Nevada Administrative Code Chapter 116B - Condominium Hotels
📌 Background: NAC Chapter 116B
NAC 116B establishes rules related to:
Condominium hotel associations – Formation, governance, and board responsibilities.
Membership rights and obligations – Use of units, voting rights, and compliance with rules.
Financial management – Fees, assessments, reserve funds, and audits.
Transfers, resale, and rentals of units – Procedures and restrictions on unit sales and rentals.
Dispute resolution and enforcement – Procedures for complaints, arbitration, and penalties for violations.
🧑⚖️ Case 1: Failure to Disclose Special Assessments
Situation
A buyer purchased a unit in a condominium hotel but was not informed of an upcoming special assessment for roof repairs.
Relevant NAC Rules
NAC 116B.220 requires full disclosure of all financial obligations, including assessments, before a unit is sold.
Issue
The buyer claimed they would not have purchased the unit if they had known about the assessment.
Outcome
The association required the seller to pay the undisclosed assessment, or the buyer was given the option to rescind the purchase.
NAC rules protect buyers from undisclosed financial obligations.
Lesson: Complete disclosure of assessments and fees is mandatory before transferring ownership.
🧑⚖️ Case 2: Denial of Unit Use
Situation
A member attempted to use their unit during a peak holiday period, but the management denied access, citing alleged violations of association rules.
Relevant NAC Rules
NAC 116B.180 grants members the right to reasonable use of their units, provided they comply with governing documents and association rules.
Issue
The denial was made verbally, and the member claimed they had not violated any rules.
Outcome
Association was required to issue written notice of the alleged violation and provide an opportunity to remedy it.
Access was restored once due process was followed.
Lesson: Associations must follow procedural fairness before restricting a member’s access.
🧑⚖️ Case 3: Excessive Fee Increase
Situation
The condominium hotel board increased monthly maintenance fees by 40% without member approval.
Relevant NAC Rules
NAC 116B.240 requires notice and, in certain cases, member approval for significant fee changes.
Issue
Members argued the increase violated NAC rules because it lacked proper notice and approval.
Outcome
The board rolled back the increase until a membership vote was held, ratifying the adjustment in compliance with NAC.
A procedure was established for future fee changes.
Lesson: Fee changes must follow proper governance procedures with adequate member notification.
🧑⚖️ Case 4: Improper Resale of Units
Situation
A member attempted to resell their condominium unit, but the board denied the transfer without explanation.
Relevant NAC Rules
NAC 116B.250 specifies conditions for resale and transfer, including approval procedures and criteria for buyers.
Issue
The selling member claimed the board’s denial was arbitrary.
Outcome
The board was required to provide written reasons for the denial.
The resale was approved once the buyer met association criteria.
Lesson: Resale of units must comply with established criteria, and decisions must be transparent.
🧑⚖️ Case 5: Failure to Maintain Common Areas
Situation
Members complained that the pool, fitness center, and lobby were poorly maintained, affecting their enjoyment of the property.
Relevant NAC Rules
NAC 116B.200 and 116B.210 require boards to maintain common areas and amenities in a safe and usable condition.
Issue
The lack of maintenance constituted a breach of the association’s management responsibilities.
Outcome
The board implemented a maintenance schedule and conducted repairs.
Members could file complaints under NAC 116B procedures if obligations were not met.
Lesson: Boards are responsible for maintaining shared facilities, and failure to do so can trigger complaints or enforcement action.
🧑⚖️ Case 6: Dispute Over Use of Rental Units
Situation
A member wanted to rent their unit through a third-party platform, but the board had rules limiting rentals to the association’s approved program.
Relevant NAC Rules
NAC 116B.260 governs rental policies and restrictions, including conditions under which members can rent units.
Issue
The member claimed the restrictions were unfair.
Outcome
The board provided written justification for rental restrictions and outlined procedures for approval of exceptions.
NAC requires that rental policies be applied consistently and fairly.
Lesson: Rental policies must be clear, fair, and consistently enforced, with written explanations for any denials.
🔑 Key Themes from NAC Chapter 116B
Transparency in Financial Obligations – Full disclosure of fees and assessments protects buyers.
Member Rights and Due Process – Access to units, participation in decisions, and procedural fairness are mandatory.
Proper Fee Governance – Fee changes require notice, approval, and adherence to governance procedures.
Fair Resale and Transfer Procedures – Resale of units must follow established criteria with transparent explanations for denials.
Maintenance of Common Areas – Boards must maintain facilities and respond to member complaints.
Rental Policy Compliance – Rental restrictions must be clear, consistent, and documented.
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