DR HORTON v. Dist. Ct.

168 P.3d 731
CourtNevada Supreme Court
DecidedOctober 11, 2007
Docket47654
StatusPublished

This text of 168 P.3d 731 (DR HORTON v. Dist. Ct.) is published on Counsel Stack Legal Research, covering Nevada Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
DR HORTON v. Dist. Ct., 168 P.3d 731 (Neb. 2007).

Opinion

168 P.3d 731 (2007)

D.R. HORTON, INC., A Nevada Corporation; RCR Companies; Central Valley Insulation Las Vegas, LLC; and Builder Services Group, Inc., d/b/a Central Valley Insulation, Petitioners,
v.
The EIGHTH JUDICIAL DISTRICT COURT of the State of Nevada, In and For the COUNTY OF CLARK, and The Honorable Allan R. Earl, District Judge, Respondents, and
First Light at Boulder Ranch Homeowners Association, A Nevada Corporation, Real Party in Interest.

No. 47654.

Supreme Court of Nevada.

October 11, 2007.

*734 Marquis & Aurbach and Jack Juan and Micah S. Echols, Las Vegas, for Petitioner D.R. Horton, Inc.

Hansen & Rasmussen and R. Scott Rasmussen, Las Vegas, for Petitioners Central Valley Insulation Las Vegas, LLC, and Builder Services Group, Inc., d/b/a Central Valley Insulation.

Quon Bruce Christensen Law Firm and James R. Christensen, Las Vegas, for Real Party in Interest.

Burris, Thomas & Springberg and Andrew J. Thomas, Las Vegas, for Amicus Curiae Nevada Trial Lawyers Association.

Jeanne Winkler & Associates and Jeanne L. Winkler, Las Vegas, for Amicus Curiae Safe Homes Nevada.

Marquiz Law Office and Craig A. Marquiz, Henderson, for Amicus Curiae Nevada Subcontractors Association.

Snell & Wilmer, LLP, and Leon F. Mead II, Las Vegas, for Amici Curiae Associated *735 General Contractors, Las Vegas Chapter, and Coalition for Fairness in Construction.

BEFORE THE COURT EN BANC.

OPINION

By the Court, GIBBONS, J.:

In this petition, we address the question of how district courts should determine the sufficiency of a pre-litigation notice of constructional defects under NRS 40.645. The parties and amici curiae[1] invite us to examine the reasonableness of a pre-litigation notice that triggers a builder's right to repair, or a claimant's right to commence suit. Today, we provide district courts with a test and guidelines to measure the sufficiency of the pre-litigation notice.

Real party in interest First Light at Boulder Ranch Homeowners Association utilized a "representative sample" of constructional defects in a small number of homes as a basis for giving notice of constructional defects common throughout a development of 414 residences. According to petitioners, First Light's extrapolated notice was inadequate because it failed to provide the "reasonable detail" of defects and their location necessary to preserve for petitioners a meaningful opportunity to repair the alleged defects before suit is brought. We conclude that adequate extrapolated pre-litigation notice must have a reasonable statistical basis to describe the alleged defects and their locations in reasonable detail sufficient to afford contractors a meaningful opportunity to repair the alleged defects. Therefore, we articulate below a test to guide district courts in making written findings on whether a pre-litigation notice satisfies that threshold. So long as an extrapolated notice meets that requirement, district courts have wide discretion to determine the adequacy of a pre-litigation notice on a case-by-case basis.

Since we have adopted a test to be used by the district courts, we grant this petition in part and direct the district court to reconsider the notice and make factual findings as discussed herein.

FACTS

The First Light at Boulder Ranch Community is located in Henderson, Nevada. Petitioner D.R. Horton, Inc., built and sold the community in twenty-six releases. The community consists of 138 buildings with three residential units in each building, totaling 414 residences. The community has three floor plans, each with two possible elevations, for a total of six different types of homes. Approximately 40 contractors and subcontractors from various trades, some of which used several work crews, were involved in constructing the community. At times, more than one subcontractor from each trade was employed at the community.

Believing that numerous constructional defects may exist in each residence in the community, First Light hired experts to assist it in preparing an NRS 40.645 pre-litigation notice of constructional defects. Those experts formulated the notice after using visual and invasive testing in a small representative sampling of the homes in the community. But they did not provide D.R. Horton with the addresses or the expert report of the homes they had tested. Based on the occurrence of each defect they found, the experts extrapolated the percentage of homes in which they believed each defect existed throughout the entire community. The defects First Light alleges are categorized into several major groups, many of which have multiple subcategories. According to First Light's notice, approximately 160 defects may exist in various combinations in each of the 414 homes. First Light's experts estimate that anywhere from 2 to 100 percent of the 414 homes in the community have any combination of each of the 160 defects. In its notice, First Light did not specify the floor plans, elevations, or addresses of the homes in which it alleges that a particular defect may exist. Unsatisfied with D.R. Horton's response to its notice, First Light *736 filed a constructional defect action with the district court.

In response to First Light's pre-litigation notice and action, D.R. Horton moved the district court for a declaratory judgment, stating that First Light's NRS 40.645 notice was unreasonable and thus statutorily insufficient. The district court denied that motion, expressing dissatisfaction with the statutory constraints when it comes to cases involving a significant number of homes.[2] The district court further refused to declare First Light's NRS 40.645 notice statutorily insufficient. In its written order, the district court found that First Light "properly relied upon expert opinion and representative sampling pursuant to NRS 40.645(3)[and] (4)" to prepare its notice.[3]

D.R. Horton then filed this petition challenging the district court's order denying its motion for declaratory relief.[4] Through this petition, D.R. Horton challenges the district court's order, arguing that First Light's prelitigation notice does not give it notice with the "reasonable detail" required by NRS 40.645(2). D.R. Horton further argues that the inadequacy of First Light's notice frustrates its opportunity to repair under NRS 40.647. In its answer, First Light contends that its notice is sufficient and that D.R. Horton bears the burden of finding and repairing the defects noticed or allow the litigation to proceed.

DISCUSSION

D.R.

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D.R. Horton, Inc. v. Eighth Judicial District Court
168 P.3d 731 (Nevada Supreme Court, 2007)

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Bluebook (online)
168 P.3d 731, Counsel Stack Legal Research, https://law.counselstack.com/opinion/dr-horton-v-dist-ct-nev-2007.