Stone Land & Livestock Co. v. HBE , 309 Neb. 970 ( 2021 )

Nebraska Supreme Court Online Library
www.nebraska.gov/apps-courts-epub/
10/08/2021 08:08 AM CDT
- 970 -
Nebraska Supreme Court Advance Sheets
309 Nebraska Reports
STONE LAND & LIVESTOCK CO. v. HBE
Cite as 309 Neb. 970Stone Land and Livestock Company, Inc.,
a Nebraska corporation, et al., appellants,
v. HBE, LLP, a Nebraska limited liability
partnership, and Michael
J. Arens, appellees.
___ N.W.2d ___
Filed August 13, 2021. No. S-20-672.
1. Jurisdiction: Appeal and Error. A jurisdictional question which does
not involve a factual dispute is determined by an appellate court as a
matter of law.
2. Judgments: Appeal and Error. An appellate court independently
reviews questions of law decided by a lower court.
3. Service of Process: Waiver: Intent: Proof. A voluntary appearance
refers to a party who has not been served with process taking some
action or making some submission to the court that demonstrates an
intention to waive service of process.
4. Attorney and Client: Negligence. A client is bound by the acts, omis-
sions, neglect, and fraud of the client’s attorney when such is within the
attorney’s scope of express, implied, apparent, or ostensible authority.
Appeal from the District Court for Lancaster County:
Andrew R. Jacobsen, Judge. Affirmed.
Steven E. Guenzel, Cameron E. Guenzel, and Corey J.
Wasserburger, of Johnson, Flodman, Guenzel & Widger, for
appellants.
Taylor M. Hayes and Gregory C. Scaglione, of Koley Jessen,
P.C., L.L.O., for appellees.
- 971 -
Nebraska Supreme Court Advance Sheets
309 Nebraska Reports
STONE LAND & LIVESTOCK CO. v. HBE
Cite as 309 Neb. 970Heavican, C.J., Cassel, Stacy, Funke, Papik, and
Freudenberg, JJ.
Papik, J.
This case presents the question of whether a defendant’s
filing of an “Appearance of Counsel” constitutes a voluntary
appearance that relieves a plaintiff of the ordinary obligation to
serve defendant with the lawsuit. We hold that it does not and
therefore affirm the district court’s order dismissing the lawsuit
on the grounds that defendants were not timely served.
BACKGROUND
Complaint and “Appearance of Counsel.”
On March 1, 2019, Stone Land and Livestock Company,
Inc., and its shareholders (collectively Stone Land) filed suit
against HBE, LLP, an accounting firm, and Michael J. Arens,
a member and manager of HBE (collectively HBE), in the
Lancaster County District Court. The complaint alleged that
Arens provided Stone Land with incorrect information regard-
ing the income tax consequences of a sale of land.
On April 8, 2019, attorneys for HBE filed a document
entitled “Appearance of Counsel.” The document bore the
caption of the lawsuit and stated, “Gregory C. Scaglione and
Cassandra M. Langstaff of the law firm of Koley Jessen P.C.,
L.L.O., hereby enter their appearance as counsel of record for
Defendants HBE, LLP and MICHAEL J. ARENS.” Under this
statement were the names of the defendants and the signature
block of the attorneys.
Dismissal and Attempt to Reinstate.
Our record reflects no activity in the case for nearly a year
after the filing of the Appearance of Counsel. Then, on April
6, 2020, the district court entered an order dismissing the case
without prejudice. The order of dismissal stated that the com-
plaint was being dismissed because Stone Land had not timely
served HBE with the lawsuit.
- 972 -
Nebraska Supreme Court Advance Sheets
309 Nebraska Reports
STONE LAND & LIVESTOCK CO. v. HBE
Cite as 309 Neb. 970On April 13, 2020, Stone Land filed a motion asking the
district court to reinstate the case. Stone Land asserted that the
Appearance of Counsel was a voluntary appearance that was
“equivalent to service” under Neb. Rev. Stat. § 25-516.01(1)
(Cum. Supp. 2020).
