Thompson v. Heineman

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798 289 NEBRASKA REPORTS
CONCLUSION
We conclude that the cumulative errors of failing to comply
with the provisions of § 27-513, the continued questioning of
Nancy after she refused to testify, and the trial court’s refusal
to either admonish or instruct the jury not to draw an inference
from the invocation of the privilege constitute reversible error.
Because the evidence presented by the State was sufficient to
sustain Draper’s convictions, we reverse the convictions and
remand the cause for a new trial.
R eversed and remanded for a new trial.
Randy Thompson et al., appellees and cross-appellants,
v. Dave H eineman, in his official capacity as
Governor of the State of Nebraska, et al.,
appellants and cross-appellees.
___ N.W.2d ___
Filed January 9, 2015. No. S-14-158.
1. Judgments: Appeal and Error. An appellate court independently reviews ques-
tions of law decided by a lower court.
2. Judgments: Jurisdiction. A jurisdictional question which does not involve a
factual dispute presents a question of law.
3. Constitutional Law: Statutes. The constitutionality of a statute presents a ques-
tion of law.
4. Standing: Jurisdiction: Parties. Standing is a jurisdictional component of a
party’s case. Only a party that has standing—a legal or equitable right, title, or
interest in the subject matter of the controversy—may invoke the jurisdiction of
a court or tribunal.
5. Standing: Proof. Common-law standing usually requires a litigant to demon-
strate an injury in fact that is actual or imminent.
6. Taxation: Standing. Taxpayer standing is an exception to the injury-in-fact
requirement for standing.
7. Actions: Taxation: Injunction. A resident taxpayer, without showing any inter-
est or injury peculiar to itself, may bring an action to enjoin the illegal expendi-
ture of public funds raised for governmental purposes.
8. Taxation: Standing: Public Purpose. As a limited exception to the injury-in-fact
requirement for standing, taxpayers may raise a matter of great public concern.
9. Mandamus: Public Purpose. The “great public concern” exception is another
name for the “public interest” exception in early mandamus cases to enforce a
public right.
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THOMPSON v. HEINEMAN 799
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10. Actions: Taxation: Standing: Public Purpose. In taxpayer actions raising a
matter of great public concern, there is no requirement that the taxpayer show the
alleged unlawful act would otherwise go unchallenged because no other potential
party is better suited to bring the action.
11. Constitutional Law: Statutes: Presumptions. A court presumes that statutes are
constitutional and will not strike down a statute unless its unconstitutionality is
clearly established.
12. Constitutional Law: Administrative Law: Public Service Commission. The
Public Service Commission is not a statutorily created state agency. It is
an independent regulatory body for common carriers created by Neb. Const.
art. IV, § 20.
13. Public Service Commission. The Public Service Commission has independent
legislative, judicial, and executive or administrative powers over common car-
riers, which powers are plenary and self-executing. Absent specific legisla-
tion, the commission’s enumerated powers over common carriers are absolute
and unqualified.
14. Constitutional Law: Legislature: Public Service Commission. In any field
where the Legislature has not acted, the Nebraska Constitution authorizes
the Public Service Commission to exercise its plenary powers over com-
mon carriers.
15. ____: ____: ____. Under Neb. Const. art. IV, § 20, the Legislature can restrict the
Public Service Commission’s plenary powers only through specific legislation.
16. Constitutional Law: Legislature: Public Service Commission: Jurisdiction:
Words and Phrases. Under Neb. Const. art. IV, § 20, the term “specific legisla-
tion” means specific restrictions. It does not include general legislation to divest
the Public Service Commission of its jurisdiction and transfer its powers to
another governmental entity or official besides the Legislature.
17. Constitutional Law: Legislature: Public Service Commission: Jurisdiction.
Under Neb. Const. art. IV, § 20, the Legislature can divest the Public Service
Commission of jurisdiction over a class of common carriers by passing specific
legislation that occupies a regulatory field, thereby preempting the commis-
sion’s control.
18. ____: ____: ____: ____. Under Neb. Const. art. IV, § 20, if the Legislature passes
specific legislation to divest the Public Service Commission of jurisdiction in a
regulatory field, the Legislature cannot abandon control over the common carriers
in that field. Regulatory control over common carriers must reside either in the
commission or in the Legislature.
19. Constitutional Law: Legislature: Public Service Commission. Unless
the Legislature enacts legislation to specifically restrict the Public Service
Commission’s authority and retains control over that class of common carriers, it
cannot constitutionally deprive the commission of its regulatory powers.
20. ____: ____: ____. The Public Service Commission’s constitutional authority to
regulate “common carriers” is limited to the common-law meaning of that term
unless the Legislature has authorized the commission to exercise control over
carriers that are outside of that meaning.
