Legislation continues to be proposed as we are still early in the legislative process with seventy-four days remaining before the session closes. Those bills outlined in our prior blog posts remain pending. We continue to monitor those bills and provide updates of any key developments. With that said, following is a summary of the newly proposed legislation.
Senate Bill 358
By way of SB358, Senator Ira Hansen and his wife, Assemblywoman Alexis Hansen, have proposed the complete repeal of NRS Chapter 116; the laws generally governing Nevada homeowners’ associations.By way of SB358, the Hansen’s further propose repealing certain provisions NRS Chapter 358, which requires the use of alternative dispute resolution efforts (mediation or arbitration), before litigating claims on the interpretation, application or enforcement of a community’s governing documents. In other words, instead of proceeding through the Real Estate Division’s mediation or arbitration program, claimants would resort to lawsuits to resolve any disputes.
Rather than have a productive effect on Nevada communities, repeal of NRS Chapter 116 and portions of NRS Chapter 358 would remove many of the protections developed over time to protect both Nevada homeowners, the providers of mortgages to homes within Nevada community associations as well as the managers and board members who help these communities to function. Though NRS Chapter 116 may not be perfect, the Hansen’s approach seems more akin to throwing the baby out with the bathwater.
Senate Bill 368
Though not directed specifically act Nevada community associations, SB368 may have an impact. Current law provides that any restriction or prohibition in a written instrument relating to real property, such as a community’s CC&Rs, that purports to forbid or restrict the conveyance, encumbrance, leasing or mortgaging of real property on the basis of race, color, religion, ancestry, national origin, disability, familial status, sex, sexual orientation or gender identity or expression is void and unenforceable by operation of law. Where such a provision exists, the law currently authorizes an of real property that is subject to a restriction to record a declaration of removal of the discriminatory restriction or prohibition by filing a declaration form with the county recorder. If an owner files such a form, the law currently requires the county recorder to attach the declaration form to the original recorded Declaration to indicate that the discriminatory restriction or prohibition is void. (See, NRS 111.237).
If it passes, SB368 would eliminate those provisions relating to the filing and recordation of a declaration of removal of a discriminatory restriction or prohibition. Instead, an owner or other interested persons (such as a community association), would file a petition in the District Court asking that an order be issued directing the county recorder to redact the discriminatory language from the original document. If, after considering the petition, and any objections, the District Court determines that a restriction or prohibition is void and unenforceable by operation of law, the Court would then issue an order directing the county recorder to redact the discriminatory restriction or prohibition from the original document.
Isaacson Law will continue to provide updates on pending legislation as the Session moves forward. Should you have questions on any matter, please call Troy Isaacson at (702) 529-2559.