The district court denied Stone Land’s motion. The district
court concluded that the Appearance of Counsel was not a
voluntary appearance under § 25-516.01(1). It relied on lan-
guage from Carlson v. Allianz Versicherungs-AG, 287 Neb.
628, 641, 844 N.W.2d 264, 274 (2014), in which we stated
that “a voluntary appearance is the equivalent to service that
waives a defense of insufficient service or process if the party
requests general relief from the court on an issue other than
sufficiency of service or process, or personal jurisdiction.” The
district court concluded that because HBE had not invoked the
district court’s authority or requested general relief, it had not
made a voluntary appearance. Based on its determination that
HBE had not made a voluntary appearance and Stone Land had
not perfected service upon HBE, the district court determined
that the matter was properly dismissed under Neb. Rev. Stat.
§ 25-217(2) (Reissue 2016).
Stone Land timely appealed, and we moved the case to our
docket. We later granted a motion for revivor filed by the per-
sonal representative of the estate of a deceased shareholder of
Stone Land and revived the appeal in the name of the personal
representative, in her capacity as personal representative.
ASSIGNMENT OF ERROR
Stone Land assigns several errors, but they can be effec-
tively consolidated and restated into one: Stone Land contends
the district court erred by dismissing the complaint for failure
to perfect service within the statutory deadline.
STANDARD OF REVIEW
The parties disagree regarding the appropriate standard of
review in this case. HBE contends that because Stone Land
- 973 -
Nebraska Supreme Court Advance Sheets
309 Nebraska Reports
STONE LAND & LIVESTOCK CO. v. HBE
Cite as 309 Neb. 970seeks review of the district court’s order denying its motion
to reinstate the case, which was a motion to alter or amend the
judgment, an abuse of discretion standard applies. Stone Land
argues that we should review this matter independently of the
determination reached by the district court.
[1,2] Although the denial of a motion to alter or amend the
judgment is generally reviewed for an abuse of discretion, see,
e.g., State v. Robertson, 294 Neb. 29, 881 N.W.2d 864 (2016),
Stone Land seeks review of a jurisdictional determination by
the district court, see, e.g., Kovar v. Habrock, 261 Neb. 337,
622 N.W.2d 688 (2001) (district court lacks jurisdiction over
action after failure to serve defendant pursuant to § 25-217).
A jurisdictional question which does not involve a factual dis-
pute is determined by an appellate court as a matter of law. In
re Estate of Brinkman, 308 Neb. 117, 953 N.W.2d 1 (2021).
Stone Land’s arguments also require that we engage in statu-
tory interpretation, which also presents a question of law. Ryan
v. Streck, Inc., ante p. 98, 958 N.W.2d 703 (2021). An appel-
late court independently reviews questions of law decided by
a lower court. In re Estate of Brinkman, supra. Further, it is
of little practical consequence in this case whether we label
our review as abuse of discretion or de novo. As we have
explained, this case presents a question of law, and a “district
court by definition abuses its discretion when it makes an error
of law.” Koon v. United States, 518 U.S. 81, 100, 116 S. Ct.
2035, 135 L. Ed. 2d 392 (1996).
ANALYSIS
Under the version of § 25-217 in effect at the time Stone
Land filed its complaint, it was required to serve HBE within
6 months. But, see, 2019 Neb. Laws, L.B. 308, § 1 (amending
service deadline of 6 months to 180 days, effective September
1, 2019). If service is not completed within this statutory
deadline, the district court loses jurisdiction and the action is
dismissed without prejudice by operation of law. See Vopalka
v. Abraham, 260 Neb. 737, 619 N.W.2d 594 (2000).
- 974 -
Nebraska Supreme Court Advance Sheets
309 Nebraska Reports
STONE LAND & LIVESTOCK CO. v. HBE
Cite as 309 Neb. 970There is no dispute that HBE was not actually served within
6 months of the filing of Stone Land’s complaint. Another
statute, however, provides that the “voluntary appearance of
the party is equivalent to service.” § 25-516.01(1). If, as Stone
Land contends, the Appearance of Counsel was a voluntary
appearance under this statute, that would be a timely “equiva-
lent to service,” and the district court should not have dis-
missed the action under § 25-217.