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21. Words and Phrases. A carrier refers to an individual or organization that con-
tracts to transport passengers or goods for a fee. The common law recognizes
only two types of carriers: common carriers and private carriers.
22. Contracts: Words and Phrases. A private carrier is one that, without being in
the business of transporting for others or holding itself out to the public as will-
ing to do so, undertakes only by special agreement to transport property, either
gratuitously or for a consideration.
23. Public Purpose: Words and Phrases. Any person, corporation, or association
holding itself out to the public as offering its services to all persons similarly situ-
ated and performing as its public vocation the services of transporting passengers,
freight, messages, or commodities for a consideration or hire, is a common carrier
in the particular spheres of such employment.
24. ____: ____. A carrier is a common carrier if its vocation is of a public nature,
although limited to the transportation of certain classes or kinds of freight, and
it may be of service to a limited few who by their peculiar situation or business
may have occasion to employ it. Transporting commodities for others is a voca-
tion of a public nature even if the service is not available to the public at large.
25. Oil and Gas: Words and Phrases. An oil pipeline carrier is a common carrier if
it holds itself out as willing to transport oil products for a consideration to all oil
producers in the area where it offers its transportation services.
26. Constitutional Law: Statutes: Proof. A plaintiff can succeed in a facial chal-
lenge only by establishing that no set of circumstances exists under which the act
would be valid, i.e., that the law is unconstitutional in all of its applications.
27. Oil and Gas: Legislature: Intent. Neb. Rev. Stat. § 75-501 (Reissue 2009)
does not define the whole field of pipeline common carriers. Its historical con-
text shows that the Legislature intended only to ensure that intrastate carriers
are regulated.
28. Constitutional Law: Courts: Public Service Commission. A court liberally
construes the constitutional provision creating the Public Service Commission
and delineating its powers.
29. Constitutional Law: Statutes. A canon of statutory construction must yield to
constitutional requirements governing the same subject matter.
30. Public Utilities: Rates. The public nature of a corporate utility’s operations and
the public franchise that authorizes its operations justify government regulation
of its rates.
31. Eminent Domain. The reason common carriers can exercise the right of eminent
domain lies in their quasi-public vocation of transporting passengers or commodi-
ties for others.
32. Constitutional Law: Eminent Domain: Taxation: Public Purpose. A citizen’s
property may not be taken against his or her will, except through the sovereign
powers of taxation and eminent domain, both of which must be for a pub-
lic purpose.
33. Eminent Domain: Public Purpose: Words and Phrases. Eminent domain is the
State’s inherent power to take private property for a public use.
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THOMPSON v. HEINEMAN 801
Cite as 289 Neb. 798
34. Constitutional Law: Eminent Domain: Legislature: Statutes. The State’s
eminent domain power resides in the Legislature and exists independently
of the Nebraska Constitution. But the constitution has limited the power of
eminent domain, and the Legislature can limit its use further through statu-
tory enactments.
35. Constitutional Law: Eminent Domain: Public Purpose. Under Neb. Const. art.
I, § 21, the State can take private property only for a public use and only if it
pays just compensation.
36. Eminent Domain: Legislature. Only the Legislature can authorize a private or
public entity to exercise the State’s power of eminent domain.
37. Eminent Domain: Legislature: Public Purpose. Because a common carrier
performs a public transportation service, the Legislature can grant it the sovereign
power to take private property for a public use and the State can control its opera-
tions, to the extent that the regulation is not precluded by federal law.
38. Constitutional Law: Property. The Nebraska Constitution prohibits the taking
of private land for a private purpose.
39. Constitutional Law: Eminent Domain: Public Purpose: Oil and Gas. Under
the Nebraska Constitution’s limitation on the power of eminent domain, common
carriers can take private property only for a public use. That minimally means
that a pipeline carrier must be providing a public service by offering to transport
the commodities of others who could use its service, even if they are limited
in number.
40. Constitutional Law: Public Service Commission: Oil and Gas. The Public
Service Commission’s constitutional powers over common carriers include rout-
ing decisions for pipeline common carriers.
Appeal from the District Court for Lancaster County:
Stephanie F. Stacy, Judge. Judgment vacated.
Jon Bruning, Attorney General, Katherine J. Spohn, Ryan S.
Post, and Blake E. Johnson for appellants.
David A. Domina, Brian E. Jorde, and Megan N. Mikolajczyk,
of Domina Law Group, P.C., L.L.O., for appellees.
Richard Klingler, Kathleen Mueller, and Lauren C. Freeman,
of Sidley Austin, L.L.P., and James G. Powers and Patrick D.
Pepper, of McGrath, North, Mullin & Kratz, P.C., L.L.O., for
amicus curiae TransCanada Keystone Pipeline, LP.
