TABLE OF AUTHORITIES
2013 Lien and Foreclosure Statutes
(2015 amendments do not apply)
NRS 116.3116 – Liens against units for assessments.
NRS 116.31162 – Foreclosure of liens: Mailing of notice of delinquent assessment; recording of notice of default and election to sell; period during which unit s owner may pay lien to avoid foreclosure; limitations on type of lien
NRS 116.3163 – Foreclosure of liens: Mailing of notice of default and election to sell to certain interested persons
NRS 116.311635 – Foreclosure of liens: Providing notice of time and place of sale; service of notice of sale; contents of notice of sale; proof of service.
NRS 116.31164 – Foreclosure of liens: Procedure for conducting sale; purchase of unit by association; execution and delivery of deed; use of proceeds of sale.
NRS 116.31166 – Foreclosure of liens: Effect of recitals in deed; purchaser not responsible for proper application of purchase money; title vested in purchaser without equity or right of redemption.
NRS 116.31168 – Foreclosure of liens: Requests by interested persons for notice of default and election to sell; right of association to waive default and withdraw notice or proceeding to foreclose.
Other Relevant Statutes which apply to the enforcement of the SCA governing documents
NRS 116.1113 Obligation of good faith
NRS 116.3102(3)(4) Enforcement decisions must be prudent, not arbitrary or capricious
NRS 116.3103 Fiduciary, business judgment, act on an informed basis
NRS 116.31031 Limits on Board’s power to sanction
NRS 116.310313 Authority of Association to collect past due obligations and to charge reasonable fee to collect.
NRS 116.3106(d) Requires association bylaws to define what BOD can’t delegate
NRS 116A.640(8) Prohibits a manager from intentionally applying a payment of an assessment from a unit’s owner towards any fine, fee or other charge that is due.
NRS 116A.640(9) Prohibits a manager from refusing to accept from a unit’s owner payment of any assessment, fine, fee or other charge that is due because there is an outstanding payment due.
NRS 116A.640(10) Prohibits a manager from collect any fees or other charges from a client not specified in the management agreement.
NRS 116.3108 (4) The same specificity required for unit owner meeting agendas is required for Board meeting agendas
NRS 116.31083 (2017 amendments do not apply) Relates to the requirements for HOA Board meetings, agendas, minutes, owners’ rights to attend, speak and hear all deliberations, to receive clear notice of the agenda so it is known what actions the Board intends to take
NRS 116.31085 (2017 amendments do not apply)
NRS 116.31085(4) BOD SHALL meet in exec session to hold a hearing on an alleged violation of the governing documents unless the person who is about to be sanctioned requests an open hearing by the BOD. If the person requests in writing that an open hearing be conducted
NRS 116.31085(4a) Owner who is being sanctioned for an alleged violation is entitled to attend all portions of the Board hearing, including the presentation of evidence and the testimony of witnesses
NRS 116.31085(4b) Owner is entitled to due process which must include without limitation the right to counsel, right to present witnesses and the right to present information relating to any conflict of interest of any member of the hearing panel (BOD)
NRS 116.31085(5) Subsection 4 establishes the MINIMUM protections the BOD must provide before it makes a decision
NRS 116.31085(6f) Any matter discussed in exec session must be noted briefly in the minutes of the Executive Board. The Board shall maintain minutes of any decision related to subsection concerning the alleged violation and upon request shall provide a copy of the decision to the owner subject to being sanctioned or representative
NRS 116.31087 Right of units’ owners to have certain complaints placed on BOD agenda
NRS 116.4117 Right to initiate civil action if damaged by a HOA CC&Rs bound party’s failure to comply with NRS 116 or the HOA’s governing documents
NRS 116.31175 Board is required to provideowner rights to access association records
NRS 116A.620(m) Management agreement must (m) Acknowledge that all records and books of the client are the property of the client, except any proprietary information and software belonging to the community manager;
Relevant Governing Documents provisions
6.1 Function of the association -primary entity to enforce the governing documents; must perform in accordance with governing documents
7.4 Compliance & Enforcement: The Board may impose sanctions for violation of the Governing Documents after notice and a hearing in accordance with the procedures set forth in the By-Laws.