The district court determined that the Appearance of Counsel
was not a voluntary appearance, because it did not request gen-
eral relief from the court on an issue other than sufficiency of
service of process or personal jurisdiction. Stone Land argues
that the district court overlooked a way in which HBE did in
fact request relief through its Appearance of Counsel. Stone
Land points out that HBE electronically filed its Appearance
of Counsel and, by doing so, ensured that its counsel would
receive automatic notice of subsequent filings in the case. We
disagree that HBE requested general relief on an issue other
than sufficiency of service or process, or personal jurisdiction
in its Appearance of Counsel. Even assuming that a request
to be notified of future filings would amount to a request for
relief on an “issue” in the case, the Appearance of Counsel
made no such request. Automatic notice of future filings may
have been a consequence of the Appearance of Counsel, but
not because the Appearance of Counsel requested it.
Alternatively, Stone Land asks that we find that the
Appearance of Counsel was a voluntary appearance even if it
did not request relief from the district court on an issue other
than sufficiency of service or process, or personal jurisdic-
tion. Although we have stated that a party makes a voluntary
appearance if it makes such a request, see Carlson v. Allianz
Versicherungs-AG, 287 Neb. 628, 844 N.W.2d 264 (2014), that
cannot be the only mechanism by which a party can make a
voluntary appearance. If that were so, a party filing a document
stating that it had received the complaint and was entering
- 975 -
Nebraska Supreme Court Advance Sheets
309 Nebraska Reports
STONE LAND & LIVESTOCK CO. v. HBE
Cite as 309 Neb. 970its voluntary appearance and waiving service of process would
not make a voluntary appearance. That is obviously not the
case. See, e.g., J.S. v. Grand Island Public Schools, 297 Neb.
347, 899 N.W.2d 893 (2017) (recognizing such filing as vol-
untary appearance). See, also, John P. Lenich, Nebraska Civil
Procedure § 10:26 (2021).
While there is no question that a party can make a voluntary
appearance without requesting general relief from the court on
an issue other than sufficiency of service or process, or personal
jurisdiction, we do not appear to have previously explored
what a party must do to make a voluntary appearance in this
way. To answer this question, we must interpret § 25-516.01(1)
and particularly the term “voluntary appearance” as it appears
in that subsection. Ordinarily, we give statutory language its
plain and ordinary meaning. See In re Guardianship of Eliza
W., 304 Neb. 995, 938 N.W.2d 307 (2020). The term “volun-
tary appearance,” however, is a legal term of art. A legal term
of art is a word or phrase having a specific, precise meaning
in a given specialty apart from its general meaning in ordinary
contexts. State ex rel. Peterson v. Creative Comm. Promotions,
302 Neb. 606, 924 N.W.2d 664 (2019). When legal terms of art
are used in statutes, they are to be construed according to their
term of art meaning. Id.The term “appearance,” in this context, generally refers to
the idea of a party to a lawsuit taking some action or submit-
ting something to the court by which that party demonstrates
an intention to submit to the court’s jurisdiction. See, e.g.,
Dyer v. Surratt, 266 Ga. 220, 466 S.E.2d 584 (1996) (appear-
ance signifies overt act by which person against whom suit
has commenced submits to court’s jurisdiction); U.S. Aviation,
Inc. v. Wyoming Avionics, 664 P.2d 121, 124 (Wyo. 1983)
(“[a]n appearance in an action involves some submission or
presentation to the court by which a party shows his intention
to submit himself to the jurisdiction of the court”); Minton
v. First National Exchange Bank of Virginia, 206 Va. 589,
593, 145 S.E.2d 139, 143 (1965) (“[i]t is generally held that
- 976 -
Nebraska Supreme Court Advance Sheets
309 Nebraska Reports
STONE LAND & LIVESTOCK CO. v. HBE
Cite as 309 Neb. 970an appearance by a party requires some act on the part of
that party evidencing an intention to submit himself to the
jurisdiction of the court”). A “voluntary appearance” stands in
contrast to a “compulsory appearance”: a voluntary appearance
is made by one who appears without having been served with
process, while a compulsory appearance is made by a party
who is required to appear as a result of being served with
process. Black’s Law Dictionary 122 (11th ed. 2019); 6 C.J.S.