Heavican, C.J., Connolly, Stephan, McCormack, Miller-
Lerman, and Cassel, JJ., and Riedmann, Judge.
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Connolly, J.
I. NATURE OF THE DECISION
The State appeals from the district court’s judgment that
determined L.B. 1161,1 which the Legislature passed in 2012,
was unconstitutional.
Neb. Const. art. V, § 2, in relevant part, requires that a
supermajority of this court’s members concur before it can
strike down legislation as unconstitutional: “No legislative act
shall be held unconstitutional except by the concurrence of
five judges.”
Four judges of this court have determined that the appel-
lees (the landowners), who challenged the constitutionality of
L.B. 1161, have standing to raise this issue and that the legis-
lation is unconstitutional. Three judges of this court conclude
that the landowners lacked standing and decline to exercise
their option to address the constitutional issues.
The majority’s opinion that the landowners have standing
controls that issue. But because there are not five judges of this
court voting on the constitutionality of L.B. 1161, the legisla-
tion must stand by default. Accordingly, we vacate the district
court’s judgment.
The following judges are of the opinion that the landowners
have standing and that the challenged legislation is unconstitu-
tional: Justices Connolly, McCormack, and Miller-Lerman, and
Judge Riedmann.
II. SUMMARY
L.B. 1161 allows “major oil pipeline” carriers to bypass the
regulatory procedures of the Public Service Commission (PSC).
As an alternative to obtaining approval from the PSC—a con-
stitutional body charged with regulating common carriers—
L.B. 1161 permits these pipeline carriers to obtain approval
from the Governor to exercise the power of eminent domain
for building a pipeline in Nebraska. The district court ruled
that the Legislature had unconstitutionally divested the PSC of
its regulatory authority over common carriers. On appeal, the
1
2012 Neb. Laws, L.B. 1161.
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State contends that the landowners lacked standing to sue and
that L.B. 1161 is constitutional.
III. BACKGROUND
L.B. 1161 has its origins in the controversial Keystone
XL oil pipeline proposed in 2008 by TransCanada Keystone
Pipeline, LP (TransCanada). TransCanada wanted to construct
its pipeline to carry crude oil products from Canada to the
Texas coastline. By executive order, the construction of a
pipeline that crosses an international border requires a per-
mit from the President of the United States.2 Executive Order
No. 13337 delegates to the U.S. Secretary of State the authority
to “receive all applications for Presidential permits . . . for the
construction, connection, operation, or maintenance, at the bor-
ders of the United States, of facilities for the . . . exportation
or importation of petroleum [or] petroleum products . . . to or
from a foreign country.”3 In 2008, TransCanada applied for a
presidential permit to construct its proposed pipeline.
As originally proposed, the pipeline would have passed
directly through Nebraska’s Sandhills, raising considerable
public concern about environmental damage to a sensitive eco-
system and the region’s high water table. In 2008, the statute
that governs eminent domain power for oil pipelines imposed
no standards on carriers for the right to exercise eminent
domain power.4 In October 2011, the Governor called a special
session of the Nebraska Legislature to determine whether siting
legislation could be enacted.
1. Legislative Background
In the 2011 special session, the Legislature amended
§ 57-1101 by enacting L.B. 1, a legislative bill called the
Major Oil Pipeline Siting Act (MOPSA).5 MOPSA required
2
See, Exec. Order No. 13337, 69 Fed. Reg. 25,299 (Apr. 30, 2004); Exec.
Order No. 11423, 33 Fed. Reg. 11,741 (Aug. 16, 1968).
3
See Exec. Order 13337, supra note 2, § 1(a).
4
See Neb. Rev. Stat. § 57-1101 (Reissue 2010).
5
See 2012 Neb. Laws, L.B. 1, § 2, 1st Spec. Sess.
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804 289 NEBRASKA REPORTS
a major oil pipeline carrier to apply for and obtain approval
from the PSC before it could exercise eminent domain power
to build a pipeline.6 Section 5(2) of MOPSA defines a major
oil pipeline as a pipeline larger than 6 inches in diameter that
is built to transport any petroleum product “within, through, or
across Nebraska.”7
In passing MOPSA, the Legislature recognized8 that federal
law preempts state regulation of safety issues related to oil
pipelines.9 But it asserted the State’s authority to regulate the
siting of pipelines to protect the economic and aesthetic value
of Nebraska’s land and natural resources.10 In determining
whether to approve a proposed route, MOPSA required the
PSC to consider several economic, environmental, and social
factors, including whether another corridor could be feasibly
and beneficially used.11 Two of MOPSA’s stated purposes
were to ensure the protection of Nebraskans’ property rights
and the State’s natural resources.12 The Legislature did not
appropriate funds to the PSC to carry out these duties. Instead,
MOPSA authorized the PSC to assess the costs of its regula-
tory investigation and the application process to the appli-
cant.13 It set out an appeal process for any party aggrieved by
the PSC’s final order.14 The Legislature enacted MOPSA with
an emergency clause so that it became effective on November
23, 2011.15
6
Id., § 1.