8.8 Lien for assessment may be enforced in the manner proscribed in act
8.12 Asset enhancement fee 1/3 of 1% due to the association on all but specifically exempted transfers of title.
3.13(a, e, f) Compensation can’t appear to influence decisions, create a conflict; can’t relate to fines or violations; must conform to standards of practice
3.15 Open BOD meetings – must give owner minutes of hearing on violation of governing documents
3.15A SHALL hold hearing re violations Executive session
3.17 Powers of BOD business judgment benefits the association
3.18(a) Duties of the Board that SHALL NOT be delegated (a) adopt budget
3.18(b) Duties of the Board that SHALL NOT be delegated (b) levy and collect assessments
3.18 (e ) Duties of the Board that SHALL NOT be delegated (e) deposit all funds taken on association’s behalf and use to operate
3.18(f) Duties of the Board that SHALL NOT be delegated (f) Use restrictions and rules
3.18 (g) Duties of the Board that SHALL NOT be delegated (g) opening of bank accounts on the Association’s behalf and designating signatories required
3.18(i) Duties of the Board that SHALL NOT be delegated (i) enforcing the Governing Documents and bringing any legal proceedings…on behalf of or against the Owners concerning the Association; provided, the Association’s obligation in this regard shall be conditioned as provided in CC&Rs 7.4
3.20 Defines what duties SHALL NOT be delegated
3.21 Accounts and reports: delinquency report
3.25 Board standards: must be reasonable
3.26 Enforcement procedures
4.6 Contracts, checks, agreements must be signed by two BOD members, not manager or debt collector or attorney
5.2 Deed Restriction Enforcement Committee (Covenants)
6.4 (a,b,c) Books & Records: rights of owners and directors to SCA information defined
10/23/14 SCA Rules and Regulations
Management and Debt Collection Agreements
1/1/10 RMI Management Agreement
RMI Management LLC
Red Rock Financial Services, a FirstService Residential Management company
3/31/14 FSR Management Agreement
FirstService Residential, Nevada Management Agreement
Nevada Real Estate Division Advisory Opinions
ANTI-FORECLOSURE FRAUD LEGISLATION
AB 284 Foreclosure reform act – specifies duties of the trustee; assignments not effective unless and until recorded; notarized affidavit under penalty of perjury that the lender or trustee is in actual possession of the note; civil penalties for mortgage lending fraud;
NRS 205.372 False representation of title raised to category C felony or category B if there is a pattern of deceit.
12 CFR1026.39 Mortgage transfer disclosures – Truth in Lending (TILA)
SB 321 (2013) Nevada Homeowner Bill of Rights – prevention of “dual tracking”
NRS Chapter 111 STATUTE OF FRAUDS REGARDING CONVEYANCE OF REAL PROPERTY
NRS 111.105 Conveyances by deed. Conveyances of lands, or of any estate or interest therein, may be made by deed, signed by the person from whom the estate or interest is intended to pass, being of lawful age, or by the person’s lawful agent or attorney, and acknowledged or proved, and recorded, as directed in this chapter.
NRS 111.120 Conditions necessary before proof by subscribing witness can be taken. No proof by a subscribing witness shall be taken unless the witness shall be personally known to the person taking the proof to be the person whose name is subscribed to the conveyance as witness thereto, or shall be proved to be such by the oath or affirmation of a credible witness.
NRS 111.125 Proof required from subscribing witnesses. No certificate of proof shall be granted unless subscribing witnesses shall prove: 1. That the person whose name is subscribed thereto as a party is the person described in, and who executed the same. 2. That such person executed the conveyance. 3. That such witness subscribed his name thereto as a witness thereof.
NRS 111.315 Recording of conveyances and instruments: Notice to third persons. Every conveyance of real property, and every instrument of writing setting forth an agreement to convey any real property, or whereby any real property may be affected, proved, acknowledged and certified in the manner prescribed in this chapter, to operate as notice to third persons, shall be recorded in the office of the recorder of the county in which the real property is situated or to the extent permitted by NRS 105.010 to 105.080, inclusive, in the Office of the Secretary of State, but shall be valid and binding between the parties thereto without such record.
