Two separate Nevada Supreme Court opinions issued on August 7, 2014 provide important insights for lenders and construction professionals doing business in Nevada.
In Byrd Underground, LLC v. Angaur, LLC, 130 Nev. Adv. Op. 62, the Court was asked to answer three certified questions from the U.S. Bankruptcy Court for the District of Nevada to clarify Nevada mechanics’ lien priority law, including whether placing significant quantities of dirt or building materials on a prospective building project site months before a building permit is issued constitutes “commencement of construction” on the site as well as whether grading constitutes “visible commencement of construction” for the purpose of establishing lien priority under NRS 108.225.
The Court held that grading work “may constitute visible commencement of construction of a work of improvement in some circumstances, as long as it is visible from a reasonable inspection of the site in a manner sufficient to provide notice of lienable work that may be entitled to priority.” However, the Court declined to rule on this matter, saying that the question of whether these improvements are visible or if construction has commenced are questions of fact for a trial court to decide.
In Simmons Self-Storage Partners, LLC v. Rib Roof, Inc., 130 Nev. Adv. Op. 57, the issue before the Court was whether the establishment of a materialman’s lien requires proof that materials were simply delivered for use in property improvements or were actually used for those property improvements. The Court ruled that a materialman’s lien can be established by showing proof that materials were supplied for use in improving a property, and that NRS 108.22 does not require delivery of materials to a specific location.
Las Vegas construction law firm Marquis Aurbach Coffing (MAC Law) focuses on solving complex construction issues for Nevada construction companies and subcontractors. Contact us for the legal expertise you need to run your business successfully.