Jacobs Engr. Group v. ConAgra Foods , 301 Neb. 38 ( 2018 )

Nebraska Supreme Court Online Library
www.nebraska.gov/apps-courts-epub/
09/28/2018 08:13 AM CDT
- 38 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38Jacobs Engineering Group Inc., appellee,
v. ConAgra Foods, I nc., appellant.
___ N.W.2d ___
Filed September 14, 2018. No. S-16-896.
1. Actions: Parties: Standing. Whether a party who commences an action
has standing and is therefore the real party in interest presents a jurisdic-
tional issue.
2. Judgments: Jurisdiction: Appeal and Error. When a jurisdictional
question does not involve a factual dispute, determination of a juris-
dictional issue is a matter of law which requires an appellate court to
reach a conclusion independent from the trial court’s; however, when
a determination rests on factual findings, a trial court’s decision on the
issue will be upheld unless the factual findings concerning jurisdiction
are clearly incorrect.
3. Directed Verdict: Appeal and Error. In reviewing a trial court’s rul-
ing on a motion for directed verdict, an appellate court must treat the
motion as an admission of the truth of all competent evidence submit-
ted on behalf of the party against whom the motion is directed; such
being the case, the party against whom the motion is directed is entitled
to have every controverted fact resolved in its favor and to have the
benefit of every inference which can reasonably be deduced from
the evidence.
4. Directed Verdict: Evidence. A directed verdict is proper at the close of
all the evidence only when reasonable minds cannot differ and can draw
but one conclusion from the evidence, that is, when an issue should be
decided as a matter of law.
5. Judgments: Appeal and Error. An appellate court reviews a denial of
a motion to alter or amend the judgment for an abuse of discretion.
6. Motions for New Trial: Appeal and Error. An appellate court reviews
a trial court’s ruling on a motion for a new trial for an abuse of
discretion.
7. Contracts. Contract interpretation presents a question of law.
- 39 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 388. Jury Instructions. Whether the jury instructions given by a trial court
are correct is a question of law.
9. Judgments: Appeal and Error. An appellate court independently
reviews questions of law decided by a lower court.
10. Verdicts: Appeal and Error. When reviewing a jury verdict, the appel-
late court considers the evidence and resolves evidentiary conflicts in
favor of the successful party.
11. Verdicts: Juries: Appeal and Error. A jury verdict may not be set
aside unless clearly wrong, and it is sufficient if there is competent
evidence presented to the jury upon which it could find for the success-
ful party.
12. Actions: Parties: Standing. The focus of the real party in interest
inquiry is whether the party has standing to sue due to some real interest
in the cause of action, or a legal or equitable right, title, or interest in the
subject matter of controversy.
13. Standing: Jurisdiction: Parties. Standing refers to whether a party
had, at the commencement of the litigation, a personal stake in the out-
come of the litigation that would warrant a court’s or tribunal’s exercis-
ing its jurisdiction and remedial powers on the party’s behalf.
14. Actions: Parties: Jurisdiction: Standing. The question of whether a
party who commences an action has standing and is therefore the real
party in interest is jurisdictional. Because the requirement of standing
is fundamental to a court’s exercise of jurisdiction, either a litigant or a
court can raise the question of standing at any time.
15. Standing. The stage of the litigation in which a party claims that its
opponent lacks standing affects how a court should dispose of the claim.
16. Standing: Pleadings: Pretrial Procedure. In resolving a facial chal-
lenge, a court will review the pleadings to determine whether there are
sufficient allegations to establish the plaintiff’s standing.
17. Motions to Dismiss: Jurisdiction: Pleadings: Appeal and Error. An
appellate court reviews a trial court’s decision on a motion to dismiss for
lack of subject matter jurisdiction based on a facial attack on the plead-
ings de novo.
18. ____: ____: ____: ____. Where the trial court’s decision on a motion
to dismiss for lack of subject matter jurisdiction is based on a factual
challenge, the court’s factual findings are reviewed under the clearly
erroneous standard.
19. Insurance: Contracts: Words and Phrases. An indemnity contract is
a chose in action because it confers a right to bring a legal action to
recover a sum of money from or out of the contract.
20. Liability: Damages. Indemnification is available when one party is
compelled to pay money which in justice another ought to pay or has
agreed to pay.
- 40 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 3821. Pleadings: Evidence: Words and Phrases. A judicial admission is a
formal act done in the course of judicial proceedings which is a substi-
tute for evidence, thereby waiving or dispensing with the production of
evidence by conceding for the purpose of litigation that the proposition
of fact alleged by the opponent is true.
22. Jurisdiction. While parties cannot confer subject matter jurisdiction
upon a judicial tribunal by either acquiescence or consent, nor may sub-
ject matter jurisdiction created by waiver, estoppel, consent, or conduct
of the parties, such does not prevent a party from conclusively admitting
the truth of an underlying fact required to establish subject matter juris-
diction by judicial admission.
23. Pretrial Procedure: Pleadings. A general denial is not effective where
an answer contains specific admissions of facts alleged.
24. Actions: Parties: Intent. The primary purpose of the real party in inter-
est requirement is to protect the defendant from the risk of multiple
litigation.
25. Insurance: Damages. Under the collateral source rule, the fact that the
party seeking recovery has been wholly or partially indemnified for a
loss by insurance or otherwise cannot be set up by the wrongdoer in
mitigation of damages.
26. Circumstantial Evidence: Proof. Circumstantial evidence is not inher-
ently less probative than direct evidence, and a fact proved by circum-
stantial evidence is nonetheless a proven fact.
27. Evidence: Proof. A finder of fact may draw reasonable inferences from
the facts and circumstances proved.
28. Contracts: Words and Phrases. An indemnity agreement is a contract
to be construed according to the principles generally applied in con-
struction or interpretation of other contracts.
29. Contracts. A contract must receive a reasonable construction and must
be construed as a whole, and if possible, effect must be given to every
part of the contract.
30. Workers’ Compensation: Liability: Contracts. When an employer,
liable to an employee under the Nebraska Workers’ Compensation Act,
agrees to indemnify a third party for a loss sustained as the result of
the third party’s payment to the indemnitor’s employee, the employ-
er’s exclusion from liability accorded by the act does not preclude
the third party’s action to enforce the indemnity agreement with the
indemnitor-employer.
31. Jury Instructions: Pleadings: Evidence. A litigant is entitled to have
the jury instructed upon only those theories of the case which are pre-
sented by the pleadings and which are supported by competent evidence.
32. Jury Instructions: Appeal and Error. If the instructions given, which
are taken as a whole, correctly state the law, are not misleading, and
- 41 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38adequately cover the issues submissible to a jury, there is no prejudicial
error concerning the instructions and necessitating a reversal.
33. Verdicts: Appeal and Error. Where a party has sustained the burden
and expense of trial and has succeeded in securing a verdict on the facts
in issue, that party has the right to keep the benefit of the verdict unless
there is prejudicial error in the proceedings by which it was secured.
34. Negligence. A party is only answerable for the natural, probable, rea-
sonable, and proximate consequences of his acts; and where some new
efficient cause intervenes, not set in motion by him, and not connected
with but independent of his acts and not flowing therefrom, and not rea-
sonably in the nature of things to be contemplated or foreseen by him,
and produced the injury, it is the dominant cause.
35. ____. Because the extent of foreseeable risk depends on the specific
facts of the case, courts should leave such determinations to the trier of
fact unless no reasonable person could differ on the matter.
36. Verdicts: Appeal and Error. A civil verdict will not be set aside where
evidence is in conflict or where reasonable minds may reach different
conclusions or inferences, as it is within the jury’s province to decide
issues of fact.
37. Negligence: Liability. Where separate and independent acts of neg-
ligence by different persons combine to produce a single injury, each
participant is liable for the damage, although one of them alone could
not have caused the result.
38. Damages: Appeal and Error. The amount of damages to be awarded
is a determination solely for the fact finder, and the fact finder’s deci-
sion will not be disturbed on appeal if it is supported by the evidence
and bears a reasonable relationship to the elements of the damages
proved.
39. Verdicts: Remittitur. Where a verdict is excessive, but not so much as
to indicate passion or prejudice on the part of the jury, the error may be
corrected by remittitur, if the excess can be estimated with reasonable
certainty.
40. Remittitur: Appeal and Error. An appellate court should order remit-
titur only when the award is contrary to all reason.
Appeal from the District Court for Douglas County: Gary B.
R andall, Judge. Affirmed.
Christopher Landau, P.C., of Kirkland & Ellis, L.L.P.,
William F. Hargens and Lauren R. Goodman, of McGrath,
North, Mullin & Kratz, P.C., L.L.O., and on brief, Jeremy M.
Feigenbaum, for appellant.
- 42 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38Stephen B. Kinnaird and Sarah G. Besnoff, of Paul Hastings,
L.L.P., Gilbert S. Keteltas, Robert G. Abrams, and Thomas
E. Hogan, of Baker Hostetler, L.L.P., and Shawn D. Renner
and Andre R. Barry, of Cline, Williams, Wright, Johnson &
Oldfather, L.L.P., for appellee.
Heavican, C.J., Miller-Lerman, Cassel, Stacy, K elch, and
Funke, JJ.
Funke, J.
This case arises out of an explosion at a ConAgra Foods,
Inc. (ConAgra), plant in Garner, North Carolina, which killed
3 ConAgra employees and injured more than 60 others. When
dozens of employees sued Jacobs Engineering Group Inc.
(Jacobs), Jacobs sought contractual indemnification from
ConAgra, but ConAgra declined, and Jacobs defended against
and settled the claims.
Jacobs sued ConAgra for indemnification in the district
court for Douglas County. Following a 4-week trial, the jury
awarded Jacobs the full amount of the settlement payments,
$108.9 million, and the court entered judgment on the verdict.
We affirm.
I. BACKGROUND
1. Contract Between
Jacobs and ConAgra
ConAgra, a food manufacturer, contracted with Jacobs, an
engineering firm, in 2007 to provide engineering services.