 7
See id., § 5(2) (codified at Neb. Rev. Stat. § 57-1404(2) (Cum. Supp.
2014)).
8
Id., §§ 3(2) and 4(1) (codified at Neb. Rev. Stat. §§ 57-1402(2) and
57-1403 (Cum. Supp. 2014)).
9
See 49 U.S.C. § 60104(c) (2012).
10
See, 49 U.S.C. § 60104(e); Hazardous Liquid Pipeline Safety Act of 1979,
Pub. L. 96-129, § 202(4), 93 Stat. 1003 (1979); Texas Midstream Gas Serv.
v. City of Grand Prairie, 608 F.3d 200 (5th Cir. 2013).
11
See L.B. 1, § 8 (codified at Neb. Rev. Stat. § 57-1407 (Cum. Supp. 2014)).
12
See id., § 3 (codified at § 57-1402).
13
See id., § 7 (codified at Neb. Rev. Stat. § 57-1406 (Cum. Supp. 2014)).
14
See id., § 10 (codified at Neb. Rev. Stat. § 57-1409 (Cum. Supp. 2014)).
15
See id., § 23.
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But MOPSA contained a significant exemption to its
requirement that major oil pipeline carriers comply with the
PSC procedures: MOPSA did not apply to TransCanada. It
excluded any major pipeline carrier that had submitted an
application to the U.S. Department of State “pursuant to
Executive Order 13337” before MOPSA became effective.16
The parties stipulated that TransCanada filed its application
in 2008. The district court found that when the Legislature
enacted MOPSA, TransCanada’s Keystone XL pipeline was
the only major oil pipeline that satisfied the requirements for
MOPSA’s exemption.
2. Legislature Passes L.B. 4 for
TransCanada’s Pipeline
In the same special session, the Legislature enacted separate
legislation—L.B. 4—for TransCanada’s pipeline.17 L.B. 4 did
not specifically refer to TransCanada or its previously submit-
ted application under the exemption from MOPSA (for pending
applications). But because L.B. 4 did not contain an exemp-
tion, it was the only bill that applied to TransCanada’s pro-
posed pipeline by default. And unlike MOPSA, L.B. 4 did not
require a pipeline carrier to obtain the PSC’s approval before
exercising eminent domain power under § 57-1101. Instead,
§ 3 of L.B. 4 authorized the Department of Environmental
Quality (DEQ) to collaborate with any federal agency that
was conducting a supplemental environmental impact review
for Nebraska under the National Environmental Policy Act
of 1969.18
The National Environmental Policy Act of 1969 requires
federal agencies to determine the environmental impact of
significant federal actions. When making this determination,
a federal agency must request the comments of appropri-
ate state and local agencies.19 In collaborating with federal
16
See id., § 3(3).
17
See 2012 Neb. Laws, L.B. 4, 1st Spec. Sess.
18
See id., § 3(1). See, also, Pub. L. 91-190, 83 Stat. 852 (Jan. 1, 1970)
(codified at 42 U.S.C. §§ 4321 to 4335 and 4341 to 4347 (2012)).
19
See, 42 U.S.C. § 4332(2)(C); 40 C.F.R. § 1503.1(a)(2) (2013).
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agencies to produce an environmental impact statement for
Nebraska, L.B. 4 authorizes the DEQ to hire outside vendors.20
But § 3(2) stated that to ensure an objective report and avoid
the appearance of any conflicts of interest, no costs would
be assessed to the applicant.21 Instead, the Legislature appro-
priated $2 million from the State’s general fund to a DEQ
cash fund to carry out the requirements of L.B. 4.22 After the
DEQ prepares the supplemental statement, L.B. 4 requires
it to submit its evaluation to the Governor, who then has 30
days to inform the responsible federal agency whether he or
she approves the route.23 Unlike MOPSA, L.B. 4 does not
provide an appeal procedure. Like MOPSA, the Legislature
provided for an emergency clause for L.B. 4 and it became
effective on November 23, 2011, the same date that MOPSA
became effective.24
On January 18, 2012, the President of the United States
denied TransCanada’s application. Because TransCanada
no longer had an active application pending with the U.S.
Department of State, it was subject to the PSC regulatory pro-
cedures under MOPSA if it reapplied for a presidential permit
or route through Nebraska.