NRS 111.320 Filing of conveyances or other instruments is notice to all persons: Effect on subsequent purchasers and mortgagees. Every such conveyance or instrument of writing, acknowledged or proved and certified, and recorded in the manner prescribed in this chapter or in NRS 105.010 to 105.080, inclusive, must from the time of filing the same with the Secretary of State or recorder for record, impart notice to all persons of the contents thereof; and subsequent purchasers and mortgagees shall be deemed to purchase and take with notice.
NRS 111.325 Unrecorded conveyances void as against subsequent bona fide purchaser for value when conveyance recorded. Every conveyance of real property within this State hereafter made, which shall not be recorded as provided in this chapter, shall be void as against any subsequent purchaser, in good faith and for a valuable consideration, of the same real property, or any portion thereof, where his or her own conveyance shall be first duly recorded.
NRS 111.340 Certificate of acknowledgment and record may be rebutted. Neither the certificate of the acknowledgment nor of the proof of any conveyance or instrument, nor the record, nor the transcript of the record, of such conveyance or instrument, shall be conclusive, but the same may be rebutted.
NRS 111.345 Proof taken upon oath of incompetent witness: Instrument not admissible until established by competent proof. If the party contesting the proof of any conveyance or instrument shall make it appear that any such proof was taken upon the oath of an incompetent witness, neither such conveyance or instrument, nor the record thereof, shall be received in evidence, until established by other competent proof.
NRS 111.180 Bona fide purchaser: Conveyance not deemed fraudulent in favor of bona fide purchaser unless subsequent purchaser had actual knowledge, constructive notice or reasonable cause to know of fraud.
1. Any purchaser who purchases an estate or interest in any real property in good faith and for valuable consideration and who does not have actual knowledge, constructive notice of, or reasonable cause to know that there exists a defect in, or adverse rights, title or interest to, the real property is a bona fide purchaser.
2. No conveyance of an estate or interest in real property, or charge upon real property, shall be deemed fraudulent in favor of a bona fide purchaser unless it appears that the subsequent purchaser in such conveyance, or person to be benefited by such charge, had actual knowledge, constructive notice or reasonable cause to know of the fraud intended.
Relevant sections of the NRS 240 re NOTARY PUBLICS
NRS 240.155 Notarization of signature of person not in presence of notary public unlawful; penalty.
1. A notary public who is appointed pursuant to this chapter shall not willfully notarize the signature of a person unless the person is in the presence of the notary public and:
(a) Is known to the notary public; or
(b) If unknown to the notary public, provides a credible witness or documentary evidence of identification to the notary public.
2. A person who:
(a) Violates the provisions of subsection 1; or
(b) Aids and abets a notary public to commit a violation of subsection 1, is guilty of a gross misdemeanor.
NRS 240.075 Prohibited acts. A notary public shall not:
1. Influence a person to enter or not enter into a lawful transaction involving a notarial act performed by the notary public.
2. Certify an instrument containing a statement known by the notary public to be false.
3. Perform any act as a notary public with intent to deceive or defraud, including, without limitation, altering the journal that the notary public is required to keep pursuant to NRS 240.120.
4. Endorse or promote any product, service or offering if his or her appointment as a notary public is used in the endorsement or promotional statement.
5. Certify photocopies of a certificate of birth, death or marriage or a divorce decree.
6. Allow any other person to use his or her notary’s stamp.
7. Allow any other person to sign the notary’s name in a notarial capacity.
8. Perform a notarial act on a document that contains only a signature.
9. Perform a notarial act on a document, including a form that requires the signer to provide information within blank spaces, unless the document has been filled out completely and has been signed.
10. Make or note a protest of a negotiable instrument unless the notary public is employed by a depository institution and the protest is made or noted within the scope of that employment. As used in this subsection, “depository institution” has the meaning ascribed to it in NRS 657.037.
11. Affix his or her stamp to any document which does not contain a notarial certificate.
NRS 240.147 Unlawful destruction, defacement or concealment of notarial record. It is unlawful for a person to knowingly destroy, deface or conceal a notarial record.(Added to NRS by 1997, 930; A 2009, 3029)
NRS 240.120 Journal of notarial acts: Duty to maintain; contents; verification based upon credible witness; copy of entry; storage; period of retention; report of loss or theft; exceptions.
