Before Chief Justice Pickering and Justices Hardesty and Saitta. Opinion by Justice Hardesty.
In this appeal from a 12(b)(5) motion to dismiss, the Court addressed the validity of a contractual provision shortening the statute of limitations to make claims for construction defects. In particular, the Court examined the requirements of NRS 116.4116, which allows parties to agree to shorten the limitations period from six years to no less than two years for breach of warranty claims involving residential common-interest communities, so long as the parties’ agreement is memorialized in a “separate instrument.” The Court joined numerous other jurisdictions in holding that in general, parties may agree to shorten a statutory limitations period, so long as that agreement does not contradict any other statute, and so long as the agreed-upon period is reasonable and does not violate public policy. A limitations period will be considered unreasonable if it “effectively deprives a party of the reasonable opportunity to vindicate his or her rights.” The Court concluded, however, that the district court erred in finding that the arbitration agreement at issue in this case was a “separate instrument” under NRS 116.4116, since the agreement expressly stated that it was part of the purchase contract, and the purchase contract also expressly stated that the arbitration agreement was incorporated into the contract. Finally, the Court held that the district court erred when it dismissed Appellant’s negligence claims as time-barred, since NRS 116.4116 pertains only to breach of warranty claims. Reversed and remanded. (Jeff S. Riesenmy, Associate in the Las Vegas office of McDonald Carano Wilson).