3. Legislature Passes L.B. 1161 Giving
Major Oil Pipeline Carriers
a P rocedural Choice
On January 19, 2012, during the regular session, Senator
Jim Smith introduced L.B. 1161, which amended the statutory
changes to § 57-1101 enacted by MOPSA and § 3 of L.B. 4.25
As explained, under MOPSA, the Legislature had previously
amended § 57-1101 to provide that a pipeline carrier had to
20
See L.B. 4, § 3(2) (codified at Neb. Rev. Stat. § 57-1503(2) (Cum. Supp.
2014)).
21
See id.
22
See 2012 Neb. Laws, L.B. 4A, 1st Spec. Sess.
23
See L.B. 4, § 3(4) (codified at § 57-1503(4)).
24
See id., § 8.
25
See Legislative Journal, 102d Leg., 2d Sess. 292 (2012).
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apply for and obtain the PSC’s approval before exercising emi-
nent domain power to build a pipeline—unless it had a pend-
ing application for a presidential permit. L.B. 1161 eliminated
this statutory exemption.26 But the Legislature also enacted
a regulatory choice for major oil pipeline carriers seeking to
exercise eminent domain power. Under § 1 of L.B. 1161, a
pipeline carrier had two choices: It could comply with § 3 of
L.B. 4, as amended by L.B. 1161, “and receive the approval
of the Governor for the route,” or it could comply with the
MOPSA approval process through the PSC.27
Originally, § 3 of L.B. 4 did not require a pipeline carrier to
apply for approval from the DEQ or the Governor. As noted,
it authorized the DEQ to collaborate with federal agencies in
producing a supplemental environmental impact statement for
Nebraska and authorized the Governor to approve that state-
ment.28 But L.B. 1161 amended § 3 of L.B. 4 so that the DEQ
had two options. It could still collaborate with federal agencies
on preparing a supplemental environmental impact statement.
But instead of collaborating with federal agencies, the DEQ
could now choose to independently evaluate a proposed route
submitted by a pipeline carrier for being included in a federal
review process to determine the environmental impact of an
oil pipeline.29
Senator Smith testified at the committee hearing that
L.B. 1161 was intended to decouple the DEQ’s efforts from
those of the U.S. Department of State under federal law and
to allow the DEQ to continue with its review of an alterna-
tive route for the Keystone XL pipeline.30 This decoupling
was necessary because TransCanada did not have a permit
request pending with the U.S. Department of State. And after
the President denied TransCanada’s application for a permit,
26
See L.B. 1161, § 4.
27
See id., § 1 (codified at § 57-1101 (Cum. Supp. 2014)).
28
See L.B. 4, § 3.
29
See L.B. 1161, § 7 (codified at § 57-1503(1)(a)).
30
See Natural Resources Committee Hearing, L.B. 1161, 102d Leg., 2d Sess.
3 (Feb. 16, 2012).
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the DEQ had discontinued its review of a pipeline route in
Nebraska. A representative of TransCanada testified in support
of L.B. 1161 and stated that the company planned to reapply
for a presidential permit.31 In response to concerns that other
pipeline carriers could use L.B. 1161’s provisions in the future,
TransCanada’s representative assured senators that this sce-
nario was unlikely and that no other pipeline carrier was cur-
rently seeking to cross Nebraska.32
In conducting an independent review of a proposed route,
L.B. 1161 requires the DEQ to analyze the “environmental,
economic, social, and other impacts associated with the pro-
posed route and route alternatives in Nebraska.”33 Under § 1,
after the DEQ evaluates the impact of a pipeline carrier’s pro-
posed route and submits its report to the Governor, the carrier
can then seek the Governor’s approval of the route.
The DEQ’s final report on TransCanada’s proposed route
shows that it makes no recommendations to the Governor
whether to approve a proposed route. And L.B. 1161 does
not require a carrier to have approval from the DEQ for its
proposed route. If the Governor approves a route, § 1 implic-
itly gives a pipeline carrier the power of eminent domain in
Nebraska: “If condemnation procedures have not been com-
menced within two years after the date the Governor’s approval
is granted or after the date of receipt of an order approving
an application under [MOPSA], the right under this section
expires.”34 In sum, when a carrier elects to proceed under the
DEQ procedures, the Governor has sole authority to approve
the route and thereby bestow upon the carrier the power to
exercise eminent domain.
Under L.B. 1161, if a pipeline carrier submits a route for
evaluation by the DEQ, the carrier must reimburse the DEQ for
the cost of the evaluation.35 Yet, the Legislature reappropriated
31
Id. at 18-19 (testimony of Robert Jones).
32
Id. at 20.
33
L.B. 1161, § 3.
34
Id., § 1; § 57-1101.
35
Id., § 7 (codified at § 57-1503(1)(b)).
