Challenging Legislative Session For The UTA In Nevada

Rocky Finseth

By Rocky Finseth, Carrara Nevada, UTA Nevada Lobbyist

Nevada leads the nation in many categories -- from state government workers (we are one of the smaller in the nation) to teacher pay, and tax policy. So it should come as no surprise that the role of trustees in the foreclosure process attracted so much attention by the 76th session of the Nevada State Legislature given the state’s staggering numbers of foreclosures. Legislation on nearly every aspect of a trustee sale came under deep scrutiny this session.  As we quickly move to the conclusion of the session (June 6th is sine die), there are still a number of measures worthy of UTA members’ attention.

AB 284 - The mother of all battles this session ensued over this measure. In its original form, the bill severely restricted UTA members’ access to trustee sales in Nevada, and placed severe restrictions and penalties to those who do choose to conduct trustee sales in the state. In addition, the measure required the recordation of an assignment of all beneficial interests of a deed of trust and created a rebuttable presumption position for all trustees doing business in the state.

Sponsored by the Majority Leader of the Assembly (2nd in command) and brought forth at the behest of the Attorney General for the State, the bill was on a fast track from the outset. UTA member Michelle Mierzwa worked diligently with the Majority Leader’s office and the Attorney General’s office to secure significant improvements to the bill. Unfortunately, the changes to the bill from its original version were not enough to address all of UTA’s objections, and members subsequently engaged in a two-week campaign encouraging Governor Sandoval to veto the measure. Ultimately, the Governor choose to sign the bill into law. However, during the Governor’s five-day review period, discussions ensued about the UTA’s opposition, and new life was breathed into several of the unresolved issues that Michelle had identified from the outset. As a result, the Governor struck an agreement with the Majority Leader and the Attorney General’s office to expand the scope of who could perform trustee sales in Nevada and extended the implementation date for the measure.

We were able to amend the revised trustee requirements into another bill (AB 273), which passed and immediately transmitted to the Governor’s desk for his signature. The Governor signed AB 273 into law on June 10th. While the desired outcome was not achieved (defeat of the measure), the draconian nature of the originally introduced measure has been.

Successfully amending AB 284, (through AB 273) occurred only after intense negotiation by the UTA.  The work of Michelle Mierzwa, Esq. of Cal-Western Reconveyance and Michael Brooks, Esq. of Brooks Bauer was instrumental in conveying substantively the concerns that the Association had with AB 284.  The importance of the work in brokering an agreement among the Governor and Assembly Majority Leader Conklin by Scott Sibley of Nevada Legal News cannot be underscored enough.  Finally, the importance of relaying to the Governor that AB 284 would negatively impact jobs in Nevada – conveyed forcefully by Nevada UTA members Dianne Burnett of Meridian Trust Deed Service and Linda Frink of Phil Frink & Associates was essential in earning the Governor’s political interest.

Read AB 284 as enrolled

Read AB 273 as enrolled 

AB 300 - This measure proposes to make changes to Nevada’s Foreclosure Mediation Program. Opposed by the lending industry, MERS and the UTA, AB 300 would expand the breath and scope of the Foreclosure Mediation Program as well as making substantial changes to the mediation process. As of the writing of this article, the measure remains alive in the body.

Read AB 300

AB 388 - Also known as the energizer bunny, this bill went from bad to worse as the session progressed. As introduced, the bill had nothing to do with the UTA or its members. The bill capped collection agency fees assessed by homeowner associations. However, on the first deadline day of the session, the bill was gutted (meaning all the bills content was removed, and a new bill inserted in its place). The revised bill proposed to create a California-like loss mitigation program involving the borrower, the lender and the trustees. It placed huge responsibilities on the trustees and, as we have seen throughout this session, mixed up the role of the trustee and the lender. Again, the bill went from bad to even worse. During second deadline day of the session, the bill was again gutted, and another bill put in its place. This new version of the bill adds an additional step in Nevada’s Mediation Program to require the notice of default and election to sell mailed to the grantor (or the person who holds the title of record) to include a notice provided by the entity designated to administer the Foreclosure Mediation Program which states that the grantor (or the person who holds the title of record) has a right to seek foreclosure mediation in the Foreclosure Mediation Program. Furthermore, the bill requires additional noticing about the Mediation Program to inform the borrower about the availability of the program. This bill, along with SB 307, which contains similar provisions, is expected to be approved and signed into law by the Governor.

Read AB 388

AB 445 - A measure that would have allowed a court, which determines that a lender has acted in bad faith as part of the mediation program, to order a continuation of the mediation and would have ordered a new date and required the lender to pay for the cost of the mediation itself. This bill died.

SB 139 - this measure would have required that all assignments be recorded within 30 days, otherwise the assignment would be considered null and void. This bill died as well.

SB 311 - Somewhat similar to some of the provisions contained in AB 284 and SB 139, this bill contained a number of triggers dealing with the assignment of the deed and new recordation requirements. This bill died.

SB 77 - a bill that dealt with notaries. This measure placed certain restrictions on employers who do not carry proper oversight of their employees in the notary field. I am happy to report that many of the onerous provisions of the bill were stripped out of the measure as it progressed through the halls of the legislature. In the end, while the bill passed and serves as good public policy for notary publics in the state, the punitive actions that could be taken against unsuspecting employers are gone. This bill has passed both houses, and at the time of the writing of this article appears to be headed to conference committee to resolve some differences between the two versions of the bill.