Rockery Wall Lawsuit Update

As all should be aware, the SOA lost its Rockery Wall defect lawsuit against Somersett Development Company et al. in the District Court. The SOA subsequently appealed the decision to the Nevada Supreme Court’s Appellate Department, where it still resides as yet unsettled. Actions to date include the SOA filing its Opening Brief and the Respondents filing their Answering Briefs thereto. The SOA now has until December 14, to reply to the Respondents Answering Briefs. When available, SU will publish the SOA’s response.

The following summarizes the above referenced Court actions in more detail.

On August 13, 2020 the SOA filed its  “APPELLANT’S OPENING BRIEF” with the Nevada Appellate Court. The SOA’s Appeal Brief contained the elements listed below.. Of particular interest are the SOA’s Arguments, the details of which may be accessed via the following link:  “Appellant’s Opening Brief 20-29955“. The  Brief’s  Conclusion is quoted below in its entirety.

    • INTRODUCTION
    • JURISDICTION OF THE COURT
    • STATEMENT OF THE ISSUES PRESENTED ON REVIEW
    • STANDARD OF REVIEW
    • STATEMENT OF THE CASE
    • STATEMENT OF RELEVANT FACTS
    • ARGUMENT
      1. Material Facts Remain At Issue Regarding Whether The Project Was “Substantially Complete”.
      2. Under The Facts of This Case, The Statute of Repose Should Be Tolled During The Period of Developer Control of a Homeowners’ Association, or Respondents Should Be Equitably Estopped From Asserting Repose In This Action.
      3. NRS 11.202 Does Not Apply To NRS Chapter 116 Warranty Claims.
    • CONCLUSION

Based upon the foregoing, Appellant asks this Court to reverse the judgment of the district court, and hold either that there is a genuine dispute of material fact regarding whether the rockery walls were or are substantially complete within the meaning of NRS 11.2055; that equitable tolling or estoppel acts to delay the application of the period of repose in NRS 11.202 until the time of declarant transfer of control, or to bar Respondents from asserting the time bar in this instance; that NRS 11.202 does not apply to NRS Chapter 116 warranty claims; or some combination of these holdings permitting SOA to proceed upon its claims.”

On August 31, 2020, the Court granted the Respondents an extension until October 14 to file a response to the SOA’s Opening Brief.

On October 14, 2020 , Parsons Bros Rockeries, filed their Answering Brief to the SOA, which consisted of the following elements. The complete Brief may be accessed via the following link:   “Parsons Bros Answering Brief 20-37721

    • STATEMENT OF FACTS
    • STATEMENT OF THE CASE
    • ARGUMENT
      1. SOA Failed to Meet its Burden and Summary Judgement was proper.
      2. SOA Ignores its Own Evidence.
      3. SOA’S Failure to Produce Evidence.
      4. NRS 11.2055 and Substantial Completion
      5. SOA did not Claim Equitable Estoppel Against Parsons.
      6. SOA has no NRS 116 Statutory Warranty Claims Against Parsons

On October 14, 2020, Stantec Consulting Services, Somersett Development Company et al. and Q&D Construction filed a Joint Answering Brief to the SOA, which consisted of the following elements. The complete Brief may be accessed via the following link:   “Respondents Joint Answering Brief 20-37822“.  The Brief’s Conclusion below is quoted in its entirety.

    • STATEMENT OF THE CASE
    • STATEMENT OF FACTS
    • STANDARD OF REVIEW
    • SUMMARY OF THE ARGUMENT
    • ARGUMENT
      1. The district court correctly determined that the SOA failed to meet its burden to introduce admissible evidence that it brought its action prior to the expiration of the statute of repose.
      2. The district court correctly held that the statute of repose cannot be tolled without statutory authorization, or be subject to equitable estoppel.
      3. The district court correctly held that NRS 11.202 applies to all claims for construction defects, and the tolling provisions in NRS Chapter 116 do not take warranty claims out of the universe of claims subject to the statute of repose.
    • CONCLUSION

Substantial completion, under the common law, is achieved when the improvement is at such a stage that it can be used for its intended purpose. The rockery walls in Somersett were substantially complete by the end of 2006. The SOA, when opposing the MSJ, did not introduce admissible evidence to establish that substantial completion occurred with six years of its suit. Rather, the evidence submitted by the SOA shows the walls were finally complete, and therefore substantially complete, in December, 2006. Because statutes of repose provide developers, contractors, and design professionals with vested rights to not be sued after a period of time, statutes of repose are not subject to equitable tolling. Similarly, the effects of statutes of repose cannot be avoided through equitable estoppel, and if they can, the SOA did not provide any evidence that equitable estoppel should be applied here.”

On November 10th, 2020, the Court granted the SOA an extension until December 14, 2020, to file a reply to the Respondent’s Answering Briefs.

Who knows what the future holds for our newly elected Board? If the Appeal is granted is the Association looking at another $400-$500K to retry the case?