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$2 million to the DEQ to carry out its duties under L.B. 1161.36
Finally, if the Governor does not approve the DEQ’s reviewed
routes, he or she must notify the pipeline carrier that it must
obtain route approval from the PSC.37 The Legislature did not
appropriate any funds to the PSC to carry out the MOPSA
requirements. L.B. 1161 did not provide for a right of appeal
from the DEQ procedures, so the only appeal procedure is
limited to final orders issued by the PSC under MOPSA.38 The
Legislature enacted L.B. 1161 with an emergency clause; it
became effective on April 18, 2012.39
4. The State’s Actions in R esponse
to TransCanada’s P roposed
Pipeline Route
On April 18, 2012, TransCanada submitted for the DEQ’s
review its preferred alternative route, which it revised to
avoid the Sandhills. On May 4, TransCanada filed a new
application with the U.S. Department of State to construct the
Keystone XL pipeline. On May 24, the DEQ entered into a
memorandum of understanding with the U.S. Department of
State to collaborate on an environmental review of potential
pipeline routes in Nebraska. About 8 weeks later, the DEQ
issued a “Feedback Report” after holding public meetings
along the corridor of TransCanada’s proposed new route. This
report identified Nebraskans’ concerns, summarized the DEQ’s
review efforts, and disclosed its concerns to TransCanada to
give TransCanada an opportunity to address these concerns in
its routing decision.
In September 2012, TransCanada submitted a report to the
DEQ entitled “Supplemental Environmental Report for the
Nebraska Reroute.” In this report, TransCanada stated that it
had revised its preferred reroute in response to the DEQ’s feed-
back report and comments from landowners that the pipeline
36
Id., § 8.
37
Id., § 3(4) (codified at § 57-1503(4)).
38
See § 57-1409.
39
See L.B. 1161, § 11.
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would still cross fragile land areas with high water tables. The
extensive report comprised TransCanada’s evaluation of the
review factors required by L.B. 1161: “The analysis presented
in this [Supplemental Environmental Report] supports [the]
DEQ’s review and approval of a preferred route in Nebraska.”
The parties stipulated that if built, the proposed pipeline would
cross Nebraska’s border with South Dakota in Keya Paha
County and continue to Nebraska’s Kansas border in Jefferson
County. In October, the DEQ issued its “Draft Evaluation
Report” for public comment.
On January 3, 2013, the DEQ submitted its final evaluation
report to the Governor. On January 22, the Governor approved
TransCanada’s proposed route and asked the President and
the U.S. Secretary of State to include Nebraska’s evaluation
in the U.S. Department of State’s supplemental environmental
impact statement.
5. Procedural History
In March 2013, the landowners filed their operative com-
plaint against the Governor, the DEQ’s director, and the State
Treasurer. They sought a declaratory judgment that L.B. 1161
is unconstitutional. They alleged that the bill violated the
Nebraska Constitution’s equal protection, due process, and
separation of powers provisions, and its prohibition of spe-
cial legislation. They alleged that the bill unconstitutionally
delegated to the Governor powers over a common carrier
that exclusively belong to the PSC and unconstitutionally
delegated to the Governor plenary authority over the exer-
cise of eminent domain power that exclusively belongs to
the Legislature. Finally, they alleged that the bill unlawfully
allocated $2 million to the DEQ to implement unconstitutional
laws and unlawfully pledged the State’s funds and credit to a
pipeline applicant that repays the funds in the future. In sup-
port of this claim, they alleged that the DEQ had advanced
more than $5 million in public funds to TransCanada under
L.B. 1161.
In its answer, the State denied the landowners’ allega-
tions that L.B. 1161 was unlawful legislation. It affirmatively
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alleged that the landowners lacked standing to bring the action;
their claims were not ripe for judicial review; their claims, in
part, were moot; they failed to state a claim upon which relief
could be granted; and the court lacked subject matter jurisdic-
tion over the action.
The court tried the case on stipulated facts and exhibits. At
the hearing, the landowners specifically stated that they were
asserting a facial challenge to L.B. 1161. Regarding the land-
owners’ standing, the State contended that they lacked stand-
ing because they could not show an injury in fact. Regarding
the due process claim, the State argued that if a pipeline car-
rier initiated a condemnation proceeding, a landowner could
thereafter contest the fair market value of the property and
whether the taking of his or her private property served a pub-
lic purpose. The State also disputed the landowners’ position
that their claim fell into the standing exception for taxpayers
to challenge illegal expenditures by governmental bodies and
officials. It argued that TransCanada was required to reim-
burse the State for all the costs incurred by the DEQ and that
TransCanada had reimbursed the State for costs that included
the DEQ employees’ overtime and benefits and the DEQ’s
consultant fees.