Jacobs’ work under the contract was limited to work requested
and approved by ConAgra in work orders. Section 10 of the
parties’ engineering agreement contained mutual indemnifi-
cation provisions which provided that each party indemnify
the other for “claims, losses, costs, penalties, damages and/
or expenses” to the extent caused by the indemnifying party’s
negligence or the negligence of others under that party’s con-
trol. Section 10 provided the following relevant indemnifica-
tion provisions:
- 43 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 3810.1 [Jacobs] shall indemnify . . . ConAgra . . .
against each and every claim, loss, cost, penalty, damage,
or expense . . . suffered or incurred by any third par-
ties, employees of ConAgra and employees of [Jacobs].
[Jacobs’] obligations hereunder shall be limited to the
extent caused by the negligent acts, errors or omissions
of [Jacobs], or anyone directly or indirectly employed
by [Jacobs] or for whose acts [Jacobs] is otherwise
liable. . . .
10.2 [Jacobs’] liability, however arising by reason of
the performance of the services, is specifically limited as
provided herein and ConAgra will indemnify and release
[Jacobs] against all other claims, losses, costs, penalties,
damages and/or expenses to the extent caused by the neg-
ligence of ConAgra and/or others under its control[.]
In 2008, ConAgra planned to update the Garner plant’s
water heating system. ConAgra rejected Jacobs’ proposal for
the project as too expensive, but retained Jacobs to provide
limited management and engineering support. Jacobs desig-
nated an onsite project manager, Donald Pottner, to assist with
the project.
2. Energy Systems A nalysts and
ConAgra’s Safety Policies
ConAgra hired Energy Systems Analysts (ESA), a high-
efficiency water heater contractor, to design and install a
5-million Btu gas-fired water heater. ConAgra had previously
engaged ESA to supply gas heat systems to plants in Iowa,
Ohio, Pennsylvania, and Tennessee, and ConAgra had not
experienced any safety issues with ESA.
ConAgra contractually imposed safety requirements on
ESA’s work on the project. The contract required ESA to
“abide by safety . . . rules at all times while on company prop-
erty.” ConAgra personnel were required to bring “[a]pparent
violations” of the “Contractor Work Rules” “or unacceptable
industry work practices . . . to the attention of the contractor’s
representative for prompt correction.”
- 44 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38The contractor work rules required “practices differing from
[ConAgra] policy . . . to be reviewed by [ConAgra] before
the implementation.” The work rules placed responsibility for
correction of “unacceptable conditions” on the “‘controlling
employer,’ that is, the one in the best position to correct the
situation or ensure its correction.” ConAgra’s management was
required to report “[a]ny safety discrepancy observed . . . to
the appropriate Contractor representative for immediate correc-
tion” and to suspend work “immediately” in the case of danger
until “safety concern(s) have been corrected, to the satisfaction
of the Company.”
The contractor work rules made ConAgra responsible for
ensuring that ESA prepared a “Safe Plan of Action” (SPA)
for its commissioning of the water heater to identify risks
and outline each step of the process in order to complete the
work safely. ConAgra also had a “Fire Prevention Plan” which
required “special care and handling” requirements for flamma-
ble gases that “pose a risk of catastrophic explosion if ignited.”
The fire prevention plan applied to all ConAgra facilities and
set “procedures for controlling the hazards,” required identifi-
cation of “potential ignition sources,” and only permitted the
use or handling of natural gas “where vapors are prevented
from reaching ignition sources.”
3. Garner Plant Water
Heater Project
ConAgra employee, Timothy Yost, was the engineering
manager and supervisor at the Garner plant. ConAgra desig-
nated Yost as the individual responsible for the safety of all
plant employees during the commissioning of the water heater.
Yost was responsible for ensuring that ESA’s plans com-
plied with ConAgra standards and the contractor work rules.
ConAgra’s utility maintenance supervisor, John Puff, led the
Garner plant’s utilities department and was responsible for its
natural gas facilities.
ESA staff testified about the amount of control ConAgra
exercised over the installation of the water heater. ESA’s
- 45 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38corporate designee testified that ConAgra had the final say on
the project and controlled the schedule. He stated that Yost and
Puff “were the decision-makers when it came to anything, even
. . . when we were on site. If there was something that they
didn’t like, we’d obviously have to change it.” He admitted
that ConAgra did not provide directions of how the gas deliv-
ery system should be assembled.
On June 3, 2009, ESA provided its written plan for com-
missioning the water heater, which Yost and Puff reviewed
and found acceptable. On June 4, Pottner left the plant on a
planned medical leave and was not expected to return, and he
ultimately was not present during the commissioning of the
water heater. ConAgra confirmed its personnel would supervise
the commissioning and that Jacobs’ services were not needed.
Puff was responsible for determining the procedure to con-
nect the new equipment to the plant’s gas supply referred to
as the “line-break” procedure. The written procedure required
opening valves to purge gaslines at both the boiler and the
hot water tank. The purpose of the purge was to remove any
remaining mixture of air and natural gas in the line prior to fir-
ing the hot water heater. ConAgra identified explosion as a risk
and specified completion of the line-break procedure as the
method to control that risk.
On June 4, 2009, as part of the line-break procedure, Puff
instructed the crew to purge the line to the boiler with a hose
leading outside, but he failed to provide the instruction to
purge the line to the hot water tank. Puff stated that “[w]e just
didn’t get to it.” Yost admitted the line to the hot water tank
should have been purged before startup to prevent an explo-
sive mixture.
On June 5, 2009, at the direction of Yost, a ConAgra senior
safety specialist inspected the pumproom where the new water
heater was located. The report documented “[e]xposed wires”
as possible ignition source hazards.
Curt Poppe, an ESA employee, was assigned to commis-
sion the water heater. On June 9, 2009, Poppe arrived at the
- 46 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38Garner plant and met with Yost to discuss the commission
plan. Poppe’s commissioning plan did not include purging air
from the lines, and Puff did not provide the line-break proce-
dure to Poppe. Yost and Puff did not train Poppe in ConAgra’s
contractor work rules or ensure that Poppe was certified as
trained. In addition, no SPA was prepared for the project.
ConAgra admitted that had an SPA been implemented, the
explosion may have been prevented.
ConAgra’s policy and practice included supervising the
work of contractors, and the utilities department did not allow
contractors to work on utilities unsupervised. Puff assigned a
ConAgra employee, Ethner “Buddy” Roberson, to supervise
Poppe during commissioning. Roberson worked with Poppe
throughout the morning and, with Puff’s knowledge, brought
unrated temporary lighting into the room. Roberson had not
reviewed the fire prevention plan, was not aware that combus-
tibles should not be released into a room with ignition sources,
and did not know whether the lighting he strung in the pump-
room was safe for a flammable atmosphere.
When Poppe began the commission process, he had diffi-
culty lighting the water heater. Over the next 31⁄2 hours, Poppe
repeatedly cracked the valve on the 3⁄8  -inch pilotline and placed
a gas meter in front of the line as he released small streams of
gas into the room. Poppe said he was “‘bleeding the line.’” He
attempted to light the water heater 32 times.
Multiple ConAgra employees, including management, wit-
nessed Poppe release gas into the room and were concerned
about the presence of gas. A ConAgra utilities department
employee smelled “[t]oo much gas” in the room and felt he
was “in danger.” He reported Poppe’s unusual actions to Puff,
who reported them to Yost.
Yost, and later Puff, went into the room and smelled gas.
Puff admitted he did not tell Poppe that the line had not been
purged, even after Puff realized Poppe was struggling to light
the heater.
Puff was trained to purge lines outside; he had purged one of
the lines outside on June 4, 2009. Puff “started smelling a lot
- 47 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38of gas” and thought “pure gas” was coming through the line.
Puff was concerned that Poppe was not using the correct meter
to measure the presence of gas or was using the meter improp-
erly. A ConAgra witness admitted that under the contractor
work rules, if the gas meter malfunctioned, then the commis-
sion should have been stopped.
There was evidence that Puff could have ordered an evac-
uation, but failed to do so. As the only designated plant
emergency coordinator working that day, Puff controlled the
decision to evacuate. An emergency evacuation plan stated
that evacuation may be necessary in the face of “[i]mmedi-
ate or potential fire hazards” and could be completed within
3 minutes.
Puff interrupted the commission process so that he and
Poppe could walk outside to allow Poppe to calibrate the gas
meter in fresh air. Puff then left the plant to pick up supplies
for another project. Puff left Poppe with Roberson even though
Puff testified that he did not believe Roberson was qualified
to supervise clearing air from a gasline. Roberson thought
something was wrong and went to the roof to try to locate an
alternate purge point.
Poppe returned to the pumproom and released gas by open-
ing the cap on the 2-inch gas pipe. The room flooded with gas
in less than 60 seconds. Puff admitted he “‘should have stayed
around a lot longer’” and had given the contractor “‘more
credit’” than he should have. When asked about Poppe’s open-
ing the cap on the gas pipe, Puff testified that if he had stayed,
he “wouldn’t have allowed that.”
The pumproom exploded. Two sections of the plant’s roof
collapsed, killing three ConAgra employees and inflicting seri-
ous injuries on others.
4. Explosion Investigation
and Litigation
The North Carolina Department of Labor conducted an
investigation into the explosion and found multiple viola-
tions of North Carolina code. The department determined that
- 48 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38ConAgra violated its duty to furnish conditions of employment
“free from recognized hazards that were causing or likely to
cause death or serious physical harm.” The department found
multiple life-threatening conditions occurred in the presence of
ConAgra management, including ConAgra’s failure to purge
the 3-inch natural gasline used to supply gas to the vacuum
pumproom and allowing the presence of numerous possible
ignition sources while a natural gasline was being purged in an
enclosed room.
In contrast, the North Carolina Department of Labor found
Jacobs performed no work that could have contributed to the
accident, did not have knowledge of the hazardous condition,
and did not have a scope of work that would have permitted
knowledge of the hazardous condition. ConAgra “accepted
what the authorities determined” and did not conduct a sepa-
rate investigation.
Thereafter, 67 individuals and ConAgra’s property insur-
ers filed several lawsuits against Jacobs and Pottner; the total
settlement demands exceeded $507 million. Shortly after the
first suit was filed, Jacobs requested contractual indemnity
from ConAgra and ConAgra denied that request and did not
participate in the settlements.
A suit brought by seven ConAgra employees was the only
case to go to trial. That case proceeded to trial in March 2012
before the Johnston County Civil Superior Court of North
Carolina, case No. 09-CV-2330 (referred to as “Brockington”).
