinated or waived as to priority, may, in case it concerns only one or more mortgages or deeds of trust of, liens upon or interests in real property, together with, or in the alternative, one or more mortgages of, liens upon or interests in personal property or crops, the instruments or documents evidencing or creating which have been recorded prior to March 27, 1935, be recorded, [and, in case it concerns mortgages or deeds of trust of, liens upon or interests in real or personal property or crops, one or more of the instruments or documents evidencing or creating which are filed hereafter, may be filed in the manner provided in NRS 106.210 for the filing of assignments by either the filing of the original instrument, a certified copy or executed counterpart thereof,] and from the time any of the same are so filed for record [, or filed, as the case may be,] shall operate as constructive notice of the contents thereof to all persons.
2. Each such filing or recording shall be properly indexed by the recorder.
Sec. 16. NRS 106.260 is hereby amended to read as follows:
106.260 1. Any mortgage or lien, that has been or may hereafter be recorded, may be discharged or assigned by an entry on the margin of the record thereof, signed by the mortgagee or his personal representative or assignee, acknowledging the satisfaction of or value received for the mortgage or lien and the debt secured thereby, in the presence of the recorder or his deputy, who shall subscribe the same as a witness, and such entry shall have the same effect as a deed of release or assignment duly acknowledged and recorded. Such marginal discharge or assignment shall in each case be properly indexed by the recorder.
2. [A mortgage of personal property or crops that have been filed, as prescribed in NRS, may be discharged or assigned by an entry in the margin of the recorders index of such personal property or crop mortgage, opposite the indexing entry of such mortgage, together with an entry upon the face of such mortgage instrument (or certified copy or executed counterpart thereof) on file in the recorders office. Such entries must be signed by the mortgagee, or his personal representative or assignee, and shall acknowledge the satisfaction or assignment of the mortgage or lien and the debt secured thereby, and such entries shall be made and subscribed in the present of the recorder or his deputy, who shall subscribe the same as a witness, and such entries shall be effective for all purposes to release or assign the mortgage or lien.
3.] In the event that the mortgage or lien has been recorded by a microfilm or other photographic process, a marginal release may not be used and a duly acknowledged discharge or release of such mortgage or lien must be recorded.
κ1965 Statutes of Nevada, Page 926 (CHAPTER 353, SB 15)κ
not be used and a duly acknowledged discharge or release of such mortgage or lien must be recorded.
Sec. 17. NRS 106.270 is hereby amended to read as follows:
106.270 [1.] Any recorded mortgage shall also be discharged upon the record thereof by the recorder in whose custody it shall be, whenever there shall be presented to him a certificate executed by the mortgagee, his personal representative or assignee, acknowledged, or proved and certified, as prescribed in NRS, to entitled conveyances to be recorded, specifying that such mortgage has been paid or otherwise satisfied or discharged.
[2. A mortgage of personal property or crops that has been filed, as permitted by NRS, if not discharged as provided in NRS 106.260, must be discharged upon the index of such personal property or crop mortgage and upon the face of such mortgage instrument (or certified copy or executed counterpart thereof) on file in the recorders office upon the filing with the recorder of a certificate signed by the mortgagee, his personal representative or assigns, stating that the mortgage has been paid, satisfied or discharged.]
Sec. 18. NRS 106.280 is hereby amended to read as follows:
106.280 [1.] Every certificate of discharge of a recorded mortgage, and the proof or acknowledgment thereof, shall be recorded at full length, and a reference shall be made to the book containing such record in the minutes of the discharge of such mortgage made by the recorder upon the record thereof.
[2. Every certificate of discharge of a filed mortgage of personal property or crops shall be filed by the recorder with the mortgage (certified copy or executed counterpart thereof) on file, to which it refers, and such filing shall be properly indexed by the recorder.]
Sec. 19. NRS 107.070 is hereby amended to read as follows:
107.070 The provisions of NRS 106.210 [,] and 106.220 [and 106.230] apply to deeds of trust as therein specified.
Sec. 20. NRS 108.290 is hereby amended to read as follows:
108.209 1. Except as provided in subsection 2, any lien or liens in excess of $300 acquired as provided in NRS 108.270 to 108.360, inclusive, shall be secondary lien or liens when the motor vehicle, airplane, motorcycle, motor or airplane equipment, or trailer in question is [sold or leased on a conditional sales agreement or a recorded lease or mortgage.] the subject of a secured transaction.
2. The lien of a trailer park keeper shall not exceed $200 or the total amount due and unpaid for 4 month for rentals and utilities, whichever is the lesser.
Sec. 21. NRS 111.225 is hereby amended to read as follows:
111.225 1. Creditors as used in subsection 2 includes all persons who are creditors of the vendor or assignor at any time while the goods and chattels remain in his possession or under his control.
2. [Every] Except as provided in section 1 of this act, every sale made by a vendor of goods and chattels in his possession or under his control, and every assignment of goods and chattels, unless the same is accompanied by an immediate delivery, and is followed by an actual and continued change of possession of the things sold or assigned, shall be conclusive evidence of fraud, as against the creditors of the vendor, or the creditors of the person making such assignment, or subsequent purchasers in good faith.
κ1965 Statutes of Nevada, Page 927 (CHAPTER 353, SB 15)κ
vendor, or the creditors of the person making such assignment, or subsequent purchasers in good faith.
3. Nothing contained in this section applies to contracts of bottomry, respondentia, or assignments or hypothecations of vessels, or goods at sea, or in foreign states, or without this state, if the assignee or mortgagee takes possession of such goods as soon as may be after the arrival thereof within this state.
Sec. 22. Chapter 205 of NRS is hereby amended by adding thereto the provisions set forth as sections 22.5 to 30, inclusive, of this act.
Sec. 22.5. A bailee, or any officer, agent or servant of a bailee, who issues or aids in issuing a document of title, knowing that the goods covered by the document of title have not been received by him, or are not under his control at the time the document is issued, is guilty of a crime, and upon conviction shall be punished for each offense by imprisonment not exceeding 5 years, or by a fine not exceeding $5,000, or by both.
Sec. 23. A bailee, or any officer, agent or servant of a bailee, who issues or aids in issuing a document of title, knowing that it contains any false statement, is guilty of a crime, and upon conviction shall be punished for each offense by imprisonment not exceeding 1 year, or by a fine not exceeding $1,000, or by both.
Sec. 24. Except as provided in section 1 of this act, a bailee, or any officer, agent or servant of a bailee, who issues or aids in issuing a duplicate or additional negotiable document of title, knowing that a former negotiable document for the same goods or any part of them is outstanding and uncanceled, is guilty of a crime, and upon conviction shall be punished for each offense by imprisonment not exceeding 5 years, or by a fine not exceeding $5,000, or by both.
Sec. 25. Except as provided in section 1 of this act, a bailee, or any officer, agent or servant of a bailee, who delivers goods, knowing that they are covered by an outstanding document of title, the negotiation of which would transfer the right to possession thereof, without obtaining the negotiable document, is guilty of a crime, and upon conviction shall be punished for each offense by imprisonment not exceeding 1 year, or by a fine not exceeding $1,000, or by both.
Sec. 26. A warehouseman, or any officer, agent or servant of a warehouseman, in possession of goods which he owns in part, wholly or jointly, who issues a negotiable warehouse receipt therefor, without noting his ownership on the receipt, is guilty of a crime, and upon conviction shall be punished for each offense by imprisonment not exceeding 1 year, or by a fine not exceeding $1,000, or by both.
Sec. 27. Every person who, with intent to defraud, obtains a negotiable document of title for goods to which he does not have title, or which are subject to a security interest, and negotiates the document for value, without disclosing his want of title or the existence of the security interest, is guilty of a crime, and upon conviction shall be punished for each offense by imprisonment not exceeding 1 year, or by a fine not exceeding $1,000, or by both.
Sec. 28. Every person who, with intent to defraud, secures the issue by a bailee of a negotiable document of title, knowing at the time of issue that any or all of the goods are not in possession of the bailee, by inducing the bailee to believe that the goods are in the bailees possession, is guilty of a crime, and upon conviction shall be punished for each offense by imprisonment not exceeding 5 years, or by a fine not exceeding $5,000, or by both.
κ1965 Statutes of Nevada, Page 928 (CHAPTER 353, SB 15)κ
by inducing the bailee to believe that the goods are in the bailees possession, is guilty of a crime, and upon conviction shall be punished for each offense by imprisonment not exceeding 5 years, or by a fine not exceeding $5,000, or by both.
Sec. 29. Every person who, with intent to defraud, negotiates or transfers for value a document of title, which by the terms thereof represents that goods are in possession of the bailee which issued the document, knowing that the bailee is not in possession of the goods or any part thereof, without disclosing this fact, is guilty of a crime, and upon conviction shall be punished for each offense by imprisonment not exceeding 5 years, or by a fine not exceeding $5,000, or by both.
Sec. 30. A vendor of any stock of goods in bulk, fixtures, wares or merchandise of any kind, or any person who is acting for or on behalf of a vendor, who knowingly or willfully makes or delivers or causes to be made or delivered a statement as provided for in section 1 of this act, which does not include the names of all of the creditors of such vendor, with the correct amount due and to become due to each of them, or which contains any false or untrue statement, is guilty of a misdemeanor, and upon conviction shall be punished by imprisonment in the county jail for not more than 6 months, or by a fine not exceeding $500, or by both.
Sec. 31. NRS 205.335 is hereby amended to read as follows:
205.335 1. The [mortgagor of personal property or crops shall not sell or dispose of any such property, or remove the same from the county wherein the mortgaged property is located at the time the mortgage thereupon is executed, during the time the mortgage is in force, without the written consent of the mortgagee] debtor in possession of goods subject to a security interest shall not sell or dispose of any such property, or remove the same from the county wherein the goods are located at the time the security agreement thereupon is executed, during the time the security agreement is in force, without the written consent of the secured party first had and obtained.
2. Any person violating any of the provisions of subsection 1, with intent to hinder, delay or defraud the [mortgagee,] secured party, shall be deemed guilty of a gross misdemeanor.
Sec. 32. NRS 205.340 is hereby amended to read as follows:
205.340 Every person who shall sell or [mortgage any personal property which is at the time mortgaged or upon which any lien has been or may lawfully be filed, without informing the purchaser or mortgagee thereof before the payment of the purchase price or money loaned, of the several amounts of all such mortgages and liens known to the seller or mortgagor,] create a security interest in any personal property which is at the time subject to a security interest or upon which any lien has been or may lawfully be filed, without informing the purchaser or secured party before the payment of the purchase price or money loaned, of the several amounts of all such security interests and liens known to the seller or debtor, shall be deemed to have made a false representation and shall, where no other punishment is prescribed, be punished as for a gross misdemeanor.
Sec. 33. NRS 205.345 is hereby amended to read as follows:
205.345. 1. Every person being in possession thereof, who shall remove, conceal or destroy or connive at or consent to the removal, concealment or destruction of any personal property or any part thereof, upon which a [mortgage, lien, conditional sales contract] security interest or lease exists, in such a manner as to hinder, delay or defraud the [holder of such mortgage, lien or conditional sales contract] secured party or [such] lessor, or who, with intent to hinder, delay or defraud the [holder of such mortgage, lien or conditional sales contract] secured party or [such] lessor, shall sell, remove, conceal or destroy or connive at or consent to the removal, concealment or destruction of such property, shall be guilty of a gross misdemeanor.
κ1965 Statutes of Nevada, Page 929 (CHAPTER 353, SB 15)κ
remove, conceal or destroy or connive at or consent to the removal, concealment or destruction of any personal property or any part thereof, upon which a [mortgage, lien, conditional sales contract] security interest or lease exists, in such a manner as to hinder, delay or defraud the [holder of such mortgage, lien or conditional sales contract] secured party or [such] lessor, or who, with intent to hinder, delay or defraud the [holder of such mortgage, lien or conditional sales contract] secured party or [such] lessor, shall sell, remove, conceal or destroy or connive at or consent to the removal, concealment or destruction of such property, shall be guilty of a gross misdemeanor.
2. In any prosecution under this section any allegation containing a description of the [mortgage, lien, conditional sales contract] security agreement or lease by reference to the date thereof and names of the parties thereto, shall be sufficiently definite and certain.
Sec. 34. NRS 244.275 is hereby amended to read as follows:
244.275 1. The board of county commissioners shall have power and jurisdiction in their respective counties:
(a) To purchase any real or personal property necessary for the use of the county.
(b) To lease any real or personal property necessary for the use of the county. The provisions of NRS 244.320 shall not apply concerning leases of real property, and members of the board shall be allowed to vote on any contract or lease which extends beyond their terms of office.
2. No purchase of real property shall be made unless the value of the same be previously appraised and fixed by three disinterested persons to be appointed for that purpose by the district judge. The persons so appointed shall be sworn to make a true appraisement thereof according to the best of their knowledge and ability.
3. Notwithstanding the provisions of NRS 354.010, the board of county commissioners may enter into [conditional sales contracts] secured transactions or [other] contracts providing for deferred payment of the purchase price of any equipment, supplies, materials or other personal property purchased for the county, but as provided in NRS 244.320, no member of the board shall be allowed to vote on any contract which extends beyond his term of office.
Sec. 35. NRS 247.150 is hereby amended to read as follows:
247.150 1. Each county recorder shall [:
(a) Keep] keep two separate indexes for each separate book or series of books maintained in his office for the separate recordation of the various classes of instruments alphabetically specified in NRS 247.120.
[(b) Keep two separate indexes of the filing of mortgages of personal property or crops and other documents provided to be filed in NRS 247.140.] One of the indexes shall be for the grantor, mortgagor, plaintiff, assignee, party benefited by a subordination, waiver or release, or first party to any such instrument, and the other of such indexes shall be for the grantee, mortgagee, defendant, the party releasing or waiving or assigning or subordinating, or the second party thereto.
2. Each of the indexes shall be so arranged as to show:
κ1965 Statutes of Nevada, Page 930 (CHAPTER 353, SB 15)κ
(a) The names of each of the parties to every instrument.
(b) The date when such instrument was filed in the office of the county recorder.
(c) The book and page where such instrument is recorded, or the file number and file where such instrument may be filed.
(d) Such other data as in the discretion of the county recorder may seem desirable.
In the event the index shall be of one general series of books for all instruments recorded, it shall also show the character of the instrument indexed.
3. The county recorder may keep in the same volume any two or more of the indexes provided for in this section, but the several indexes must be kept distinct from each other. Every volume of indexes must be distinctly marked on the outside in such a way as to show all of the indexes kept therein.
4. The first column of the several indexes for grantors, mortgagors, plaintiffs, assignees, parties benefited by a subordination, waiver or release, or the first parties to any instrument, shall be properly designated to show the name of each grantor, mortgagor, plaintiff, assignee, party benefited by a subordination, waiver or release, or first party, as the case may be, and the first column of the index provided for grantees, mortgagees, defendants, the parties releasing or waiving or assigning or subordinating, or the second parties to any instrument shall be properly designated to show the name of each grantee, mortgagee, defendant, party releasing or waiving or assigning or subordinating, or second party, as the case may be, and the names of the parties in the first column of such indexes must be arranged in alphabetical order.
5. When a conveyance is executed by a sheriff, the name of the sheriff and the party charged in the execution must both be inserted in the indexes, and when an instrument is recorded or filed to which an executor, administrator, guardian or trustee is a party, the name of such executor, administrator, guardian or trustee, together with the name of the testator, testate, or ward, or party for whom the trust is held, must be inserted in the index.
6. In addition to the indexes above provided for, the county recorder shall also keep and maintain such other indexes as may from time to time be required in the performance of his official duties.
7. Every instrument filed in the office of any county recorder for record or filed, but not for recordation, must be alphabetically indexed in the indexes so provided for each separate book or set of books or file, under the names of each grantor, mortgagor, plaintiff, assignee, party benefited by a subordination, waiver or release, or the first party thereto, in the index provided for that purpose, and also under the names of each grantee, mortgagee, defendant, party releasing or waiving or assigning or subordinating, or second party thereto, in the index provided for that purpose.
8. As an alternative to the method of indexing prescribed by this section, the county recorder may, with the permission of the board of county commissioners, use in place of the index books or volumes card indexes with a metal-reinforced hole punched therein for rod insertion, and such card indexes shall be kept in suitable metal file cabinets.
κ1965 Statutes of Nevada, Page 931 (CHAPTER 353, SB 15)κ
of county commissioners, use in place of the index books or volumes card indexes with a metal-reinforced hole punched therein for rod insertion, and such card indexes shall be kept in suitable metal file cabinets.
Sec. 36. NRS 247.170 is hereby amended to read as follows:
247.170 1. Whenever any instrument has been filed for record with the county recorder of any county as a deed of trust, mortgage or [chattel mortgage,] financing statement, or copied, or a microfilm picture or photostatic copy thereof inserted, into any book of deeds, deeds of trust, mortgages or [chattel mortgages,] financing statement, such instrument need not be again filed for record or recorded in such office as a different instrument from that so filed for record or recorded, but the county recorder must index such instrument in any of the indexes kept in his office upon the request of the person recording such instrument and the payment to him of his legal fees for such indexing.
2. Such instrument from the date of such indexing imparts notice of its contents to all person, and subsequent purchasers, mortgagees, lienholders and encumbrancers purchase and take with like notice and effect as if such instrument had been copied or recorded in the proper book of records corresponding with such indexes where so indexed, notwithstanding such instrument has been but once recorded or copied in the records of such office.
Sec. 37. NRS 247.225 is hereby amended to read as follows:
247.225 1. [The] Except as provided in section 1 of this act, the county recorder of Douglas County shall be allowed to charge and collect the following fees:
For receiving, filing and entering document required to be recorded........ $0.25
For filing and entering any paper not to be recorded................................... .50
For making all necessary indexes to each paper filed or recorded, for each name to be indexed.......................................................................................................... .50
For recording any instrument, paper or document, for each folio.............. .30
If the photostatic method of recording is used, in lieu of 30 cents per folio, the county recorder may charge 75 cents for the first photostated page and 50 cents for each additional page or part of a photostated page.
For every certificate under seal........................................................................ 1.00
For every entry of discharge or assignment of mortgage on the margin of the records ............................................................................................................ .50
For abstract of title, for each document embraced thereby......................... 1.00
For searching records and files, for each document necessarily examined .50
For recording any survey or map other than a town plat, for each corner .50 For recording town plan, for each lot or separate subdivision exhibited thereby............................................................. $0.25
κ1965 Statutes of Nevada, Page 932 (CHAPTER 353, SB 15)κ
For recording town plan, for each lot or separate subdivision exhibited thereby $0.25
For each folio of lettering or figuring thereon, or in the certificate and description of the same......................................................................... .50
For recording certificates of marriage.................................................................. 1.00
For taking acknowledgment, including certificate and seal, for the first signature 1.00
For each additional signature..................................................................... .25
For preparing the abstract of unsatisfied mortgages, when requested by the board of equalization, for each......................................................................................... .25
2. The county recorder shall be allowed to charge and collect:
(a) For a copy of any record or document in his office, the same fees as for recording.
(b) For recording or copying any paper in a foreign language, double the fees as when in English.
3. No map or plat shall be recorded exceeding in size two folios of the usual size records.
4. The county recorder shall neither charge nor collect any fees for services rendered to the State of Nevada or to the county of Douglas or any city or town within Douglas County or any officer in his official capacity.
5. The county recorder shall, on or before the 5th day of each month, account for and pay to the county treasurer all fees collected during the preceding month.
