NEVADA
CONSTRUCTION LAW
TABLE OF CONTENTS
PREFACE
............................................................................................
xiii
ACKNOWLEDGEMENTS.......................................................................
xv
ABOUT THE
AUTHORS.......................................................................
xvii
CHAPTER 1
SOURCES OF NEVADA CONSTRUCTION LAW 1
I. Statutes & Regulations 1
II. Common Law/Case Law 2
CHAPTER 2
BUSINESS ENTITY TYPES 4
I. Sole Proprietorships 4
A. Characteristics of a Sole Proprietorship 4
II. Partnerships 5
A. General Partnerships 5
B. Management of Partnership 5
C. Liabilities 6
D. Limited Partnerships 6
E. Limited Liability Partnership 9
III. LIMITED LIABILITY COMPANIES 9
A. Formation 9
IV. Corporations 10
A. Formation 10
B. Liability 10
C. Management 11
CHAPTER 3
LICENSING OF CONTRACTORS AND DESIGN PROFESSIONALS 14
I. DEFINITIONS 14
A. Contractors 14
B. Professional Engineering 16
C. Professional Land Surveyor 16
D. Architect 17
E. Interior Design 18
F. Residential Design 19
G. Landscape Architect 19
II. Nevada State Contractors Board 20
A. Contractor Licensing 20
III. Nevada State Board of Engineers and Land Surveyors 37
A. Engineer 37
B. Land Surveyors 37
C. Architecture, Interior Design and Residential Design Professionals 38
CHAPTER 4
PUBLIC WORKS BIDDING 43
I. Bidding on Public Works Projects 43
A. Overview 43
B. Bid Solicitation 45
C. Requirements of Submitted Bids 45
D. Required Bonds for Public Works 55
CHAPTER 5
PUBLIC WORKS PAYMENT REMEDIES 57
I. Nevada Public Works Prompt Payment Statutes 57
A. Overview 57
B. Payments by Owner to Contractor 58
C. Withholding of Payment From Contractor 59
D. Payments by Contractor to Subcontractors and Suppliers 61
E. Payment by Subcontractors to Lower-Tiered Subcontractors and Suppliers 63
F. Remedies for Payment Violations 64
G. Subcontractor/Supplier Remedies 64
II. Public Work Payment Bonds 65
A. Introduction 65
B. Claims Upon Payment Bonds 65
CHAPTER 6
THE MECHANIC’S LIEN IN NEVADA 69
I. The Requirements to Hold and Enforce a Lien Claim 70
A. Mechanic’s Lien Enforcement 70
B. The Lien on Property and the Amount of the Lien 70
C. The Perfection of the Lien 73
II. The Enforcement of the Lien 86
A. Initiating a Foreclosure Action 86
B. Judgment Upon A Lien Claim 87
C. Duties of a Prime Contractor 88
D. Execution Upon Judgment 89
E. Time Limit to Initiate Lien Foreclosure Action/Time Extensions 89
III. The Priority of the Lien 90
IV. The Notice of Non-Responsibility and Requirements for Lessee’s Undertaking Improvements 91
V. Duties of Lessee/Tenant Improvement Bonds 92
VI. Use of Surety Bonds as Substitute Collateral for Real Properties 95
A. The Release of the Lien by Posting a Surety Bond 95
B. Action Filed Against Surety Bond 100
VII. Waiver or Release of Rights of a Lien Claimant 102
VIII. Frivolous or Excessive Notice of Lien 112
IX. Priority of Mechanic’s Liens 114
A. Equitable Subrogation 115
B. Subordination Agreements 119
CHAPTER 7
PRIVATE WORKS PAYMENT REMEDY - PROMPT PAYMENT ACT 127
I. Private Work Prompt Payment Act 127
A. Payment of Prime Contractors 128
B. Payment of Lower-Tiered Subcontractors 131
CHAPTER 8
RESIDENTIAL CONSTRUCTION 137
I. Actions Resulting From Constructional Defect: Conditions And Limitations Relating to the Chapter 40 Process 137
A. Definitions 137
B. Liability of the Contractor 138
C. Pre-Litigation 138
II. Litigation: The Lawsuit 144
A. Preference Given to Trial of Action 144
B. Disclosures Between Claimant & Contractor 145
C. Limitations On Recovery 145
III. Statutes Of Limitation Or Repose And Tolling 147
IV. Other Issues Presented in Chapter 40 Matters 148
A. When A Claimant Rejects A Reasonable Settlement 148
B. Disclosures Between Claimant And Prospective Purchaser 148
C. Presenting Claim to Insurer 149
D. Submission of Questions Concerning Defects to the State Contractor’s Board 149
CHAPTER 9
CONSTRUCTION LENDING 153
I. Construction Lending Industry 153
A. Representation of the Construction Lender 154
II. The Construction Loan Agreement 154
A. Conformance With the Construction Loan and Take Out Commitments 154
B. Factual Background to the Project 155
C. Loan Amount and Repayment 156
D. Interest Rate 156
E. Recourse Lending 157
F. Lien Priority Over Prior Encumbrances 157
G. Closing the Construction Loan 162
H. Construction Loan Disbursements 163
I. Methods of Loan Disbursement 165
J. Liability for Construction Defects 167
K. The Defaulting Developer 167
L. Workout Negotiations 167
M. The Final Loan Takeout 170
CHAPTER 10
NEVADA OCCUPATIONAL SAFETY AND HEALTH 173
I. Nevada OSHA 173
A. Overview 173
B. Violations 180
C. Enforcement 181
D. Occupational Safety and Health Review Board 182
E. Penalties 183
CHAPTER 11
DOING BUSINESS WITH DISADVANTAGED BUSINESS ENTERPRISES 188
I. Policy/Application 189
A. Definitions 190
II. Administration 191
III. Payment Provisions 193
IV. Enforcement of DBE Programs 194
A. Management 198
B. Workforce 199
C. Materials 202
D. Performance 204
V. Measuring DBE Participation 208
VI. Certification Process 209
VII. Sanctions 217
CHAPTER 12
INDEMNIFICATION IN NEVADA 222
I. Types of Indemnity 222
A. Type I Indemnity 223
B. Type II Indemnity 223
C. Type III Indemnity 224
II. Contractual Indemnity 224
III. Equitable Indemnity 232
CHAPTER 13
ALTERNATIVE DISPUTE RESOLUTION 235
I. Nevada’s Mandatory Court Annexed Arbitration Program 235
A. Proceedings Before the Arbitrator 237
B. Trial de Novo 238
II. Private Arbitration Pursuant to Agreement 238
A. Arbitration Agreement 239
B. Compelling Arbitration 241
C. Arbitration Proceedings 241