Before trial, ConAgra’s counsel wrote to Jacobs:
Based upon our understanding of the evidence in this
case, and the fact that the plaintiffs’ claim for punitive
damages has survived Jacobs’ motion for summary judg-
ment, we believe there is a possibility of a significant jury
verdict against Jacobs. As such, ConAgra requests that
Jacobs take all reasonable steps to settle these claims.
ConAgra stated that “settlement of plaintiffs’ claims by Jacobs
would be without prejudice as to any possible indemnity claim
that Jacobs’ [sic] may have as to ConAgra . . . .”
- 49 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38During the Brockington trial, Pottner became ill partway
through his testimony, was briefly hospitalized, and returned
home to Wisconsin. The court initially declared Pottner
unavailable, but later found that Pottner’s counsel, who also
represented Jacobs, misrepresented the nature or severity of
Pottner’s illness. The court struck the defendants’ answers and
confined the jury’s deliberations to the issue of damages. The
jury awarded the Brockington plaintiffs $14.6 million.
The trial court later reinstated Jacobs’ answer and granted
Jacobs a new trial. Before the second trial, Jacobs settled the
suit for $20 million. Jacobs then settled the remaining cases
and continued to request indemnification from ConAgra, which
ConAgra declined.
Jacobs brought this action against ConAgra in January 2014.
Jacobs claimed that it was entitled to the $108.9 million paid
to settle the North Carolina cases. Jacobs requested only
$17.7 million for the Brockington settlement, which repre-
sented the amount of the first verdict plus interest since the
time of filing.
Prior to trial, ConAgra filed motions to compel Jacobs
to provide the amounts paid by Jacobs and Jacobs’ insurers
toward the settlements. The court overruled ConAgra’s various
motions and found ConAgra’s arguments were not relevant to
the “two substantive issues in this case,” which it determined
were as follows: “(1) whether the [e]xplosion was caused by
the alleged negligence of ConAgra and/or others under its
control in order to trigger the indemnity provision; and (2)
whether the amount of the settlement payments were objec-
tively reasonable.”
During the 19-day trial in March 2016, the jury received
over 300 exhibits and heard testimony from eight live wit-
nesses and 40 videotaped depositions. The jury returned a
special verdict which (1) found that both ConAgra and ESA
were negligent, (2) apportioned liability of 70 percent to
ConAgra and 30 percent to ESA, and (3) found that ConAgra
controlled ESA. The jury further found that Jacobs was not
- 50 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38negligent, that Jacobs had settled the North Carolina lawsuits
in good faith, and that the settlement amounts were objec-
tively reasonable. The district court accepted the jury’s verdict.
ConAgra renewed its motion for directed verdict and moved
for judgment notwithstanding the verdict, remittitur, and a new
trial. The court denied the motions, ConAgra timely appealed,
and we sustained ConAgra’s request to bypass review by the
Nebraska Court of Appeals.
II. ASSIGNMENTS OF ERROR
ConAgra assigns, restated, that the district court erred in
failing to (1) grant ConAgra’s motion for directed verdict or
motion for new trial, because Jacobs failed to prove that it had
standing as the real party in interest to assert its indemnification
claim; (2) order a remittitur, because ConAgra did not waive its
workers’ compensation immunity; (3) grant ConAgra’s motion
for directed verdict or motion for new trial, because Jacobs did
not establish that its “‘losses’” were “‘caused by the negli-
gence of ConAgra and/or others under its control,’” as required
by the contract; and (4) alter or amend the judgment to remove
damages relating to the Brockington settlement that were not
caused by ConAgra.
III. STANDARD OF REVIEW
[1,2] Whether a party who commences an action has stand-
ing and is therefore the real party in interest presents a
jurisdictional issue.1 When a jurisdictional question does not
involve a factual dispute, determination of a jurisdictional
issue is a matter of law which requires an appellate court to
reach a conclusion independent from the trial court’s; however,
when a determination rests on factual findings, a trial court’s
1
Countryside Co-op v. Harry A. Koch Co., 280 Neb. 795, 790 N.W.2d 873(2010). See, also, Applied Underwriters v. S.E.B. Servs. of New York, 297
Neb. 246, 898 N.W.2d 366 (2017).
- 51 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38decision on the issue will be upheld unless the factual findings
concerning jurisdiction are clearly incorrect.2
[3,4] In reviewing a trial court’s ruling on a motion for
directed verdict, an appellate court must treat the motion as
an admission of the truth of all competent evidence submitted
on behalf of the party against whom the motion is directed;
such being the case, the party against whom the motion is
directed is entitled to have every controverted fact resolved in
its favor and to have the benefit of every inference which can
reasonably be deduced from the evidence.3 A directed verdict
is proper at the close of all the evidence only when reasonable
minds cannot differ and can draw but one conclusion from the
evidence, that is, when an issue should be decided as a matter
of law.4
[5,6] An appellate court reviews a denial of a motion to alter
or amend the judgment for an abuse of discretion.5 An appel-
late court reviews a trial court’s ruling on a motion for a new
trial for an abuse of discretion.6
[7-9] Contract interpretation presents a question of law.7
Whether the jury instructions given by the trial court are cor-
rect is a question of law.8 An appellate court independently
reviews questions of law decided by a lower court.9
2
Kugler Co. v. Growth Products Ltd., 265 Neb. 505, 658 N.W.2d 40 (2003).
See, also, Skyline Manor v. Rynard, 288 Neb. 602, 852 N.W.2d 303(2014).
3
Armstrong v. Clarkson College, 297 Neb. 595, 901 N.W.2d 1 (2017).
4
Id.5
State v. Amaya, 298 Neb. 70, 902 N.W.2d 675 (2017). See, also, Armstrong,
supra note 3.
6
Facilities Cost Mgmt. Group v. Otoe Cty. Sch. Dist., 298 Neb. 777, 906
N.W.2d 1 (2018). See, also, Armstrong, supra note 3.
7
Cano v. Walker, 297 Neb. 580, 901 N.W.2d 251 (2017).
8
Armstrong, supra note 3.
9
Id.- 52 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38[10,11] When reviewing a jury verdict, the appellate court
considers the evidence and resolves evidentiary conflicts in
favor of the successful party.10 A jury verdict may not be set
aside unless clearly wrong, and it is sufficient if there is com-
petent evidence presented to the jury upon which it could find
for the successful party.11
IV. ANALYSIS
1. Court Did Not Err in Determining
Jacobs Is R eal Party in Interest
In this case, the trial court issued an order at the pleading
stage which found that Jacobs had standing as the real party
in interest. The court issued its order contemporaneous with
its disposition of competing motions to compel discovery.
ConAgra had sought discovery regarding a breakdown of pay-
ments made by Jacobs and Jacobs’ insurers toward the settle-
ments in the North Carolina cases and argued the evidence
was relevant to the issue of whether Jacobs is the real party
in interest.
Under ConAgra’s theory, Jacobs brought this suit as a sub-
rogee and not an indemnitee. ConAgra asserted that there is
a possibility that the settlements entered into by Jacobs were
fully funded by Jacobs’ insurers or other third parties and that
if the evidence showed Jacobs’ insurers were fully subrogated,
then Jacobs would lack standing to pursue its indemnification
claim against ConAgra. The court disposed of this argument
by stating, “It is clear that Jacobs has the right to bring this
action for the full amount of the settlements against ConAgra
even if [its] insurers paid part of the settlements.”
The parties continued to litigate the issue, including through
posttrial motions filed by ConAgra which reiterated its theory
that Jacobs is not the real party in interest. The court held a
10
ACI Worldwide Corp. v. Baldwin Hackett & Meeks, 296 Neb. 818, 896
N.W.2d 156 (2017).
11
Id.- 53 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38hearing and received an affidavit into evidence and issued an
order overruling ConAgra’s motions, again determining that
Jacobs is the real party in interest.
On appeal, ConAgra’s primary argument is that Jacobs
is not the real party in interest. ConAgra argues that Jacobs
failed to prove that it had standing as the real party in inter-
est to seek indemnification and requests that we reverse the
judgment below. Jacobs argues the trial court properly found
that Jacobs is the real party in interest to pursue its contractual
indemnification claim and that Jacobs did not assert claims as
a subrogee.
Because the parties focus much of their attention on whether
the district court erred in its determination that Jacobs has
standing and is the real party in interest, and repeatedly raised
the issue to the court through various motions before and after
trial, we will discuss the district court’s determinations under
both a facial and a factual analysis.
[12,13] Nebraska’s real party in interest statute provides
that “[e]very action shall be prosecuted in the name of the real
party in interest . . . .”12 The purpose of that section is to pre-
vent the prosecution of actions by persons who have no right,
title, or interest in the cause.13 The focus of the real party in
interest inquiry is whether the party has standing to sue due to
some real interest in the cause of action, or a legal or equitable
right, title, or interest in the subject matter of controversy.14
Standing refers to whether a party had, at the commencement
of the litigation, a personal stake in the outcome of the litiga-
tion that would warrant a court’s or tribunal’s exercising its
jurisdiction and remedial powers on the party’s behalf.15
12
Neb. Rev. Stat. § 25-301 (Reissue 2016).
13
Cattle Nat. Bank & Trust Co. v. Watson, 293 Neb. 943, 880 N.W.2d 906(2016).
14
LeRette v. Howard, 300 Neb. 128, 912 N.W.2d 706 (2018); Manon v. Orr,
289 Neb. 484, 856 N.W.2d 106 (2014).
15
Applied Underwriters, supra note 1.
- 54 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38[14] We have said that the question of whether a party who
commences an action has standing and is therefore the real
party in interest is jurisdictional and that because the require-
ment of standing is fundamental to a court’s exercise of juris-
diction, either a litigant or a court can raise the question of
standing at any time.16
[15] Because a defect in standing is a defect in subject mat-
ter jurisdiction, a challenge to standing is treated as a motion
to dismiss for lack of subject matter jurisdiction brought
under Neb. Ct. R. Pldg. § 6-1112(b)(1).17 We have previously
explained that the stage of the litigation in which a party claims
that its opponent lacks standing affects how a court should dis-
pose of the claim.18
[16,17] If the motion is filed at the pleadings stage, it is con-
sidered a “facial challenge.”19 In resolving a facial challenge,
a court will review the pleadings to determine whether there
are sufficient allegations to establish the plaintiff’s standing.20
The court will accept the allegations of the complaint as true
and draw all reasonable inferences in favor of the nonmoving
party.21 At the pleadings stage, the standard for determining the
sufficiency of a complaint to allege standing is fairly liberal.22
An appellate court reviews a trial court’s decision on a motion
to dismiss for lack of subject matter jurisdiction based on a
facial attack on the pleadings de novo.23
16
See Stevens v. Downing, Alexander, 269 Neb. 347, 693 N.W.2d 532 (2005).