Appearances § 2 (2016). In Nebraska, the term “voluntary
appearance” has traditionally referred to a waiver of service of
process. See Lenich, supra, § 11:26.
[3] Based on the foregoing, we understand a voluntary
appearance to refer to a party who has not been served with
process taking some action or making some submission to
the court that demonstrates an intention to waive service of
process. We observe that our prior cases holding that a party
makes a voluntary appearance if it requests general relief
from the court on an issue other than sufficiency of service or
process, or personal jurisdiction is consistent with this under-
standing; by making such a request and thereby invoking the
authority of the court, a party demonstrates an intent to waive
service of process.
HBE takes the position that the Appearance of Counsel did
not demonstrate its intent to do anything. HBE frames the
Appearance of Counsel as a filing by which the attorneys refer-
enced appeared in the action, but that the parties they purported
to represent did not.
[4] We disagree that the Appearance of Counsel should be
treated as a filing of only the referenced attorneys and not a
filing on behalf of HBE. HBE conceded at oral argument that
it could be assumed in this case that the Appearance of Counsel
was made with the consent of HBE. The signature block of
the Appearance of Counsel indicates that it was submitted
on behalf of HBE. Further, the relationship between attorney
and client is one of agency. See VRT, Inc. v. Dutton-Lainson
Co., 247 Neb. 845, 530 N.W.2d 619 (1995). Consequently, the
- 977 -
Nebraska Supreme Court Advance Sheets
309 Nebraska Reports
STONE LAND & LIVESTOCK CO. v. HBE
Cite as 309 Neb. 970client is bound by the acts, omissions, neglect, and fraud of
the client’s attorney when such is within the attorney’s scope
of express, implied, apparent, or ostensible authority. Id. The
Appearance of Counsel was a filing of HBE.
Although we find that the Appearance of Counsel was filed
on behalf of HBE, we disagree that it demonstrated an inten-
tion on the part of HBE to waive service of process. In the
Appearance of Counsel, HBE did nothing more than acknowl-
edge the existence of the lawsuit and disclose to Stone Land
and the district court that the referenced attorneys would be
representing it in that lawsuit. A party’s awareness of a lawsuit
and its disclosure that it has chosen attorneys to represent it in
that lawsuit does not, in our view, demonstrate an intention to
waive service of process. A party can be aware of a lawsuit and
still insist on service of process. Further, a party’s attorneys
might take no action in a lawsuit other than contending that
service was not perfected.
Finally, we are not persuaded by Stone Land’s argument
that if the Appearance of Counsel does not qualify as a vol-
untary appearance, neither would a form entitled “Voluntary
Appearance” made available on the Nebraska Judicial Branch’s
website. The form to which Stone Land refers both expressly
cites § 25-516.01 and provides room for parties to acknowledge
they are making a “Voluntary Appearance” in the action. The
reference to the statute and the term “Voluntary Appearance”
demonstrate an intention to waive service of process pursuant
to § 25-516.01 that is absent from the Appearance of Counsel
filed in this case.
The Legislature has directed that actions are dismissed if
defendants do not, prior to the statutory deadline, receive serv­
ice or make a voluntary appearance. HBE was not served prior
to the statutory deadline, and, for reasons we have explained, its
Appearance of Counsel did not amount to a voluntary appear-
ance. Under the circumstances, the district court was obligated
to recognize the dismissal of the complaint.
- 978 -
Nebraska Supreme Court Advance Sheets
309 Nebraska Reports
STONE LAND & LIVESTOCK CO. v. HBE
Cite as 309 Neb. 970CONCLUSION
Because we find that the Appearance of Counsel was not a
voluntary appearance and that HBE was not timely served, the
district court correctly recognized the complaint as dismissed
pursuant to § 25-217. We therefore affirm.
Affirmed.
Miller-Lerman, J., not participating.