6. Court’s Order
The court stated that because it could not determine from
the landowners’ affidavits whether their property was located
in the path of the proposed pipeline, they had failed to estab-
lish traditional standing. But the court concluded that they had
established taxpayer standing to challenge L.B. 1161 and that
the legislation was unconstitutional. Regarding standing, the
court rejected the State’s arguments that our case law required
the landowners to show that there was no better suited party
to bring the action and that no illegal expenditure existed
because TransCanada had reimbursed the State for all of the
DEQ’s expenditures.
The court concluded that in the case on which the State was
relying, this court’s holding regarding “better suited” parties
was limited to the claims dealing with a governmental body or
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official’s failure to assess taxes.40 It determined that the require-
ment did not apply to illegal expenditure cases and that even
if it did, we had also held there that no party is better suited
than a taxpayer to challenge a failure to tax if the persons or
entities directly and immediately affected by the omission have
benefited from the act.41 The court concluded that under our
case law, the landowners had standing because the case raised
matters of great public concern and the group directly affected
by L.B. 1161—pipeline carriers—had benefited from the act
and had no incentive to challenge it. The court noted that the
evidence showed a representative of TransCanada, the only
pipeline carrier to invoke L.B. 1161’s provisions, testified for
its passage.
The court rejected the State’s argument that the landown-
ers had lost standing to challenge an illegal expenditure after
TransCanada reimbursed the State for the DEQ’s costs. The
court noted that this argument was more properly character-
ized as a mootness challenge, but concluded that taxpayer
standing should not turn on a manipulable factor like the
repayment of public funds: “Nor should courts, in analyzing
taxpayer standing, be required to resort to forensic account-
ing methods to determine whether all public expenditures
have been reimbursed.” The court found that in response
to the State’s invoices, TransCanada had reimbursed the
State for over $5 million in costs. It concluded that our case
law conferred standing on taxpayers to challenge illegal
appropriations and that reimbursements do not divest them
of standing.
Regarding the landowners’ constitutional challenges, the
court rejected all their arguments except one. It concluded
that pipeline carriers are common carriers and that absent spe-
cific legislation, the PSC’s authority over them is absolute. It
40
See Project Extra Mile v. Nebraska Liquor Control Comm., 283 Neb. 379,
810 N.W.2d 149 (2012).
41
See id.
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concluded that the Legislature had unconstitutionally divested
the PSC of control over pipeline common carriers and had
delegated the routing decisions for them to the DEQ and
the Governor. It rejected the State’s argument that routing
decisions are not within the PSC’s constitutionally enumer-
ated powers.
The court also rejected the State’s argument that because
a pipeline carrier could choose to comply with the PSC’s
regulatory procedures, L.B. 1161 was not unconstitutional
in every circumstance, which would defeat the landowners’
facial challenge. The court reasoned that the landowners’
challenge was limited to that part of L.B. 1161 that allows
pipeline carriers to choose the DEQ’s review process and the
Governor’s approval of a route. It concluded that L.B. 1161
completely divested the PSC of authority over carriers that
make this election and thus violated article IV, § 20, of the
Nebraska Constitution. It concluded that L.B. 1161 must
be declared void, as well as the Governor’s approval of
TransCanada’s route, because it was premised on an uncon-
stitutional statute.
IV. ASSIGNMENTS OF ERROR
The State assigns that the court erred in (1) determining
that the landowners had taxpayer standing, (2) determining
that an environmental review by the DEQ and approval by
the Governor for proposed oil pipelines that are not intrastate
common carriers divests the PSC of its authority, in violation
of Neb. Const. art. IV, § 20; and (3) considering an exhibit that
was not admitted into evidence.
On cross-appeal, the landowners assign that the court erred
in failing to hold that L.B. 1161 is unconstitutional and void
because it (1) fails to provide for judicial review and violates
due process; (2) confers upon the Governor the authority to
grant a private entity the power to exercise eminent domain;
(3) lacks a legal standard against which to test applications
for authority to act as a common carrier; and (4) involves an
unlawful pledge of the State’s credit to a private entity.
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V. STANDARD OF REVIEW
[1-3] We independently review questions of law decided
by a lower court.42 A jurisdictional question which does not
involve a factual dispute presents a question of law.43 The con-
stitutionality of a statute also presents a question of law.44
VI. ANALYSIS
1. Standing
(a) Common-Law Requirements
and Relevant Exceptions
[4,5] Standing is a jurisdictional component of a party’s
case.45 Only a party that has standing—a legal or equitable
right, title, or interest in the subject matter of the controversy—
may invoke the jurisdiction of a court or tribunal.46 Common-
law standing usually requires a litigant to demonstrate an
injury in fact that is actual or imminent.47
[6-8] But taxpayer standing is an exception to the injury-
in-fact requirement. Here, the district court determined that
the landowners had taxpayer standing for two reasons. First,
taxpayers have an equitable interest in public funds, including
state public funds.48 So a resident taxpayer, without showing
any interest or injury peculiar to itself, may bring an action to
enjoin the illegal expenditure of public funds raised for gov-
ernmental purposes.49 Additionally, a taxpayer’s action some-
times raises matters of great public concern that far exceed the
type of injury in fact an individual could normally assert in an
42
See Kelliher v. Soundy, 288 Neb. 898, 852 N.W.2d 718 (2014).