17
In re Invol. Dissolution of Wiles Bros., 285 Neb. 920, 830 N.W.2d 474(2013).
18
Field Club v. Zoning Bd. of Appeals of Omaha, 283 Neb. 847, 814 N.W.2d
102 (2012).
19
Citizens Opposing Indus. Livestock v. Jefferson Cty., 274 Neb. 386, 391,
740 N.W.2d 362, 366 (2007).
20
Id.21
Washington v. Conley, 273 Neb. 908, 734 N.W.2d 306 (2007).
22
Applied Underwriters, supra note 1.
23
See Washington, supra note 21.
- 55 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38[18] If a motion challenging a court’s subject matter juris-
diction is filed after the pleadings stage, and the court holds
an evidentiary hearing and reviews evidence outside the plead-
ings, it is considered a “factual challenge.”24 The party oppos-
ing the motion must then offer affidavits or other relevant
evidence to support its burden of establishing subject matter
jurisdiction.25 Where the trial court’s decision on a motion to
dismiss for lack of subject matter jurisdiction is based on a fac-
tual challenge, the court’s factual findings are reviewed under
the clearly erroneous standard.26
(a) Facial Challenge
(i) Background
Jacobs’ original complaint asserted a contractual indem-
nification claim against ConAgra. Jacobs alleged ConAgra’s
refusal to indemnify breached an agreement which stated in
part: “ConAgra will indemnify and release [Jacobs] against all
other claims, losses, costs, penalties, damages and/or expenses
to the extent caused by the negligence of ConAgra and/or
­others under its control.” Jacobs’ referred to the parties’ agree-
ment in the complaint and attached a copy of the agreement to
the complaint.
Jacobs alleged that it had “incurred and continues to incur
claims, losses, costs, penalties, damages and/or expenses . . .
in defending against the [l]awsuits.” ConAgra filed a motion
which argued Jacob’s indemnity claims should be dismissed
because “there is no allegation that [Jacobs] has paid the
claimants any sums for which [ConAgra] should be required to
indemnify [Jacobs].”
Prior to a decision on ConAgra’s motion to dismiss, Jacobs
filed an amended complaint which alleged that it had “incurred
claims, losses, costs, penalties, damages and/or expenses
24
Id. at 913, 734 N.W.2d at 311.
25
Id.
26
See Bohaboj v. Rausch, 272 Neb. 394, 721 N.W.2d 655 (2006).
- 56 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38. . . in connection with the [l]awsuits” and that it had “noti-
fied ConAgra in writing that . . . Jacobs has incurred costs
and expenses in connection with the [l]awsuit[s] covered by
ConAgra’s indemnity obligations, including costs of settle-
ment.” Jacobs further alleged that “ConAgra’s refusal to . . .
indemnify Jacobs for settlements, defense fees and any other
payments, costs and expenses incurred by Jacobs in defense
and resolution of the [l]awsuits, is a breach of S[ubs]ection
10.2 of the Agreement.”
ConAgra responded by filing an answer and an amended
answer, both of which admitted Jacobs’ allegations that it
incurred claims, losses, costs, penalties, damages, and/or
expenses, but “denie[d] that such expenses and costs were
reasonable and allege[d] that those expenses and costs were
increased because of the conduct of Jacobs, its employee . . .
Pottner and its counsel.” ConAgra denied Jacobs’ allegation
that ConAgra breached an agreement to indemnify, but spe-
cifically admitted that “the expenses incurred by Jacobs in
defending the lawsuits and settling claims were not reasonable
and were increased by the conduct of Jacobs, its employee . . .
Pottner and its counsel.” (Emphasis supplied.)
Thereafter, ConAgra sought discovery regarding Jacobs’
damages. ConAgra filed a motion to compel Jacobs to answer
interrogatories which sought a breakdown of the amount of
money Jacobs and Jacobs’ insurers paid toward the settle-
ments. ConAgra argued that it had not agreed to indemnify
Jacobs’ insurers; that amounts paid by Jacobs’ insurers were
not recoverable; that ConAgra had a right to know whether any
of Jacobs’ insurers had a subrogation claim against ConAgra,
and if so, how much; and that Jacobs was not the real party in
interest to bring a claim as a subrogee.
ConAgra relied on Jelinek v. Nebraska Nat. Gas Co.,27 a
subrogation case in which we found that homeowners were
not the real party in interest to bring property damage claims
27
Jelinek v. Nebraska Nat. Gas Co., 196 Neb. 488, 243 N.W.2d 778 (1976).
- 57 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38against a gas company, because the homeowners’ insurer had
been fully subrogated. The insureds in Jelinek admitted they
were “satisfied with the amount paid them by the insurance
company,” “considered it as settlement in full,” and “ma[de]
no demand on the defendant for the payment of any additional
amount because they [felt] that no additional amount [was]
owing to them.”28
The trial court overruled ConAgra’s motion to compel dis-
covery and, sua sponte, without reviewing evidence, found
that Jacobs was the real party in interest and that “any break-
down of payments between Jacobs and its insurers or commu-
nications and agreements between Jacobs and its insurers is
not relevant.” The court cited Krause v. State Farm Mut. Auto.
Ins. Co.29 for the proposition that when an insurer indemni-
fies its insured for only part of the loss the insured retains the
right of action for the entire loss and stated that a partially
subrogated insurer has an equitable interest in the insured’s
recovery.30
The court stated:
It is clear that Jacobs has the right to bring this action for
the full amount of the settlements against ConAgra even
if their insurers paid part of the settlements. The insur-
ers would then have a right of action against Jacobs, not
ConAgra, in the event that Jacobs received a judgment.
(ii) Disposition
[19,20] A party to a contract is generally a real party in
interest with standing to raise the claim of breach of contract.31
28
Id. at 490, 243 N.W.2d at 779.
29
Krause v. State Farm Mut. Auto. Ins. Co., 184 Neb. 588, 169 N.W.2d 601(1969), modified on denial of rehearing 184 Neb. 638, 170 N.W.2d 882.
30
See John P. Lenich, Nebraska Civil Procedure § 6:3 (2018) (and cases
cited therein).
31
See, Spanish Oaks, Inc. v. Hy-Vee, Inc., 265 Neb. 133, 655 N.W.2d 390(2003); Peerless Ins. Co. v. Bukacek, 211 Neb. 505, 319 N.W.2d 98 (1982).
- 58 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38An indemnity contract is a chose in action because it confers
a right to bring a legal action to recover a sum of money from
or out of the contract.32 Under Nebraska law, indemnification
is available when one party is compelled to pay money which
in justice another ought to pay or has agreed to pay.33 Nebraska
has long held that a claim for indemnity accrues at the time the
indemnity claimant suffers loss or damage.34 We have elabo-
rated that this means that the cause of action accrues when
the would-be indemnitee pays the judgment arising from the
underlying loss or damage.35
In this case, Jacobs brought an express indemnification claim
based on ConAgra’s refusal to indemnify under an agreement
between the parties. Jacobs has standing to raise this claim.
ConAgra argues further discovery could potentially show
that as a factual matter, Jacobs has been fully reimbursed for its
losses. When a trial court analyzes a facial challenge, however,
the court does not make factual findings but accepts the com-
plaint allegations as true and draws all reasonable inferences
in favor of the nonmoving party. ConAgra’s subrogation argu-
ment violates this rule, because it asks this court to construe
the parties’ allegations in ConAgra’s favor. We will not do
so, particularly where ConAgra admitted in its pleadings that
Jacobs has incurred losses and damages.
[21,22] A judicial admission is a formal act done in the
course of judicial proceedings which is a substitute for evi-
dence, thereby waiving or dispensing with the production
of evidence by conceding for the purpose of litigation that
32
See Millard Gutter Co. v. Farm Bureau Prop. & Cas. Ins. Co., 295 Neb.
419, 889 N.W.2d 596 (2016).
33
Downey v. Western Comm. College Area, 282 Neb. 970, 808 N.W.2d 839(2012).
34
Dutton-Lainson Co. v. Continental Ins. Co., 271 Neb. 810, 716 N.W.2d 87(2006). See City of Wood River v. Geer-Melkus Constr. Co., 233 Neb. 179,
444 N.W.2d 305 (1989).
35
Id.; Lyhane v. Durtschi, 144 Neb. 256, 13 N.W.2d 130 (1944).
- 59 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38the proposition of fact alleged by the opponent is true.36
While parties cannot confer subject matter jurisdiction upon
a judicial tribunal by either acquiescence or consent, nor may
subject matter jurisdiction be created by waiver, estoppel,
consent, or conduct of the parties, such does not prevent a
party from conclusively admitting the truth of an underlying
fact required to establish subject matter jurisdiction by judi-
cial admission.37
At the time the trial court first determined the issue of the
real party in interest, Jacobs’ operative complaint alleged that
Jacobs had incurred losses and damages in connection with
the North Carolina lawsuits. ConAgra admitted that Jacobs
incurred losses and damages, but denied that the amounts were
reasonable. ConAgra’s unequivocal admission that Jacobs has
sustained some injury in fact establishes that Jacobs has stand-
ing to pursue its express indemnification claim.
[23] ConAgra argues that its admissions are not conclu-
sive because, in responding to Jacobs’ claim for breach of the
implied covenant of good faith and fair dealing, ConAgra’s
pleading stated “ConAgra denies all allegations in the Amended
Complaint except those specifically admitted above.” We agree
with Jacobs that ConAgra’s general denial does not over-
come the admissions made by ConAgra in its specific denials
directed toward Jacobs’ allegations that it incurred losses and
damages. Nebraska has long held that a general denial is not
effective where an answer contains specific admissions of facts
alleged.38 Thus, the scope of ConAgra’s general denial is lim-
ited by the facts admitted in its answer.