1. Except as otherwise provided in subsection 2, each notary public shall keep a journal in his or her office in which the notary public shall enter for each notarial act performed, at the time the act is performed:
(a) The fees charged, if any;
(b) The title of the document;
(c) The date on which the notary public performed the act;
(d) Except as otherwise provided in subsection 3, the name and signature of the person whose signature is being notarized;
(e) Subject to the provisions of subsection 4, a description of the evidence used by the notary public to verify the identification of the person whose signature is being notarized;
(f) An indication of whether the notary public administered an oath; and
(g) The type of certificate used to evidence the notarial act, as required pursuant to NRS 240.1655.
2. A notary public may make one entry in the journal which documents more than one notarial act if the notarial acts documented are performed:
(a) For the same person and at the same time; and
(b) On one document or on similar documents.
3. When performing a notarial act for a person, a notary public need not require the person to sign the journal if:
(a) The notary public has performed a notarial act for the person within the previous 6 months;
(b) The notary public has personal knowledge of the identity of the person; and
(c) The person is an employer or coworker of the notary public and the notarial act relates to a transaction performed in the ordinary course of the person’s business.
4. If, pursuant to subsection 3, a notary public does not require a person to sign the journal, the notary public shall enter “known personally” as the description required to be entered into the journal pursuant to paragraph (e) of subsection 1.
5. If the notary verifies the identification of the person whose signature is being notarized on the basis of a credible witness, the notary public shall:
(a) Require the witness to sign the journal in the space provided for the description of the evidence used; and
(b) Make a notation in the journal that the witness is a credible witness.
6. The journal must:
(a) Be open to public inspection.
(b) Be in a bound volume with preprinted page numbers.
7. A notary public shall, upon request and payment of the fee set forth in NRS 240.100, provide a certified copy of an entry in his or her journal.
8. A notary public shall keep his or her journal in a secure location during any period in which the notary public is not making an entry or notation in the journal pursuant to this section.
9. A notary public shall retain each journal that the notary public has kept pursuant to this section until 7 years after the date on which he or she ceases to be a notary public.
10. A notary public shall file a report with the Secretary of State and the appropriate law enforcement agency if the journal of the notary public is lost or stolen.
11. The provisions of this section do not apply to a person who is authorized to perform a notarial act pursuant to paragraph (b), (c), (d) or (e) of subsection 1 of NRS 240.1635.
[Part 18:49:1883; BH § 2359; C § 2483; RL § 2020; NCL § 2951] + [Part 21:49:1883; BH § 2362; C § 2486; RL § 2023; NCL § 2954]—(NRS A 1967, 533; 1993, 262; 1995, 193, 1596; 1997, 936; 2001, 654; 2007, 46; 2011, 1611; 2013, 1376)
NRS 240.150 Liability for misconduct or neglect; liability of employer; penalties for willful violation or neglect of duty; procedure upon revocation or suspension.
1. For misconduct or neglect in a case in which a notary public appointed pursuant to the authority of this State may act, either by the law of this State or of another state, territory or country, or by the law of nations, or by commercial usage, the notary public is liable on his or her official bond to the parties injured thereby, for all the damages sustained.
2. The employer of a notary public may be assessed a civil penalty by the Secretary of State of not more than $2,000 for each violation specified in subsection 4 committed by the notary public, and the employer is liable for any damages proximately caused by the misconduct of the notary public, if:
(a) The notary public was acting within the scope of his or her employment at the time the notary public engaged in the misconduct; and
(b) The employer of the notary public consented to the misconduct of the notary public.
3. The Secretary of State may refuse to appoint or may suspend or revoke the appointment of a notary public who fails to provide to the Secretary of State, within a reasonable time, information that the Secretary of State requests from the notary public in connection with a complaint which alleges a violation of this chapter.
4. Except as otherwise provided in this chapter, for any willful violation or neglect of duty or other violation of this chapter, or upon proof that a notary public has been convicted of, or entered a plea of guilty, guilty but mentally ill or nolo contendere to, a crime described in paragraph (c) of subsection 2 of NRS 240.010:
(a) The appointment of the notary public may be suspended for a period determined by the Secretary of State, but not exceeding the time remaining on the appointment;
(b) The appointment of the notary public may be revoked after a hearing; or
(c) The notary public may be assessed a civil penalty of not more than $2,000 for each violation.
