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LEGISLATURE OF NEBRASKA
ONE HUNDRED SIXTH LEGISLATURE
SECOND SESSION
LEGISLATIVE BILL 767
Introduced by Lindstrom, 18.
Read first time January 08, 2020
Committee: Banking, Commerce and Insurance
1 A BILL FOR AN ACT relating to real property; to amend sections 25-223,
2 76-842, 76-844, 76-854, 76-857, 76-859, 76-860, 76-867, 76-869,
3 76-870, 76-884, and 76-890, Reissue Revised Statutes of Nebraska,
4 and section 76-861, Revised Statutes Supplement, 2019; to change
5 provisions relating to actions on breach of warranty on improvements
6 to real property; to change provisions under the Nebraska
7 Condominium Act; to harmonize provisions; and to repeal the original
8 sections.
9 Be it enacted by the people of the State of Nebraska,
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1 Section 1. Section 25-223, Reissue Revised Statutes of Nebraska, is
2 amended to read:
3 25-223 Any action to recover damages based on any alleged breach of
4 warranty on improvements to real property or based on any alleged
5 deficiency in the design, planning, supervision, or observation of
6 construction, or construction of an improvement to real property shall be
7 commenced within two four years after any alleged act or omission
8 constituting such breach of warranty or deficiency. If such cause of
9 action is not discovered and could not be reasonably discovered within
10 such two-year four-year period, or within one year preceding the
11 expiration of such two-year four-year period, then the cause of action
12 may be commenced within one year two years from the date of such
13 discovery or from the date of discovery of facts which would reasonably
14 lead to such discovery, whichever is earlier. In no event may any action
15 be commenced to recover damages for an alleged breach of warranty on
16 improvements to real property or deficiency in the design, planning,
17 supervision, or observation of construction, or construction of an
18 improvement to real property more than five ten years beyond the time of
19 the act giving rise to the cause of action. If the real property is a
20 condominium subject to the Nebraska Condominium Act, any action brought
21 under this section shall also comply with section 76-890.
22 Sec. 2. Section 76-842, Reissue Revised Statutes of Nebraska, is
23 amended to read:
24 76-842 (a) The declaration for a condominium must contain:
25 (1) the name of the condominium, which must include the word
26 condominium or be followed by the words a condominium, and the name of
27 the association;
28 (2) the name of every county in which any part of the condominium is
29 situated;
30 (3) a legally sufficient description of the real estate included in
31 the condominium;
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1 (4) a statement of the anticipated number of units which the
2 declarant reserves the right to create, subject to an amendment of the
3 declaration to add more units pursuant to the Nebraska Condominium Act;
4 (5) a description of the boundaries of each unit created by the
5 declaration, including the unit's identifying number;
6 (6) a description of any limited common elements, other than those
7 specified in subdivision (b)(8) of section 76-846;
8 (7) a general description of any development rights and other
9 special declarant rights defined in subdivision subsection (23) of
10 section 76-827 reserved by the declarant;
11 (8) an allocation to each unit of the allocated interests in the
12 manner described in section 76-844;
13 (9) any restrictions on use, occupancy, and alienation of the units;
14 and
15 (10) for a condominium project with more than four units, exclusive
16 of common area, a plan prepared by a licensed engineer or architect for
17 the preventive maintenance of the condominium and all common elements
18 therein, including, but not limited to, depreciation studies and reserve
19 analyses, an annually updated five-year capital plan, and minimum
20 financial reserves based on the reserve analyses; and
21 (11) (10) all matters required by sections 76-843 to 76-846, 76-852,
22 and 76-853, and subsection (d) of section 76-861.
23 (b) Except as otherwise provided in section 76-856, the declaration
24 may contain any other matters the declarant deems appropriate.
25 Sec. 3. Section 76-844, Reissue Revised Statutes of Nebraska, is
26 amended to read:
27 76-844 (a) The declaration shall allocate a fraction or percentage
28 of undivided interests in the common elements and in the common expenses
29 of the association, and a portion of the votes in the association, to
30 each unit and state the formulas used to establish those allocations.