The allegations show that in both its answer and its amended
answer to Jacobs’ amended complaint, ConAgra broadly
admitted that Jacobs incurred claims, losses, costs, penalties,
36
Wisner v. Vandelay Investments, 300 Neb. 825, ___ N.W.2d ___ (2018).
37
Id.38
See, State Securities Co. v. Corkle, 191 Neb. 578, 216 N.W.2d 879 (1974);
Johnson v. School Dist. No. 3, 168 Neb. 547, 96 N.W.2d 623 (1959).
- 60 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38damages, and/or expenses. ConAgra did not raise the real party
in interest issue as an affirmative defense until responding to
Jacobs’ second amended complaint filed after the court had
already determined that Jacobs had standing and was the real
party in interest. Even under a de novo facial review, ConAgra’s
affirmative defense allegation is insufficient, because it stated
that Jacobs is not the real party in interest “to the extent the
claims it asserts are as a subrogee.”
ConAgra’s admissions establish that Jacobs’ express indem-
nity claim had accrued and that Jacobs sought to invoke
the court’s jurisdiction in order to remedy ConAgra’s refusal
to indemnify. This is sufficient to establish that Jacobs has
standing and is the real party in interest with respect to its
express indemnification claim and to show that the pleadings
do not support ConAgra’s theory that Jacobs asserted claims as
a subrogee.
[24] We have said the primary purpose of the real party
in interest requirement is to protect the defendant from the
risk of multiple litigation.39 ConAgra has not advanced a
persuasive argument that it will be forced to defend claims
brought by multiple parties. The trial court addressed this
aspect of ConAgra’s argument by explaining that Jacobs’
insurers would have a right to recovery against Jacobs and
not ConAgra.
When the indemnity paid by the insurer covers only part
of the loss, the right of action remains in the insured for the
entire loss.40 This rule is “‘founded on the principle that the
wrongful act was single and indivisible, and gives rise to but
one liability. Upon this theory the splitting of causes of action
is avoided and the wrongdoer is not subjected to a multiplicity
39
See, Peerless Ins. Co., supra note 31; Redding v. Gibbs, 203 Neb. 727, 280
N.W.2d 53 (1979). See, also, Lenich, supra note 30, § 6:9.
40
See, Schmidt v. Henke, 192 Neb. 408, 222 N.W.2d 114 (1974); Krause,
supra note 29; Shiman Bros. & Co. v. Nebraska National Hotel Co., 143
Neb. 404, 9 N.W.2d 807 (1943).
- 61 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38of suits.’”41 We have recognized one exception to this rule,
not applicable here, where a tort-feasor or the tort-feasor’s
insurer, with notice of an insurer’s subrogation claim, procures
a release by settling with the insured.42
ConAgra’s theory is not based on pleading allegations and
therefore is not persuasive under a facial challenge. Accepting
the parties’ allegations as true and viewing reasonable infer-
ences in Jacobs’ favor, Jacobs incurred some amount of dam-
ages as a result of ConAgra’s refusal to indemnify, ConAgra
admitted this, and there are no contrary factual allegations stat-
ing that Jacobs’ damages have been fully reimbursed. Under
the rule from Krause, Jacobs has a right to bring an action
for the full amount of its damages. The trial court was correct
in determining that ConAgra was not forced to defend claims
brought by multiple parties.
ConAgra also suggests Jacobs’ claim may be barred by
Nebraska’s antisubrogation rule. Under the antisubrogation
rule, no right of subrogation can arise in favor of an insurer
against its own insured or coinsured for a risk covered by
the policy, even if the insured is a negligent wrongdoer.43
To allow subrogation under such circumstances would per-
mit an insurer, in effect, to avoid the very coverage which its
insured purchased.44 For example, a fully subrogated insurer of
Jacobs cannot assert a subrogation claim against Jacobs. Here,
ConAgra’s antisubrogation argument asks this court to assume
that the real party in interest is a fully subrogated insurer of
Jacobs which also happens to be an insurer of ConAgra for the
same risks. This argument is not supported by the pleadings.
41
Krause, supra note 29, 184 Neb. at 593, 169 N.W.2d at 604 (emphasis in
original).
42
Milbank Ins. Co. v. Henry, 232 Neb. 418, 441 N.W.2d 143 (1989).
43
SFI Ltd. Partnership 8 v. Carroll, 288 Neb. 698, 851 N.W.2d 82 (2014);
Buckeye State Mut. Ins. Co. v. Humlicek, 284 Neb. 463, 822 N.W.2d 351(2012).
44
Id.- 62 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38Based on the pleadings, we find Jacobs, and not ConAgra’s
insurer, is the real party in interest and is asserting an indemni-
fication claim and not a subrogation claim. We therefore reject
ConAgra’s antisubrogation argument.
As noted, after the trial court determined that Jacobs was
the real party in interest, ConAgra continued to press the
issue through pretrial motions, objections at trial, and posttrial
motions. We discuss below ConAgra’s factual challenge and
further explain why the trial court did not err in determining
that Jacobs is the real party in interest.
(b) Factual Challenge
(i) Background
Before trial, ConAgra filed another motion to compel dis-
covery of the amounts that Jacobs and its insurers paid to
settle the North Carolina lawsuits. The court issued an order
which maintained its prior ruling that these items were not dis-
coverable. The court again rejected the argument that Jacobs
brought its claim as a subrogee. The court’s order stated
that “the Court is bound by the Agreement, which contains
an express indemnity contract between the parties. Jacobs is
suing for ConAgra’s alleged breach of the Agreement, not for
subrogation.”
ConAgra revived the real party in interest issue at trial when
it moved for a directed verdict at the close of Jacobs’ evidence.
ConAgra argued that Jacobs had not offered evidence that it
actually made payments to the North Carolina plaintiffs. The
court denied the motion, and after trial, ConAgra renewed its
motion for directed verdict and moved for judgment notwith-
standing the verdict and a new trial. The court issued a written
order which explained its reasons for overruling ConAgra’s
motions.
The court clarified that it interpreted ConAgra’s argument
as an objection to Jacobs’ damages, rather than solely an
argument about standing, and explained that ConAgra’s argu-
ments contravened the collateral source rule. The court rejected
- 63 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38ConAgra’s contention that the collateral source rule did not
apply in this breach of contract action premised upon negli-
gent conduct.
[25] Under the collateral source rule, the fact that the
party seeking recovery has been wholly or partially indem-
nified for a loss by insurance or otherwise cannot be set up
by the wrongdoer in mitigation of damages.45 The theory
underlying this rule is to prevent a tort-feasor from escaping
liability because of the act of a third party, even if a possibil-
ity exists that the plaintiff may be compensated twice.46 The
majority of courts do not apply the collateral source rule to
pure breach-of-contract actions.47 However, in cases where
the breach of contract is of a tortious character, the collat-
eral source rule prevents unjust enrichment of the breach-
ing party.48
Here, the court found that the contract expressly incorpo-
rated tort principles of negligence and found the collateral
source rule applied. The court cited to Countryside Co-op v.
Harry A. Koch Co.49 and found that the damages Jacobs sought
to recover from ConAgra, a tort-feasor, could not be dimin-
ished by losses that were wholly or partially indemnified by
insurance or another collateral source. ConAgra did not assign
as error this aspect of the court’s ruling, and we do not find
plain error based on the facts of this case, given that the other
source of payment alleged is insurance, which specifically
invokes the collateral source rule.50
45
Strasburg v. Union Pacific RR. Co., 286 Neb. 743, 839 N.W.2d 273(2013).
46
Id.47
See Midland Mut. Life Ins. v. Mercy Clinics, 579 N.W.2d 823 (Iowa 1998)
(citing cases).
48
See John Munic Enterprises, Inc. v. Laos, 235 Ariz. 12, 326 P.3d 279(Ariz. App. 2014).
49
Countryside Co-op, supra note 1.
50
See Huenink v. Collins, 181 Neb. 195, 147 N.W.2d 508 (1966).
- 64 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38In addressing ConAgra’s reliance on Jelinek,51 the court
noted that the insureds in Jelinek were satisfied with payments
made by their insurer and made no demand on the defendant
for payment. The court also referenced Schmidt v. Henke,52 a
similar case cited in Jelinek, in which the insured had released
its claims against the defendant. The court distinguished both
Jelinek and Schmidt from the present case and made a fac-
tual finding that “Jacobs has made a demand on ConAgra for
payment and has not expressly released any claims against
ConAgra.” The court again found that Jacobs was the real party
in interest.
(ii) Disposition
ConAgra argues that on this record, there is no way to tell
whether this case falls on the Jelinek or Krause side of the line.
Jacobs argues the record supports the district court’s finding
that Jacobs is the real party in interest.
At trial, Jacobs introduced evidence, with information about
the payor redacted, that wire transfers were made to pay
the various settlements. The settlement documents stated that
“JACOBS and/or its insurers” will pay. Jacobs’ vice president
of global litigation testified that all of the settlements have
been paid, but did not testify who made the payments. Jacobs’
expert testified that he was asked to “review the settlements
that were paid by Jacobs.” ConAgra objected and argued if
the witness’ answer were allowed to stand that would open the
door for ConAgra to inquire into the amounts paid by Jacobs
and its insurers. The court responded that “Jacobs is the real
party in interest” and struck the witness’ answer so that the jury
would not hear evidence of collateral source payments.
After trial, ConAgra moved for judgment notwithstanding
the verdict and a new trial, in part based on its argument that
Jacobs failed to establish standing. Citing Citizens Opposing
51
Jelinek, supra note 27.
52
Schmidt, supra note 40.
- 65 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38Indus. Livestock v. Jefferson Cty.,53 Jacobs requested an evi-
dentiary hearing. In Citizens Opposing Indus. Livestock, we
held that where a motion to dismiss for lack of subject matter
jurisdiction due to lack of standing was raised for the first time
after trial, the motion was considered a factual challenge and
the trial court was required to hold an evidentiary hearing to
give a plaintiff the opportunity to offer evidence on the stand-
ing issue.
