Nevada Mechanics Lien: Protect Your Property. Protect Your Work.

  • September 15, 2017

Protect your property. Protect your work.

Property renovation is a trend that is on the rise in our area.  One consideration that homeowners often overlook when hiring a contractor and considering renovation work is the contractor’s right to record a mechanics lien against the homeowner’s property in the event that the homeowner does not pay the contractor.  A mechanics lien, in certain circumstances, may be recorded against a homeowner’s property to protect the contractor’s rights and ensure payment for the contractor’s services.  If the contractor follows the proper procedures and remains unpaid, the contractor may be able to foreclose and force the sale of the property in order to obtain payment for the contractor’s work.  It is not only important for contractors to have a solid understanding of these procedures, but homeowners should know them as well.

In Nevada, NRS Chapter 108 governs mechanics liens.  In general, a contractor or supplier is authorized by statute to record a lien if an owner fails to pay when:

  1. They have provided work or materials valued at $500.00 or more for the repair or improvement of the property;
  2. They are licensed to perform the work;
  3. They timely provide a “Notice of Right to Lien” if the contractor does not have a direct contract with the homeowner;
  4. The contractor provides a “Notice of Intent to Lien” fifteen (15) days before recording his mechanics lien;
  5. The contractor timely records his mechanics lien (formally called a “Notice of Lien”); and
  6. The contractor timely file a lawsuit to foreclose the mechanics lien within six (6) months of recording the lien.

The “Notice to Right to Lien,” is commonly referred to as pre-lien notice.  A pre-lien notice puts the homeowner on notice that the contractor may have a right to a lien on the property in the event that the contractor is not paid by the homeowner for work performed or materials delivered.  Previously, even though contractors did not always deliver this required pre-lien notice, mechanics liens were still routinely enforced based on the Nevada Supreme Court’s rulings that “[t]he failure to serve the pre-lien notice does not invalidate a mechanics’ or materialmen’s lien where the owner received actual notice.”  Fondren v. K/L Complex Ltd., 106 Nev. 705, 710, 800 P.2d 719, 721-22 (1990).  Mechanics lien statutes are “remedial in character and should be liberally construed, allowing substantial compliance with the statutory requirement as long as the property owner is not prejudiced.”  Las Vegas Plywood & Lumber, Inc. v. D&D Enters., 98 Nev. 378, 380, 649 P.2d 1367, 1368 (1982).  The case law stated that so long as the homeowner had “actual notice of the potential lien claim,” it was “not prejudiced” by not receiving the pre-lien notice.  Board of Trustees of the Vacation Trust Carpenters Local No. 1780 v. Durable Developers, 102 Nev. 401, 410, 724 P.2d 736, 743 (1986).  The Supreme Court of Nevada has clarified that “a lien claimant cannot invoke the actual notice exception to NRS 108.245 unless the property owner (1) has actual notice of the construction on his property, and (2) knows the lien claimant’s identity.  Iliescu v. Steppan citing Hardy Companies, Inc. v. SNMARK, 126 Nev. 528, 542, 245 P.3d 1149, 1158 (2010).

This decision makes it vital for contractors to follow the appropriate procedures with regard to their mechanics lien rights in Nevada.  It is worthwhile for a homeowner to understand that they can condition a partial or full payment on a partial or full lien release.  It is also important for homeowners to understand that the contractor has a limited time period in which to record a valid lien.

Before beginning a renovation project, a homeowner should consider meeting with his/her attorney to discuss the terms of the contract with the general contractor, mechanics lien rules and procedures, and other considerations to ensure maximum protection for the homeowner.

As expected, California has its own set of mechanics lien rules that differ in many respects from Nevada.  Stay tuned for an upcoming Clarity blog post on California mechanics lien laws.