Sec. 38. NRS 247.230 is hereby amended to read as follows:
247.230 1. [The] Except as provided in section 1 of this act, the county recorder of Clark County shall be allowed to charge and collect the following fees:
For receiving, filing and entering documents required to be recorded......... $0.25
For filing and entering any paper not to be recorded.......................................... .50
For making all necessary indexes to each paper filed or recorded, for each name to be indexed, for five names or less......................................................................... .50
For each additional name............................................................................ .25
For recording any instrument, paper or document, for each folio..................... .20
If the photostatic method of recording is used, in lieu of 20 cents per folio, the county recorder may charge 75 cents for the first photostated page and 50 cents for each additional page or part of a photostated page.
For every certificate under seal............................................................................. 1.00
For every entry of discharge or assignment of mortgage on the margin of the records 1.00
For abstract of title, for each document embraced thereby................................ .75
For searching records and files, for each document necessarily examined .25 For recording any survey or map other than a town plat, for each corner...................................................................... $0.30
κ1965 Statutes of Nevada, Page 933 (CHAPTER 353, SB 15)κ
For recording any survey or map other than a town plat, for each corner... $0.30
For recording town plat, for each lot or separate subdivision exhibited thereby .25
For each folio of lettering or figuring thereon, or in the certificate and description of the same......................................................................... .50
For recording certificates of marriage.................................................................. 1.00
For copying of any document, including certificate and seal, for the first signature .75
For each additional signature..................................................................... .25
2. The county recorder shall be allowed to charge and collect for recording or copying any paper in a foreign language double the fees as when in English.
3. No map or plat shall be recorded exceeding in size two folios of the usual size records.
4. The county recorder shall neither charge nor collect any fees for services rendered to the State of Nevada, or the county of Clark, or any city or town within Clark County, or any officer thereof in his official capacity.
5. The county recorder shall, on or before the 5th day of each month, account for and pay to the county treasurer all fees collected during the preceding month, except fees which he may retain as compensation.
Sec. 39. NRS 247.235 is hereby amended to read as follows:
247.235 1. [The] Except as provided in section 1 of this act, the county recorder of Elko County shall be allowed to charge and collect the following fees:
For filing and entering documents required to be recorded........................... $0.15
For filing and entering any paper not to be recorded.......................................... .50
For making all necessary indexes to each paper filed or recorded, for each name to be indexed................................................................................................................. .30
For recording any instrument, paper or document, for the first page........ ...... .75
For each additional page............................................................................. .50
For each certificate under seal.............................................................................. 1.00
For every entry of discharge or assignment of mortgage on the margin of the records .50
For recording any survey or map other than a town plat................................. 2.50
For recording town plats........................................................................................ 5.00
For recording certificate of marriage, birth or death, or affidavit pertaining to the same .................................................................................................... 1.00
For copying any instrument, paper or document, for the first page of each document .75
For each additional page or part of a page............................................... .50
2. The county recorder shall not make title searches.
3. The county recorder shall neither charge nor collect any fees for services rendered to the State of Nevada, or the county of Elko, or any city or town within Elko County, or any officer thereof in his official capacity.
κ1965 Statutes of Nevada, Page 934 (CHAPTER 353, SB 15)κ
or any city or town within Elko County, or any officer thereof in his official capacity.
4. The county recorder shall be allowed to charge and collect for recording or copying any paper in a foreign language double the fees as when in English.
5. The county recorder shall, on or before the 5th day of each month, account for and pay to the county treasurer all fees collected during the preceding month, except fees which he may retain as compensation.
Sec. 40. NRS 247.240 is hereby amended to read as follows:
247.240 1. [The] Except as provided in section 1 of this act, the county recorder of Lincoln County shall charge and collect the following fees:
For receiving, filing and entering documents required to be recorded......... $0.25
For filing and entering any paper not the be recorded........................................ .50
For making all necessary indexes to each paper filed or recorded, for each name to be indexed................................................................................................................. .50
For recording any instrument, paper or document, for each folio..................... .30
For every certificate under seal............................................................................. 1.00
For every entry of discharge of mortgage on the margin of records................ .50
For abstract of title, for each document embraced thereby.............................. 1.00
For searching records and files, for each document necessarily examined .50
For recording any survey or map other than town plat, for each course.. ...... .50
For recording town plat, for each lot or separate subdivision exhibited thereby .25
For each folio of lettering or figuring thereon, or in the certificate and description of the same....................................................................... 1.00
For recording certificates of marriage.................................................................. 1.00
For taking acknowledgment, including certificate and seal, for first signature 1.00
For each additional signature..................................................................... .25
For recording, filing and indexing each mining notice or certificate of location 1.00
For filing, recording and indexing each proof of labor or affidavit of assessment work, for the first claim...................................................................................... .50
For each and every claim............................................................................ .25
But not more than one folio for each proof of labor or affidavit of assessment; if more than one folio a fee of 30 cents per folio shall be charged.
2. The county recorder shall charge and collect:
(a) For a copy of any record or document in his office, the same fees as for recording.
κ1965 Statutes of Nevada, Page 935 (CHAPTER 353, SB 15)κ
(b) For recording or copying any paper in a foreign language, double the fees as when in English.
3. No map or plat shall be recorded exceeding in size two folios of the usual size records.
4. The county recorder shall neither charge nor collect any fees for services rendered to the State of Nevada, or the county of Lincoln, or any city or town within Lincoln County, or any officer thereof in his official capacity.
5. All fees collected under the provisions of this section shall be paid into the county treasury on or before the 5th day of the month next succeeding the month in which such fees are collected; but one-half of the fee charged for an abstract of title shall be retained by the county recorder.
Sec. 41. NRS 247.250 is hereby amended to read as follows:
247.250 1. [The] Except as provided in section 1 of this act, the county recorder of Mineral County shall be allowed to charge and to collect the following fees:
For filing and entering any paper not to be recorded...................................... $0.50
For receiving, filing and entering documents required to be recorded............. .25
For making all necessary indexes to each paper filed or recorded, for each name to be indexed................................................................................................................. .25
For recording any instrument, paper or document, for each folio..................... .30
For recording certificate of marriage, death, birth or divorce........................... 1.00
For recording certificate of proofs of labor on mining claims, for the first claim embraced therein................................................................................................ .50
For each additional claim............................................................................ .25
For each folio in excess of the first 100 words......................................... .30
For recording each and every notice of mining location.................................. 1.00
For recording any survey or map, other than town plats, for each course........... .50
For recording town plats, for each lot or separate subdivision exhibited thereby .25
For each folio of lettering or figuring thereon, or in the certificate and description of the same....................................................................... 1.00
For filing notices of lis pendens, writs of attachment, sheriffs certificates of sale of property on execution...................................................................................... 1.00
For every entry of discharge of mortgage on the margin of the record............ .50
For searching records and files, for each document necessarily examined .10
For abstract of title, for each document embraced thereby.............................. 1.00
For every certificate under seal............................................................................. 1.00
For taking acknowledgment, including certificate and seal, for the first signature 1.00
For each additional signature.............................................................. .25 For recording and filing marks and brands, and making and transmitting any required copies thereof, if new.. $2.00
κ1965 Statutes of Nevada, Page 936 (CHAPTER 353, SB 15)κ
For recording and filing marks and brands, and making and transmitting any required copies thereof, if new..................................................................................... $2.00
If a rerecord of an old mark or brand......................................................... .50
2. The county recorder shall be allowed to charge and collect:
(a) For recording notices of intention to claim exemption from annual assessment work on mining claims, under the provisions of any act of Congress providing therefor, the same fees as for recording certificates of proofs of labor.
(b) For recording and copying any paper in a foreign language, double the fees as when in English.
(c) For a copy of any record or document in his office, the same fees as for recording.
3. No map or plat shall be recorded exceeding in size two folios of the usual size records.
4. No charge shall be made for:
(a) Filing duplicate copies of a treasurers certificate of sale of property for delinquent taxes.
(b) Filing and recording any official bonds required by law to be recorded.
(c) Filing and recording the treasurers deed as trustee of property sold at a delinquent tax sale.
(d) Any deed to the county or state, or any school district.
5. The county recorder shall neither charge nor collect any fees for services rendered to the State of Nevada, or the county of Mineral, or any city or town within Mineral County, or any officer thereof in his official capacity.
6. All fees collected by the county recorder shall be paid by him into the county treasury on or before the 5th day of the month next succeeding the month in which such fees are collected.
Sec. 42. NRS 247.260 is hereby amended to read as follows:
247.260 1. [The] Except as provided in section 1 of this act, the county recorder of Ormsby County shall be entitled to the following fees:
For receiving, filing and entering documents required to be recorded......... $0.25
For filing and entering any paper not to be recorded.......................................... .50
For making all necessary indexes to each paper filed or recorded, for each name to be indexed................................................................................................................. .50
For recording any instrument, paper or document, for each folio..................... .30
For every certificate under seal............................................................................. 1.00
For every entry of discharge of mortgage on the margin of records................ .50
For abstract of title, for each document embraced thereby.............................. 1.00
For searching records and filed, for each document necessarily examined .50
For recording any survey or map, other than a town plat, for each course .50 For recording town plat, for each lot or separate subdivision exhibited thereby............................................................. $0.25
κ1965 Statutes of Nevada, Page 937 (CHAPTER 353, SB 15)κ
For recording town plat, for each lot or separate subdivision exhibited thereby $0.25
For each folio of lettering or figuring thereon, or in the certificate and description of the same....................................................................... 1.00
For recording certificates of marriage, death, divorce or birth......................... 1.00
For certified copy of marriage certificate............................................................. 1.00
For taking acknowledgment, including certificate and seal, for the first signature 1.00
For each additional signature..................................................................... .25
For preparing the abstract of unsatisfied mortgages required by the board of equalization, for each......................................................................................... .25
2. The county recorder shall be allowed to charge and collect:
(a) For a copy of any record or document in his office, the same fees as for recording.
(b) For recording or copying any paper in a foreign language, double the fees as when in English.
3. No map or plat shall be recorded exceeding in size two folios of the usual size records.
4. The county recorder shall neither charge nor collect any fees for services rendered to the State of Nevada, or the county of Ormsby, or any city or town within Ormsby County, or any officer thereof in his official capacity.
5. All fees received by the county recorder and ex officio auditor under the provisions of this section shall be accounted for and paid over monthly not later than the 5th day of the month next succeeding the month in which such fees are collected, to the county treasurer for the benefit of the general fund.
Sec. 43. NRS 247.265 is hereby amended to read as follows:
247.265 1. [The] Except as provided in section 1 of this act, the county recorder of Pershing County shall be allowed to charge and collect the following fees:
For receiving, filing and entering documents required to be recorded......... $0.25
For filing and entering any paper not to be recorded.......................................... .50
For making all necessary indexes to each paper filed or recorded, for each name to be indexed................................................................................................................. .30
For recording any instrument, paper or document, for each folio..................... .30
If the photostatic method of recording is used, in lieu of 30 cents per folio, the county recorder may charge 75 cents for the first photostated page and 50 cents for each additional page or part of a photostated page.
For every certificate under seal............................................................................. 1.00
For every entry of discharge or assignment of mortgage on the margin of the records 1.00 For abstract of title, for each folio................... $0.30
κ1965 Statutes of Nevada, Page 938 (CHAPTER 353, SB 15)κ
For abstract of title, for each folio...................................................................... $0.30
If the photostatic method of abstracting is used, in lieu of 30 cents per folio, the county recorder may charge 75 cents for the first photostated page and 50 cents for each additional page or part of a photostated page.
For searching records and files, for each document necessarily examined .25
For recording town plat, for each lot or separate subdivision exhibited thereby .25
For each folio of lettering or figuring thereon, or in the certificate and description of the same......................................................................... .50
For recoding certificates of marriage.................................................................... 1.00
For copying of any document or record in his office, for each folio................. .30
For taking acknowledgment, including certificate and seal, for the first signature 1.00
For each additional signature..................................................................... .25
For certifying any document, including certificate and seal, each.................. 1.00
2. The county recorder shall be allowed to charge and collect:
(a) For recording or copying any paper in a foreign language, double the fees as when in English.
(b) For making photostatic or photographic copies, a reasonable fee based on the cost of making such copies.
3. No map or plat shall be recorded exceeding in size two folios of the usual size records.
4. The county recorder shall neither charge nor collect any fees for services rendered to the State of Nevada, or the county of Pershing, or any city or town within Pershing County, or any officer thereof in his official capacity.
5. The county recorder shall, on or before the 5th day of each month, account for and pay to the county treasurer all fees collected during the preceding month, except fees which he may retain as compensation.
Sec. 44. NRS 247.270 is hereby amended to read as follows:
247.270 1. [The] Except as provided in section 1 of this act, the county recorder of Washoe County shall be allowed to charge and collect the following fees:
For receiving, filing and entering documents required to be recorded......... $0.25
For filing and entering any paper not to be recorded.......................................... .50
For making all necessary indexes to each paper filed or recorded, for each name to be indexed, for five names or less......................................................................... .50
For each additional name............................................................................ .25
For recording any instrument, paper or document, for each folio.............. .20 For photostatic recording of any instrument, paper or document, for the first photostated page.............................................. $0.75
κ1965 Statutes of Nevada, Page 939 (CHAPTER 353, SB 15)κ
For photostatic recording of any instrument, paper or document, for the first photostated page........................................................................................... $0.75
For each additional photostated page or part of a page........................ .50
For every certificate under seal............................................................................. 1.00
For every entry of discharge or assignment of mortgage on the margin of the records 1.00
For abstract of title, for each document embraced thereby................................ .75
For searching records and files, for each document necessarily examined .25
For recording any survey or map other than a town plat, for each corner....... .30
For recording town plat, for each lot or separate subdivision exhibited thereby .25
For each folio of lettering or figuring thereon, or in the certificate and description of the same......................................................................... .50
For recording certificates of marriage, death, divorce or birth........................... .50
For copying of any document or record in his office, for each folio................. .20
For taking acknowledgment, including certificate and seal, for the first signature .75
For each additional signature..................................................................... .25
2. The county recorder shall be allowed to charge and collect for recording or copying any paper in a foreign language double the fees as when in English
3. No map or plat shall be recorded exceeding in size two folios of the usual size records.
4. The county recorder shall neither charge nor collect any fees for services rendered to the State of Nevada, or the county of Washoe, or any city or town within Washoe County, or any officer thereof in his official capacity.
5. The county recorder shall, on or before the 5th day of each month, account for and pay to the county treasurer all fees collected during the preceding month, except fees which he may retain as compensation.
Sec. 45. NRS 247.280 is hereby amended to read as follows:
247.280 1. [The] Except as provided in section 1 of this act, the following fees are fixed and established as the fees to be charged and collected by the county recorder of White Pine County:
For receiving, filing and entering document required to be recorded........... $0.15
For filing and entering any paper not to be recorded.......................................... .30
For making all necessary indexes to each paper filed or recorded, for each name to be indexed................................................................................................................. .30
For recording any instrument, paper or document, for each folio..................... .20
For every certificate under seal........................................................................ .75 For every entry of discharge or assignment of mortgage on the margin of the records...................................................... $0.25
κ1965 Statutes of Nevada, Page 940 (CHAPTER 353, SB 15)κ
For every entry of discharge or assignment of mortgage on the margin of the records $0.25
For abstract of title, for each document embraced thereby................................ .75
For searching records and files, for each document necessarily examined .25
But this charge shall not be included in the charge for the abstract of title.
For recording any survey or map other than a town plat, for each corner....... .30
For recording town plat, for each lot or separate subdivision exhibited thereby .20
For each folio of lettering or figuring thereon, or in the certificate and description of the same......................................................................... .50
For recording certificates of marriage, death, divorce or birth........................... .50
For copying of any document or record in his office, for each folio................. .20
For taking acknowledgment, including certificate and seal, for the first signature .75
For each additional signature..................................................................... .25
For preparing the abstract of unsatisfied mortgages, when requested by the board of equalization, for each......................................................................................... .25
2. The county recorder shall be allowed to charge and collect:
(a) For recording or copying any paper in a foreign language, double the fees as when in English.
(b) All other fees which are now or may hereafter be fixed and established by law.
3. No map or plat shall be recorded exceeding in size two folios of the usual size records.
4. The county recorder shall neither charge nor collect any fees for services rendered to the State of Nevada, or the county of White Pine, or any city or town within White Pine County, or any officer thereof in his official capacity.
5. On the 5th day of each month the county recorder shall pay to the county treasurer of White Pine County the amount of all fees charged by the county recorder during the preceding month with the exception of fees charged as provided in subsection 1 for abstracts of title, which fees he may retain as compensation for the last-mentioned service.
Sec. 46. NRS 247.300 is hereby amended to read as follows:
247.300 [1. Except as provided in NRS 247.225, 247.230, 247.235, 247.240, 247.250, 247.260, 247.265, 247.270, and 247.280, the fees of county recorders in counties wherein the total vote at the last general election did not exceed 800 and in counties wherein the total vote at the last general election exceeded 800, for the filing, indexing and safe-keeping as provided by law and for the making of the required notations and endorsements thereon of mortgages of personal property and crops, for the issuing of certificates of searches as provided for by law, for filing assignments, discharges, satisfactions, releases, subordinations and waivers relating to mortgages of personal property and crops or to the lien or interest created or evidenced thereby and for issuing a certificate not under seal of any such filing shall be as follows, and not otherwise:
κ1965 Statutes of Nevada, Page 941 (CHAPTER 353, SB 15)κ
and waivers relating to mortgages of personal property and crops or to the lien or interest created or evidenced thereby and for issuing a certificate not under seal of any such filing shall be as follows, and not otherwise:
Counties Counties
Polling Polling
800 Votes Over 800
Or Less Votes
For filing, issuing certificate of such filing when requested, indexing and keeping every mortgage of personal property or crops or a certified copy or executed counterpart thereof, and making the necessary notations or endorsement thereon $0.50............................................................... $0.50
For making searches of the records and indexes of his office, and certificates or abstracts thereof relating to documents and instruments affecting personal property or crops, for each year for which such searches are certified....................... .25 .25
For filing, issuing certificates of such filing when requested, indexing and keeping every assignment, release, discharge, satisfaction, and cancellation relating to any mortgage of personal property or crops, or the lien or interest created or evidenced thereby, or of any certified copy or executed counterpart thereof..................................................... .25 .25
For filing, issuing certificate of such filing when requested, indexing, making all necessary notations and endorsements, and keeping every instrument by which, or for the benefit of which, the lien or interest evidenced or created by any mortgage of personal property or crops is subordinated or waived as to priority................................................... .25 .25
For every marginal entry of discharge, credit or release of any mortgage of personal property or crops, and indexing the same ........................................................................... .25
2.] 1. No county recorder [of any county specified in this section] shall charge or collect any fees for any [of the] services [herein specified] relating to a financing statement rendered by him to the State of Nevada or the county, or any city or town within the county, or any officer thereof in his official capacity.
[3.] 2. County recorders shall, on or before the 5th day of each month, account for and pay to the county treasurer all [such] fees collected relating to financial statements during the preceding month, except fees which may be retained as compensation.
Sec. 47. NRS 361.245 is hereby amended to read as follows:
κ1965 Statutes of Nevada, Page 942 (CHAPTER 353, SB 15)κ
361.245 When personal property is [mortgaged or pledged] subject to a security interest it shall, for the purpose of taxation, be deemed the property of the person who has possession thereof.
Sec. 48. NRS 364.110 is hereby amended to read as follows:
364.110 No county license board and no other licensing authority, whether county, city or township, within the State of Nevada, shall issue or transfer any license to any person, firm or corporation authorizing such person, firm or corporation to engage in, or in any manner carry on, any business of the retail sale of wines, beers, liquors, soft drinks, produce, meats or other foodstuffs, clothing, hardware, or any other type or class of merchandise whatever, without requiring the applicant or applicants for such license to file with such licensing authority an affidavit showing:
1. Whether such applicant or applicants are engaged in business under a fictitious name, and if so engaged in business, that such applicant or applicants have complied with the provision of chapter 602 of NRS.
