HOW DOES ASSEMBLY BILL 39 IMPACT MY RESIDENTIAL IMPROVEMENT CONTRACT?

This article addressed changes to Nevada law implemented at the end of 2023. Assembly Bill 39 (AB 39) was passed in the Nevada 2023 Legislature and became effective on October 1, 2023. AB 39 affects certain residential improvement contracts and includes contracts for construction, remodeling, repair, or improvements to existing, completed single-family residences that are occupied by their owners. The primary purpose of AB 39 is to establish a minimum set of requirements for all residential improvement contracts and the following is a nonexhaustive list of the mandatory requirements AB 39 added to Chapter 624 of the Nevada Revised Statutes (NRS):

Any contact for work concerning a residential improvement must contain in writing the following substantive information:

1. The name of the residential contractor, his or her address and contractor’s license number and the monetary limit on that license.

2. The name and mailing address of the owner of the single-family residence on which the work is being performed and the address or legal description of the property.

3. The date of execution of the contract.

4. The estimated date of completion of all work to be performed under the contract.

5. A description of the work to be performed under the contract.

6. The total amount to be paid to the residential contractor by the owner for all work to be performed under the contract, including all applicable tax.

7. The amount, not to exceed $1,000 or 10% of the aggregate contract price, whichever is less, of any initial down payment or deposit paid or promised to be paid to the residential contractor by the owner before the start of the work (which may not apply if the residential contractor files for a bond of $100,000.00 with the Nevada State Contractors Board).

8. A statement that the residential contractor has provided the owner with the notice and informational form required by NRS 624.520 and 624.600.

AB 39 also establishes requirement to the form of the agreement, which include: (1) a method whereby the owner may initial provisions of the contract, to indicate that those provisions were read and understood; and (2) in close proximity to the signatures of the owner and the residential contractor, a notice advising the owner of the following: i. The owner may contact the Nevada State Contractors Board if assistance is needed to clarify any of the provisions of the contract that the owner does not understand; ii. The owner has the right to request a bond for payment and performance if such a bond is not otherwise required; iii. The owner may contact an attorney for an explanation of the owner’s rights under the contact; and iv. If the contract was explained in a language other than the language in which the contract is written, the owner may ask for a contract that is written in the language in which the contact was explained.

These are some, but not all of the mandatory elements of a residential improvement contract implemented by AB 39. For additional requirements and/or advice regarding AB 39, you should seek counsel from an attorney or contact the Nevada State Contractors Board.

This article is for general information and does not constitute legal advice or representation. If you are in need of legal services based on information in this article, contact your attorney or MOBO LAW, LLP and know that the passage of time may bar your rights, so time may be of the essence.

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