Nev. Admin. Code § 624.69575

Current through December 12, 2024

Section 624.69575 - Bond or deposit for protection of consumers

1. An applicant for the issuance or renewal of a license to perform work concerning a residential pool or spa who is required to provide a bond or cash deposit solely for the protection of consumers pursuant to NRS 624.276 shall submit with his or her application an affidavit that sets forth:

(a) The aggregate value of all contracts for work concerning a residential pool or spa that the applicant entered into during the 12 months immediately preceding the date of his or her application;

(b) The aggregate value of all contracts for work concerning a residential pool or spa that the applicant expects to enter into during the 12 months immediately following the date of the application;

(c) The average dollar value of all contracts for work concerning a residential pool or spa that the applicant entered into during the 12 months immediately preceding the date of the application; and

(d) The number of contracts for work concerning a residential pool or spa that are pending on the date of the application.

2. In fixing the amount of an applicant's bond or cash deposit, the Board will consider the applicant's financial and professional responsibility and the magnitude of his or her operations, but ordinarily the Board will base the amount of the bond or deposit on the greater of the aggregate value of all contracts for work concerning a residential pool or spa that the applicant entered into during the 12 months immediately preceding the date of his or her application or the aggregate value of all contracts for work concerning a residential pool or spa that the applicant expects to enter into during the 12 months immediately following the date of his or her application and fix the amount of the bond or deposit as follows:

Aggregate value	Amount of
of contracts	bond or deposit
$25,000 or less................................................................................................	$10,000
25,001 to 50,000.............................................................................................	15,000
50,001 to 100,000...........................................................................................	30,000
100,001 to 250,000.........................................................................................	50,000
250,001 to 500,000.........................................................................................	100,000
500,001 to 1,000,000......................................................................................	200,000
1,000,001 to 5,000,000...................................................................................	300,000
more than 5,000,000.......................................................................................	400,000

3. The Board will notify an applicant who is required to provide a bond or cash deposit of the amount the Board has fixed.

4. An applicant who disagrees with the amount of the bond or deposit fixed by the Board may petition the Board to reconsider the amount. The petition must:

(a) Be addressed to the Executive Officer of the Board and filed with the Board within 10 days after the applicant receives notification of the amount;

(b) Set forth specific reasons why the amount fixed by the Board should be modified; and

(c) Include all documentary evidence in support of the petition that the applicant wishes the Board to consider.

Within 30 days after receiving a timely filed petition, the Board or its designee will fully consider the issues raised in the petition, fix the amount of the bond or deposit and notify the applicant of the amount. The amount of the bond or deposit fixed after reconsideration may be less than, greater than or the same as the amount originally fixed.

5. The Board will provide a blank form of a bond to each applicant required to provide such a bond. The bond will be in substantially the following form:

RESIDENTIAL POOL AND SPA LICENSE BOND FOR THE PROTECTION OF CONSUMERS

License Bond No.: ........................................

KNOW ALL PERSONS BY THESE PRESENTS:

That ....................................................................., having a principal place of business in the city of ......................................., in the State of .............., as principal (hereinafter "Principal"), and .............................................................................................., a corporation licensed to execute surety bonds under the provisions of the Nevada Insurance Code, and whose long-term obligations are rated "A" or better by a nationally recognized rating agency, as surety (hereinafter "Surety"), are held and firmly bound to the State of Nevada in the full and just sum of ...................................................... Dollars ($ .......................................) for which payment well and truly to be made, the Principal and Surety bind themselves, their respective heirs, executors, administrators, successors and assigns, jointly and severally, firmly by these presents.

THE CONDITIONS OF THIS OBLIGATION ARE SUCH THAT:

Whereas, the principal has applied for or holds a contractor's license with the Nevada State Contractors' Board pursuant to Chapter 624 of Nevada Revised Statutes to perform work concerning residential pools and spas.

NOW, THEREFORE, this bond is made in favor of the State of Nevada solely for the benefit of a consumer who entered into a contract with a contractor to perform work concerning a residential pool or spa and:

(a) Is damaged by the failure of the contractor to perform the contract or to remove liens filed against the property; or

(b) Is injured by any unlawful act or omission of the contractor in the performance of a contract.

If an action is commenced on this bond, the Surety shall notify the Board of the action within thirty (30) days after:

(a) being served with a complaint and summons; or

(b) the action is commenced, whichever occurs first. The total aggregate liability of the Surety for all claims shall be limited to the face amount of the bond, irrespective of the number of years the bond is in force or the number of claims filed. The Surety shall have the right to terminate its suretyship under this obligation by serving written notice of its election so to do upon the State Contractors' Board, at its office in Reno, Nevada, by certified mail at least sixty (60) days prior to the date of termination of suretyship. Thereafter, the Surety shall be discharged from liability hereunder for any default of the Principal occurring after the date of termination. The liability of the Surety shall be confined to acts, omissions or defaults of the Principal occurring subsequent to the effective date hereof.

NO ACTION MAY BE COMMENCED on this bond after the expiration of two (2) years following the commission of the act upon which the action is based.

IN THE EVENT the Surety shall make any payments hereunder, without awaiting Court action, the bond amount shall be reduced to the extent of any payment made by the Surety in good faith under the bond, provided the Surety shall notify the Board, in writing, within ten (10) days of any payments made hereunder.

IN WITNESS WHEREOF, the Principal and said Surety have executed this instrument on the .................... day of ..................................., ............., to be effective on the .................... day of ...................................., .............

By: ..................................................................

By:................................................................

(SIGNATURE OF NEVADA AGENT) (SIGNATURE OF PRINCIPAL)

Agent License No.: .......................

Address: ......................................................... Surety:..........................................................

......................................................................... ......................................................................

(SIGNATURE OF ATTORNEY-IN-FACT)

POWER OF ATTORNEY MUST BE ATTACHED

6. An applicant required to provide a bond or cash deposit must file the properly executed bond on the form provided by the Board or establish the deposit within 30 days after receiving the original or reconsidered notification from the Board of the amount of the bond or deposit required.

Nev. Admin. Code § 624.69575

Added to NAC by Contractors' Bd. by R094-05, eff. 12-29-2005

NRS 624.100, 624.276