2. Whether there has been any change in ownership in the business of the applicant or applicants during the preceding calendar year, and if there has been any such change in ownership, that such change was made in compliance with the provisions of [chapter 98 of NRS.] section 1 of this act.
Sec. 49. NRS 482.055 is hereby amended to read as follows:
482.055 Legal owner means a person who holds the legal title of a vehicle or a [mortgage thereon.] security interest therein.
Sec. 50. NRS 482.420 is hereby amended to read as follows:
482.420 1. Except as provided in subsection 2, in the event of the transfer by operation of law of the title or interest of an owner in and to a vehicle as upon inheritance, devise or bequest, order in bankruptcy or insolvency, execution sale, repossession upon default in performing the terms of a lease or executory sales contract, or otherwise, the registration thereof shall expire and the vehicle shall not be operated upon the highways until and unless the person entitled thereto shall apply for and obtain the registration thereof.
2. An administrator, executor, trustee or other representative of the owner, or a sheriff or other officer, or any person repossessing the vehicle under the terms of a conditional sales contract, lease, [chattel mortgage,] or other security agreement, or the assignee or legal representative of any such person, may operate or cause to be operated any vehicle upon the highways for a distance of not exceeding 75 miles from the place or repossession or place where formerly kept by the owner to a garage, warehouse or other place of keeping or storage, either upon displaying upon such vehicle the number plate issued to the former owner or without a number plate attached thereto but under written permission first obtained from the department or the local police authorities having jurisdiction over such highways, and upon displaying in plain sight a placard bearing the name and address of the person authorizing and directing such movement and plainly readable from a distance of 100 feet during daylight.
Sec. 21. NRS 488.035 is hereby amended to read as follows:
κ1965 Statutes of Nevada, Page 943 (CHAPTER 353, SB 15)κ
488.035 As used in this chapter, unless the context otherwise requires:
1. Department means a [person holding the legal title to a vessel under a conditional sale contract, a mortgagee of a vessel] secured party under a security agreement relating to a vessel or a renter or lessor of a vessel to the state or any political subdivision of the state under a lease, lease-sale or rental-purchase agreement which grants possession of the vessel to the lessee for a period of 30 consecutive days or more.
3. Motorboat means any vessel propelled by machinery, whether or not such machinery is the principal source of propulsion, but does not include a vessel which has a valid marine document issued by the Bureau of Customs of the United States Government or any federal agency successor thereto.
4. Operate means to navigate or otherwise use a motorboat or a vessel.
5. Owner means:
(a) A person having all the incidents of ownership, including the legal title of a vessel, whether or not such person lends, rents or pledges such vessel; and
(b) A [person entitled to the possession of a vessel as the purchaser under a conditional sale contract; and
(c) A mortgagor of a vessel.] debtor under a security agreement relating to a vessel.
Owner does not include a person holding legal title to a vessel under a conditional sale contract, a mortgagee of a vessel or a renter or lessor of a vessel to the state or any political subdivision of the state under a lease, lease-sale or rental-purchase agreement which grants possession of the vessel to the lessee for a period of 30 consecutive days or more.
6. Person means an individual, partnership, firm, corporation, association or other entity.
7. Registered owner means the person registered by the department as the owner of a vessel.
8. Vessel means every description of watercraft, other than a seaplane on the water, used or capable of being used as a means of transportation on water.
9. Waters of this state means any waters within the territorial limits of this state.
Sec. 52. NRS 562.050 is hereby amended to read as follows:
562.050 All liens provided for in this chapter shall be foreclosed in the manner provided by [NRS 40.430 to 40.450, inclusive,] section 1 of this act, but the judgment therein shall also allow reasonable attorneys fees, to be fixed by the court.
Sec. 53. NRS 564.110 is hereby amended to read as follows:
564.110 1. Any brand or brand and mark or marks, awarded and recorded and remaining of record in accordance with the terms of NRS 564.010 to 564.150, inclusive, including those transferred legally as provided in this section, shall be the property of the person or persons to whom they stand of record as provided in NRS 564.010 to 564.150, inclusive, and shall be subject to sale, assignment, transfer, [mortgage] security agreement or lien, devise or descent the same as other personal property.
κ1965 Statutes of Nevada, Page 944 (CHAPTER 353, SB 15)κ
to whom they stand of record as provided in NRS 564.010 to 564.150, inclusive, and shall be subject to sale, assignment, transfer, [mortgage] security agreement or lien, devise or descent the same as other personal property.
2. Instruments of writing evidencing such sale, assignment, transfer, [mortgage,] security agreement, lien, devise or descent shall be in that form, as to text, signatures, witnesses, acknowledgments or certifications, required by statutes, in the case of the kind of instrument concerned; but the department may secure such competent legal advice or rulings, and require such supporting evidence as it deems necessary, as to such instruments of writing, being in fact, authentic and in due legal form, before approving and recording the same, as provided in NRS 564.010 to 564.150, inclusive.
3. Instruments in writing evidencing the transfer of ownership of any brand or brand and mark or marks shall, after approval, be recorded in the office of the department in a book to be provided for that purpose and shall not be legally binding until so approved by the department and recorded.
4. Recording of such instruments shall have the same force and effect as to third parties as the recording of instruments affecting the sale, assignment, transfer, devise or descent of other personal property. The original, or a certified copy of any such instrument, may be introduced in evidence the same as is provided for similar instruments affecting personal property, and the record of such instrument or instruments of transfer, or the transcript thereof certified by the custodian of such record, may be read in evidence without further proof.
5. Whenever any brand or brand and mark or marks of record, in accordance with the terms of NRS 564.010 to 564.150, inclusive, becomes the subject of, or is included in, any [mortgage,] security agreement, provisional assignment or legal lien, the [mortgagee,] secured party, provisional assignee or lien holder may notify the department in writing as to the existence and conditions of such [mortgage,] security agreement, provisional assignment or lien. After the receipt of such written notice the department shall not transfer such brand or brank and mark or marks, other than to such [mortgagee,] secured party, provisional assignee or lien holder until there is filed with the department satisfactory legal evidence that such [mortgage,] security agreement, provisional assignment or lien has been legally satisfied and removed.
6. No transfer or change, or partial, joint or complete ownership of any brand, under the provisions of this section, shall be construed to grant or recognize any change in the method or area of its use, from that authorized for the same at the time of recording, or subsequent thereto but prior to such transfer or change of ownership, nor shall it waive or modify the rerecording requirements set forth in NRS 564.120.
Sec. 54. NRS 646.010 is hereby amended to read as follows:
646.010 Every person engaged, in whole or in part, in the business of loaning money on the security of pledges, deposits or [conditional sales of] other secured transactions in personal property, shall be deemed to be a pawnbroker.
κ1965 Statutes of Nevada, Page 945 (CHAPTER 353, SB 15)κ
Sec. 55. Chapters 79, 92, 93, 94, 95, 96, 98 and 103 of NRS and NRS 52.080, 78.255, 78.260, 100.070 to 100.170, inclusive, 106.060 to 106.180, inclusive, 106.230, 106.250, 107.060, 247.140, 482.510, 662.130, 663.040, 664.010 and 664.050 to 664.070, inclusive, are hereby repealed.
Sec. 56. This act shall become effective March 1, 1967.
________
Senate Bill No. 121Senator Dial
CHAPTER 354
AN ACT to amend NRS section 450.240, relating to operation and control of county public hospitals and other institutions by the board of hospital trustees, by making such operation and control permissive as to the other institutions.
[Approved April 12, 1965]
The People of the State of Nevada, represented in Senate and Assembly,
do enact as follows:
Section 1. NRS 450.240 is hereby amended to read as follows:
450.240 1. In all counties where a tax from the establishment and maintenance of a public hospital has been authorized, or is hereafter authorized, by a majority of the voters voting for a bond issue in accordance with law, the supervision, management, government and control of the county hospital [, county isolation hospital, county home for the indigent sick, county workhouse for indigents, and the county poor farm] shall vest in and be exercised by the board of hospital trustees for the county public hospital, and the institution [or institutions] shall thereafter be operated by the board of hospital trustees.
2. In all such counties, the supervision of the county isolation hospital, county home for the indigent sick, county workhouse for indigents, and the county poor farm, or any of them, may, at the discretion of the board of county commissioners, be vested in and exercised by the board of hospital trustees, and such institution or institutions may thereafter be operated by the board of hospital trustees.
3. Annually, upon the request of the board of hospital trustees, the board of county commissioners may levy a tax for the maintenance and operation of the county public hospital and other institutions named in subsection [1.] 2.
[3.] 4. The resolution adopted by the board of county commissioners imposing a tax levy for a county public hospital shall state:
(a) The portion of the levy which is necessary to retire hospital bonds and to pay interest thereon;
(b) The portion of the levy which is necessary to pay for the care of indigent patients; and
(c) The portion of the levy which is necessary to pay for the cost of new equipment, replacement of old equipment and other improvements to the hospital not covered by specific bond issues and not included in the cost of care of indigent patients as provided in paragraph (b). The cost shall be prorated to the county in accordance with the number of patient days of care of county patients.
κ1965 Statutes of Nevada, Page 946 (CHAPTER 354, SB 121)κ
cost shall be prorated to the county in accordance with the number of patient days of care of county patients.
[4.] 5. The board of county commissioners may not levy a tax for the care of indigents in the county public hospital as a hospital expense unless the levy and its justification are included in the hospital fund budget as submitted to the Nevada tax commission as provided by law.
Sec. 2. This act shall become effective upon passage and approval.
________
Senate Bill No. 101Committee on Banks, Banking and Corporations
CHAPTER 355
AN ACT to amend chapter 662 of NRS, relating to banks and trust companies, by allowing banks to charge higher interest rates on small loans.
[Approved April 12, 1965]
The People of the State of Nevada, represented in Senate and Assembly,
do enact as follows:
Section 1. Chapter 662 of NRS is hereby amended by adding thereto a new section which shall read as follows:
Any bank organized under the laws of the State of Nevada and any national bank doing business in the State of Nevada may charge in advance a rate of interest amounting to 8 percent on loans which do not exceed $500 and a rate of interest of 7 percent on loans exceeding $500 but not exceeding $1,500.
Sec. 2. This act shall become effective upon passage and approval.
________
Senate Bill No. 238Committee on Banks, Banking and Corporations
CHAPTER 356
AN ACT to amend NRS sections 367.020 and 367.030, relating to assessment of banks real property and banks shares, respectively, by including real property of a subsidiary bank building corporation or affiliate bank building corporation.
[Approved April 12, 1965]
The People of the State of Nevada, represented in Senate and Assembly,
do enact as follows:
Section 1. NRS 367.020 is hereby amended to read as follows:
367.020 The real property belonging to any bank, subsidiary bank building corporation or affiliate bank building corporation shall be assessed to [it] the bank in the same manner and form as other real property is assessed to the owners thereof.
Sec. 2. NRS 367.030 is hereby amended to read as follows:
κ1965 Statutes of Nevada, Page 947 (CHAPTER 356, SB 238)κ
367.030 1. All shares of stock in banks, whether of issue or not, existing by authority of the United States, or of the State of Nevada, or of any other state, territory or foreign government, and located within the State of Nevada, shall be assessed to the owners thereof in the county, city, town or district where such banks are located, and not elsewhere, in the assessment of all state, county, town or special taxes, imposed and levied in such place, whether such owner is a resident of the county, city, town or district, or not.
2. All such shares shall be assessed at their full cash value on October 1, first deducting therefrom the proportionate value of the real property belonging to the bank, subsidiary bank building corporation or affiliate bank building corporation and the amount or value of such mortgages and trust deeds owned by the bank and on which the bank has paid the taxes or authorized the assessment thereof in its name, at the same rate and no greater than that at which other moneyed capital in the hands of citizens and subject to taxation is assessed by law.
3. The proportionate parts of the shares of stock in a bank having branches in one or more counties, cities, towns or districts, shall be assessed as provided herein in such counties, cities, towns or districts where such bank or branches may be situated, such proportionate parts to be assessed in each such county, town, city or district being determined by the ratio which the total deposits, both time and demand, at the close of banking hours on the last business day of September in the bank or branch situated in such county, city, town or district bear to the total of such deposits on the last business day of September in all of the banks and branches thereof, ownership of which is represented by the shares of stock so assessed.
4. The persons or corporations who appear from the records of the banks to be the owners of shares at the close of the business day next preceding October 1 in each year shall be taken and deemed to be the owners thereof for the purposes of this section.
________
κ1965 Statutes of Nevada, Page 948κ
Senate Bill No. 113Senator Dodge
CHAPTER 357
AN ACT to amend chapter 11 of NRS, relating to limitation of actions, by adding a new section providing for a 6-year limitation period on actions for damages for injury to person or property or for wrongful death caused by deficiency in design, planning, supervision of construction or construction of improvements to real property; providing that actions arising in the sixth year shall nevertheless be commenced within 1 year after the date of injury; and providing that limitation shall not be a defense for persons in possession of the property; to amend NRS section 11.190, relating to limitation of actions, by providing that general limitations are subject to further limitation under this act; and providing other matters properly relating thereto.
[Approved April 13, 1965]
The People of the State of Nevada, represented in Senate and Assembly,
do enact as follows:
Section 1. Chapter 11 of NRS is hereby amended by adding thereto a new section which shall read as follows:
1. No action in tort, contract or otherwise shall be commenced against any person performing or furnishing the design, planning, supervision or observation of construction, or the construction, of an improvement to real property more than 6 years after the substantial completion of such an improvement, for the recovery of damages for:
(a) Any deficiency in the design, planning, supervision or observation of construction or construction of such an improvement; or
(b) Injury to real or personal property caused by any such deficiency; or
(c) Injury to or wrongful death of a person caused by any such deficiency.
2. Notwithstanding the provisions of NRS 11.190 and subsection 1 of this section, where injury occurs in the sixth year after substantial completion of such an improvement, an action for damages for injury to property or person, damages for wrongful death resulting from such injury or damages for breach of contract may be commenced within 1 year after the date of such injury, irrespective of the date of death, but in no event may an action be commenced more than 7 years after the substantial completion of the improvement.
3. Where an action for damages for wrongful death or injury to person or property caused by any deficiency in an improvement to real property is brought against a person in actual possession or control as owner, tenant or otherwise of such improvement, the limitation prescribed by this section shall not be a defense for such person.
Sec. 2. NRS 11.190 is hereby amended to read as follows:
11.190 Actions other than those for the recovery of real property unless further limited by section 1 of this act, can only be commenced as follows:
1. Within 6 years:
(a) An action upon a judgment or decree of any court of the United States, or of any state or territory within the United States.
(b) An action upon a contract, obligation or liability founded upon an instrument in writing, except those mentioned in the preceding sections of this chapter.
κ1965 Statutes of Nevada, Page 949 (CHAPTER 357, SB 113)κ
an instrument in writing, except those mentioned in the preceding sections of this chapter.
2. Within 4 years:
(a) An action on an open account for goods, wares and merchandise sold and delivered.
(b) An action for any article charged in a store account.
(c) An action upon a contract, obligation or liability not founded upon an instrument in writing.
3. Within 3 years:
(a) An action upon a liability created by statute, other than a penalty or forfeiture.
(b) An action for waste or trespass of real property; but when the waste or trespass is committed by means of underground works upon any mining claim, the cause of action shall not be deemed to have accrued until the discovery by the aggrieved party of the facts constituting such waste or trespass.
(c) An action for taking, detaining or injuring personal property, including actions for specific recovery thereof; but in all cases where the subject of the action is a domestic animal usually included in the term livestock, having upon it at the time of its loss a recorded mark or brand, and when such animal was strayed or stolen from the true owner without his fault, the statute shall not begin to run against an action for the recovery of such animal until the owner has actual knowledge of such facts as would put a reasonable man upon inquiry as to the possession thereof by the defendant.
(d) An action for relief on the ground of fraud or mistake; the cause of action in such case not to be deemed to have accrued until the discovery by the aggrieved party of the facts constituting the fraud or mistake.
4. Within 2 years:
(a) An action against a sheriff, coroner or constable upon the liability incurred by the doing of an act in his official capacity and in virtue of his office, or by the omission of an official duty, including the nonpayment of money collected upon an execution.
(b) An action upon a statute for a penalty or forfeiture, where the action is given to an individual, or to the state, or an individual and the state, except when the statute imposing it prescribes a different limitation.
(c) An action for libel, slander, assault, battery, false imprisonment or seduction.
(d) An action against a sheriff or other officer for the escape of a prisoner arrested or imprisoned on civil process.
(e) An action to recover damages for injuries to a person or for the death of a person caused by the wrongful act or neglect of another. The provisions of this paragraph relating to an action to recover damages for injuries to a person shall apply only to causes of action which shall accrue after March 20, 1951.
5. Within 1 year:
(a) An action against an officer, or officers de facto:
(1) To recover any goods, wares, merchandise or other property seized by any such officer in his official capacity, as tax collector, or to recover the price or value of any goods, wares, merchandise or other personal property so seized, or for damages for the seizure, detention, sale of, or injury to any goods, wares, merchandise or other personal property seized, or for damages done to any person or property in making such seizure.
κ1965 Statutes of Nevada, Page 950 (CHAPTER 357, SB 113)κ
to recover the price or value of any goods, wares, merchandise or other personal property so seized, or for damages for the seizure, detention, sale of, or injury to any goods, wares, merchandise or other personal property seized, or for damages done to any person or property in making such seizure.
(2) For money paid to any such officer under protest, or seized by such officer in his official capacity, as a collector of taxes, and which, it is claimed, ought to be refunded.
(b) Actions or claims against a county, incorporated city or town which have been rejected by the board of county commissioners, city council or board of trustees, as the case may be, after the first rejection thereof by such board, city council or board of trustees.
________
Senate Bill No. 266Committee on Public Morals
CHAPTER 358
AN ACT to amend NRS section 463.270, relating to the renewal of state gaming licenses, by changing provisions relating to payment of license fees by licensee-owners of slot machines; and providing other matters properly relating thereto.
[Approved April 13, 1965]
The People of the State of Nevada, represented in Senate and Assembly,
do enact as follows:
Section 1. NRS 463.270 is hereby amended to read as follows:
463.270 1. Subject to the power of the commission to deny, revoke, suspend, condition or limit licenses, any state license in force may be renewed by the commission for the next succeeding calendar quarter upon proper application for renewal and payment of state license fees as required by law and the regulations of the commission.
2. All state gaming licenses shall become subject to renewal on the 1st day of each January and the 1st day of each calendar quarter thereafter.
3. Application for renewal shall be filed with the commission and all state license fees required by law shall be paid to the commission on or before the 25th day of January of each year and on or before the 25th day of the first month of each calendar quarter thereafter.
4. Application for renewal of licenses for slot machines only shall be made by the licensee-owner of the slot machines on behalf of himself and the operators of the locations where such machines are situated. [The license fee payable pursuant to NRS 463.370 shall be based upon the entire gross revenue derived from all slot machines for which the licensee-owner is licensed, whether or not such gross revenue is shared with any location operator, and shall be paid by the licensee-owner of the slot machines.] The licensee-owner shall pay the license fee required by NRS 463.370, which license fee shall be based upon his share of the entire gross revenue derived from all slot machines at locations for which the licensee-owner is licensed, and he shall also collect the location operators license fee from the location operator and pay the same to the commission if the gross revenue is shared with such location operator, but in computing the license fee payable by the licensee-operator pursuant to NRS 463.370 the gross revenue derived by the location operator shall not be combined with the gross revenue derived by the licensee-owner.