The court granted Jacobs’ request, and Jacobs offered its
insurance policies into evidence. The policies showed that
Jacobs had deductible obligations and a 10-percent copay-
ment obligation for all sums that exceeded $7.5 million.
Although there was no direct evidence that Jacobs paid these
obligations, there was also no evidence that Jacobs’ insurers
waived these obligations. ConAgra did not offer any evidence
to support its theory and did not assign error to the district
court’s decisions regarding discovery. ConAgra also did not
assign error as to the court’s factual findings and clarified that
“[t]his appeal involves only questions of law . . . .”54 Jacobs’
insurance policies therefore established circumstantial evi-
dence that Jacobs paid a share of the $108.9 million in settle-
ment payments.
[26,27] Circumstantial evidence is not inherently less proba-
tive than direct evidence, and a fact proved by circumstantial
evidence is nonetheless a proven fact.55 A finder of fact may
draw reasonable inferences from the facts and circumstances
proved.56 Based on the court’s specific findings that “Jacobs
has made a demand on ConAgra for payment and has not
expressly released any claims against ConAgra,” and the insur-
ance policies in evidence, we find the trial court’s factual
determination that Jacobs had standing and was the real party
53
Citizens Opposing Indus. Livestock, supra note 19.
54
Brief for appellant at 4.
55
See State v. Pierce, 248 Neb. 536, 537 N.W.2d 323 (1995).
56
In re Interest of Elainna R., 298 Neb. 436, 904 N.W.2d 689 (2017).
- 66 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38in interest was not clearly erroneous. There is evidence in
the record to support the district court’s finding that Jacobs
had standing to pursue its express indemnity claim and that
ConAgra will not be subjected to multiple litigation.
Although ConAgra challenged Jacobs’ standing before the
end of trial, unlike the defendant in Citizens Opposing Indus.
Livestock, ConAgra was not prejudiced by the court’s decision
to hold a posttrial evidentiary hearing. ConAgra was on notice
of the court’s ruling on standing and objected at trial whenever
a witness for Jacobs testified that Jacobs had paid the settle-
ments. The court’s factual determination regarding Jacobs’
standing was merely a consistent supplement to its determina-
tion at the pleading stage.
Under both a facial and a factual analysis, this assignment of
error is without merit.
2. Court Did Not Err in Finding
ConAgra’s Workers’ Compensation
Immunity Inapplicable
ConAgra asserts the trial court erred in finding that Jacobs
could be indemnified for settlements made to ConAgra employ-
ees, because the indemnification agreement with Jacobs did
not explicitly waive ConAgra’s workers’ compensation immu-
nity. Jacobs argues that ConAgra agreed to indemnify Jacobs
for claims and losses incurred by ConAgra employees and that
the agreement is all that is required under Nebraska law. We
agree with Jacobs that ConAgra misconstrues our precedent
regarding the relationship between the Nebraska Workers’
Compensation Act (NWCA), Neb. Rev. Stat. § 48-101 et
seq. (Reissue 2010, Cum. Supp. 2016 & Supp. 2017), and
an employer’s liability based on express indemnification of
third parties.
[28,29] An indemnity agreement is a contract to be con-
strued according to the principles generally applied in con-
struction or interpretation of other contracts.57 A contract must
57
Kuhn v. Wells Fargo Bank of Neb., 278 Neb. 428, 771 N.W.2d 103 (2009).
- 67 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38receive a reasonable construction and must be construed as a
whole, and if possible, effect must be given to every part of
the contract.58
(a) Parties’ Contract Covered
Indemnification of Claims
and Losses Incurred by
ConAgra Employees
Subsection 10.1 of the contract provides that “[Jacobs] shall
indemnify . . . ConAgra . . . against each and every claim, loss,
cost, penalty, damage, or expense . . . suffered or incurred by
any third parties, employees of ConAgra and employees of
[Jacobs].” Subsection 10.2 provides that “ConAgra will indem-
nify and release [Jacobs] against all other claims, losses, costs,
penalties, damages and/or expenses to the extent caused by the
negligence of ConAgra and/or others under its control.”
The district court explained that “[w]hen Section 10 of the
Agreement is viewed as a whole, there is no question that
S[ubs]ection 10.2 is an express contract in which ConAgra
agreed to indemnify Jacobs against claims by ConAgra employ-
ees.” We agree the meaning of section 10 becomes clear once
subsections 10.1 and 10.2 are construed together.
Subsections 10.1 and 10.2 are reciprocal indemnification
provisions. Subsection 10.1 states Jacobs shall indemnify
ConAgra “against each and every claim, loss, cost, penalty,
damage, or expense” incurred by “employees of ConAgra,”
and subsection 10.2 states that ConAgra will indemnify Jacobs
“against all other claims, losses, costs, penalties, damages and/
or expenses.” In addition, subsection 10.1 states that Jacobs’
“obligations hereunder shall be limited to the extent caused by
the negligent acts, errors or omissions of [Jacobs],” and sub-
section 10.2 states that Jacobs’ liability “is specifically limited
as provided herein.”
Reading section 10 as a whole and in context, the term
“all other claims” as provided in subsection 10.2 must refer
58
Id.- 68 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38to “all other claims” within section 10. Because subsection
10.1 plainly provides for indemnification of claims brought by
employees of ConAgra, when read together, subsections 10.1
and 10.2 provide a clear indication that ConAgra agreed to
indemnify Jacobs for claims and losses incurred by employ-
ees of ConAgra “to the extent caused by the negligence of
ConAgra and/or others under its control.” Thus, the district
court correctly interpreted the parties’ contract to obligate
ConAgra to indemnify claims and losses incurred by ConAgra
employees caused by ConAgra’s negligence.
(b) NWCA Does Not Immunize ConAgra
From Indemnifying Jacobs for Losses
Sustained by ConAgra Employees
Section 48-148 of the NWCA provides that if an employ-
ee’s injury arises out of and in the course of employment,
the employee’s exclusive remedy is against the employer for
workers’ compensation.59 The NWCA imposes liability on the
employer without fault, and in return, shields the employer
from tort actions.60 But nothing in Nebraska law or public
policy prevents an employer from indemnifying a third party
for losses paid to the indemnitor’s employee.61
[30] We held in Union Pacific RR. Co. v. Kaiser Ag.
Chem. Co.62 that when an employer, liable to an employee
under the NWCA, agrees to indemnify a third party for a
loss sustained as the result of the third party’s payment to
the indemnitor’s employee, the employer’s exclusion from
liability accorded by the NWCA does not preclude the third
59
Bennett v. Saint Elizabeth Health Sys., 273 Neb. 300, 729 N.W.2d 80(2007).
60
Estate of Teague v. Crossroads Co-op Assn., 286 Neb. 1, 834 N.W.2d 236(2013).
61
See, Petznick v. United States, 575 F. Supp. 698 (D. Neb. 1983); Union
Pacific RR. Co. v. Kaiser Ag. Chem. Co., 229 Neb. 160, 425 N.W.2d 872(1988).
62
Union Pacific RR. Co., supra note 61.
- 69 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38party’s action to enforce the indemnity agreement with the
indemnitor-employer.63
ConAgra argues that Jacobs’ claim is based on a gen-
eral indemnification provision and that ConAgra cannot be
deprived of the protections of the NWCA absent an affirma-
tive waiver of workers’ compensation immunity. Our prec-
edent, however, does not recognize the rule ConAgra sug-
gests, and we have taken the opposite approach in analyzing
indemnification agreements, finding a waiver of workers’
compensation immunity where an indemnity provision fails
to include language stating that an employer has not waived
immunity.64
In interpreting the effectiveness of the indemnity agree-
ment in Union Pacific RR. Co., we noted that the “agreement
contains no specific provision or language which excludes,
exempts, or exonerates [the employer] from liability for indem-
nification or contribution as a contractual duty,” 65 and con-
cluded that the employer remained liable for indemnification
or contribution based on the railroad’s settlement with the
employer’s employee. We found that to conclude otherwise
would rewrite the agreement by adding a provision to preserve
the employer’s workers’ compensation immunity.66
Similarly, in Oddo v. Speedway Scaffold Co.,67 we cited
Union Pacific RR. Co. and found the NWCA did not bar a
contractor’s liability under an indemnification agreement by
reasoning that the agreement “contains no specific provision
or language which excludes, exempts, or exonerates Contractor
from indemnification as a contractual duty.” 68
63
See, also, Harsh International v. Monfort Indus., 266 Neb. 82, 662 N.W.2d
574 (2003).
64
Union Pacific RR. Co., supra note 61.
65
Id. at 169, 425 N.W.2d at 879.
66
Id.67
Oddo v. Speedway Scaffold Co., 233 Neb. 1, 443 N.W.2d 596 (1989).
68
Id. at 9, 443 N.W.2d at 602.
- 70 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38The same analysis applies here. The agreement between
ConAgra and Jacobs includes indemnification obligations for
claims and losses incurred by ConAgra employees and does not
express any exclusions in favor of ConAgra or Jacobs based on
workers’ compensation immunity. Therefore, ConAgra’s con-
tractual liability remains.
ConAgra urges a different result based on our decision in
Harsh International v. Monfort Indus.69 In Harsh International,
the district court dismissed a petition brought by a manufac-
turer which asserted a contribution claim against an employer,
after settling claims brought by injured employees. We affirmed
the district court’s dismissal of the petition. In doing so, we
rejected the manufacturer’s implied indemnity claim and found
the employer’s liability was limited to the employee, absent
an express indemnity contract or an implied indemnification
claim involving a special relationship.70 In dicta, we contrasted
a contractual indemnity claim from an implied indemnity claim
by stating that “[u]nder an express contract of indemnity,
an employer has explicitly agreed to reimburse a third party
for payment to an injured employee.”71 We did not hold, as
ConAgra argues, that an employer who enters an indemnity
agreement must affirmatively waive its workers’ compensation
immunity in order to be subject to indemnity claims brought by
third parties based on employees’ losses.
Rather, we have consistently held that an indemnification
agreement is construed according to general contract prin-
ciples.72 ConAgra may be applying the different rule, not
applicable here, that an indemnitee shall not be indemnified
69
Harsh International, supra note 63.
70
Id.
71
Id. at 88, 662 N.W.2d at 580.