31 Those allocations may not discriminate in favor of units owned by the
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1 declarant.
2 (b) If units may be added to or withdrawn from the condominium, the
3 declaration must state the formulas to be used to reallocate the
4 allocated interests among all units included in the condominium after the
5 addition or withdrawal.
6 (c) The declaration may provide: (i) that different allocations of
7 votes shall be made to the units on particular matters specified in the
8 declaration; (ii) for cumulative voting only for the purpose of electing
9 members of the executive board; and (iii) for class voting on specified
10 issues affecting the class if necessary to protect valid interests of the
11 class. A declarant may not utilize cumulative or class voting for the
12 purpose of evading any limitation imposed on declarants by the Nebraska
13 Condominium Act sections 76-825 to 76-894, nor may units constitute a
14 class because they are owned by a declarant.
15 (d) Except for minor variations due to rounding, the sum of the
16 undivided interests in the common elements and common expense liabilities
17 allocated at any time to all the units must equal one if stated as
18 fractions or one hundred percent if stated as percentages. In the event
19 of discrepancy between an allocated interest and the result derived from
20 application of the pertinent formula, the allocated interest prevails.
21 (e) The common elements are not subject to partition, and any
22 purported conveyance, encumbrance, judicial sale, or other voluntary or
23 involuntary transfer of an undivided interest in the common elements made
24 without the unit to which that interest is allocated, is void.
25 Sec. 4. Section 76-854, Reissue Revised Statutes of Nebraska, is
26 amended to read:
27 76-854 (a) Except in cases of amendments that may be executed by (1)
28 a declarant under subsection (f) of section 76-846 or under section
29 76-847, (2) the association under section 76-831 or 76-850, subsection
30 (d) of section 76-843, subsection (c) of section 76-845, or subsection
31 (a) of section 76-849, or (3) certain unit owners under subsection (b) of
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1 section 76-845, subsection (a) of section 76-849, subsection (b) of
2 section 76-850, or subsection (b) of section 76-855, and except as
3 limited by subsection (d) of this section, the declaration, including the
4 plats and plans, may be amended only by vote or agreement of unit owners
5 of units to which at least sixty-seven percent of the votes in the
6 association are allocated or any larger majority the declaration
7 specifies up to eighty percent of the votes in the association. The
8 declaration may specify a smaller number only if all of the units are
9 restricted exclusively to nonresidential use.
10 (b) No action to challenge the validity of an amendment adopted by
11 the association pursuant to this section may be brought more than one
12 year after the amendment is recorded.
13 (c) Every amendment to the declaration must be recorded in every
14 county in which any portion of the condominium is located and is
15 effective only upon recordation.
16 (d) Except to the extent expressly permitted or required by other
17 provisions of the Nebraska Condominium Act, no amendment may create or
18 increase special declarant rights, increase the number of units, or
19 change the boundaries of any unit, the allocated interests of a unit, or
20 the uses to which any unit is restricted in the absence of the unanimous
21 consent of the unit owners. In addition, no amendment may change the
22 boundaries of any unit, increase the allocated interests of any unit, or
23 change the uses to which any unit is restricted, without the consent of
24 the owner of the unit.
25 (e) Amendments to the declaration required by the act to be recorded
26 by the association shall be prepared, executed, recorded, and certified
27 on behalf of the association by any officer of the association designated
28 for that purpose or, in the absence of designation, by the president of
29 the association.
30 Sec. 5. Section 76-857, Reissue Revised Statutes of Nebraska, is
31 amended to read:
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1 76-857 (a) If the declaration for a condominium provides that any of
2 the powers described in section 76-860 are to be exercised by or may be
3 delegated to a profit or nonprofit corporation, or unincorporated
4 association, which exercises those or other powers on behalf of one or
5 more condominiums or for the benefit of the unit owners of one or more
6 condominiums, all provisions of the Nebraska Condominium Act sections
7 76-825 to 76-894 applicable to unit owners associations apply to any such
8 corporation or unincorporated association, except as modified by this
9 section. However, in no case shall the declaration provide that the power
10 to institute or intervene as a plaintiff in litigation or administrative
11 proceedings, other than litigation or administrative proceedings to
12 enforce covenants, bylaws, or rules against unit owners, be delegated to
13 or exercised by any party other than the unit owners.