κ1965 Statutes of Nevada, Page 951 (CHAPTER 358, SB 266)κ
which the licensee-owner is licensed, and he shall also collect the location operators license fee from the location operator and pay the same to the commission if the gross revenue is shared with such location operator, but in computing the license fee payable by the licensee-operator pursuant to NRS 463.370 the gross revenue derived by the location operator shall not be combined with the gross revenue derived by the licensee-owner.
5. Any person failing to pay any state license fees due at the times hereinabove provided shall pay in addition to such license fees a penalty of not less than $10 or 10 percent of the gross amount due, whichever is the greater, but in no case in excess of $500, which penalty shall be collected as are other charges, licenses and penalties under this chapter.
6. Upon renewal of any state license, the commission shall issue an appropriate renewal certificate or validating device or sticker, which shall be attached to each state gaming license so renewed.
7. Any person who shall operate, carry on, conduct or expose for play any gambling game, gaming device or slot machine after his license shall have become subject to renewal, and shall thereafter fail to apply for renewal as herein provided, shall be guilty of a misdemeanor; and, in addition to the penalties provided by law, shall be liable to the State of Nevada for all license fees and penalties which would have been due and payable upon application for renewal as herein provided.
________
Assembly Bill No. 585Committee on Ways and Means
CHAPTER 359
AN ACT to amend NRS sections 218.500, 220.090, 345.010, 345.020, 345.050 and 380.170, relating to the distribution of certain state publications, by abolishing provisions for free distribution to certain recipients and by fixing the price for the Statutes of Nevada when published in more than one volume for any year; to repeal NRS section 345.030, relating to the distribution of certain publications to certain newspapers; and providing other matters properly relating thereto.
[Approved April 13, 1965]
The People of the State of Nevada, represented in Senate and Assembly,
do enact as follows:
Section 1. NRS 218.500 is hereby amended to read as follows:
218.500 1. The secretary of state shall furnish to the superintendent of state printing, within 3 days from the time he receives the same from the governor, after approval, a copy of all acts, joint and concurrent resolutions, and memorials passed at each session.
2. The superintendent of state printing shall:
(a) Print the number of copies as provided by NRS 218.510.
(b) Furnish printed sheets thereof to the legislative counsel bureau, which shall, immediately upon the adjournment of the session, make out and deliver to the superintendent of state printing an index of the same.
κ1965 Statutes of Nevada, Page 952 (CHAPTER 359, AB 585)κ
out and deliver to the superintendent of state printing an index of the same.
(c) Immediately upon the adjournment of the session, print the index prepared by the legislative counsel bureau and bind it in connection with the Statutes of Nevada.
(d) [Furnish to each senator and assemblyman, for distribution among their constituents, 15 copies of the printed sheets of each act as printed, or if more than one act is printed at one time, then copies of the printed sheets of such series of acts.
(e)] Distribute one copy of the act or acts to each county clerk, county auditor, district judge, district attorney and justice of the peace in the state.
Sec. 2. NRS 220.090 is hereby amended to read as follows:
220.090 The secretary of state shall make available for inspection to the legislative counsel:
1. All records of his office which are or may be of use to the legislative counsel.
2. Any books or statutes in his custody.
Sec. 3. NRS 345.010 is hereby amended to read as follows:
345.010 1. Upon publication of the Statutes of Nevada, the secretary of state shall distribute one copy by mail [to each of the judges of the United States Court of Appeals, Ninth Circuit; one copy] to each of the judges of the United States district [courts in the states] court in the State of Nevada. [, California and Oregon; and two copies to the law librarian of the San Francisco law library.]
2. Upon publication of the Statutes of Nevada, the secretary of state shall distribute one copy by mail to each county officer and justice of the peace, who shall keep all copies received by him in his office for the use of the office. The officer receiving the same shall transfer the volumes to his successor in office, who shall give his receipt therefor.
3. The secretary of state shall take proper receipts for the copies distributed under the provision of subsection 2, and shall file the receipts in his office. Except as provided in NRS 3.160, the secretary of state shall not supply a missing or second volume other than at the statutory price.
Sec. 4. NRS 345.020 is hereby amended to read as follows:
345.020 1. Upon receipt of five hundred copies of each volume of Nevada Reports from the superintendent of state printing, as provided in NRS 2.390, the secretary of state shall distribute them as follows:
(a) [To each state and territory, one copy.
(b) To each of the heads of departments at Washington, D.C., one copy.
(c) To the Library of Congress, two copies
(d)] To each of the judges of the [United States Court of Appeals, Ninth Circuit, and] United States district [courts in the states] court in the State of Nevada, [California and Oregon,] one copy.
[(e)] (b) To the Nevada state library, two copies.
[(f)] (c) To each state officer, justice of the supreme court, clerk of the supreme court, district judge, district attorney, county clerk, and justice of the peace in this state, one copy.
κ1965 Statutes of Nevada, Page 953 (CHAPTER 359, AB 585)κ
[(g)] (d) To each public library in this state, one copy.
2. The secretary of state shall distribute shall distribute [copies to literary and scientific institutions, publishers, and authors as in his opinion may secure an interchange of works which may properly be placed in the Nevada state library.] such additional copies to the Nevada state library as in his opinion may secure an interchange of appropriate works for such library, including newspapers published in the State of Nevada.
3. The remaining copies shall be held for sale at the price provided by law.
Sec. 5. NRS 345.050 is hereby amended to read as follows:
345.050 1. The secretary of state is authorized to sell the following publications at the prices herein provided:
(a) Nevada Reports.
For each volume............................................................................................. $10.00
(b) Statutes of Nevada
For each volume up to and including Statutes of Nevada 1928-1929.... 1.00
For each volume published after Statutes of Nevada 1928-1929............ 10.00
For each volume of special sessions laws................................................. .50
(c) Compilations of laws.
Compiles Laws of Nevada (1861-1873), by Bonnifield and Healy (two volumes), for each set..................................................................................................... 2.00
General Statutes Nevada 1885 (1861-1885), by Baily & Hammond, for each volume 1.00
Compiled Laws of Nevada 1861-1900, by Cutting, for each volume...... 1.00
Revised Laws of Nevada 1912, Volumes I and II (two volumes), for each set 3.00
Revised Laws of Nevada 1919, Volume III, for each volume................... 1.50
(d) Miscellaneous publications.
Nevada Constitutional Debates & Proceedings 1864, for each volume 1.00
Nevada and Sawyers Digest 1878, for each volume................................ .50
Nevada Digest Annotated (1912), by Patrick, for each volume.............. 1.50
Journals of the assembly or senate, for each volume............................... 5.00
Appendices to journals of senate and assembly, when bound separately, for each volume....................................................................................................... 5.00
2. When the Statutes of Nevada for any year are published in a set of two or more volumes, the price per set shall be $15.
3. No volume shall be sold or delivered until the purchase price therefor is first received.
Sec. 6. NRS 380.170 is hereby amended to read as follows:
380.170 The secretary of state is authorized [and directed] to transmit to the county clerk of each county, for the use of the law library established therein pursuant to the provisions of this chapter:
κ1965 Statutes of Nevada, Page 954 (CHAPTER 359, AB 585)κ
1. A copy of each publication thereafter made by the state.
2. A copy of each volume of Nevada Reports and the Statutes of Nevada theretofore published.
The secretary of state shall charge and collect for such volumes the prices provided by law.
Sec. 7. NRS 345.030 is hereby repealed.
Sec. 8. This act shall become effective upon passage and approval.
________
Assembly Bill No. 624Committee on Ways and Means
CHAPTER 360
AN ACT to amend NRS sections 286.250, 286.400, 286.420, 286.430, 286.575, 286.600 to 286.620, inclusive, 286.680 and chapter 286 of NRS, relating to public employees retirement, by increasing the amount of the public employees retirement board revolving fund by a transfer of funds; clarifying the rights of a person who leaves covered employment; deferring the beginning and the withdrawal of contributions; providing for post-retirement allowance credit for years of retirement prior to 1963; providing for a change of beneficiary under an option plan prior to retirement; providing that disability and service retirement are alternative; providing a method of securing credit for prior public service; providing for physical custody of securities held for the public employees retirement fund; and providing other matters properly relating thereto.
[Approved April 13, 1965]
The People of the State of Nevada, represented in Senate and Assembly,
do enact as follows:
Section 1. NRS 286.250 is hereby amended to read as follows:
286.250 1. The public employees retirement board revolving fund is hereby created in the sum of [$175,000.] $350,000.
2. The public employees retirement board revolving fund shall be used by the board for the purpose of paying retirement and disability allowances, post-retirement allowances and authorized refunds to members of the system and for no other purpose.
3. All claims or demands paid by the board from the public employees retirement board revolving fund shall, after payment thereof, be passed upon by the state board of examiners in the same manner as other claims against the state, and, when the claims have been approved by the state board of examiners, the state controller shall draw his warrant for the amount of such claim or claims in favor of the public employees retirement board revolving fund, to be paid to the order of the board, and the state treasurer shall pay the same.
4. The board is directed to deposit the public employees retirement board revolving fund in a bank of reputable standing and to secure the deposit by a depository bond satisfactory to the state board of examiners.
5. All checks drawn upon the public employees retirement board revolving fund shall be signed by two persons designated by the board, and the persons so designated shall furnish such bond as shall be directed by the state board of examiners.
κ1965 Statutes of Nevada, Page 955 (CHAPTER 360, AB 624)κ
and the persons so designated shall furnish such bond as shall be directed by the state board of examiners.
Sec. 2. On July 1, 1965, the state controller and state treasurer are directed to transfer from the public employees retirement fund to the public employees retirement board revolving fund the sum of $175,000 required to increase the latter fund to the amount authorized by section 1 of this act. This $175,000 shall be in addition to the $175,000 previously appropriated to such fund.
Sec. 3. NRS 286.400 is hereby amended to read as follows:
286.400 An employee shall cease to be a member of the system and shall forfeit all previously accrued retirement rights if:
1. He is absent from the service of all employers participating in the system for a total of more than 5 years during any 6-year period after he becomes a member of the system; or
2. During any absence from such service he withdraws the amount credited to his account in the public employees retirement fund.
Sec. 4. NRS 286.420 is hereby amended to read as follows:
286.420 1. Deduction shall not be made from the salary of an employee and contributions shall not be paid thereon by the public employer until the start of the next official pay period following the conclusion of [60] 90 consecutive days of employment, unless the employee shall elect, at the beginning of the employment period, to make such contributions from the first day of employment.
2. That period of employment upon which contributions are not paid shall not be regarded as service toward retirement and the individual shall not be entitled to any benefits under this chapter during such period of noncontribution.
Sec. 5. NRS 286.430 is hereby amended to read as follows:
286.430 If an employee who is a member of the system and has contributed to the public employees retirement fund is separated for any reason from all service entitling him to membership in the system, he may withdraw from the public employees retirement fund the amount credited to him in his account. A person on leave of absence without pay for 30 or more consecutive days may withdraw his contributions [during such period.] at the conclusion of such period and prior to return to covered employment.
Sec. 6. NRS 286.575 is hereby amended to read as follows:
286.575 1. A post-retirement allowance shall be paid from the public employees retirement fund to each member receiving a disability allowance or service retirement allowance under the provisions of this chapter on June 30, 1963, and to each member who first becomes entitled to receive any such disability allowance or service retirement allowance on and after July 1, 1963, as follows: On the 1st day of July in each year following June 30, 1963, or the calendar year in which any monthly disability allowance or service retirement allowance was first paid, whichever last occurs, there shall be added to such monthly disability allowance or service retirement allowance and paid to the member monthly thereafter an amount equivalent to 1.5 percent of the amount of such monthly disability allowance or service retirement allowance as originally computed, approved and paid.
κ1965 Statutes of Nevada, Page 956 (CHAPTER 360, AB 624)κ
2. Beginning on July 1, 1965, each member who retired before January 1, 1962, is entitled to receive a post-retirement allowance increase of 1.5 percent of the amount of his monthly disability allowance or service retirement allowance, as originally computed, approved and paid, for each calendar year following the calendar year of his retirement and preceding the calendar year 1963. Each member whose disability allowance or service retirement allowance is based upon the minimum allowance provisions of NRS 286.540 and 286.550 is entitled to receive an increase based upon such minimum allowances.
Each member whose allowance was increased after his retirement by payments for years of service in excess of 20 years is entitled to receive an increase based upon his adjusted allowance.
Sec. 7. NRS 286.600 is hereby amended to read as follows:
286.600 1. A member of the system who has become eligible for a service retirement allowance by virtue of attained age and required service may elect to protect a beneficiary under the terms and conditions of one of Options 2 to 5, inclusive, as described in NRS 286.590 and continue in employment.
2. The allowances payable to the designated beneficiary under the options shall be calculated upon the conditions of service and average salary obtaining on the 1st day of the month in which the application for protection, upon a form prescribed by the board, shall be received in the office of the board.
3. Should the member die after the election has become effective, the designated beneficiary, if surviving, shall become eligible for an allowance under the terms and conditions of the elected option.
4. The allowance payable to the beneficiary shall be recalculated under the conditions of service and average salary of the member existing at the time of his death and contributions shall not be refundable in any part. The recalculated allowance shall not be less than the original calculation.
5. If the beneficiary should predecease the member, the member may name a beneficiary under NRS 286.660 to receive his retirement contributions in case of his death prior to actual entry into retirement.
6. Should the member enter into actual retirement within 12 months of the effective date of protection to a beneficiary, he shall receive his allowance under the terms and conditions of the option previously selected, but calculations thereunder shall be made under the conditions of service and average salary obtaining upon the date of retirement. The recalculated allowance shall not be less than the original calculation.
7. Should the member enter into retirement status at a date in excess of 12 months after the effective date or protection of a beneficiary, he shall be permitted to reelect a retirement option, with a change of beneficiary, if desired, and calculations thereunder shall be made upon the conditions of service and average salary obtaining upon the date of retirement. The recalculated allowance shall be reduced by the actuarial equivalent of the protection previously received, based upon ages as of the original date of protection, if the member chooses a plan other than that originally selected or names a beneficiary other than one previously designated hereunder.
κ1965 Statutes of Nevada, Page 957 (CHAPTER 360, AB 624)κ
8. Protection under this section may be extended to only one person prior to actual entry into retirement [.] , but if the originally named beneficiary should die prior to the entry of the member into actual retirement a new beneficiary may be named under an optional plan. A charge shall be made for the protection previously extended to the deceased beneficiary which shall be the actuarial equivalent of the protection previously received and the optional payments for the new beneficiary shall be calculated under regular procedures.
Sec. 8. NRS 286.610 is hereby amended to read as follows:
286.610 1. A member with 25 or more years of service but who is not yet eligible for retirement by reason of age may elect to protect a beneficiary under the terms and conditions of one of Options 2 to 5, inclusive, as described in NRS 286.590.
2. The protection to the beneficiary shall be calculated upon the members conditions of service and average salary obtaining on the 1st day of the month in which the application for such protection, upon a form prescribed by the board, shall be received in the office of the board.
3. Should the member die after the election has become effective, the designated beneficiary, if surviving, shall become eligible for receipt of an allowance under the elected plan at such time as the deceased member would have reached retirement age or, if either Option 4 or Option 5 has been elected, under the terms and conditions of such option, whichever is later. If the beneficiary does not survive to the date upon which the deceased member would have reached retirement age, or to such date as the beneficiary would be otherwise eligible for an allowance, the refund of the contributions of the deceased member shall be paid in equal shares directly and without probate or administration to the surviving children of the deceased member or, if there be no such surviving children, to the estate of the deceased beneficiary. The anticipated retirement age shall be that age upon which the member could have retired in consideration of service credited at the time of death.
4. Should the member die after the effective date of protection, the allowance payable to the designated beneficiary under the elected option shall be recalculated under the conditions of service and average salary obtaining as of the date of such death.
5. If the beneficiary should die during the continued employment of the member, the member may designate a beneficiary under NRS 286.660 to receive his total retirement contributions in case of death prior to actual entry into retirement.
6. Protection under optional plans may be extended to only one person prior to actual entry into retirement status [.] , but if the originally named beneficiary should die prior to the entry of the member into actual retirement a new beneficiary may be named under an optional plan. A charge shall be made for the protection previously extended to the deceased beneficiary which shall be the actuarial equivalent of the protection previously received and the optional payments for the new beneficiary shall be calculated under regular procedures.
7. Should the member enter into actual retirement status within 12 months of the effective date of protection to a beneficiary, he shall receive his allowance under the terms and conditions of the option previously selected, but the allowance payable under the option shall be recalculated upon the conditions of service and average salary obtaining as of the date of retirement, and the recalculated allowance shall be reduced by the actuarial equivalent of the protection previously received, based upon ages when the member is first eligible to retire.
κ1965 Statutes of Nevada, Page 958 (CHAPTER 360, AB 624)κ
receive his allowance under the terms and conditions of the option previously selected, but the allowance payable under the option shall be recalculated upon the conditions of service and average salary obtaining as of the date of retirement, and the recalculated allowance shall be reduced by the actuarial equivalent of the protection previously received, based upon ages when the member is first eligible to retire.
8. Should the member enter into actual retirement status at a date in excess of 12 months after the effective date of protection, he may retire under the terms and conditions of the plan previously selected or he may be permitted to reselect a retirement plan, with a change of beneficiary if desired, and calculations in every case shall be made upon the conditions of service and average salary obtaining upon the date of retirement. The recalculated allowance shall be reduced in every case by the actuarial equivalent of the protection previously received, based upon ages when the member is first eligible to retire. If the member does not change selection of retirement option or beneficiary, the period of protection chargeable to him ceases on the date he is first eligible to retire. If the member changes either the selection of retirement allowance or beneficiary, the period of protection chargeable to him ceases on the date of the actual retirement.
Sec. 9. NRS 286.620 is hereby amended to read as follows:
286.620 1. A member of the system who has had 10 years or more of continuous service, is not eligible for a service retirement allowance, and becomes totally unable to work due to injury or mental or physical illness will receive a disability retirement allowance; provided:
(a) That he shall be in the employ of a participating member at the time of incapacitation for service; and
(b) That he shall have been in such employ for a minimum period of 6 months prior to such incapacitation unless such incapacitation shall be the result of injuries incurred in the course of such employment.
2. If 6 months or more of employment shall immediately precede the incapacitation, it shall not be required that such injury or mental or physical illness shall have arisen out of and in the course of employment.
3. Such disability retirement allowance shall be calculated in the same manner and under the same conditions as provided for service retirement calculations in NRS 286.550, except that age shall not be a condition of eligibility [.] nor shall the provisions of paragraph (b) of subsection 3 thereof be used in any manner in such calculation.
4. No payments under such disability retirement allowance shall be paid for the first 90 days; provided, that the initial payment shall be retroactive to the last day of compensation for services received by the member.
5. Should death occur during a period of disability any beneficiary named by the member shall receive the surplus of retirement contributions made by the member over the benefits received by the member.
6. Upon attainment of service retirement age while in receipt of a disability retirement allowance, the member shall be regarded as receiving service retirement under NRS 286.520.
κ1965 Statutes of Nevada, Page 959 (CHAPTER 360, AB 624)κ
Sec. 10. NRS 286.680 is hereby amended to read as follows:
286.680 1. Notwithstanding the provisions of chapter 355 of NRS or of any other law, the board may invest and reinvest the moneys in its funds as provided in NRS 286.690 to 286.800, inclusive, and may employ investment counsel for such purpose. The provisions of NRS 286.680 to 286.800, inclusive, shall not be deemed to prevent the board from making investments in accordance with the provisions of chapter 355 of NRS.
2. No person, firm or corporation engaged in business as a broker or dealer in securities or who has a direct pecuniary interest in any such business who receives commissions for transactions performed as agent for the board shall be eligible for employment as investment counsel for the board.
