Nevada Governor Brian Signs Construction Defect Bill

Nevada Gov. Brian Sandoval has signed a bill aimed at curbing frivolous lawsuits over construction defects after the measure passed through the Republican-controlled Legislature along party lines.

The Republican governor said AB125, which was sponsored by Republican Assemblyman Ira Hansen, incorporated ideas that had been discussed for more than a decade.

The measure would more narrowly define construction defects so they wouldn’t include issues that crop up as a result of remodeling or later construction. It would require homeowners to exhaust other options, such as using the builder’s warranty and seeking resolution through the Nevada State Contractors Board, before pursuing a lawsuit. The bill would also require parties to pay their own legal fees.

Republicans said the bill would fix a law that was originally meant to protect homeowners when flaws surfaced in their houses but has opened the floodgates for expensive litigation and created a financial incentive for attorneys to file suit. Construction companies testified that the litigious environment raised their insurance rates and discouraged them from taking on projects.

Democratic opponents said they worried the bill helps contractors while making it harder for homeowners to get recourse when they encounter a problem with their house.