Nevada high court declines to dismiss Venetian liens

Wednesday, March 7, 2001 | 10:30 a.m.

CARSON CITY -- The Nevada Supreme Court dismissed the appeal of the Venetian hotel-casino on the Las Vegas Strip that claimed millions of dollars of mechanics' liens filed against the resort were frivolous.

The decision Tuesday upholds Senior District Judge James Brennan, who declined to toss out the liens in 27 cases.

More than 90 liens totaling more than $300 million were filed against the Venetian as a result of the construction of the project. The district court hearing on these liens were put on hold while the Supreme Court considered the appeal.

The Venetian had a construction management agreement with Lehrer McGovern Bovis Inc., (LMB) which was to supply the contractors, labor and materials. There were a number of agreements but disputes arose among the various contractors and subcontractors as well as between the Venetian and LMB.

LMB, according to the court, apparently refused to pay some of the contractors and subcontractors and that resulted in the numerous mechanic's liens being filed.

Brennan refused a motion to dismiss and said these were issues that should be presented at trial.

The Supreme Court said the law provides for an appeal of a district judge's ruling only if he determines the lien is frivolous, excessive or that lien is neither frivolous nor excessive. In this case, the court said Brennan's orders did not determine if the liens were frivolous or excessive so there is no right to appeal.

Meanwhile, the Senate Commerce and Labor Committee in the Nevada Legislature introduced a bill Monday to protect the rights of subcontractors. SB274 says the subcontractor must receive payment within 30 days after submitting a bill or within 10 days after the contractor has been paid, whichever is earlier.

It permits the subcontractor to stop work if the payment is not made. But the subcontractor must give at least five days notice before stopping work. And if the subcontractor terminates the contract, it may recover the amount due plus 2 percent and interest on the money due.

If a subcontractor stops work, lower-tiered subcontractors may also halt work on the project.