3. The board shall not engage investment counsel unless:
(a) The principal business of the person, firm or corporation selected by the board consists of rendering investment supervisory services, that is, the giving of continuous advice as to the investment of funds on the basis of the individual needs of each client;
(b) The principal ownership and control of such person, firm or corporation rests with individuals who are actively engaged in such business;
(c) Such person, firm or corporation and its predecessors have been continuously engaged in such business for a period of 10 or more years;
(d) Such person, firm or corporation is registered as an investment adviser under the laws of the United States of America as from time to time in effect;
(e) The contract between the retirement board and the investment counsel is of no specific duration and is voidable at any time by either party;
(f) Such person, firm or corporation is a member of the Investment Counsel Association of America; and
(g) Such person, firm or corporation has been approved by the state board of finance for employment as investment counsel.
4. The expense of such employment shall be paid out of the public employees retirement fund.
5. All investments made by the board and any investment program undertaken by the board shall be subject to review by the state board of finance each quarter. If after such review, the state board of finance finds that the investment policies pursued by the board are not in the best interests of the system or the state, the state board of finance may require the board to discharge any investment counsel employed by it.
6. With the approval and consent of the state treasurer, the board may designate the bank or banks which [shall] may have the custody of the various investments authorized in NRS 286.690 to 286.800, inclusive. The physical custody and control of securities held for the public employees retirement fund shall be, at the discretion of the state treasurer, entrusted to the custodian bank or exercised by the state treasurer. All costs incurred for the services of a custodian bank shall be paid out of the public employees retirement fund.
7. The board may accept due bills from brokers upon delivery of warrants if the certificates representing such investments are not readily available.
κ1965 Statutes of Nevada, Page 960 (CHAPTER 360, AB 624)κ
warrants if the certificates representing such investments are not readily available.
Sec. 11. Chapter 286 of NRS is hereby amended by adding thereto a new section which shall read as follows:
Employees of a political subdivisions admitted to membership in the system after coverage under the old-age and survivors insurance system embodied in the Social Security Act may secure credit for service rendered to the political subdivision prior to the membership of the political subdivision in the old-age and survivors insurance system by paying to the public employees retirement fund the amount which would otherwise have been paid in such prior period. The accreditation of such service shall not be effective until 1 year after the admission of the political subdivision to the system.
________
Senate Bill No. 20Senators Parks, Bissett, Slattery, Monroe, Titlow, Bay and Fisher
CHAPTER 361
AN ACT to amend Title 42 of NRS, relating to fire protection, by adding a new chapter relating to the establishment of the office of state fire marshal; creating the state fire marshals advisory board and providing for the appointment, qualifications and duties of the members of such board; providing the powers and duties of the state fire marshal; designating certain municipal and township officers as assistants to the state fire marshal; and providing other matters properly relating thereto.
[Approved April 13, 1965]
The People of the State of Nevada, represented in Senate and Assembly,
do enact as follows:
Section 1. Title 42 of NRS is hereby amended by adding thereto a new chapter to consist of the provisions set forth as sections 2 to 6, inclusive, of the act.
Sec. 2. The office of state fire marshal is hereby established in the insurance division of the department of commerce. The state fire marshal shall be:
1. Appointed by the governor from the names submitted pursuant to the provisions of paragraph (c) of subsection 7 of section 3.
2. In the classified service of the state except for the method of appointment.
Sec. 3. 1. The state fire marshals advisory board is hereby created. The board shall consist of five members appointed by the governor. Persons appointed to the board shall be employed in the fire service within the state.
2. Immediately following July 1, 1965, the governor shall appoint:
(a) Two members of the board for terms of 2 years.
(b) Two members of the board for terms of 3 years.
(c) One member of the board for a term of 4 years.
κ1965 Statutes of Nevada, Page 961 (CHAPTER 361, SB 20)κ
3. Appointments by the governor made after the initial appointments provided for in subsection 2 shall be for terms of 4 years. Vacancies shall be filled by the governor for the unexpired term.
4. The board shall select a chairman from among its members to serve for 1 year. The state fire marshal shall serve as the secretary of the board.
5. The board shall meet on the call of the chairman, the secretary or any three members.
6. The members of the board shall receive no compensation for their services, but shall be entitled to mileage and per diem expenses the same as other state officers.
7. The duties of the board shall be:
(a) To submit the names of qualified persons to the state fire marshal for appointment as deputy state fire marshals.
(b) To make recommendations to the state fire marshal and to the legislature concerning necessary legislation in the field of fire fighting and fire protection.
(c) To submit names of qualified persons to the governor for appointment as state fire marshal.
Sec. 4. 1. The state fire marshal shall enforce all laws and ordinances, and make rules and regulations relating to:
(a) The prevention of fires.
(b) The storage and use of combustibles and explosives.
(c) The construction, maintenance and regulation of fire escapes.
(d) Overseeing the safety of and directing the means and adequacy of exit in case of fire from factories, asylums, hospitals, churches, schools, halls, theaters, amphitheaters, all buildings, except private residences, which are occupied for sleeping purposes, and all other places where large numbers of persons work, live or congregate from time to time for any purpose.
(e) The suppression and punishment of arson and fraudulent claims or practices in connection with fire losses.
2. The state fire marshal and his deputies shall have such powers and perform such other duties as are prescribed by law.
Sec. 5. All municipal fire chiefs or their designated representatives of every city or town in which a fire department is established, the marshal or chief of police of any city or town in which no fire department exists, and the constables within their townships outside of cities and towns shall be, by virtue of the offices held by them, assistants to the state fire marshal without additional compensation, subject to the duties and obligations imposed by law.
Sec. 6. The state fire marshal shall annually transmit to the governor a full report of his proceedings and such statistics as he may wish to include therein. He shall also recommend any amendments to the law which, in his judgment, are desirable.
________
κ1965 Statutes of Nevada, Page 962κ
Senate Bill No. 221Committee on Judiciary
CHAPTER 362
AN ACT to amend Title 18 of NRS, relating to the state executive department, by adding a new chapter providing for administrative procedures for agencies of the executive department of the state government; excepting certain agencies from the operation of the statute; defining terms; providing procedures for adoption of regulations and the giving of notice thereof; providing for the use of declaratory judgments in determining the validity of regulations; providing for judicial review in contested cases; and providing other matters properly relating thereto.
[Approved April 13, 1965]
The People of the State of Nevada, represented in Senate and Assembly,
do enact as follows:
Section 1. Title 18 of NRS is hereby amended by adding thereto a new chapter to consist of the provisions set forth as sections 2 to 14, inclusive, of this act.
Sec. 2. This chapter may be cited as the Nevada Administrative Procedure Act.
Sec. 3. 1. By this act, the legislature intends to establish minimum procedural requirements for the regulation-making and adjudication procedure of all agencies of the executive department of the state government and for judicial review of both functions, excepting those agencies expressly exempted pursuant to the provisions of this chapter. This chapter confers no additional regulation-making authority upon any agency except to the extent provided in subsection 1 of section 6.
2. The provisions of this chapter are intended to supplement present statutes applicable to specific agencies. Nothing in the chapter shall be held to limit or repeal additional requirements imposed on such agencies by statutes or to limit such requirements otherwise recognized by law.
Sec. 4. In this chapter, unless the context otherwise requires:
1. Agency means each public agency, bureau, board, commission, department, division, officer or employee of the executive department of the state government authorized by law to make regulations or to determine contested cases, except:
(a) The governor.
(b) Any penal or educational institution.
(c) Any agency acting within its capacity as administrator of the military affairs of this state.
(d) The state gaming control board.
(e) The Nevada gaming commission.
(f) The state board of parole commissioners.
2. Contested case means an actual adversary proceeding before an agency.
3. License means the whole or part of any agency permit, certificate, approval, registration, charter or similar form of permission required by law. Licensing means the agency procedure whereby the license is granted, denied, revoked, suspended, annulled, withdrawn or amended.
κ1965 Statutes of Nevada, Page 963 (CHAPTER 362, SB 221)κ
4. Party means each person or agency named or admitted as a party, or properly seeking and entitled as of right or be admitted as a party in any contested case.
5. Person means any individual, partnership, corporation, association, political subdivision or public or private organization of any character other than an agency.
6. Regulation means each agency rule, standard, directive or statement of general applicability that implements or interprets law or policy, or describes the organization, procedure or practice requirements of any agency. The term includes the amendment or repeal of a prior regulation, but does not include:
(a) Statements concerning only the internal management of an agency and not affecting private rights or procedures available to the public;
(b) Declaratory rulings issued pursuant to section 13 of this act;
(c) Intra-agency memoranda;
(d) Agency decisions and findings in contested cases; or
(e) Regulations concerning the use of public roads or facilities which are indicated to the public by means of signs and signals.
(f) Any order for immediate action, including but not limited to quarantine and the treatment or cleansing of infected or infested animals, objects or premises, made under the authority of the state board of agriculture, the state board of health, the state board of sheep commissioners or any other agency of this state in the discharge of a responsibility for the preservation of human or animal health or for insect or pest control.
Sec. 5. Unless otherwise provided by law, each agency may adopt reasonable regulations to aid it in carrying out the functions assigned to it by law and shall adopt such regulations as are necessary to the proper execution of those functions. If adopted and filed in accordance with the provisions of this chapter, such regulations shall have the force of law and be enforced by all peace officers. In every instance, the power to adopt regulations to carry out a particular functions is limited by the terms of the grant of authority under which the function was assigned. The courts shall take judicial notice of every regulation duly adopted and filed under the provisions of sections 7 and 8 of this act from the effective date of such regulation.
Sec. 6. 1. In addition to other regulation-making requirements imposed by law, each agency shall:
(a) Adopt regulations of practice, setting forth the nature and requirements of all formal and informal procedures available, including a description of all forms and instructions used by the agency.
(b) Make available for public inspection all regulations adopted or used by the agency in the discharge of its functions.
(c) Make available for public inspection all final orders, decisions and opinions except those expressly made confidential or privileged by statute.
2. No agency regulation, rule, final order or decision shall be valid or effective against any person or party, nor may it be invoked by the agency for any purpose, until it has been made available for public inspection as required in this section, except that this provision shall not be applicable in favor of any person or party who has actual knowledge thereof.
κ1965 Statutes of Nevada, Page 964 (CHAPTER 362, SB 221)κ
inspection as required in this section, except that this provision shall not be applicable in favor of any person or party who has actual knowledge thereof.
Sec. 7. 1. Prior to the adoption, amendment or repeal of any regulation, the agency shall give at least 20 days notice of its intended action.
2. The notice shall:
(a) Include a statement of either the terms or substance of the proposed regulation or a description of the subjects and issues involved, and of the time when, the place where, and the manner in which, interested persons may present their views thereon.
(b) Be mailed to all persons who have requested in writing that they be placed upon a mailing list, which shall be kept by the agency for such purpose.
3. All interested persons shall be afforded a reasonable opportunity to submit data, views or arguments, orally or in writing. With respect to substantive regulations, opportunity for oral hearing must be granted if requested by any interested person who will be directly affected by the proposed regulation. The agency shall consider fully all written and oral submissions respecting the proposed regulation.
4. If an agency finds that an emergency exists, and such a finding is concurred in by the governor by written endorsement on the original copy of a proposed regulation, a regulation may be adopted and become effective immediately upon its being filed in the office of the secretary of state. A regulation so adopted may be effective for a period of not longer than 120 days, but the adoption of an identical regulation under subsections 1 to 3, inclusive, is not precluded.
5. No regulation adopted after July 1, 1965, is valid unless adopted in substantial compliance with this section, but no objection to any regulation on the ground of noncompliance with the procedural requirements of this section may be made more than 2 years after its effective date. Regulations in effect on July 1, 1965, shall continue in effect until amended or repealed in accordance with the provisions of this chapter, if an original and two copies are deposited with the secretary of state on or before July 1, 1965.
6. Upon adoption of a regulation, the agency, if requested to do so by an interested person, either prior to adoption or within 30 days thereafter, shall issue a concise statement of the principal reasons for and against its adoption, and incorporate therein its reasons for overruling the consideration urged against its adoption.
Sec. 8. 1. Regulations shall become effective 30 days after an original and two duplicate copies of each regulation are filed with the secretary of state, except where:
(a) A later date is required by statute;
(b) A later date is specified in the regulation; or
(c) The agency finds that an emergency exists, and such finding is concurred in by the governor, by written endorsement upon the original regulation.
2. Each regulation shall include a citation of the authority pursuant to which it, or any part of it, was adopted.
κ1965 Statutes of Nevada, Page 965 (CHAPTER 362, SB 221)κ
3. The secretary of state shall cause to be endorsed on the original and duplicate copies of each regulation filed the time and date of the filing thereof, and shall maintain a file of such regulations for public inspection together with suitable indexes therefor.
4. No adopted regulation, which attempts to incorporate an agencys ruling, order or similar pronouncement by referring to the general subject of such, or to where such may be found, or to both, shall be effective.
5. Each agency shall furnish a copy of its regulations to any person who requests a copy, and may charge a reasonable fee for such copy based on the cost of reproduction if it does not have funds appropriated or authorized for such purpose.
Sec. 9. When any regulation filed with the secretary of state expires by its own terms or is superseded or revoked, and the adopting agency so informs the secretary of state, the secretary of state shall cause the same to be placed in an inactive file.
Sec. 10. The secretary of states authenticated file stamp on a rule or regulation shall raise a rebuttable presumption that the rule or regulation was adopted and filed in compliance with all requirements necessary to make it effective.
Sec. 11. Any interested person may petition an agency requesting the adoption, filing, amendment or repeal of any regulation and shall accompany his petition with relevant data, views and arguments. Each agency shall prescribe by regulation the form for such petitions and the procedure for their submission, consideration and disposition. Upon submission of such a petition, the agency shall within 30 days either deny the petition in writing, stating its reasons, or initiate regulation-making proceedings in accordance with section 7 of this act.
Sec. 12. 1. The validity or applicability of any regulation may be determined in a proceeding for a declaratory judgment in the district court in and for Ormsby County, or in and for the county where the plaintiff resides, when it is alleged that the regulation, or its proposed application, interferes with or impairs, or threatens to interfere with or impair, the legal rights or privileges of the plaintiff. A declaratory judgment may be rendered after the plaintiff has first requested the agency to pass upon the validity of the regulation in question. The court shall declare the regulation invalid if it finds that it violates constitutional or statutory provisions or exceeds the statutory authority of the agency.
2. Any agency whose regulation is made the subject of a declaratory action under subsection 1 shall be made a party to the action. Any agency may institute an action for a declaratory judgment, as provided in subsection 1, concerning any regulation adopted and filed by it or any other agency.
3. Actions for declaratory judgment provided for in subsections 1 and 2 shall be in accordance with the Uniform Declaratory Judgment Act (chapter 30 of NRS), and the Nevada Rules of Civil Procedure. In all actions under subsections 1 and 2, the attorney general shall, before judgment is entered, be served with a copy of the petition, and shall be entitled to be heard.
κ1965 Statutes of Nevada, Page 966 (CHAPTER 362, SB 221)κ
Sec. 13. Each agency shall provide by regulation for the filing and prompt disposition of petitions for declaratory orders and advisory opinions as to the applicability of any statutory provision, agency regulation or decision of the agency. Declaratory orders disposing of petitions in such cases shall have the same status as agency decisions. A copy of the declaratory order or advisory opinion shall be mailed to the petitioner.
Sec. 14. 1. Any person aggrieved by a final decision in a contested case is entitled to judicial review thereof under this chapter. Nothing in this section shall be deemed to limit utilization of trial de novo review where provided by statute, but this section shall provide an alternative means of review in those cases. Any preliminary, procedural or intermediate agency act or ruling shall be immediately reviewable in any case in which review of the final agency decision would not provide an adequate remedy.
2. Proceedings for review shall be instituted by filing a petition in the district court in and for Ormsby County, in and for the county in which the aggrieved party resides, or in and for the county where the act of which the proceeding is based occurred, within 30 days after the service of the final decision of the agency or, if a rehearing is held, within 30 days after the decision thereon. Copies of the petition shall be served upon the agency and all other parties of record.
Sec. 15. The provisions of this act do not apply to contested cases pending on July 1, 1965.
________
Senate Bill No. 296Committee on Judiciary
CHAPTER 363
AN ACT to amend NRS sections 90.030, 90.140 and 90.150 and chapter 90 of NRS, relating to transactions in securities, by adding new sections defining terms; limiting the allowable amount of compensation paid by an issuer of securities; requiring minimum contributions by the promoters of an issue of equity securities; providing exceptions; and providing other matters properly relating thereto.
[Approved April 13, 1965]
The People of the State of Nevada, represented in Senate and Assembly,
do enact as follows:
Section 1. NRS 90.030 is hereby amended to read as follows:
90.030 1. Agent means any individual other than a broker-dealer who represents a broker-dealer or issuer in effecting or attempting to effect purchases or sales of securities.
2. Agent does not include an individual who represents an issuer in effecting transactions with existing employees, partners or directors of the issuer, or any of its subsidiaries, if no commission or other remuneration is paid or given directly or indirectly for soliciting any person in this state.
3. A partner, officer or director of a broker-dealer or issuer, or a person occupying a similar status or performing similar functions is [an agent only if he otherwise comes within this definition.]
κ1965 Statutes of Nevada, Page 967 (CHAPTER 363, SB 296)κ
person occupying a similar status or performing similar functions is [an agent only if he otherwise comes within this definition.] not the agent of such broker-dealer or issuer, but may, if he meets the test of subsection 1, be the agent of another broker-dealer or issuer.
Sec. 2. NRS 90.140 is hereby amended to read as follows:
90.140 1. It is unlawful for any person to offer or sell any security in this state by means of a public intrastate offering unless:
(a) He has filed a statement with the administrator concerning such security as described in NRS 90.150;
(b) He has paid a filing fee of $500 therefor; [and]
(c) The administrator has approved such statement [.] ; and
(d) The total amount of underwriting fees plus any other commissions or discounts allowed by the issuer does not exceed 15 percent, and the amount paid or allowed by the issuer for expenses directly or indirectly incurred does not exceed 5 percent, of the amount actually received in money.
2. When a statement is withdrawn the administrator shall retain the filing fee.
[3. As used in this section, public intrastate offering means every attempt or offer to dispose of, or solicitation of an offer to buy, a security or interest in a security for value made solely within this state to 25 persons or more by means of any news media, including but not limited to newspapers, magazines, radio and television, or through the use of the United States mails, or by direct solicitation by an agent, except such offerings as are registered under the Securities Act of 1933 (15 U.S.C. § 77a et seq.) or exempt from registration thereunder other than by reason of the intrastate character thereof.]
Sec. 3. NRS 90.150 is hereby amended to read as follows:
90.150 1. The statement required by subsection 1 of NRS 90.140 shall be in writing and verified as provided in NRS 15.010 for the verification of pleadings.
2. The statement shall contain the following information and shall be accompanied by the following documents:
(a) The names, residences and post office addresses of the officers.
(b) The location of the principal office and the principal place of business.
(c) An itemized account of the issuers financial condition and the amount and character of all assets and liabilities prepared by an independent certified public accountant who holds a certificate issued pursuant to the provisions of chapter 628 of NRS.
(d) A detailed statement of the plan upon which business is proposed to be transacted.
(e) A copy of the issuers articles of incorporation or partnership or association, as the case may be, and of any amendments thereto, and all other papers pertaining to its organization.
(f) A copy of any security proposed to be issued.
(g) A copy of any contract proposed to be made concerning such security.
(h) A copy of any prospectus or advertisement or other description of such security prepared by or for the issuer for distribution or publication.
κ1965 Statutes of Nevada, Page 968 (CHAPTER 363, SB 296)κ
(i) The date upon which it is proposed to commence to sell such securities.
(j) The number, kind and amount of securities proposed to be sold.