California Commercial Property Owners – Lease Updates Needed

  • February 9, 2017

On September 16, 2016, Governor Jerry Brown signed Assembly Bill 2093, which amended California Civil Code Section 1938 placing increased burden on commercial property owners when leasing their property.  Those who ignore or who are unaware of the amended statute are exposed to substantial financial risk for their non-compliance.

The law requires every rental agreement, signed on or after January 1, 2017 to advise the tenant in advance as to whether the subject premises has undergone an inspection by a Certified Access Specialist (CASp).  A CASp inspector inspects buildings and sites for compliance with applicable state and federal construction-related accessibility standards under the ADA and state equivalents.

Where property has undergone a CASp inspection and received a disability access inspection certificate, it is advisable to provide the appropriate notices and reports to the tenant within the specified timelines.  In the event the subject premises has not been issued a disability access inspection certificate, the commercial property owner is required to state the following on the lease form or rental agreement:

“A Certified Access Specialist (CASp) can inspect the subject premises and determine whether the subject premises comply with all of the applicable construction-related accessibility standards under state law. Although state law does not require a CASp inspection of the subject premises, the commercial property owner or lessor may not prohibit the lessee or tenant from obtaining a CASp inspection of the subject premises for the occupancy or potential occupancy of the lessee or tenant, if requested by the lessee or tenant. The parties shall mutually agree on the arrangements for the time and manner of the CASp inspection, the payment of the fee for the CASp inspection, and the cost of making any repairs necessary to correct violations of construction-related accessibility standards within the premises.”

Failure to comply with Civil Code Section 1938 may allow a commercial tenant to rescind the lease agreement.  Of greater concern may be the question of who must pay for the improvements required by the CASp inspection report.  Unless otherwise specifically agreed between the landlord and tenant, the presumption is that the commercial property owner shall pay for both the report and any required repairs set forth in the report.

The law requires different notices be provided from landlord to tenant based on whether there has been a CASp inspection and whether a disability access inspection certificate has been granted.  Additionally, if a CASp inspection or certificate has not been issued, landlords may wish to consider including specific in the lease agreement with regard to payment of costs regarding the inspection if one has not already taken place as well as the costs of bringing the property in compliance if it turns out not to be in compliance.

If you need more information or have any questions regarding how the new law may affect your business, do not hesitate to contact Incline Law Group, LLP for some clarity on the subject.

Tahoe Home Buying Considerations

  • January 3, 2017

This article originally appeared in the Sierra Sun/Tahoe Bonanza.

Winter is a great time to buy in the Truckee/Tahoe area. Whether you are looking to purchase a new primary residence or just a vacation home, there are a number of legal issues that you will want to consider.

1. TRPA/BUILDING RESTRICTIONS

The Tahoe Basin is under the jurisdiction of a bi-state federal agency known as the Tahoe Regional Planning Agency (TRPA). TRPA’s mission is, primarily, to preserve the environmental health and sustainability of the Lake Tahoe region.

TRPA has the authority to establish and enforce land use planning, building and development restrictions. The TRPA code may limit a homeowner’s ability to build, remodel, landscape and otherwise improve their property.

If you are purchasing within the jurisdiction of TRPA, it is important that you understand what you can and cannot do with your property with regard to improvements and the timelines for permitting and/or building within the Tahoe Basin.

Certain activities like grading and digging are generally prohibited October 15 through April 30. If your property is within a scenic corridor or within a sensitive zone (like a stream zone), you may be subject to additional TRPA oversight.

TRPA does not make redevelopment, remodeling or improvement impossible, but it is important that you be aware that TRPA restrictions may impact your intended use of your new property. There is a great deal of information available on the TRPA website.

2. HOMEOWNERS’ ASSOCIATIONS

If you are looking at purchasing a condominium or townhome that is within a homeowners’ association, you should carefully review any applicable Covenants, Conditions and Restrictions (CCRs).

The CCRs will dictate any use restrictions on your property. For many second-home buyers in Tahoe, rental restrictions are very important.

