On March 26th, 2009 the Nevada Supreme Court issued its decision in favor of Weil & Drage’s architect (Klai Juba Architects) and structural engineer (Lochsa, LLC) in a case involving $60m in damages and the Mandalay Bay Hotel (and thus MGM and its legal advisors who purchased Mandalay before this matter went to the Supreme Court.)
Attorney Jean Weil argued the matter extensively before the Nevada Supreme Court with the following question at issue: “Does the economic loss doctrine apply to preclude negligence-based claims against design professionals, such as engineers and architects, who provide services in the commercial property development or improvement process, when the plaintiffs seek to recover purely economic losses?”
The Supreme Court answered: “Yes. Purely economic loss has been defined as ‘the loss of the benefit of the user’s bargain…including…pecuniary damage for inadequate value, the cost of repair and replacement of [a] defective product, or consequent loss of profits, without any claim of personal injury or damage to other property. After examining relevant authority and contemplating the policy considerations behind the economic loss doctrine, we have determined that the doctrine’s purpose – to shield defendants from unlimited liability for all of the economic consequences of a negligent act, particularly in a commercial or professional setting, and thus to keep the risk of liability reasonably calculable – would be furthered by applying it to preclude the professional negligence claims at issue here. Thus, we conclude that the economic loss doctrine bars professional negligence claims against design professionals who provided services in the process of developing or improving commercial property when the plaintiffs’ damages are purely financial.”
The oral argument of this matter by Jean Weil before the Nevada Supreme Court, as well as the legal briefing by the lawyers at Weil & Drage, resulted in this very important decision in favor of design professionals involved in high-profile projects on the Las Vegas strip. The timing could not be more perfect in light of the potential claims brewing against the design professional community and their insurers in Nevada.
THE 2009 LEGISLATIVE SESSION
Stimulating the Stimulus Randy Lavigne, Hon. AIA
Executive Director, AIA Nevada/AIA Las Vegas
Our lobbyist, Fred Hillerby, reports that federal stimulus money remains a hot topic in Carson City. Hearings continue on how the money can be used, and what priorities should be funded first. The Nevada Dept. of Transportation has approved its list of $140 million in projects, and the Legislature continues working on its plans to spend the money and create a new committee to oversee that spending. Some pots of the new money will go through a dizzying array of budget maneuvers as it is used to fill budget holes, transferred to other agencies to match other stimulus funds, and back to the agencies it was designed to fund in the first place.
Two separate bills have been heard to mandate new benefits in health insurance policies, in this case autism and acupuncture. Labor unions support increased workers compensation benefits and increased safety training and oversight requirements. Advocates for the under- and un-insured, the unemployed, and other groups have a list of desires. All of this in the face of declining budget revenues and increasingly bad news for nearly every sector of the business community. Legislators have their hands full dealing with their core constituencies and the painful realities of paying the bills.
Also looming in April are deadlines to get bills introduced, get them passed out of committees, and on their way to the other house. This also coincides with the Democratic leadership’s self-imposed deadline to finish budget hearings, announce how much they want to raise to meet their goals, and just which taxes they will put on the list. Stay tuned to see who will be remembered as a Caesar and who a Brutus when the dust settles from this Ides of March.
AIA Nevada continues to push for “Pencil Ready Projects” in order to get the industry back on its feet, and are now taking the message to City Councils, Planning Commissions, and State, Local Public Works Boards and all entities that can generate projects. Another visit to Carson City is planned within the next two weeks, in order to again urge legislators to generate “Pencil Ready Projects”. If you are interested in representing the AIA in Carson City, please contact Randy at rlavigne@aianevada.org. If you can’t go to Carson City, you’ll want to call your representatives and encourage them to generate jobs in the design industry with pencil ready projects.
AIA Nevada is also tracking a number of bills this session, many of which are based on supporting renewable energy and sustainability efforts. These bills include:
AB147(BDR 753) - Requires local governments to grant preference to local bidders bidding on certain contracts for goods or services.
AB148(BDR 276) - Requires certain health and safety training for construction workers and supervisors.
AB166(BDR 30) - Makes various changes to provisions relating to employment practices.
AB175(BDR 1032) - Temporarily revises the provisions governing the prequalification of bidders on public works of this State.
AB192(BDR 245) - Revises provisions governing certain performance contracts for operating cost-savings measures.
AB223 (BDR 857) - Revises provisions concerning preferences for bidders on certain state purchasing and public works contracts.
AB298(BDR 587) - Revises provisions relating to public works.
AB304(BDR 641) - Makes various changes relating to the preservation of existing neighborhoods.
AB339(BDR 58-520) - Authorizes the sale of electricity by an owner of property on which electricity is generated using renewable energy.
AB456(BDR 58-121) - Provides for renewable energy installations and energy efficiency improvements for residential property.
AB457(BDR 10-66) - Revises provisions relating to the energy efficiency of residential dwellings.
AB483(BDR 28-932) - Revises the provisions governing the terms of certain contracts between public bodies and certain design professionals on public works.
SB49(BDR 353) - Creates a requirement for a written contract between a client and an architect, registered interior designer or residential designer under certain circumstances.
SB90(BDR 352) - Creates an emeritus title for certain architects, registered interior designers and residential designers.
SB114(BDR 380) - Makes various changes relating to systems for obtaining and using solar energy and other renewable energy resources.
SB127(BDR 596) - Exempts qualified persons or groups providing services as a project manager or construction manager to a long-term recovery group from regulation as a contractor.
SB165(BDR 381) - Requires certain utilities that supply electricity in this State to include in the resource plan of the utility certain provisions relating to any future regulation of carbon emissions.
SB188(BDR 379) - Establishes the Solar Hot Water Heating Systems Demonstration Program.
SB191(BDR1141) - Adopts the Uniform mechanical code and the National Electrical
SB242(BDR 58-378) - Enacts provisions relating to energy efficiency, renewable energy and building construction.
SB298(BDR 34-1075) - Authorizes the Board of Regents of the University of Nevada to plan for and establish programs for the study of renewable energy resources within the Nevada System of Higher Education
SB323(BDR 28-1079) - Requires local governments to develop a plan for the retrofit of local government buildings with energy-efficient measures.
SB337(BDR 2-1149) - Revises the statutes of repose relating to certain actions concerning construction defects.
SB349(BDR 3-1151) - Makes various changes relating to constructional defects.
SB395(BDR 58-1219) - Makes various changes regarding renewable energy and energy efficiency and alters the composition of the Commission on Economic Development.