(k) The par or face value, if any, and the price at which it is proposed to sell such securities.
(l) The commission or compensation to be paid for the sale of such securities [.] , including without limitation underwriting fees, discounts and any amounts paid or allowed by the issuer for expenses directly or indirectly incurred.
(m) The states in which a statement or similar document in connection with the offering has been or is to be filed.
(n) A copy of any adverse order, judgment or decree entered in connection with the offering by the regulatory authorities in each state, by any court or by the Securities and Exchange Commission.
(o) The consent to service of process as required by subsection 6 of NRS 90.210.
(p) The amount of money paid in and property contributed to the issuer by each organizer or promoter, with a description of any such property sufficient to establish its nature and value.
(q) Such additional information concerning the issuer, its conditions and affairs as the administrator may, by regulation, require.
3. If the person filing the statement is a trustee, the statement shall also be accompanied by a copy of all instruments by which the trust is created and in which it is accepted, acknowledged or declared.
4. If the person filing the statement is a corporation, the statement shall also be accompanied by:
(a) A copy of its bylaws and of any amendments thereto.
(b) A copy of all minutes of any proceeding of its directors, stockholders or members relating to or affecting the issue of the security.
5. If the person filing the statement is a corporation or association organized under the laws of any other state, territory or government, the statement shall also be accompanied by a certificate executed by the proper officer of that state, territory or government not more than 30 days before the filing of the statement, showing that such corporation or association is authorized to transact business in that state, territory or government.
Sec. 4. Chapter 90 of NRS is hereby amended by adding thereto the provisions set forth as sections 5 to 10, inclusive, of this act.
Sec. 5. Equity security means any security which evidences participation in the ownership of the issuer, as distinguished from a debt or fixed obligation of the issuer.
Sec. 6. Organizer or promoter means any person who prior to any public offering of the equity securities of an issuer holds any of such securities or has the right to acquire any of such securities at a predetermined price.
Sec. 7. Public intrastate offering means every attempt or offer to dispose of, or solicitation of an offer to buy, a security or interest in a security for value made solely within this state to 25 persons or more by means of any news media, including but not limited to newspapers, magazines, radio and television, or through the use of the United States mails, or by direct solicitation by an agent, except such offerings as are registered under the Securities Act of 1933 (15 U.S.C.
κ1965 Statutes of Nevada, Page 969 (CHAPTER 363, SB 296)κ
registered under the Securities Act of 1933 (15 U.S.C. § 77a et seq.) or exempt from registration thereunder other than by reason of the intrastate character thereof.
Sec. 8. Underwriting means undertaking by agreement with an issuer to dispose of an entire issue of securities at an agreed price net to the issuer.
Sec. 9. 1. It is unlawful for any person to offer or sell any equity security in this state by means of a public intrastate offering unless the organizers or promoters of the issuer have in the aggregate paid in or contributed to the issuer in money or in real or tangible personal property the following proportions of the total amount of equity securities to be offered or sold in this state or elsewhere, as shown by the statement required by NRS 90.150:
(a) Five percent of the first $200,000.
(b) Two percent of the amount between $200,000 and $400,000.
(c) One percent of the amount in excess of $400,000.
2. For the purpose of this section, money or property is not paid in or contributed to an issuer if the organizer or promoter withdraws it within 1 year after the intrastate public offering either by receipt from the issuer of an equivalent in moneys worth or by the sale of his equity securities to any person other than an organizer or promoter of the issuer.
Sec. 10. The requirements of NRS 90.140 and 90.150 do not apply to the securities of any insurance company which is subject to the provisions of chapter 682 of NRS.
________
Assembly Bill No. 88Committee on Ways and Means
CHAPTER 364
AN ACT relating to the annual salaries of certain elected state officers; to amend NRS sections 223.050, 224.050, 225.050, 226.090, 227.060, 344.020 and 512.070, relating respectively to the annual salaries of the governor, the lieutenant governor, the secretary of state, the state treasurer, the state controller, the superintendent of state printing and the inspector of mines, by increasing such annual salaries; to amend NRS section 228.070, relating to the salary of the attorney general and prohibiting his private practice of the law, by increasing his annual salary and removing the prohibition against private law practice; and providing other matters properly relating thereto.
[Approved April 13, 1965]
The People of the State of Nevada, represented in Senate and Assembly,
do enact as follows:
Section 1. NRS 223.050 is hereby amended to read as follows:
223.050 [The annual salary of the governor shall be $18,000. From and after the expiration of the present term of the governor, his successor and successors in office thereafter shall receive an annual salary of $20,000.] From July 1, 1965, until the 1st Monday in January 1967, the governor shall receive an annual salary of $20,000. From and after the 1st Monday in January 1967, the governor shall receive an annual salary of $25,000.
κ1965 Statutes of Nevada, Page 970 (CHAPTER 364, AB 88)κ
the 1st Monday in January 1967, the governor shall receive an annual salary of $25,000.
Sec. 2. NRS 224.050 is hereby amended to read as follows:
224.050 1. [The lieutenant governor shall receive an annual salary of $2,400. From and after the expiration of the present term of the lieutenant governor, his successor and successors in office, thereafter shall receive an annual salary of $3,600.] From July 1, 1965, until the 1st Monday in January 1967, the lieutenant governor shall receive an annual salary of $3,600. From and after the 1st Monday in January 1967, the lieutenant governor shall receive an annual salary $4,500.
2. In addition to the annual salary provided for in subsection 1, the lieutenant governor shall receive [$25] $40 per day for such times as he may be actually employed as governor or president of the senate, and if he travels daily from his home to sessions of the legislature, he shall be allowed for each mile between the capital and his home, for each day the senate is actually convened, travel expenses at the rate of 10 cents per mile traveled.
3. In addition to the salary provided in subsections 1 and 2, if the lieutenant governor does not travel from home daily but takes up a temporary residence in the vicinity of the capital for the duration of the legislative session, he shall be allowed a per diem expense allowance of [$15] $25 for each day he is away from his home and for the entire period that the legislature is in session.
4. The lieutenant governor shall receive the per diem allowance and travel expenses as provided by law for state officers and employees when acting as governor, or when discharging other official duties as lieutenant governor, at times when the legislature is not in session.
Sec. 3. NRS 225.050 is hereby amended to read as follows:
225.050 [The annual salary of the secretary of state shall be $10,000. From and after the expiration of the present term of the secretary of state, his successor and successors in office thereafter shall receive an annual salary of $12,000.] From July 1, 1965, until the 1st Monday in January 1967, the secretary of state shall receive an annual salary of $12,000. From and after the 1st Monday in January 1967, the secretary of state shall receive an annual salary of $15,000.
Sec. 4. NRS 226.090 is hereby amended to read as follows:
226.090 [The annual salary of the state treasurer shall be $10,000. From and after the expiration of the present term of the state treasurer, his successor and successors in office thereafter shall receive an annual salary of $12,000.] From July 1, 1965, until the 1st Monday in January 1967, the state treasurer shall receive an annual salary of $12,000. From and after the 1st Monday in January 1967, the state treasurer shall receive an annual salary of $15,000.
Sec. 5. NRS 227.060 is hereby amended to read as follows:
227.060 [The annual salary of the state controller shall be $10,000. From and after the expiration of the present term of the state controller, his successor and successors in office thereafter shall receive an annual salary of $12,000.] From July 1, 1965, until the 1st Monday in January 1967, the state controller shall receive an annual salary of $12,000. From and after the 1st Monday in January 1967, the state controller shall receive an annual salary of $15,000.
κ1965 Statutes of Nevada, Page 971 (CHAPTER 364, AB 88)κ
Sec. 6. NRS 228.070 is hereby amended to read as follows:
228.070 1. [The annual salary of the attorney general shall be $15,000. From and after the expiration of the present term of the attorney general, his successor and successors in office thereafter shall receive an annual salary of $17,000.] From July 1, 1965, until the 1st Monday in January 1967, the attorney general shall receive an annual salary of $17,000. From and after the 1st Monday in January 1967, the attorney general shall receive an annual salary of $18,000.
2. The attorney general [shall not] is permitted to engage in the private practice of law.
Sec. 7. NRS 344.020 is hereby amended to read as follows:
344.020 [The annual salary of the superintendent of state printing shall be $10,000. From and after the expiration of the present term of the superintendent of state printing, his successor and successors in office shall receive an annual salary of $12,000.] From July 1, 1965, until the 1st Monday in January 1967, the superintendent of state printing shall receive an annual salary of $12,000. From and after the 1st Monday in January 1967, the superintendent of state printing shall receive an annual salary of $15,000.
Sec. 8. NRS 512.070 is hereby amended to read as follows:
512.070 [The annual salary of the inspector of mines shall be $10,000. From and after the expiration of the present term of the inspector of mines, his successor and successors in office thereafter shall receive an annual salary of $12,000.] From July 1, 1965, until the 1st Monday in January 1967, the inspector of mines shall receive an annual salary of $12,000. From and after the 1st Monday in January 1967, the inspector of mines shall receive an annual salary of $15,000.
________
Assembly Bill No. 573Committee on Ways and Means
CHAPTER 365
AN ACT to amend NRS sections 232.170 and 232.190, relating to the department of administration, by providing for a central data processing division; to amend Title 19 of NRS, relating to government and public affairs, by creating a new chapter providing for the organization, duties and financing of the central data processing division; and providing other matters properly relating thereto.
[Approved April 13, 1965]
The People of the State of Nevada, represented in Senate and Assembly,
do enact as follows:
Section 1. NRS 232.170 is hereby amended to read as follows:
232.170 1. The department of administration is hereby created.
2. The department shall consist of a director and the following divisions:
(a) Budget division.
(b) Buildings and grounds division.
κ1965 Statutes of Nevada, Page 972 (CHAPTER 365, AB 573)κ
(c) Central data processing division.
(d) Personnel division.
[(d)] (e) Purchasing division.
3. The director may establish a motor pool division or may assign the functions of the state motor pool to one of the other divisions of the department.
Sec. 2. NRS 232.190 is hereby amended to read as follows:
232.190 The director shall:
1. Appoint, with the consent of the governor, a chief of each of the divisions of the department, except the budget division.
2 Be responsible for the administration, through the division of the department, of the provisions of chapters 284, 331, 333 and 336 of NRS, sections 4 to 9, inclusive, of this act, NRS 353.150 to 353.246, inclusive, and all other provisions of law relating to the functions of the divisions of the department.
3. Have other such powers and duties as provided by law.
Sec. 3. Title 19 of NRS is hereby amended by adding thereto a new chapter consist of the provisions set forth as section 4 to 9, inclusive, of this act.
Sec. 4. As used in this chapter, unless the context otherwise requires:
1. Division means the central data processing division of the department or administration.
2. Equipment means any machine or device designed for the automatic handling of coded information, including but not limited to recording, storage and retrieval.
Sec. 5. The purposes of the division are:
1. To insure economical utilization of state-owned or state-leased equipment.
2. To provide data processing service for state agencies.
3. To provide technical advice but not administrative control of data processing within the several state agencies. Sec. 6. 1. Subject to the provisions of subsections 2 and 4, for the period of July 1, 1965, to June 30, 1967, executive offices, departments, commissions and agencies shall:
(a) Maintain direct managerial control of equipment in such offices, departments, commissions and agencies.
(b) Have first priority in the use of such equipment.
2. Notwithstanding the provisions of subsection 1, during the period July 1, 1965, to June 30, 1967, the director of the department of administration shall:
(a) Assign the priority of any surplus capacity of the equipment in the various executive offices, departments, commissions and agencies; and
(b) Make a study of central data processing and make recommendations to the legislature for possible consolidation of equipment of executive offices, departments, commissions and agencies.
3. Except as otherwise provided in subsection 4, on and after July 1, 1967, upon the recommendation of the director of the department of administration, the governor may assign state-owned or state-leased equipment of an executive office, department, commission or agency to the division and may withdraw any equipment from any such office, department, commission, or agency and reassign it to the division.
κ1965 Statutes of Nevada, Page 973 (CHAPTER 365, AB 573)κ
equipment of an executive office, department, commission or agency to the division and may withdraw any equipment from any such office, department, commission, or agency and reassign it to the division. Rental charges on any equipment so reassigned shall be paid by the division from the date of reassignment. Rental charges on any equipment assigned to or retained by any other state agency shall be paid from the budget of such using agency.
4. The provisions of subsections 1 to 3, inclusive, do not apply to the office of the state controller, the University of Nevada and the department of highways, but, subject to the provisions of this chapter, the state controller, the University of Nevada and the department of highways may utilize the services of the division.
Sec. 7. To facilitate the economical processing of data throughout the state government, the division may provide service for agencies not under the control of the governor, upon the request of any such agency.
Sec. 8. Subject to the approval of the director of the department of administration, the chief of the division shall adopt regulations necessary for the administration of this chapter. Such regulations may include provision for the performance, by any agency which uses the services of the division, of preliminary input procedures, such as data recording and verification, within such agency.
Sec. 9. 1. There is hereby created in the state treasury a continuing fund to be known as the central data processing division working capital fund. Moneys from such fund shall be paid out on claims as other claims against the state are paid. Such claims shall be made in accordance with budget allotments and shall be subject to preaudit examination and approval.
2. All operating, maintenance, rental, repair and replacement costs of equipment and all salaries of personnel assigned to the division shall be paid from such fund.
3. Each agency using the services of the division shall pay a fee for such use, which shall be set by the chief of the division in such amount as to reimburse the division for the entire cost of providing such services, including overhead. Each using agency shall budget for such services. All fees, proceeds from the sale of equipment, and other moneys received by the division shall be deposited in such fund.
4. The initial balance of such fund shall be provided by direct legislative appropriation.
________
κ1965 Statutes of Nevada, Page 974κ
Senate Bill No. 28Senator Lamb
CHAPTER 366
AN ACT appropriating the sum of $50,000 to the state public health facilities construction assistance fund for the purpose of constructing the Lincoln County Hospital at Caliente, Lincoln County, Nevada; expressly limiting the use of such appropriated funds; and providing other matters properly relating thereto.
[Approved April 13, 1965]
The People of the State of Nevada, represented in Senate and Assembly,
do enact as follows:
Section 1. For the purpose of providing moneys in the state public health facilities construction assistance fund, created pursuant to the provisions of NRS 449.400, for the express and only purpose stated in section 2, there is hereby appropriated from the general fund in the state treasury the sum of $50,000 to the state public health facilities construction assistance fund.
Sec. 2. Notwithstanding the provisions of any other law, the health division of the department of health and welfare shall not expend any of the moneys appropriated by section 1 except for the construction of the Lincoln County Hospital at Caliente, Lincoln County, Nevada, pursuant to the provisions of the Nevada Health Facilities Assistance Act, being NRS 449.250 to 449.430, inclusive. If no application for a health facility construction project relating to the Lincoln County Hospital is made to the health division of the department of health and welfare within 8 years from the effective date of this act, then the moneys appropriated by section 1 shall revert to the general fund in the state treasury notwithstanding the provisions of NRS 449.400.
Sec. 3. The state controller is hereby authorized and directed to transfer the sum appropriated by section 1 forthwith from the general fund to the state public health facilities construction assistance fund.
Sec. 4. This act shall become effective upon passage and approval.
________
Senate Bill No. 53Committee on Finance
CHAPTER 367
AN ACT to amend NRS section 616.135, relating to the Nevada industrial commission member representative of employers, by raising the amount of his annual salary.
[Approved April 13, 1965]
The People of the State of Nevada, represented in Senate and Assembly,
do enact as follows:
Section 1. NRS 616.135 is hereby amended to read as follows:
616.135 1. One of the commissioners shall be representative of employers and shall be selected by the governor for appointment from the individuals whose names are submitted to him by recognized associations and employer groups located in the state.
κ1965 Statutes of Nevada, Page 975 (CHAPTER 367, SB 53)κ
2. The annual salary of the commissioner representative of employers shall be [$12,000.] $13,200.
3. The present commissioner whose term expires on June 23, 1955, is hereby determined to be the representative of employers. The successor of the commissioner representative of employers shall be deemed to represent employers.
________
Senate Bill No. 54Committee on Finance
CHAPTER 368
AN ACT to amend NRS section 616.130, relating to the Nevada industrial commission member representative of labor, by raising the amount of his annual salary.
[Approved April 13, 1965]
The People of the State of Nevada, represented in Senate and Assembly,
do enact as follows:
Section 1. NRS 616.130 is hereby amended to read as follows:
616.130 1. One of the commissioners shall be representative of labor and shall be selected by the governor for appointment from the individuals whose names are submitted to him, one by the Nevada State Federation of Labor affiliated with the American Federation of Labor, and one by the Congress of Industrial Organizations for the State of Nevada.
2. The annual salary of the commissioner representative of labor shall be [$12,000.] $13,200.
3. The present commissioner whose term expires on September 3, 1955, is hereby determined to be the representative of labor. The successor of the commissioner representative of labor shall be deemed to represent labor.
________
Senate Bill No. 61Senator Bay
CHAPTER 369
AN ACT appropriating the sum of $35,000 to the state public health facilities construction assistance fund for the purpose of constructing the Eureka County Diagnostic and Treatment Center at Eureka, Eureka County, Nevada; expressly limiting the use of such appropriated funds; and providing other matters properly relating thereto.
[Approved April 13, 1965]
The People of the State of Nevada, represented in Senate and Assembly,
do enact as follows:
Section 1. For the purpose of providing moneys in the state public health facilities construction assistance fund, created pursuant to the provisions of NRS 449.400, for the express and only purpose stated in section 2, there is hereby appropriated from the general fund in the state treasury the sum of $35,000 to the state public health facilities construction assistance fund.
κ1965 Statutes of Nevada, Page 976 (CHAPTER 369, SB 61)κ
in section 2, there is hereby appropriated from the general fund in the state treasury the sum of $35,000 to the state public health facilities construction assistance fund.
Sec. 2. Notwithstanding the provisions of any other law, the health division of the department of health and welfare shall not expend any of the moneys appropriated by section 1 except for the construction of the Eureka County Diagnostic and Treatment Center at Eureka, Eureka County, Nevada, pursuant to the provisions of the Nevada Health Facilities Assistance Act, being NRS 449.250 to 449.430, inclusive. If no application for a health facility construction project relating to the Eureka County Diagnostic and Treatment Center is made to the health division of the department of health and welfare within 8 years from the effective date of this act, then the moneys appropriated by section 1 shall revert to the general fund in the state treasury notwithstanding the provisions of NRS 449.400.
Sec. 3. The state controller is hereby authorized and directed to transfer the sum appropriated by section 1 forthwith from the general fund to the state public health facilities construction assistance fund.
Sec. 4. This act shall become effective upon passage and approval.
________
Senate Bill No. 62Senator Fransway
CHAPTER 370
AN ACT appropriating the sum of $50,000 to the state public health facilities construction assistance fund for the purpose of constructing the Humboldt County General Hospital at Winnemucca, Humboldt County, Nevada; expressly limiting the use of such appropriated funds; and providing other matters properly relating thereto.
[Approved April 13, 1965]
The People of the State of Nevada, represented in Senate and Assembly,
do enact as follows:
Section 1. For the purpose of providing moneys in the state public health facilities construction assistance fund, created pursuant to the provisions of NRS 449.400, for the express and only purpose stated in section 2, there is hereby appropriated from the general fund in the state treasury the sum of $50,000 to the state public health facilities construction assistance fund.
Sec. 2. Notwithstanding the provisions of any other law, the health division of the department of health and welfare shall not expend any of the moneys appropriated by section 1 except for the construction of the Humboldt County General Hospital at Winnemucca, Humboldt County, Nevada, pursuant to the provisions of the Nevada Health Facilities Assistance Act, being NRS 449.250 to 449.430, inclusive. If no application for a health facility construction project relating to the Humboldt County General Hospital is made to the health division of the department of health and welfare within 8 years from the effective date of this act, then the moneys appropriated by section 1 shall revert to the general fund in the state treasury notwithstanding the provisions of NRS 449.400.