Some associations may limit the length of rentals or prohibit them entirely. If you are intending to rent out your new house as a vacation rental or on a longer-term basis, you should carefully review the CCRs for provisions relating to rentals.

It is also important that you understand if you will be required to pay monthly assessments, whether there are any planned or pending special assessments and the general financial health of the association, which should be evident in the operating and reserve budgets and financial reports.

3. TITLE REPORT/TITLE INSURANCE

An often-overlooked document in the mountain of paperwork that you wade through when purchasing a home is the preliminary title report issued by the title company in preparation for the issuance of title insurance at the close of escrow.

The title report provides a list of recorded documents that will be excluded from title insurance coverage. It is very important to review this list of exceptions and exclusions.

Often you will see easements affecting the property or any recorded use restrictions (like CCRs), and sometimes you may see issues relating to TRPA building covenants or restrictions.

The title insurance policy that you obtain will not insure against loss resulting from a claim that is related to a title condition that was listed on the exceptions list.

More importantly, certain title conditions can impact your intended use of the property (for example, if there is a public easement for beach access that goes right by your new master bedroom window … you may want to know about that).

It may be possible to remove some title exceptions and/or to insure around others. You may want to seek legal counsel to understand the impact and possible removal of certain types of exceptions.

Your Realtor should be able to guide you on when it is advisable to seek legal counsel to assist with title issues.

4. CALIFORNIA VERSUS NEVADA?

While the Tahoe Basin is one big beautiful region, there is one major tax difference that should be pointed out in case you are not already aware: The State of California has individual and corporate state income tax, while the State of Nevada does not.

When buying a second home that is intended for your personal vacation use, this may not be an important issue. However, if you are intending your new Tahoe home to be your new primary residence, it is worthy of consideration.

Additionally, if you intend to rent out your property, thereby generating income, the rental income is likely to be subject to income tax — not such a big deal if you are already a California state taxpayer, but if you are a Nevada resident, you may be subjecting yourself to California income tax on that rental income.

It’s all food for thought, and depending on circumstances, a reason to get in touch with your tax professional for guidance.

5. REAL ESTATE AGENTS

As with any community, the Truckee/Tahoe area has many excellent Realtors … and a few that may not be quite so excellent. Choose an agent/broker by asking questions of both the Realtor and people who you may know in the community.

Realtors who live and work full time in the community, and have for some time, are going to understand the many unique aspects of home-ownership in Tahoe, such as why you want to think twice about a long, steep north-facing driveway or when you should investigate your grand remodel plans with TRPA.

Many of the communities around the lake and in the Truckee area have a local Board of Realtors. They can often be found online and may be a useful place to do a little research.

The Truckee/Tahoe Area is an amazing region rich with unparalleled beauty, outdoor adventure and close knit communities.

If Incline Law Group, LLP, can ever be of service to you in the purchase of your Tahoe home, or with other legal needs, please feel free to contact us. Until then, we will see you on the trails and the ski runs.

7 Tips to Ready Your Business for 2017

  • November 23, 2016

Hard to believe that another new year is just around the corner.  Whether you are thinking about end of year organization or New
7 tips to ready your business for 2017Year’s business resolutions, here are  seven tips for readying your business for 2017:

