Panel backs construction-defect bill

CARSON CITY — A plan sought by builders to limit the ability of Nevada homeowners trying to file claims for construction defects won approval Thursday in the Senate Judiciary Committee.

Senate Bill 349, drafted with guidance from a special subcommittee led by Judiciary Chairman Terry Care, D-Las Vegas, now moves to the full Senate.

Builders had pressed for the measure, arguing that the current system results in many bogus claims and exorbitant legal fees, and often impedes home repairs. But critics said the plan would severely restrict homeowners’ rights.

Under existing law, homeowners who sue can’t claim noneconomic damages, such as emotional distress or punitive damages; and builders must pay the homeowners’ costs of bringing lawsuits, provided homeowners agree to reasonable settlements.

SB 349 restricts homeowners’ rights to recover legal fees and narrows the definition of a construction defect. A home would have to present “unreasonable risk of injury to a person or property,” or would have to violate building codes, have actual damage and be built in a way that’s not “good and workmanlike” according to industry standards.

Under the current legal process, homeowners have to show only one of those criteria.

Lobbyists for builders and subcontractors argued in an earlier hearing that the proposal would eliminate cosmetic issues that often lead to expensive litigation, which in turn would help builders solve more substantive problems.

But critics said the bill would unfairly limit the rights of homeowners, including thousands who bought substandard houses during Nevada’s building boom during the 1990s.

Scott Canepa, a construction defect lawyer who has litigated hundreds of defect cases, said after the Senate Judiciary vote that the bill “cannot stand” and he’ll try to get it killed or revised in the Assembly if it wins full Senate approval.

“I’m very dismayed that they have turned back the hands of time and exposed homeowners to the dangers of code violations,” Canepa said.

Canepa added that the measure is “morally repugnant, period” because of the increased potential for code violations by builders.

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