κ1965 Statutes of Nevada, Page 977 (CHAPTER 370, SB 62)κ
to the general fund in the state treasury notwithstanding the provisions of NRS 449.400.
Sec. 3. The state controller is hereby authorized and directed to transfer the sum appropriated by section 1 forthwith from the general fund to the state public health facilities construction assistance fund.
Sec. 4. This act shall become effective upon passage and approval.
________
Senate Bill No. 63Senator Monroe
CHAPTER 371
AN ACT directing the superintendent of the Nevada state hospital to convey certain land to the department of highways.
[Approved April 13, 1965]
The People of the State of Nevada, represented in Senate and Assembly,
do enact as follows:
Section 1. The superintendent of the Nevada state hospital is hereby authorized and directed to convey to the department of highways of the State of Nevada, in fee simple, without consideration therefor, for highway purposes, that property owned by the State of Nevada and situated in the City of Sparks, County of Washoe, State of Nevada, and further described as being a portion of the NE 1/4 of the NE 1/4 of Section 7, T. 19 N., R. 20 E., M.D.B.& M., and more fully described by metes and bounds as follows:
Beginning at a point 119.76 feet left of and at right angles to the centerline of Nevada Interstate Route 80 at Highway Engineers Station M 828 + 19.76 P.O.T. (median strip); such point is further described as bearing S. 81°44′34ʺ W. a distance of 709.46 feet from the northeast corner of Section 7; thence S. 80°24′30ʺ E. along the left or northerly right-of-way line of Nevada Interstate Route 80 a distance of 540.74 feet to a point; thence S. 88°56′45ʺ E. along the left or northerly right-of-way line a distance of 166.63 feet to an intersection with the easterly boundary of grantors property; thence S. 0°41′08ʺ W. along the easterly boundary a distance of 243.91 feet to a point in the Southern Pacific Companys northerly right-of-way line; thence N. 81°04′08ʺ W. along Southern Pacific Companys right-of-way line a distance of 706.82 feet to an intersection with the westerly boundary of grantors property; thence N. 0°20′57ʺ E. along the westerly boundary a distance of 227.33 feet to the point of beginning; such parcel contains an area of 158,227 square feet, more or less. Together with any and all abutters rights, including access rights, appurtenant to the remaining property of the owners, occupants or claimants, in and to Interstate Route 80, over and across the lands hereinabove described.
Sec. 2. This act shall become effective upon passage and approval.
________
κ1965 Statutes of Nevada, Page 978κ
Senate Bill No. 67Committee on Aviation, Transportation and Highways
CHAPTER 372
AN ACT to amend NRS section 371.050, relating to the vehicle privilege tax, by providing for valuation of vehicles having an unladened weight of over 6,000 pounds; to amend chapter 371 of NRS, relating to the vehicle privilege tax, by providing for prorating the tax by interstate motor carriers; and providing other matters properly relating thereto.
[Approved April 13, 1965]
The People of the State of Nevada, represented in Senate and Assembly,
do enact as follows:
Section 1. NRS 371.050 is hereby amended to read as follows:
371.050 1. Valuation of vehicles shall be determined by the department upon the basis of 35 percent of the manufacturers suggested retail price in Nevada excluding options and extras, as of the time the particular make and year model is first offered for sale in Nevada.
2. If the department is unable to determine the manufacturers suggested retail price in Nevada in respect to any vehicle because the vehicle is specially constructed, or for any other reason, the department shall determine the valuation upon the basis of 35 percent of the original retail price to the original purchaser of the vehicle as evidenced by such document or documents as the department may require.
3. For each bus, truck, truck tractor, trailer and semitrailer having an unladened weight of more than 6,000 pounds, the department may use 85 percent of the original purchasers cost price in lieu of the manufacturers suggested retail price.
Sec. 2. Chapter 371 of NRS is hereby amended by adding thereto a new section which shall read as follows:
Interstate motor carriers who register under the Interstate Highway User Fee Apportionment Act may prorate their vehicle privilege tax by the same percentages as those set out in subsection 2 of NRS 706.810.
________
Senate Bill No. 87Committee on Banks, Banking and Corporations
CHAPTER 373
AN ACT to amend NRS section 78.105, relating to articles, bylaws and stock ledgers of private corporations, by deleting obsolete language and including judgment creditors among those authorized to inspect the stock ledger.
[Approved April 13, 1965]
The People of the State of Nevada, represented in Senate and Assembly,
do enact as follows:
Section 1. NRS 78.105 is hereby amended to read as follows:
78.105 1. Every corporation shall keep and maintain at its principal office in this state:
κ1965 Statutes of Nevada, Page 979 (CHAPTER 373, SB 87)κ
(a) A certified copy of its certificate of incorporation or articles of incorporation, and all amendments thereto; and
(b) A certified copy of its bylaws and all amendments thereto; and
(c) A stock ledger or a duplicate stock ledger, revised annually, containing the names, alphabetically arranged, of all persons who are stockholders of the corporation, showing their places of residence, if known, and the number of shares held by them respectively; or
(d) In lieu of the stock ledger or duplicate stock ledger specified in paragraph (c), a statement setting out the name of the custodian of the stock ledger or duplicate stock ledger, and the present and complete post office address, including street and number, if any, where such stock ledger or duplicate stock ledger specified in this section is kept.
2. [The stock ledger or duplicate thereof shall be open daily, except Sundays and holidays, during at least 2 business hours, for inspection by any judgment creditor of the corporation, or by any stockholder of such corporation, and persons who are entitled to inspect such stock ledger or the duplicate thereof may take extracts therefrom.] Any person who has been a stockholder of record of a corporation for at least 6 months immediately preceding his demand, or any person holding, or thereunto authorized in writing by the holders of, at least 5 percent of all its outstanding shares, upon at least 5 days written demand, or any judgment creditor of the corporation without prior demand, shall have the right to inspect in person or by agent or attorney, during usual business hours, the stock ledger or duplicate stock ledger, whether kept in the principal office of the corporation in this state or elsewhere as provided in paragraph (d) of subsection 1, and to make extracts therefrom. Holders of voting trust certificates representing shares of the corporation shall be regarded as stockholders for the purpose of this subsection. Every corporation that neglects or refuses to keep the stock ledger or duplicate copy thereof open for inspection, as required in this subsection, shall forfeit to the state the sum of $25 for every day of such neglect or refusal.
3. An inspection authorized by subsection 2 may be denied to such stockholder or other person upon his refusal to furnish to the corporation an affidavit that such inspection is not desired for a purpose which is in the interest of a business or object other than the business of the corporation and that he has not at any time sold or offered for sale any list of stockholders of any domestic for foreign corporation or aided or abetted any person in procuring any such record of stockholders for any such purpose.
4. If any officer or agent of any such corporation willfully neglects or refuses to make any proper entry in such stock ledger or duplicate copy thereof, or neglects or refuses to permit an inspection of such stock ledger or duplicate thereof upon demand by a person entitled to inspect the same, or refuses to permit extracts to be taken therefrom, as provided in subsections 2 and 3, such corporation and such officer or agent shall be jointly and severally liable to the person injured for all damages resulting to him therefrom.
5. When the corporation keeps and maintains a statement in the manner provided for in paragraph (d) of subsection 1, the information contained thereon shall be given to any judgment creditor of the corporation or to any stockholder of such corporation demanding such information, when the demand is made during business hours.
κ1965 Statutes of Nevada, Page 980 (CHAPTER 373, SB 87)κ
manner provided for in paragraph (d) of subsection 1, the information contained thereon shall be given to any judgment creditor of the corporation or to any stockholder of such corporation demanding such information, when the demand is made during business hours. Every corporation that neglects or refuses to keep such statement available, as in this subsection required, shall forfeit to the state the sum of $25 for every day of such neglect or refusal.
6. If any officer or agent of any such corporation willfully neglects or refuses to keep the statement current and accurate, or neglects or refuses to give the information contained thereon, upon demand, to a person entitled to such information, such corporation and such officer or agent shall be jointly and severally liable to the person injured for all damages resulting to him therefrom.
7. It shall be a defense, however, to any action for penalties under this section that the person suing has at any time sold, or offered for sale, any list of stockholders of such corporation, or any other corporation, or has aided or abetted any person in procuring any such stock list for any such purpose, or that the person suing desired inspection for a purpose which is in the interest of a business or object other than the business of the corporation.
8. Nothing contained in this section, however, shall be deemed or construed in anywise to impair the power or jurisdiction of any court to compel the production for examination of the books of a corporation in any proper case.
Sec. 2. This act shall become effective upon passage and approval.
________
Senate Bill No. 95Senators Lamb, Slattery, Titlow, Fisher, Humphrey and Bay
CHAPTER 374
AN ACT to amend chapter 617 of NRS, relating to the occupational diseases, by adding a new section providing supplemental compensation for persons suffering from silicosis and certain dependents who have received the maximum sum payable under NRS sections 617.460 and 617.465; to amend NRS sections 617.460 and 617.465, relating to the payment of compensation to persons suffering from silicosis, by making technical amendments to conform with added supplemental compensation; and providing other matters properly relating thereto.
[Approved April 13, 1965]
The People of the State of Nevada, represented in Senate and Assembly,
do enact as follows:
Section 1. NRS 617.460 is hereby amended to read as follows:
617.460 1. Silicosis shall be considered an occupational disease and shall be compensable as such when contracted by an employee and when arising out of and in the course of the employment.
2. Claims for compensation on account of silicosis shall be forever barred unless application shall have been made to the commission within 1 year after total disability or within 6 months after death.
κ1965 Statutes of Nevada, Page 981 (CHAPTER 374, SB 95)κ
barred unless application shall have been made to the commission within 1 year after total disability or within 6 months after death.
3. Nothing in this chapter shall entitle an employee or his dependents to compensation, medical, hospital and nursing expenses or payment of funeral expenses for disability or death due to silicosis in the event of the failure or omission on the part of the employee truthfully to state, when seeking employment, the place, duration and nature of previous employment in answer to an inquiry made by the employer.
4. No compensation shall be paid in case of silicosis unless, during the 10 years immediately preceding the disablement or death, the injured employee shall have been exposed to harmful quantities of silicon dioxide dust for a total period of not less than 4 years in employment in Nevada, some portion of which shall have been after July 1. 1947.
5. Compensation, medical, hospital and nursing expenses on account of silicosis shall be payable only in the event of temporary total disability, permanent total disability, or death, in accordance with the provisions of chapter 616 of NRS, and only in the event of such disability or death resulting within 2 years after the last injurious exposure; provided, that:
(a) In the event of death following continuous total disability commencing within 2 years after the last injurious exposure, the requirement of death within 2 years after the last injurious exposure shall not apply.
(b) Except as provided in NRS 617.465 [,] and section 3 of this amendatory act, the maximum sum payable, including compensation, medical, nursing and hospital benefits for death or disability due to silicosis shall not exceed $14,250. Compensation shall be payable in sums provided by chapter 616 of NRS. The sum payable to a claimant may be used for any or all of the following items: Compensation, hospital, medical or nursing benefits; except that the amount payable for hospital, medical or nursing benefits shall not exceed $50 per month. The commission shall not allow the conversion of the compensation benefits provided for in this section into a lump sum payment notwithstanding the provisions of NRS 616.620. Payment of benefits and compensation shall be limited to the claimant and his dependents.
Sec. 2. NRS 617.465 is hereby amended to read as follows:
617.465 1. Any claimant or his dependents who have received the maximum sum payable pursuant to NRS 617.460 prior to March 19, 1963 or who will receive such maximum sum payable after March 19, 1963 and prior to July 1, 1965, shall be entitled to receive supplemental compensation in an amount not to exceed $3,000 during the period between March 19, 1963, and July 1, 1965.
2. Such supplemental compensation shall be payable to a claimant or his dependents in sums provided by chapter 616 of NRS.
3. In paying the supplemental compensation authorized by this section, the commission may, in addition to any moneys required from the occupational diseases fund and the medical benefits fund, expend:
(a) All moneys which represent the total remainder of amounts of maximum sums payable under paragraph (b) of subsection 5 of NRS 617.460 which were not paid between July 1, 1961, and March 19, 1963, because the claimants thereof died or their dependents became disqualified to receive further benefits prior to receipt of the maximum sums payable; and
κ1965 Statutes of Nevada, Page 982 (CHAPTER 374, SB 95)κ
617.460 which were not paid between July 1, 1961, and March 19, 1963, because the claimants thereof died or their dependents became disqualified to receive further benefits prior to receipt of the maximum sums payable; and
(b) All moneys which represent the total remainder of amounts of supplemental compensation payable under this section which were not paid between March 19, 1963, and July 1, 1965, because the claimants thereof died or their dependents became disqualified to receive further supplemental benefits prior to receipt of the maximum supplemental compensation authorized by this section.
[4. No supplemental compensation shall be paid after July 1, 1965.]
Sec. 3. Chapter 617 of NRS is hereby amended by adding thereto a new section which shall read as follows:
1. Any claimant or his dependents who have received the maximum sums payable pursuant to NRS 617.460 and 617.465 prior to the effective date of this act or who will receive such maximum sum payable after the effective date of this act and prior to July 1, 1967, shall be entitled to receive supplemental compensation in an amount not to exceed $3,000 during the period between the effective date of this act and July 1, 1967.
2. Such supplemental compensation shall be payable to a claimant or his dependents in sums provided by chapter 616 of NRS.
3. In paying the supplemental compensation authorized by this section, the commission may, in addition to any moneys required from the occupational diseases fund and the medical benefits fund, expend:
(a) All moneys which represent the total remainder of amounts of maximum sums payable under paragraph (b) of subsection 5 of NRS 617.460 and NRS 617.465 which were not paid between July 1, 1961, and the effective date of this act, because the claimants thereof died or their dependents became disqualified to receive further benefits prior to receipt of the maximum sums payable; and
(b) All moneys which represent the total remainder of amounts of supplemental compensation payable under this section which were not paid between the effective date of this act and July 1, 1967, because the claimants thereof died or their dependents became disqualified to receive further supplemental benefits prior to receipt of the maximum supplemental compensation authorized by this section.
4. No supplemental compensation shall be paid after July 1, 1967.
Sec. 4. This act shall become effective upon passage and approval.
________
κ1965 Statutes of Nevada, Page 983κ
Senate Bill No. 110Committee on Judiciary
CHAPTER 375
AN ACT to amend NRS sections 449.250 to 449.430, inclusive, being the Nevada Hospital Survey and Construction Act, by redesignating such sections as the Nevada Health Facilities Assistance Act; amending and adding certain definitions of words and terms; establishing a health facilities advisory council; extending the scope and purpose of such sections by including references to medical facilities, facilities for the mentally retarded and community mental health centers; to amend chapter 449 of NRS, relating to hospitals and nursing and maternity homes, by adding new sections providing for the terms of office, the filling of vacancies, meetings and compensation of members of the health facilities advisory council; to amend NRS 244.263, relating to the composition, use and investment of county hospital construction funds, by making technical changes required by the amendment of the Nevada Hospital Survey and Construction Act; and providing other matters properly relating thereto.
[Approved April 13, 1965]
The People of the State of Nevada, represented in Senate and Assembly,
do enact as follows:
Section 1. NRS 449.250 is hereby amended to read as follows:
449.250 NRS 449.250 to 449.430, inclusive, may be cited as the Nevada [Hospital Survey and Construction Act.] Health Facilities Assistance Act.
Sec. 2. NRS 449.260 is hereby amended to read as follows:
449.260 [As used in NRS 449.250 to 449.430, inclusive:
1. Construction includes construction of new buildings, expansion, remodeling and alteration of existing buildings, and initial equipment of such buildings, including architects fees, but excluding the cost of off-site improvements and, except with respect to public health centers, the cost of the acquisition of the land.
2. Federal Act means the Hospital Survey and Construction Act, approved August 13, 1946, and its amendments, being c. 958, 60 Stat. 1040, also designated as 41 U.S.C. §§ 291-291n, including, without limiting, the Medical Facilities Survey and Construction Act of 1954, approved July 12, 1954 being c. 471, 68 Stat. 461, also designated as 41 U.S.C. §§ 291o-291v.
3. Health division means the health division of the department of health and welfare.
4. Hospital includes public health centers and general, tuberculosis, mental, chronic disease, and other types of hospitals, and related facilities such as laboratories, out-patient departments, nurses home and training facilities, and central service facilities operated in connection with hospitals, but does not include any hospital furnishing primarily domiciliary care.
5. Nonprofit hospital means any hospital owned and operated by a corporation or association, no part of the net earnings of which inures, or may lawfully inure, to the benefit of any private shareholder or individual.
6. Public health center means a publicly owned facility for the provisions of public health services, including related facilities such as laboratories, clinics, and administrative offices operated in connection with public health centers.
κ1965 Statutes of Nevada, Page 984 (CHAPTER 375, SB 110)κ
laboratories, clinics, and administrative offices operated in connection with public health centers.
7. State department means the department of health and welfare, acting through the health division.
8. Surgeon General means the Surgeon General of the Public Health Service of the United States.] As used in NRS 449.250 to 449.430, inclusive:
1. Community mental health center means a facility providing services for the prevention or diagnosis of mental illness, or care and treatment of mentally ill patients, or rehabilitation of such persons, which services are provided principally for persons residing in a particular community or communities in or near which the facility is situated.
2. Construction includes construction of new buildings, modernization, expansion, remodeling and alteration of existing buildings, and initial equipment of such buildings (including medical transportation facilities), including architects fees, but excluding the cost of off-site improvements and, except with respect to public health centers, the cost of the acquisition of the land.
3. Facility for the mentally retarded means a facility specially designed for the diagnosis, treatment, education, training or custodial care of the mentally retarded, including facilities for training specialists and sheltered workshops for the mentally retarded, but only if such workshops are part of facilities which provide or will provide comprehensive services for the mentally retarded.
4. Federal Act means the Hospital Survey and Construction Act, as amended, being Title VI of the Public Health Service Act (42 U.S.C. §§ 291 et seq.) with respect to hospitals and medical facilities, the Mental Retardation Facilities and Community Mental Health Centers Construction Act of 1963 (42 U.S.C. 2661 et seq.) with respect to facilities for the mentally retarded and community mental health centers and any other federal law providing for or applicable to the provision of assistance for health facilities now or hereafter enacted.
5. Federal agency means the federal department, agency or official designated by law, regulation or delegation of authority to administer the Federal Act.
6. Health division means the health division of the department of health and welfare.
7. Health facility includes hospitals, medical facilities, facilities for the mentally retarded, community mental health centers, and other facilities for the provision of diagnosis, treatment, care, rehabilitation, training or related services to individuals with physical or mental impairments, but except for facilities for the mentally retarded does not include any facility furnishing primarily domiciliary care.
8. Hospital includes public health centers and general, tuberculosis, mental, chronic disease, and other types of hospitals, and related facilities such as laboratories, out-patient departments, nurses home and training facilities, and central service facilities operated in connection with hospitals, but does not include any hospital furnishing primarily domiciliary care.
κ1965 Statutes of Nevada, Page 985 (CHAPTER 375, SB 110)κ
9. Medical facility means diagnostic or diagnostic and treatment centers, rehabilitation facilities and nursing homes, as those terms are defined in the Federal Act, and such other medical facilities for which federal aid may be authorized under the Federal Act.
10. Nonprofit health facility means any health facility owned and operated by a corporation or association, no part of the net earnings of which inures or may lawfully inure to the benefit of any private shareholder or individual.