5. If the Secretary of State revokes or suspends the appointment of a notary public pursuant to this section, the Secretary of State shall:
(a) Notify the notary public in writing of the revocation or suspension;
(b) Cause notice of the revocation or suspension to be published on the website of the Secretary of State; and
(c) If a county clerk has issued a certificate of permission to perform marriages to the notary public pursuant to NRS 122.064, notify the county clerk of the revocation or suspension.
6. Except as otherwise provided by law, the Secretary of State may assess the civil penalty that is authorized pursuant to this section upon a notary public whose appointment has expired if the notary public committed the violation that justifies the civil penalty before his or her appointment expired.
7. The appointment of a notary public may be suspended or revoked by the Secretary of State pending a hearing if the Secretary of State believes it is in the public interest or is necessary to protect the public.
1. In an action for the foreclosure of a mortgage upon real property, or affecting the title or possession of real property, the plaintiff, at the time of filing the complaint, and the defendant, at the time of filing his or her answer, if affirmative relief is claimed in the answer, shall record with the recorder of the county in which the property, or some part thereof, is situated, a notice of the pendency of the action, containing the names of the parties, the object of the action and a description of the property in that county affected thereby, and the defendant shall also in the notice state the nature and extent of the relief claimed in the answer.
2. A notice of an action affecting real property, which is pending in any United States District Court for the District of Nevada may be recorded and indexed in the same manner and in the same place as provided with respect to actions pending in courts of this state.
3. From the time of recording only, except as otherwise provided in NRS 14.017, the pendency of the action is constructive notice to a purchaser or encumbrancer of the property affected thereby. In case of the foreclosure of the mortgage, all purchasers or encumbrancers, by unrecorded deed or other instrument in writing made before the recording of the notice, and after the date of the mortgage, shall be deemed purchasers or encumbrancers after the recording of the notice, and subject thereto, unless NRS 14.017 is applicable or they can show that, at the time of recording the notice, the plaintiff had actual notice of the purchase or encumbrance.
1. After a notice of pendency of an action has been recorded with the recorder of the county, the defendant or, if affirmative relief is claimed in the answer, the plaintiff, may request that the court hold a hearing on the notice, and such a hearing must be set as soon as is practicable, taking precedence over all other civil matters except a motion for a preliminary injunction.
2. Upon 15 days’ notice, the party who recorded the notice of pendency of the action must appear at the hearing and, through affidavits and other evidence which the court may permit, establish to the satisfaction of the court that:
(a) The action is for the foreclosure of a mortgage upon the real property described in the notice or affects the title or possession of the real property described in the notice;
(b) The action was not brought in bad faith or for an improper motive;
(c) The party who recorded the notice will be able to perform any conditions precedent to the relief sought in the action insofar as it affects the title or possession of the real property; and
(d) The party who recorded the notice would be injured by any transfer of an interest in the property before the action is concluded.
3. In addition to the matters enumerated in subsection 2, the party who recorded the notice must establish to the satisfaction of the court either:
(a) That the party who recorded the notice is likely to prevail in the action; or
(b) That the party who recorded the notice has a fair chance of success on the merits in the action and the injury described in paragraph (d) of subsection 2 would be sufficiently serious that the hardship on him or her in the event of a transfer would be greater than the hardship on the defendant resulting from the notice of pendency,
Ê and that if the party who recorded the notice prevails he or she will be entitled to relief affecting the title or possession of the real property.
4. The party opposing the notice of the pendency of an action may submit counter-affidavits and other evidence which the court permits.
5. If the court finds that the party who recorded the notice of pendency of the action has failed to establish any of the matters required by subsection 2, the court shall order the cancellation of the notice of pendency and shall order the party who recorded the notice to record with the recorder of the county a copy of the order of cancellation. The order must state that the cancellation has the same effect as an expungement of the original notice.