  • Charitable Giving: Business or personal, charitable giving is not only a tax deductible event it is always better to give than to receive. There are many local non-profits that could especially use your help this time of year. Consider funding a Thanksgiving meal for a family, donating a warm coat or even volunteering some hours.
  • Estate Planning: When is the last time you updated your estate plan? Do you need to accomplish any year end gifting? It is advisable to review you estate plan at least every 5 years and depending on your circumstances more often.
  • Tax Planning: This is the time to call your CPA and discuss any over or under payments for 2016, year-end purchases and retirement account contributions.
  • Business Registrations: Have you renewed all required registrations, licenses and filed all required tax returns?  Business registration renewals of all types should be calendared. If Incline Law Group, LLP serves as your registered agent, we will track your annual business registration and state business license renewal for you.
  • Insurance: As long as the Affordable Care Act (“Obamacare”) remains in place, there is an open enrollment period which runs November 1, 2016 through February 1, 2017. Your employee health insurance plan is now likely to have a year-end renewal date regardless of when you used to renew. Now is the time to renew or shop for new policies.
  • Leases: Commercial leases often run for longer periods of time and new leases or renewals can often take some time to complete. If your lease is expiring in 2017, now is the time to start planning for that.
  • Employment Policies: January 1 is a great time to put new policies in place for employees in place, especially ones that address newer issues like medical marijuana in the work place and privacy issues. You do want to be sure that your employment practices and policies are compliant with state and federal employment law.  Please be sure to consult with your attorney before putting new employment policies in place.
This article was originally published in the Sierra Sun/Tahoe Bonanza in Incline Law Group’s monthly opinion column, Legal Clarity.

Nevada Question No. 1 & the Second Amendment

  • October 27, 2016

State Question No. 1 on the current Nevada election ballot asks whether federal background checks already required in the purchase of firearms at federally-licensed retail firearms dealers should also apply to a variety of other firearms sales and transfers such as those made at gun shows, over the internet and between strangers.

Question 1 includes numerous exemptions and exceptions that cover the most frequent innocent non-commercial transfer of firearms, so that loaning or transferring a firearm to an extended family member is exempt from background checks, as is loaning a firearm to a hunting partner during a hunt, or to a friend at a shooting range.

Opponents argue that Question 1 infringes on the Second Second AmendmentAmendment and punishes law-abiding citizens. In my opinion, the Second Amendment right to keep and bear arms is not affected by Question 1. The Second Amendment provides: “A well-regulated Militia, being necessary to the security of a free State, the right of the people to keep and bear Arms, shall not be infringed.”

If you ask 10 people what the Second Amendment means, you are likely to get ten different answers. There is only one interpretation of the Second Amendment that really matters, and that is the late Justice Antonin Scalia’s 2008 majority opinion in District of Columbia v. Heller, 128 S. Ct. 2783 (2008):

“State Question 1, which includes many significant exemptions, does not infringe upon anyone’s constitutional rights and does not punish law-abiding citizens by extending background checks to non-retail sales and transfers of firearms.”

(1) It protects an individual right to possess a firearm unconnected with service in a militia, and to use that firearm for traditionally lawful purposes, such as self-defense within the home.

(2) It does not limit the right to keep and bear arms for militia purposes, but limits the type of weapon to which the right applies to those in common use for lawful purposes.

(3) It does not provide unlimited rights to keep and carry any weapon whatsoever in any manner whatsoever and for whatever purpose. Longstanding prohibitions on the possession of firearms by felons and the mentally ill, laws forbidding the carrying of firearms in sensitive places such as schools and government buildings, and laws imposing conditions and qualifications on the commercial sale of arms remain valid.

Heller, a law enacted for Washington, D.C., restricted residents from owning handguns and required that all other firearms be kept unloaded and disassembled or trigger-locked. Heller ruled this invalid.

The Second Amendment, however, does not guaranty freedom from all regulation of firearms (nor is it a right as some believe to keep arms for an armed insurrection against democratically elected leaders).

In Heller, Justice Scalia — the court’s conservative lion for three decades — specifically ruled that laws imposing conditions and qualifications on the commercial sale of arms do not violate the Second Amendment.

For this reason, State Question 1, which includes many significant exemptions, does not infringe upon anyone’s constitutional rights and does not punish law-abiding citizens by extending background checks to non-retail sales and transfers of firearms.

Andrew Wolf is a Nevada Sportsman and gun owner. 