11. Public health center means a publicly owned facility for the provision of public health services, including related facilities such as laboratories, clinics and administrative offices operated in connection with public health centers.
12. State department means the department of health and welfare, acting through the health division.
Sec. 3. NRS 449.270 is hereby amended to read as follows:
449.270 The state department shall constitute the sole agency of the state for the purpose of:
1. Inventorying existing [hospitals,] health facilities, surveying the need for construction of [hospitals,] health facilities, and developing [a program of hospital] programs of health facilities construction as provided in NRS 449.250 to 449.430, inclusive.
2. Developing and administering [a state plan] state plans for the construction of public and other nonprofit [hospitals] health facilities as provided in NRS 449.250 to 449.430, inclusive.
3. Developing and administering any other plan or program providing assistance to health facilities for which funds may be available to this state under the Federal Act.
Sec. 4. NRS 449.280 is hereby amended to read as follows:
449.280 In carrying out the purposes of NRS 449.250 to 449.430, inclusive, the state department is authorized and directed:
1. To require such reports, make such inspections and investigations, and prescribe such regulations as it deems necessary.
2. To provide such methods of administration, appoint all necessary officers and other personnel and take such other action as may be necessary to comply with the requirements of NRS 449.250 to 449.430, inclusive, the Federal Act and the regulations thereunder.
3. To procure in its discretion the temporary or intermittent services of experts or consultants or organizations thereof, by contract, when such services are to be performed on a part-time or fee-for-service basis and do not involve the performance of administrative duties.
4. To the extent that it considers desirable to effectuate the purposes of NRS 449.250 to 449.430, inclusive, to enter into agreements for the utilization of the facilities and services of other departments, agencies and institutions, public or private.
5. To accept on behalf of the state and to deposit with the state treasurer any grant, gift or contribution made to assist in meeting the cost of carrying out the purposes of NRS 449.250 to 449.430, inclusive, and to expend the same for such purposes.
6. To make an annual report to the governor on activities and expenditures pursuant to NRS 449.250 to 449.430, inclusive, including recommendations for such additional legislation as the state department considers appropriate to furnish adequate [hospital, clinic, and similar] health facilities to the people of this state.
κ1965 Statutes of Nevada, Page 986 (CHAPTER 375, SB 110)κ
recommendations for such additional legislation as the state department considers appropriate to furnish adequate [hospital, clinic, and similar] health facilities to the people of this state.
7. To do all other things on behalf of the state necessary or advisable to obtain the maximum benefits available under the Federal Act.
Sec. 5. NRS 449.290 is hereby amended to read as follows:
449.290 [The hospital advisory council, appointed pursuant to NRS 449.100, shall advise and consult with the state department in carrying out the administration of NRS 449.250 to 449.340, inclusive.] 1. There is hereby established a health facilities advisory council which shall advice and consult with the department in carrying out the administration of NRS 449.250 to 449.430, inclusive. The council shall consist of the state health officer ex officio, who shall serve as the director and chairman, and such even number of additional members appointed by the governor to represent nongovernmental organizations or groups, public agencies and consumers familiar with the need for the services provided by health facilities as the governor shall determine to be advisable to meet the requirements of the Federal Act and regulations promulgated thereunder.
2. Each member of the council other than the state health officer shall hold office for a term of 4 years. The terms of the members first taking office shall commence concurrently, but shall expire, as designated by the governor at the time of appointment, so that one-third more or less thereof shall expire at the end of the second year, one-third more or less thereof at the end of the third year and the remainder at the end of the fourth year, after the date on which their terms commenced.
Sec. 6. Chapter 449 of NRS is hereby amended by adding thereto the provisions set forth as sections 7 to 9, inclusive, of this act.
Sec. 7. An appointment to fill a vacancy in the health facilities advisory council caused other than by the expiration of a term shall be for the unexpired portion of the term.
Sec. 8. Members of the health facilities advisory council shall serve without remuneration, but shall receive, when away from their places of residence, traveling expenses and subsistence allowances in accordance with law.
Sec. 9. The health facilities advisory council shall meet as often as necessary, but not less than once each year, or upon call of the state health officer or on request of three or more members.
Sec. 10. NRS 449.300 is hereby amended to read as follows:
449.300 The state department is authorized and directed to inventory existing [hospitals,] health facilities, including public, nonprofit, and proprietary [hospitals,] health facilities, to survey the need for construction of [hospitals,] health facilities, and, on the basis of such inventory and survey, to develop [a program] programs for the construction of such public and other nonprofit [hospitals] health facilities as will, in conjunction with existing facilities, afford the necessary physical facilities for furnishing adequate [hospital, clinic, and similar] health facility services to all the people of the state.
Sec. 11. NRS 449.310 is hereby amended to read as follows:
449.310 The construction [program] programs shall provide, in accordance with regulations prescribed under the Federal Act, NRS 449.250 to 449.430, inclusive, and the regulations thereunder, for adequate [hospital] health facilities for the people residing in this state, and, insofar as possible, shall provide for their distribution throughout the state in such manner as to make all types of [hospital service] health facility services reasonably accessible to all persons in the state.
κ1965 Statutes of Nevada, Page 987 (CHAPTER 375, SB 110)κ
accordance with regulations prescribed under the Federal Act, NRS 449.250 to 449.430, inclusive, and the regulations thereunder, for adequate [hospital] health facilities for the people residing in this state, and, insofar as possible, shall provide for their distribution throughout the state in such manner as to make all types of [hospital service] health facility services reasonably accessible to all persons in the state.
Sec. 12. NRS 449.320 is hereby amended to read as follows:
449.320 1. The state department is authorized to make application to the [Surgeon General] federal agency for federal funds to assist in carrying out the survey, planning and construction activities provided for in NRS 449.250 to 449.430, inclusive.
2. Such funds shall be deposited in the state treasury and shall be available to the state department for expenditure for carrying out the purposes of NRS 449.250 to 449.430, inclusive.
3. Any such funds received and not expended for such purpose shall be repaid to the Treasury of the United States.
Sec. 13. NRS 449.330 is hereby amended to read as follows:
449.330 1. The state department shall prepare and submit to the [Surgeon General a state plan] federal agency state plans which shall include the [hospital] health facilities construction [program] programs developed under NRS 449.250 to 449.430, inclusive, and which shall provide for the establishment, administration and operation of [hospital] health facilities construction activities in accordance with the requirements of the Federal Act and regulations thereunder.
2. The state department shall, prior to the submission of any such plan to the [Surgeon General,] federal agency, give adequate publicity of a general description to all the provisions proposed to be included therein. [, and hold a public hearing at which all persons or organizations with a legitimate interest in such plan may be given an opportunity to express their views.]
3. The state department shall, from time to time, review the [hospital construction program] health facilities construction programs and submit to the [Surgeon General] federal agency any modifications thereof which may be found necessary and may submit to the [Surgeon General] federal agency such modifications of the state [plan] plans not inconsistent with the requirements of the Federal Act as may be deemed advisable.
Sec. 14. NRS 449.340 is hereby amended to read as follows:
449.340 1. The state department shall have the authority to establish standards for the maintenance and operation of [hospitals] health facilities which receive federal aid, which standards shall have the force and effect of law and shall supersede all local ordinances and regulations heretofore or hereafter enacted inconsistent therewith.
2. A copy of such standards adopted by the state department, giving the date that they take effect, shall be filed with the secretary of state, and copies shall be issued in pamphlet form.
3. Any [hospital] health facility that applies for and accepts federal aid for construction under [the] a state plan so on condition that the [hospital] health facility shall qualify under the minimum standards for maintenance and operation adopted, promulgated and enforced by the state department.
κ1965 Statutes of Nevada, Page 988 (CHAPTER 375, SB 110)κ
4. Any person, partnership, association or corporation establishing, conducting, managing or operating any [hospital] health facility within the meaning of NRS 449.250 to 449.430, inclusive, who shall violate any of the provisions of this section or regulations lawfully promulgated thereunder shall be guilty of a misdemeanor.
Sec. 15. NRS 449.350 is hereby amended to read as follows:
449.350 The state [plan] plans shall set forth the relative need for the several projects included in the construction [program,] programs, determined on the basis of the relative need [of different sections of the population and of different areas lacking adequate hospital facilities, giving special consideration to hospitals serving rural communities and areas with relatively small financial resources, and] in accordance with the regulations of the [Surgeon General] federal agency prescribed pursuant to the Federal Act, and shall provide for their construction in the order of relative need so determined, insofar as financial resources available therefor make it possible.
Sec. 16. NRS 449.360 is hereby amended to read as follows:
449.360 1. Applications for [hospital] health facility construction projects for which federal funds are required shall be submitted to the state department; and they may be submitted by the state or any political subdivision thereof or by any public or nonprofit agency authorized to construct and operate a [hospital.] health facility.
2. Each application for a construction project shall conform to federal and state requirements and shall be submitted in the manner and form prescribed by the state department.
Sec. 17. NRS 449.370 is hereby amended to read as follows:
449.370 1. The state department shall afford to every applicant for assistance for a construction project an opportunity for a fair hearing before the [council] state department acting by and through the health division upon 10 days written notice to the applicant.
2. If the state department, after affording reasonable opportunity for development and presentation of applications in the order of relative need, finds that a project application is in conformity with the state plan, the state department shall approve such application and shall recommend and forward it to the [Surgeon General.] federal agency.
3. The state department shall consider and forward applications in the order of relative need set forth in the state plan in accordance with NRS 449.350.
Sec. 18. NRS 449.380 is hereby amended to read as follows:
449.380 From time to time, the state department shall inspect each construction project approved by the [Surgeon General] federal agency and, if the inspection so warrants, the state department shall certify to the [Surgeon General] federal agency that work has been performed upon the project, or that purchases have been made, in accordance with the approved plans and specifications, and that payment of an installment of federal funds is due to the applicant.
Sec. 19. NRS 449.390 is hereby amended to read as follows:
449.390 1. The state department is hereby authorized to receive federal funds in behalf of, and transmit them to, [such] applicants.
2. There is hereby established separate and apart from all public moneys and funds of this state a [hospital construction fund.]
κ1965 Statutes of Nevada, Page 989 (CHAPTER 375, SB 110)κ
moneys and funds of this state a [hospital construction fund.] nonreverting trust fund designated as the health facilities assistance fund. Money received from the Federal Government for a construction project approved by the [Surgeon General] federal agency shall be transmitted to the state treasurer to be deposited in the state treasury to the credit of the [hospital construction] health facilities assistance fund, and shall be used solely for payments due applicants for work performed, [or] purchases made [,] or other approved expenditures in carrying out approved projects [.] or plans, except that any moneys in such fund which become available under the Federal Act and regulations for expenditure in administering an approved state plan may be expended for that purpose.
3. The state department shall establish and maintain such accounts and fiscal controls of moneys deposited in and disbursed from the health facilities assistance fund as may be required by the Federal Act and regulations promulgated thereunder.
Sec. 20. NRS 449.400 is hereby amended to read as follows:
449.400 1. In order to provide state assistance for construction projects for publicly owned general hospitals, hospitals for the chronically ill and impaired, [nursing homes, diagnostic centers or diagnostic and treatment centers, and rehabilitation facilities] medical facilities, facilities for the mentally retarded and community mental health facilities financed in part by federal funds in accordance with NRS 449.250 to 449.430, inclusive, and to promote maximum utilization of federal funds available for such projects, there is hereby created in the state treasury a nonreverting trust fund to be known as the state public [hospital] health facilities construction assistance fund. Moneys for such fund may be provided from time to time by legislative appropriation.
2. The state public [hospital] health facilities construction assistance fund shall be administered by the state department in accordance with the purposes and provisions of NRS 449.250 to 449.340, inclusive.
Sec. 21. NRS 449.410 is hereby amended to read as follows:
449.410 1. Moneys in the state public [hospital] health facilities construction assistance fund shall be used to supplement federal funds and moneys provided by the project sponsor for approved projects for the construction of publicly owned general hospitals, hospitals for the chronically ill or impaired, [nursing homes, diagnostic centers or diagnostic and treatment centers, and rehabilitation facilities,] medical facilities, facilities for the mentally retarded and community mental health facilities, and for no other purpose or purposes.
2. Applications for state assistance for construction projects shall be submitted to the state department for consideration in the manner prescribed in NRS 449.250 to 449.430, inclusive, for applications for federal assistance.
3. No project shall be entitled to receive state assistance unless and until it shall be entitled to receive federal assistance.
Sec. 22. NRS 449.420 is hereby amended to read as follows:
449.420 Moneys in the state public [hospital] health facilities construction assistance fund shall be allocated and paid to construction projects on the basis of relative need in accordance with NRS 449.350 and in accordance with the following ratio: A maximum of $1 of state assistance funds for every $2 of federal funds actually made available for such approved project; but in no event shall the amount of state assistance funds made available or paid out for such project exceed the amount supplied by the project sponsor.
κ1965 Statutes of Nevada, Page 990 (CHAPTER 375, SB 110)κ
and in accordance with the following ratio: A maximum of $1 of state assistance funds for every $2 of federal funds actually made available for such approved project; but in no event shall the amount of state assistance funds made available or paid out for such project exceed the amount supplied by the project sponsor.
Sec. 23. NRS 449.430 is hereby amended to read as follows:
449.430 [1.] Moneys in the state public [hospital] health facilities construction assistance fund allocated to a particular approved project shall be paid out in installments at the same times and in the same manner as installments of federal funds are paid out from the [hospital construction] health facilities assistance fund pursuant to NRS 449.390.
[2. The amount of each installment payment from the state public hospital construction assistance fund for a particular approved project shall bear the same ratio to the total amount of state assistance allocated to such project as the amount of the corresponding installment of federal funds paid from the hospital construction fund bears to the total amount of federal funds allocated to such project.]
Sec. 24. NRS 244.263 is hereby amended to read as follows:
244.263 1. Notwithstanding the provisions of NRS 244.260 and 450.250, with the approval of the state board of finance, the board of county commissioners of any county may, by an order of such board, create in the county treasury a fund to be designated as the county hospital construction fund.
2. Moneys in the county hospital construction fund shall be used only for county participation in the construction of a [hospital pursuant to the provisions of the Nevada Hospital Survey and Construction Act, being NRS 449.250 to 449.430, inclusive. As used in this subsection, construction and hospital have the same meanings ascribed to them in subsections 1 and 4 of NRS 449.260.] health facility pursuant to the provisions of the Nevada Health Facilities Assistance Act, being NRS 449.250 to 449.340, inclusive. As used in this subsection, construction and health facility have the same meaning ascribed to them in subsection 2 and 7 of NRS 449.260.
3. The county hospital construction fund may be composed of:
(a) All or a part of the moneys paid to the county under the provisions of paragraph (b) of subsection 2 of NRS 463.320.
(b) All or a part of the moneys accumulated by the county pursuant to the provisions of NRS 244.260.
(c) The proceeds of any annual special tax levied by the board of county commissioners for such fund.
4. Moneys deposited in a county hospital construction fund shall not revert to the county general fund at the end of any fiscal year, but no county hospital construction fund shall exist for a period longer than 10 years from the date of the order of its creation. Any moneys remaining in the county hospital construction fund at the end of the 10-year period shall revert to the county general fund.
5. Any moneys in the county hospital construction fund may, from time to time, be invested only in short-term United States Government bonds.
κ1965 Statutes of Nevada, Page 991 (CHAPTER 375, SB 110)κ
Sec. 25. Nothing in this amendatory act shall be construed to repeal or otherwise invalidate any of the provisions of chapter 18, Statutes of Nevada 1956, chapter 441, Statutes of Nevada 1959, chapter 211, Statutes of Nevada 1960, chapter 363, Statutes of Nevada 1961, chapter 442, Statutes of Nevada 1963, or any other statute of this state by the terms of which certain moneys were appropriated by the legislature from the general fund in the state treasury to the state public hospital construction assistance fund, now designated by section 20 of this amendatory act as the state public health facilities construction assistance fund, and any moneys in the state public hospital construction assistance fund on the effective date of this amendatory act shall remain in such fund as herein redesignated and shall be available for expenditure for the specific uses and purposes stated in the statutes making the appropriations. The department of health and welfare, acting through the health division, the state controller, the state treasurer and all other state officers are directed to perform such acts as may be necessary to effectuate the purposes of this amendatory act.
Sec. 26. This act shall become effective upon passage and approval.
________
Senate Bill No. 115Committee on Finance
CHAPTER 376
AN ACT to amend NRS section 286.400, relating to cessation of membership in the public employees retirement system, by permitting an absence without loss of previously accrued retirement rights if a nonelective employee was discharged for political reasons; and providing other matters properly relating thereto.
[Approved April 13, 1965]
The People of the State of Nevada, represented in Senate and Assembly,
do enact as follows:
Section 1. NRS 286.400 is hereby amended to read as follows:
286.400 1. An employee shall cease to be a member of the system and shall forfeit all previously accrued retirement rights if:
[1.] (a) He is absent from the service of all employers participating in the system for a total of more than 5 years during any 6-year period after he becomes a member of the system; or
[2.] (b) During any absence from such service he withdraws the amount credited to his account in the public employees retirement fund.
2. If a nonelective employee of the state or one of its political subdivisions was discharged for political reasons prior to January 1, 1960, an absence from covered service of 8 years and 3 months shall be permitted without loss of previously accrued retirement rights. Employment in any other covered position during the first 8 years shall terminate the 8-year-and-3-month grace period for political discharge and the individual shall, from the date of such reemployment, resume regular coverage.
κ1965 Statutes of Nevada, Page 992 (CHAPTER 376, SB 115)κ
regular coverage. To establish discharge for political reasons the employee must have been discharged within 6 months after the political change resulting in the discharge and he must establish to the satisfaction of the board by evidence other than his own testimony that the discharge was not for reasons other than political. An unsupported affidavit by an individual to the effect that discharge was for political reasons shall not be regarded as sufficient to establish this fact. The provisions of this subsection shall be applicable only when discharged persons have returned to covered employment as prescribed and have applied to the board for coverage of service prior to political discharge within 6 months after the effective date of this amendatory act or 6 months after reemployment, whichever is later, provided that reemployment must be prior to July 1, 1968.
Sec. 2. This act shall become effective upon passage and approval.
________
Senate Bill No. 120Senator Dial
CHAPTER 377
AN ACT appropriating the sum of $50,000 to the state public health facilities construction assistance fund for the purpose of constructing the Ormsby County Carson-Tahoe Hospital at Carson City, Ormsby County, Nevada; expressly limiting the use of such appropriated funds; and providing other matters properly relating thereto.
[Approved April 13, 1965]
The People of the State of Nevada, represented in Senate and Assembly,
do enact as follows:
Section 1. For the purpose of providing moneys in the state public health facilities construction assistance fund, created pursuant to the provisions of NRS 449.400, for the express and only purpose stated in section 2, there is hereby appropriated from the general fund in the state treasury the sum of $50,000 to the state public health facilities construction assistance fund.
Sec. 2. Notwithstanding the provisions of any other law, the health division of the department of health and welfare shall not expend any of the moneys appropriated by section 1 except for the construction of the Ormsby County Carson-Tahoe Hospital at Carson City, Ormsby County, Nevada, pursuant to the provisions of the Nevada Health Facilities Assistance Act, being NRS 449.250 to 449.430, inclusive. If no application for a health facility construction project relating to the Ormsby County Carson-Tahoe Hospital is made to the health division of the department of health and welfare within 8 years from the effective date of this act, then the moneys appropriated by section 1 shall revert to the general fund in the state treasury notwithstanding the provisions of NRS 449.400.
Sec. 3. The state controller is hereby authorized and directed to transfer the sum appropriated by section 1 forthwith from the general fund to the state public health facilities construction assistance fund.
Sec. 4. This act shall become effective upon passage and approval.
________