The NFS version 3 protocol is designed to allow servers to be as simple and general as possible. Sometimes the simplicity of the server can be a problem, if the client implements complicated file system semantics.
For example, some operating systems allow removal of open files. A process can open a file and, while it is open, remove it from the directory. The file can be read and written as long as the process keeps it open, even though the file has no name in the file system. It is impossible for a stateless server to implement these semantics. The client can do some tricks such as renaming the file on remove (to a hidden name), and only physically deleting it on close. The NFS version 3 protocol provides sufficient functionality to implement most file system semantics on a client.
Every NFS version 3 protocol client can also potentially be a server, and remote and local mounted file systems can be freely mixed. This leads to some problems when a client travels down the directory tree of a remote file system and reaches the mount point on the server for another remote file system. Allowing the server to follow the second remote mount would require loop detection, server lookup, and user revalidation. Instead, both NFS version 2 protocol and NFS version 3 protocol implementations do not typically let clients cross a server's mount point. When a client does a LOOKUP on a directory on which the server has mounted a file system, the client sees the underlying directory instead of the mounted directory.
For example, if a server has a file system called /usr and mounts another file system on /usr/src, if a client mounts /usr, it does not see the mounted version of /usr/src. A client could do remote mounts that match the server's mount points to maintain the server's view. In this example, the client would also have to mount /usr/src in addition to /usr, even if they are from the same server.