72
See, Kuhn, supra note 57; Oddo, supra note 67; Union Pacific RR. Co.,
supra note 61. See, also, Woodmen of the World Life Ins. Soc. v. Peter
Kiewit Sons’ Co., 196 Neb. 158, 241 N.W.2d 674 (1976); Currency
Services, Inc. v. Passer, 178 Neb. 286, 133 N.W.2d 19 (1965).
- 71 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38for a loss occasioned by his or her own negligence unless the
language of the contract affirmatively expresses an intent to
indemnify for such loss.73 Here, Jacobs seeks indemnification
for claims and losses caused by ConAgra’s negligence and not
Jacobs’ own negligence. The NWCA does not bar ConAgra’s
liability to Jacobs for settlements made with ConAgra employ-
ees. This assignment of error is without merit.
3. Jacobs Established Jury Issue That
ConAgra Breached Contract
ConAgra assigns, restated, that the district court erred in
declining to direct a verdict in favor of ConAgra or grant a
new trial based on the argument that Jacobs failed to establish
ConAgra breached the contract.
In order to establish that ConAgra’s refusal to indemnify
breached the contract at issue, Jacobs was required to sat-
isfy two components: (1) that Jacobs incurred claims, losses,
costs, penalties, damages, and/or expenses and (2) that Jacobs’
claims, losses, costs, penalties, damages, and/or expenses
were caused by the negligence of ConAgra and/or others
under its control. ConAgra asserts Jacobs failed to prove both
aspects as a matter of law. We find no merit to this assignment
of error.
(a) Jacobs Established Sufficient
Evidence of Its Claims,
Losses, or Damages to
Submit Issue to Jury
ConAgra argues Jacobs did not establish a triable claim
that ConAgra caused Jacobs’ losses. ConAgra relies on an
instruction given by the district court regarding Jacobs’ dam-
ages which stated that “Jacobs is entitled to indemnification
for all objectively reasonable settlements of the North Carolina
lawsuits to the extent that the explosion and/or the resulting
73
Kuhn, supra note 57.
- 72 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38injuries and damages to the North Carolina plaintiffs were
caused by the negligence of ConAgra and/or others under its
control.” (Emphasis supplied.) ConAgra argues the court erred
by instructing the jury that the losses at issue were the injuries
and damages from the underlying explosion, as opposed to
Jacobs’ settlement payments. ConAgra argues that it was preju-
diced, because the court’s instructions and special verdict form
deprived ConAgra of the ability to argue that the settlements
were caused by the efficient intervening cause of defense coun-
sel’s performance during the Brockington trial.
[31-33] A litigant is entitled to have the jury instructed upon
only those theories of the case which are presented by the
pleadings and which are supported by competent evidence.74
If the instructions given, which are taken as a whole, correctly
state the law, are not misleading, and adequately cover the
issues submissible to a jury, there is no prejudicial error con-
cerning the instructions and necessitating a reversal.75 Where
a party has sustained the burden and expense of trial and has
succeeded in securing a verdict on the facts in issue, that party
has the right to keep the benefit of the verdict unless there is
prejudicial error in the proceedings by which it was secured.76
ConAgra claims it was prevented from arguing that the
actions of defense counsel during the Brockington trial were
an unforeseeable efficient intervening cause that negated its
liability. ConAgra points to language from the court’s dam-
ages instruction provided above, and the special verdict form,
which asked the jury: “Did ConAgra’s negligence proximately
cause the explosion and/or the resulting injuries and damages
to the North Carolina plaintiffs?” and “Were the settlement
amounts that Jacobs is seeking in all of the North Carolina
lawsuits objectively reasonable?” In evaluating ConAgra’s
argument, we cannot view these instructions in artificial
74
Rodriguez v. Surgical Assocs., 298 Neb. 573, 905 N.W.2d 247 (2018).
75
Id.; InterCall, Inc. v. Egenera, Inc., 284 Neb. 801, 824 N.W.2d 12 (2012).
76
Wolfe v. Abraham, 244 Neb. 337, 506 N.W.2d 692 (1993).
- 73 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38isolation but must consider the instructions provided to the
jury as a whole.77
Beginning with the court’s statement of the case instruction,
jury instruction No. 2, the court explained that Jacobs’ claim
was not confined to only its “losses” as ConAgra argues on
appeal. The court provided the language of subsection 10.2
to demonstrate that Jacobs sought to recover for “claims,
losses, costs, penalties, damages and/or expenses.” The court
instructed the jury that it had determined that subsection 10.2
required ConAgra to indemnify Jacobs “for claims to the extent
the Garner plant explosion and/or the resulting injuries and
damages were caused by the negligence of ConAgra and/or
others under ConAgra’s control.” (Emphasis supplied.)
The court then provided a breach of contract instruction,
jury instruction No. 11. The instruction provided, “For Jacobs
to recover on its claim for breach of contract against ConAgra,
Jacobs must prove, by the greater weight of the evidence . . .
[t]hat ConAgra’s breach of contract was a proximate cause of
some damage to Jacobs.” Jury instruction No. 12 stated, in
part, “You must determine whether ConAgra owes a contrac-
tual duty to indemnify Jacobs for any amounts paid to settle
the North Carolina lawsuits.” Thus, the court instructed the
jury to consider whether ConAgra breached a contractual duty
to indemnify Jacobs for claims, whether ConAgra’s breach
was a proximate cause of damage to Jacobs, and whether
ConAgra was responsible to Jacobs for amounts paid to settle
the lawsuits.
The court also provided a general proximate cause instruc-
tion, jury instruction No. 14, which stated, “A proximate
cause is a cause [that] produces a result in a natural and con-
tinuous sequence, and without which the result would not have
occurred.” And, near the beginning of jury instruction No. 21,
prior to the portion quoted by ConAgra, the court instructed
the jury that “Jacobs is seeking as damages amounts it agreed
to settle the claims of the North Carolina plaintiffs.”
77
See State v. Sellers, 279 Neb. 220, 777 N.W.2d 779 (2010).
- 74 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38Although in isolated parts of the instructions the district
court could have more precisely stated that under subsec-
tion 10.2, Jacobs sought to prove that ConAgra’s negligence
caused the settlements rather than the North Carolina plaintiffs’
personal injuries, we certainly cannot say the failure to do
so under the circumstances of this case impacted the fairness
of trial. As noted, the scope of the indemnification provision
under subsection 10.2 includes claims and damages, in addition
to losses. All of the claims in this case were for injuries caused
by the explosion, ConAgra was liable for claims under the
indemnity provision, the court made the jury aware that Jacobs
was seeking damages based on the settlement figures, and the
court provided proximate cause instructions. Taken together as
a whole, the instructions asked the jury to determine whether
ConAgra proximately caused Jacobs’ settlements.
ConAgra’s request for an efficient intervening cause instruc-
tion was not supported by the evidence. An efficient interven-
ing cause is the new and independent conduct of a third per-
son, which itself is a proximate cause of the injury in question
and breaks the causal connection between the original conduct
and the injury.78 The evidence showed the North Carolina
plaintiffs brought their claims against Jacobs as a result of
the explosion.
ConAgra criticized the outcome of the Brockington trial
and sought to argue that the settlement was caused by the
performance of defense counsel. We agree with the district
court which rejected this argument by stating that the mis-
conduct of Jacobs’ attorney in the Brockington lawsuit “in
no way intervened to cause the injuries resulting from the
[e]xplosion at the Garner Plant.” And, even taking ConAgra’s
argument at face value, ConAgra failed to prove prejudice,
because it never argued what the amount of the Brockington
settlement would have been had the misconduct not occurred.
ConAgra never provided what it claimed to be the appropri-
ate settlement value and, in fact, told the jury during closing
78
Latzel v. Bartek, 288 Neb. 1, 846 N.W.2d 153 (2014).
- 75 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38argument that the value could be $14.4 million, $17.7 million,
or $20 million.
Jacobs established a triable issue that ConAgra caused
Jacobs’ claims, losses, and damages. The evidence did not
support the use of an efficient intervening cause instruction
regarding performance of defense counsel at trial. ConAgra
was not prejudiced. This argument is without merit.
(b) Jacobs Established Triable Issue That
Its Claims, Losses, or Damages Were
Caused by ConAgra or Someone
Under ConAgra’s Control
ConAgra raises three additional arguments which claim that
it cannot be held liable for the explosion as a matter of law.
First, ConAgra argues that it did not cause Jacobs’ claims,
losses, or damages, because Poppe’s removal of the cap on the
2-inch gasline broke the causal chain between ConAgra and
the explosion as a matter of law. Second, ConAgra argues that
Poppe and ESA were not under ConAgra’s control, and relat-
edly, third, that the indemnification provision is inapplicable
under the circumstances of this case.
Jacobs contends that sufficient evidence was presented that
ConAgra’s employees knew of the significant danger posed by
Poppe’s action, but did nothing to stop him. In addition, Jacobs
contends that there was sufficient evidence submitted to the
jury of ConAgra’s control over Poppe and ESA. In the alterna-
tive, Jacobs contends that ConAgra had a nondelegable duty to
protect its employees with a safe working environment free of
deadly hazards.
We agree with Jacobs that there was sufficient evidence to
support the jury’s determination that Poppe’s actions did not
breach the causal chain as a matter of law. In addition, we find
there was evidence supporting the jury’s determination that
Poppe and ESA were under ConAgra’s control. With regard
to the nondelegable duty doctrine, we note that this issue
concerns an alternative and independent theory of ConAgra’s
liability based on negligence at common law, and we agree
- 76 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38with the statement from ConAgra’s brief that “[t]here is no
basis for reading this contract to require [common-law tort]
liability.”79 However, we conclude there is evidence to support
the contract theory.
(i) There Was Evidence to Support Jury’s Finding
ConAgra’s Negligence Was Proximate
Cause of Jacobs’ Damages
[34,35] A party is only answerable for the natural, probable,
reasonable, and proximate consequences of his acts; and where
some new efficient cause intervenes, not set in motion by him,
and not connected with but independent of his acts and not
flowing therefrom, and not reasonably in the nature of things to
be contemplated or foreseen by him, and produced the injury, it
is the dominant cause.80 Because the extent of foreseeable risk
depends on the specific facts of the case, courts should leave
such determinations to the trier of fact unless no reasonable
person could differ on the matter.81
[36] A civil verdict will not be set aside where evidence is in
conflict or where reasonable minds may reach different conclu-
sions or inferences, as it is within the jury’s province to decide
issues of fact.82
The district court found “there [was] evidence that ConAgra
employees knew of the significant dangers posed by . . .