The Thunderbird Yacht is Back…

  • July 13, 2016

…and it is just in time for its birthday. The drought that hit the sierras after the historic 2010-2011 ski season has been devastating to many parts of California and Nevada. Lakes and reservoirs dried up, thunderbird-tahoe-0_Cwildfires raged, and a number of other negative effects were caused by the extended drought. The 2015-2016 ski season was not a huge winter, historically, but it did work wonders in bringing Lake Tahoe back above its natural rim and beyond. Water is flowing into the Truckee River, the boat ramps around the lake are accessible, and the most beautiful and historic yacht on Lake Tahoe is back in the water.

In 2014, the Thunderbird Yacht had engine trouble in both of its engines. The Thunderbird Lodge Preservation Society’s Executive Director and Curator, Bill Watson, did what he does best. He raised enough money to rebuild the engines. Even before they were reinstalled in the yacht, they were on display at the Thunderbird Lodge and looked spectacular. Everyone was excited to get the yacht back into operation.

Unfortunately, the winter did not provide enough snowmelt in 2014-2015. This left the dock that houses the Thunderbird with insufficient water to store the infamous yacht. Again, Mr. Watson was able to make something good out of an otherwise unfortunate situation. Recently, the bottom of the yacht was replaced, some of which had not been replaced since 1939 (when the yacht was originally constructed), even though most wood bottoms only last 20-30 years.

The Thunderbird Yacht was recently relaunched and sent back to its boathouse. This is just in time for her 76th birthday in mid-July (July 14). If you have not been to the Thunderbird Lodge, you should definitely go take a tour. The Yacht itself is worth the trip. Add in all the history, the tunnels, and the ever-popular opium den and you have an experience to remember. Plus, your money goes toward a great cause: keeping the property maintained and open for us all to enjoy.

  • May 9, 2016

Welcome to CLARITY – Incline Law Group’s Blog featuring legal and community news you can use.

Thanks for being here!

What If My Relative Died Without a Will? (Intestate Succession)

  • May 3, 2016

If a person dies without a will or a trust, their real and personal property passes through a process known as intestate succession. Intestate succession provides a distribution to the living heirs of the decedent pursuant to the statute in the state where the decedent was a resident when s/he passed away. If the descendant left real property in another state, the intestate succession laws of that state will govern the disposition of that property.

When someone dies without a will, the estate will still have to go through a legal process. This will require filing the proper pleadings with the court in the appropriate jurisdiction. Instead of appointing an executor of the will, the court will appoint an administrator of the estate. Similar to an executor, an administrator has a fiduciary duty to act in the best interest of the estate.

The process for intestate succession follows almost exactly the same process as a probate. Depending on the estimated value of the estate, there may need to be a notice to creditors, an inventory and appraisement of value, as well as many other formalities to process the estate so that it can be properly distributed to the rightful heirs.

If you need assistance gaining legal clarity for an intestate succession, please feel free to call the attorneys at Incline Law Group.

Does a Will Cover Assets in Two States?

  • May 3, 2016

As an attorney, people often ask me what to do if a relative who had a Last Will and Testament passes away, but leaves property in more than one state.

Based on our geographic area in Lake Tahoe, it is very common for our clients and their relatives to have property in both California and Nevada. In cases such as these,California and Nevada State Line in Lake Tahoe there will usually need to be two separate probates completed. The first probate is done in the state where the decedent resided at the time of death. In this initial probate, all of the real property in that state, as well as all personal property located in any state will be probated. If there is real property in another state, a second “ancillary” probate is processed. Ancillary probates are similar to an ordinary probate but they do have some intricacies. Many times, there is only one piece of real property in another state. Depending on the value of that real property, this may allow for a shorter, more expedited ancillary probate than would otherwise be available.

Many prefer to substantially complete the probate in the home state before starting the ancillary probates. However, ancillary probates may be done concurrently with the home state probate in order to expedite the distribution of the entire estate of the decedent. As with an ordinary probate, ancillary probates are required to transfer title to any real property in any state that is not the home state of the decedent.

The attorneys at Incline Law Group are licensed in both Nevada and California and can assist with a home state or ancillary probate.