14 (b) Unless a master association is acting in the capacity of an
15 association described in section 76-859, it may exercise the powers set
16 forth in subdivision (a)(2) of section 76-860 only to the extent
17 expressly permitted in the declarations of condominiums which are part of
18 the master association or expressly described in the delegations of power
19 from those condominiums to the master association.
20 (c) If the declaration of any condominium provides that the
21 executive board may delegate certain powers to a master association, the
22 members of the executive board have no liability for the acts or
23 omissions of the master association with respect to those powers
24 following delegation.
25 (d) The rights and responsibilities of unit owners with respect to
26 the unit owners association set forth in sections 76-861, 76-866 to
27 76-868, and 76-870 apply in the conduct of the affairs of a master
28 association only to those persons who elect the board of a master
29 association, whether or not those persons are otherwise unit owners
30 within the meaning of the act sections 76-825 to 76-894.
31 (e) Notwithstanding the provisions of subsection (f) of section
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1 76-861 with respect to the election of the executive board of an
2 association, by all unit owners after the period of declarant control
3 ends, and even if a master association is also an association described
4 in section 76-859, the articles of incorporation or other instrument
5 creating the master association and the declaration of each condominium
6 the powers of which are assigned by the declaration or delegated to the
7 master association may provide that the executive board of the master
8 association must be elected after the period of declarant control in any
9 of the following ways:
10 (1) All unit owners of all condominiums subject to the master
11 association may elect all members of that executive board.
12 (2) All members of the executive boards of all condominiums subject
13 to the master association may elect all members of that executive board.
14 (3) All unit owners of each condominium subject to the master
15 association may elect specified members of that executive board.
16 (4) All members of the executive board of each condominium subject
17 to the master association may elect specified members of that executive
18 board.
19 Sec. 6. Section 76-859, Reissue Revised Statutes of Nebraska, is
20 amended to read:
21 76-859 A unit owners association must be organized no later than the
22 date the units first unit in the condominium equal to one-half of the
23 total number of units plus one are is conveyed. The membership of the
24 association at all times shall consist exclusively of all the unit owners
25 or, following termination of the condominium, of all former unit owners
26 entitled to distributions of proceeds under section 76-855 or their
27 heirs, successors, or assigns. The association shall be organized as a
28 profit or nonprofit corporation or as an unincorporated association.
29 Sec. 7. Section 76-860, Reissue Revised Statutes of Nebraska, is
30 amended to read:
31 76-860 (a) Except as provided in subsection (b) of this section and
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1 subject to the provisions of the declaration, the association, even if
2 unincorporated, may:
3 (1) Adopt and amend bylaws and rules and regulations;
4 (2) Adopt and amend budgets for revenue, expenditures, and reserves
5 and collect assessments for common expenses from unit owners;
6 (3) Hire and discharge managing agents and other employees, agents,
7 and independent contractors;
8 (4) Institute, defend, or intervene as a plaintiff in litigation or
9 administrative proceedings, other than litigation or administrative
10 proceedings to enforce covenants, bylaws, or rules against unit owners,
11 in its own name on behalf of itself or two or more unit owners on matters
12 affecting the condominium upon the affirmative vote of at least ninety
13 percent of the votes in the association;
14 (5) Make contracts and incur liabilities;
15 (6) Regulate the use, maintenance, repair, replacement, and
16 modification of common elements;
17 (7) Cause additional improvements to be made as a part of the common
18 elements;
19 (8) Acquire, hold, encumber, and convey in its own name any right,
20 title, or interest to real or personal property, but common elements may
21 be encumbered conveyed or subjected to a security interest only pursuant
22 to section 76-870;
23 (9) Grant easements, leases, licenses, and concessions through or
24 over the common elements;
25 (10) Impose and receive any payments, fees, or charges for the use,
26 rental, or operation of the common elements, other than limited common
27 elements described in subdivisions (2) and (4) o