6. If the court finds that the party who recorded the notice of pendency of the action has established the matters required by subsection 2, the party opposing the notice may request the court to determine whether a bond in an amount to be determined by the court would provide adequate security for any damages which the party who recorded the notice might incur if the notice were so cancelled and the party opposing the notice did not prevail in the action. If the court determines that a bond would provide adequate security, the party opposing the notice may post a bond or other security in the amount determined by the court. The court shall then order the cancellation of the notice of pendency and shall order the party opposing the notice to record with the recorder of the county a copy of the order of cancellation. The order must state that the cancellation has the same effect as an expungement of the original notice.
1. Upon the withdrawal of a notice of the pendency of an action affecting real property, or upon the recordation of a certified copy of a court order for the cancellation of a notice of the pendency of such an action with the recorder of the county in which the notice was recorded, each person who thereafter acquires an interest in the property as a purchaser, transferee, mortgagee or other encumbrancer for a valuable consideration, except a party to the action who is not designated by a fictitious name at the time of the withdrawal or order of cancellation, shall be deemed to be without knowledge of the action or of any matter, claim or allegation contained therein, irrespective of whether the person has or at any time had actual knowledge of the action or of any matter, claim or allegation contained therein.
2. The purpose of this section is to provide for the absolute and complete transferability of real property after the withdrawal or cancellation of a notice of the pendency of an action affecting the property.
(Added to NRS by 1987, 637)
NRS CHAPTER 205 CRIMES AGAINST PROPERTY
NRS 205.395 False representation concerning title; penalties; civil action.
1. Every person who:
(a) Claims an interest in, or a lien or encumbrance against, real property in a document that is recorded in the office of the county recorder in which the real property is located and who knows or has reason to know that the document is forged or groundless, contains a material misstatement or false claim or is otherwise invalid;
(b) Executes or notarizes a document purporting to create an interest in, or a lien or encumbrance against, real property, that is recorded in the office of the county recorder in which the real property is located and who knows or has reason to know that the document is forged or groundless, contains a material misstatement or false claim or is otherwise invalid; or
(c) Causes a document described in paragraph (a) or (b) to be recorded in the office of the county recorder in which the real property is located and who knows or has reason to know that the document is forged or groundless, contains a material misstatement or false claim or is otherwise invalid,
has made a false representation concerning title.
2. A person who makes a false representation concerning title in violation of subsection 1 is guilty of a category C felony and shall be punished as provided in NRS 193.130.
3. A person who engages in a pattern of making false representations concerning title is guilty of a category B felony and shall be punished by imprisonment in the state prison for a minimum term of not less than 3 years and a maximum term of not more than 20 years, or by a fine of not more than $50,000, or by both fine and imprisonment.
4. In addition to the criminal penalties imposed for a violation of this section, any person who violates this section is subject to a civil penalty of not more than $5,000 for each violation. This penalty must be recovered in a civil action, brought in the name of the State of Nevada by the Attorney General. In such an action, the Attorney General may recover reasonable attorney’s fees and costs.
5. Except as otherwise provided in this subsection, the owner or holder of the beneficial interest in real property which is the subject of a false representation concerning title may bring a civil action in the district court in and for the county in which the real property is located to recover any damages suffered by the owner or holder of the beneficial interest plus reasonable attorney’s fees and costs. The owner or holder of the beneficial interest in the real property must, before bringing a civil action pursuant to this subsection, send a written request to the person who made the false representation to record a document which corrects the false representation. If the person records such a document not later than 20 days after the date of the written request, the owner or holder of the beneficial interest may not bring a civil action pursuant to this subsection.
6. As used in this section:
(a) “Encumbrance” includes, without limitation, a lis pendens or other notice of the pendency of an action.
(b) “Pattern of making false representations concerning title” means one or more violations of a provision of subsection 1 committed in two or more transactions:
(1) Which have the same or similar pattern, purposes, results, accomplices, victims or methods of commission, or are otherwise interrelated by distinguishing characteristics;
(2) Which are not isolated incidents within the preceding 4 years; and
(3) In which the aggregate loss or intended loss is more than $250.
Ombudsman is required by NRS 116.625 (e)(7) to
(e) Compile and maintain a registration of each association organized within the State which includes, without limitation, the following information:
(7) The number of foreclosures which were completed on units within the common-interest community or condominium hotel and which were based on liens for the failure of the unit’s owner to pay any assessments levied against the unit or any fines imposed against the unit’s owner;