Poppe’s action, and did nothing to stop him” and that its
judgment should not be substituted for the jury’s. We have
the same view. There was competent evidence to sustain the
jury’s determination that ConAgra was a proximate cause of
Jacobs’ damages.
Even if Poppe’s decision to unscrew the cap to the 2-inch
line was “crazy” and was the final act prior to the explosion,
79
Brief for appellant at 50.
80
Welsh v. Zuck, 192 Neb. 1, 218 N.W.2d 236 (1974).
81
See, Pittman v. Rivera, 293 Neb. 569, 879 N.W.2d 12 (2016); A.W. v.
Lancaster Cty. Sch. Dist. 0001, 280 Neb. 205, 784 N.W.2d 907 (2010).
82
InterCall, Inc., supra note 75.
- 77 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38there was evidence to support a jury finding that Poppe’s
decision was either (1) set in motion by ConAgra’s negli-
gence or (2) was connected with or flowed from ConAgra’s
negligence, and was not independent thereof. The evidence
showed that ConAgra breached the standard of care in the
planning and execution of its water heater project and that
Poppe’s actions occurred because of a series of errors com-
mitted by ConAgra.
ConAgra’s worksite hazard assessment plan described the
line-break procedure and the need to address the risk of
explosion. Puff was responsible for the line-break proce-
dure, but did not follow the written procedure and did not
train Poppe in the procedure resulting in the gasline to the
water heater’s not being purged prior to the commission-
ing. ConAgra allowed Poppe to attempt to light the water
heater for 31⁄2 hours, even after ConAgra employees witnessed
Poppe crack the pilotline and release gas into the room. Puff
smelled gas and did not tell Poppe that the line had not been
purged, and he allowed Poppe to continue to purge inside
even though Puff had been trained to purge outdoors and had
already purged one of the lines outdoors 5 days prior. Puff
testified that the gas smell eventually grew stronger and that
he temporarily stopped Poppe from working due to his con-
cern about whether the gas meter was functioning properly.
Puff left the scene and admitted that he should not have left
Poppe unsupervised. Puff admitted he would not have allowed
Poppe to open the cap on the gasline if he had stayed. Had
Puff purged the line on June 4, 2009, the explosion may have
been avoided.
In addition, an SPA was never created for ConAgra’s water
heater, and ConAgra admitted that, if implemented, an SPA
would have prevented Poppe from venting in the pumproom,
and thus prevented the explosion. Further, ConAgra failed to
comply with the fire prevention plan, which prohibited the
handling of natural gas “where vapors are prevented from
reaching ignition sources.”
- 78 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38[37] Even if the jury determined that Poppe’s decision
to remove the gas cap was a proximate cause of the explo-
sion, the record supports the verdict, because Jacobs had to
show that ConAgra was only a proximate cause of Jacobs’
damages, and not the sole proximate cause. Jury instruction
No. 11, discussed above, stated that Jacobs was required to
prove that “ConAgra’s breach of contract was a proximate
cause of some damage to Jacobs.” (Emphasis supplied.) Even
ConAgra’s refused instruction stated that Jacobs must prove
that “ConAgra’s negligence was a proximate cause of Jacobs’
losses.” (Emphasis supplied.) Where separate and independent
acts of negligence by different persons combine to produce
a single injury, each participant is liable for the damage,
although one of them alone could not have caused the result.83
The record provided the jury a sufficient basis from which to
conclude that Poppe’s decision to remove the gas cap was not
the single, independent cause of Jacobs’ damages. ConAgra’s
argument that Poppe broke the causal chain as a matter of law
is without merit.
(ii) Jacobs Established Triable Issue
Regarding ConAgra’s Control
of ESA Under Contract
ConAgra asserts that it did not exercise control over ESA,
an independent contractor, and was entitled to a directed ver-
dict based on this issue. As noted above, ConAgra asserted that
the contract does not incorporate common-law nondelegable
duties. ConAgra also argues that as a matter of law, Jacobs’
claims did not satisfy the general rule discussed in Gayton v.
Wal-Mart 84 that “one who employs an independent contractor
is not liable for physical harm caused to another by the acts or
omissions of the contractor or its servants.”
Jacobs argues that ConAgra had control over ESA’s abil-
ity to purge the gasline and that Puff and Roberson exercised
83
Sacco v. Carothers, 253 Neb. 9, 567 N.W.2d 299 (1997).
84
Gaytan v. Wal-Mart, 289 Neb. 49, 57, 853 N.W.2d 181, 192 (2014).
- 79 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38control over Poppe’s work. Jacobs further argues that suf-
ficient evidence was presented to satisfy the three-part test
from Gaytan to establish that ConAgra had control over Poppe
and ESA.
In Gaytan, we held that in order to impose liability on a
general contractor for injury to a subcontractor’s employee,
the general contractor must have (1) supervised the work that
caused the injury to the employee, (2) actual or constructive
knowledge of the danger which ultimately caused the injury,
and (3) the opportunity to prevent the injury.
On the question of ConAgra’s “control” of ESA, we give
primary consideration to Jacobs’ contract theory. Under Jacobs’
theory of contractual indemnification, we interpret the con-
tractual term “under [ConAgra’s] control” according to its
plain meaning and context. “Control” is defined as “the power
or authority to manage, direct, or oversee.” 85 To the extent
ConAgra’s arguments can be interpreted as claiming that it did
not exercise authority over ESA, we reject those arguments
based on the record in this case.
Drawing every reasonable inference from the evidence in
Jacobs’ favor, there was evidence that Puff and his team had
control over the line-break procedure and the purging of the
natural gasline and that ConAgra should have required ESA to
follow this procedure to comply with industry standards. There
was evidence that in accordance with ConAgra policy, Puff
and Roberson supervised Poppe’s work and had the ability to
train and instruct Poppe and stop his work if needed. There
was also evidence that ConAgra knew Poppe was releasing
gas into an enclosed room, that Roberson brought unrated
temporary lighting into the room, and that ConAgra could
have had Poppe purge outside, discontinue the commissioning
based on an inoperative gas meter, or evacuate the building.
Thus, there was competent evidence that ConAgra exercised
supervisory authority over ESA, that ConAgra had actual or
85
Black’s Law Dictionary 403 (10th ed. 2014).
- 80 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38constructive knowledge of the danger which ultimately caused
the injuries, and that ConAgra had the opportunity to prevent
the injuries. Therefore, ESA was under ConAgra’s control
within the meaning of the indemnification provision. This
assignment of error is without merit.
4. Court Did Not Err in Declining to
R educe Jury’s Award of Damages
ConAgra assigns error to the trial court’s decision not to
reduce the amount of damages awarded by the jury. ConAgra
argues that we should reduce the judgment by the amount of
the Brockington settlement, because the $17.7 million figure
was arbitrary.
[38-40] The amount of damages to be awarded is a deter-
mination solely for the fact finder, and the fact finder’s deci-
sion will not be disturbed on appeal if it is supported by the
evidence and bears a reasonable relationship to the elements of
the damages proved.86 The law is well established that where a
verdict is excessive, but not so much as to indicate passion or
prejudice on the part of the jury, the error may be corrected by
remittitur, if the excess can be estimated with reasonable cer-
tainty.87 A request for remittitur is generally made in lieu of a
request for a new trial.88 An appellate court should order remit-
titur only when the award is contrary to all reason.89
ConAgra argues there was no evidentiary basis upon which
a jury could value the Brockington settlement at $17.7 million.
However, Jacobs’ expert, a North Carolina trial lawyer with
over 40 years of experience, testified that the $17.7 million
86
Dutton-Lainson Co. v. Continental Ins. Co., 279 Neb. 365, 778 N.W.2d
433 (2010).
87
Barbour v. Jenson Commercial Distributing Co., 212 Neb. 512, 323
N.W.2d 824 (1982).
88
See, Crewdson v. Burlington Northern RR. Co., 234 Neb. 631, 452 N.W.2d
270 (1990); Barbour, supra note 87; Pearse v. Loup River Public Power
District, 137 Neb. 611, 290 N.W. 474 (1940).
89
Holmes v. Crossroads Joint Venture, 262 Neb. 98, 629 N.W.2d 511 (2001).
- 81 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
JACOBS ENGR. GROUP v. CONAGRA FOODS
Cite as 301 Neb. 38figure represented the amount of the first verdict, $14.6 mil-
lion, plus prejudgment interest under North Carolina law. He
compared the settlement amounts to what would be fair com-
pensation for the injuries suffered and opined that the settle-
ment amounts were objectively reasonable.
Jacobs’ expert witness’ opinion was based on an objec-
tive 10-factor analysis, which considered: venue, nature and
magnitude of disaster, horrific nature of the injuries, ratio of
demands to settlements, target defendants, ConAgra’s expo-
sure, and comparable verdicts and settlements. In demonstrat-
ing the objective reasonableness of the Brockington settlement,
he testified that the Brockington venue was “plaintiff-friendly”
and that Jacobs was a target defendant as an out-of-state “face-
less” corporation with deep pockets. He stated the settlement
demand for the Brockington case was $25 million before the
first and second trials.
The expert witness described the horrific nature of the inju-
ries at issue in the Brockington case, which involved seven
plaintiffs. The severe nature of the plaintiffs’ injuries included
burns to the face and upper torso and legs; the insertion of a
metal plate to repair musculoskeletal injuries; temporary blind-
ness and paralysis; a traumatic brain injury; and neck, spine,
and knee surgeries.
The jury’s decision was supported by evidence and bore
a reasonable relationship to the damages proved. As already
noted, ConAgra did not actually specify to the jury the amount
to award for the Brockington settlement. We cannot conclude
that the jury’s verdict was contrary to all reason, and we there-
fore decline to alter the amount of damages awarded.
V. CONCLUSION
For the reasons set forth herein, we find no merit to
ConAgra’s assignments of errors and affirm the judgment of
the district court.
A ffirmed.
K elch, J., not participating in the decision.
Wright, J., not participating.