SOA BOD Election Results

The Somersett Owners Association (SOA) Board of Director (BOD) election ballots were counted by Association volunteers at the Annual SOA Homeowner Meeting on Monday November 16th. Association member attendance was restricted to log-in via Zoom video conferencing due to COVID-19 requirements. Election results were subsequently announced via “Somersett Happenings” email distributions to Association members, which are summarized below for those of you who may not have received them.

Five candidates were running for the three open two year BOD positions, Two incumbents (Fitzgerald and Retter) and three new candidates (Capalongan, O’Donnell and Williams). Results were as follows with vote totals indicated:

    1. Mark Capalongan (892)
    2. William O’Donnell (839)
    3. Jacob Williams (800)
    4. Terry Retter (395)
    5. Tom Fitzgerald (336)

Congratulations to new Board Members Mark Capalongan, William O’Donnell and Jacob Willians, who subsequent to the election met with incumbent Board members Simon Baker and Craig Hanson and selected the following as Board Officers:

    • President  –  Mark Capalongan
    • Secretary  –  Willian O’Donnell
    • Treasurer  –  Simon Baker
    • Vice Presidents  –  Craig Hanson and Jacob Williams

Again, voter turnout was less than desired with only about a third of eligible Association members voting (i.e., 1047 total). Also, the second year in a row wherein incumbents did not prevail. Perhaps indicating that Association members are not happy with the current state of affairs. Whatever the case, we all need to thank Mr. Fitzgerald and Mr. Retter for the efforts they have put in to serve the community.

SOA/SGCC Lawsuit Update – Installment 5

Perhaps a little history first:

    • On June 5th 2020, the Somersett Owners Association (SOA) filed a complaint against the Somersett Golf and Country Club (SGCC) regarding liabilities for Rockery Wall Failure and Water Well Pump repairs as required under the Purchase and Lease Agreements. Details of the complaint may be accessed via the following SU Post of July 22nd  –  “SOA Legal Complaint Against the SGCC
    • On July 10th, the SGCC filed an answer to the SOA claim along with their own counterclaim. Details of the SGCC response may be accessed via the following SU Post of July 23rd  –  “SGCC Response and Counterclaim to SOA Complaint
    • On July 31st, the SOA filed its legal response to the SGCC counterclaim in which they sought an order to dismiss the counterclaim and for the Court to require the SGCC to provide more definite statements regarding their stated causes of action against the SOA. Details of the SOA filing may be accessed via following SU Post of August 5th  –  “SOA Response to SGCC Counterclaim
    • On August 7th, The SGCC filed its opposition to the SOA motion to Dismiss and to the provision of more definitive statements regarding the causes of actions in their counterclaim. Details of the SGCC filing may be accessed via the following SU Post of August 16th  –  “And the Saga Continues – 4th Installment

Which brings us today. On November 11th, the Court denied the SOA’s motion to dismiss the SGCC Counterclaim but upheld the SOA’s position that the SGCC did not adequately plead their case and therefore granted the SOA motion for the SGCC to provide more definitive statements regarding their counterclaim. The SGCC has until November 20th to file an amended Answer and Counterclaim, after which the SOA has 21 days to respond.

The Court ruling in its entirety (which provides a good historical overview) may be accessed via the following link:

Order Denying Motion to Dismiss, Order Granting Motion for a More Definite Statement

So what does 2021 have in store with regard to this litigation? Obviously more legal fees, or can a negotiated settlement be reached between the parties? At last notice, the SOA proposed splitting the contested amount which would result in $264K from the SGCC. The best offer from the SGCC being $30K over time, quite a difference, unless something has transpired that we are not aware of.

Have You Voted Yet?

If you have not yet submitted your ballot for the Somersett Owners Association (SOA) Board of Director elections, you have only five days remaining to do so. All ballots must be received no later than 1:00 PM on Monday November 16th at The Club at Town Center (TCTC).  Rather than relying on US mail delivery at this time, a ballot box is located at TCTC for drop off. Be sure to follow the instructions for use of the provided yellow “Ballot” and white “Somersett Owners Association” envelopes.

Ballots will be counted and results announced at the November 16th Annual Owners Meeting at TCTC starting at 4:00 PM, which will have only two agenda items: 1) Ballot counting and election results and 2) Ratification of the 2021 Budget, which is basically automatic given it would take a vote of 75% of owners present or with proxies to reject it.

At last notice the Association was still looking for volunteers to count ballots. If interested, please contact the Association office ASAP.

The 2021 Board will consist of at least one and perhaps three new members, given that there are three open positions with two incumbents (Fitzgerald and Retter) and three new owners (Capalongan, O’Donnell and Williams) vying for the three positions.. SU sees two major challenges facing the new Board in 2021: 1) effective management of Contracting and Professional Consulting Services, and 2) litigation carryover on the Rockery Wall, Country Club and Preston Home lawsuits.