43
See id.
44
See J.M. v. Hobbs, 288 Neb. 546, 849 N.W.2d 480 (2014).
45
Butler Cty. Sch. Dist. v. Freeholder Petitioners, 283 Neb. 903, 814 N.W.2d
724 (2012).
46
Field Club v. Zoning Bd. of Appeals of Omaha, 283 Neb. 847, 814 N.W.2d
102 (2012).
47
Project Extra Mile, supra note 40.
48
See id.
49
Id.
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action against government officials or entities.50 So we have
recognized a limited exception for taxpayer actions that raise
such matters.51 The district court determined that both of these
exceptions applied.
(b) Parties’ Contentions
The State argues that the court erred in concluding the land-
owners had taxpayer standing based solely on a challenged
appropriation. It contends that no illegal expenditure occurred
because L.B. 1161 requires a pipeline carrier to reimburse the
State for the DEQ’s regulatory costs in evaluating a proposed
route. It also argues that the landowners failed to show there
is no better suited plaintiff to bring the action as required by
Project Extra Mile v. Nebraska Liquor Control Comm.52
The landowners argue that this case illustrates why taxpay-
ers have an interest in challenging unlawful appropriations,
regardless of whether the legislation requires reimbursement
of the expenditures. They point to evidence that TransCanada
has reimbursed the State for over $5 million in costs, despite a
legislative appropriation to the DEQ of only $2 million.
The landowners contend that they made a prima facie show-
ing there is no better party to bring the challenge and that the
State adduced no evidence to refute their position. The land-
owners also argue that it is irrelevant whether TransCanada
reimbursed the State. They argue that they are challenging the
facial validity of L.B. 1161, not whether an illegal expenditure
occurred in this particular case.
Neither party, however, has addressed the court’s determina-
tion that this case raises a matter of great public concern. But
we agree with that determination.
(c) Analysis
We adopted the “great public concern” exception in
Cunningham v. Exon.53 There, the plaintiff, a citizen taxpayer,
50
See id.
51
See Cunningham v. Exon, 202 Neb. 563, 276 N.W.2d 213 (1979).
52
Project Extra Mile, supra note 40.
53
See Cunningham, supra note 51.
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brought a declaratory judgment action against the State. The
taxpayer challenged the validity of two constitutional amend-
ments to article VII, § 11, which governs public funding
of schools. The voters had adopted one of the Legislature’s
proposed amendments but rejected a second one. Because of
the way the proposals were presented, the vote had the effect
of omitting language that restricted the State from accepting
“money or property to be used for sectarian purposes,” unless
the sole source of money was a federal grant and it was dis-
tributed according to the terms of the grant. The plaintiff chal-
lenged the presentation to the voters. He argued that the restric-
tion had been inadvertently omitted because the Legislature
had not explained the effect of voting for the first proposal
and against the second. The district court dismissed the action,
concluding that the plaintiff lacked standing.
We had previously recognized that a taxpayer, without show-
ing an injury peculiar to himself, has standing to challenge an
unlawful governmental expenditure or appropriation, or an
unlawful increase in the burden of taxation.54 Yet, the chal-
lenged act in Cunningham involved neither circumstance. The
State argued that the only persons who could have standing to
challenge the amendments were the potential recipients of fed-
eral funds who were affected by the amendments. We rejected
that argument and adopted a standing exception “where matters
of great public concern are involved and a legislative enact-
ment may go unchallenged unless plaintiff has the right to
bring the action.”55 We quoted the Colorado Supreme Court’s
holdings regarding a taxpayer’s standing to obtain a declara-
tory judgment even if the taxpayer’s interest was no different
from that of any other taxpayer:
“[W]e can conceive of no greater interest a taxpayer can
have than his interest in the form of government under
which he is required to live, or in any proposed change
thereof. In the last analysis, this interest may well exceed
any pecuniary interest he may have. The interest and
54
See, e.g., Niklaus v. Miller, 159 Neb. 301, 66 N.W.2d 824 (1954); Martin
v. City of Lincoln, 155 Neb. 845, 53 N.W.2d 923 (1952).
55
Cunningham, supra note 51, 202 Neb. at 567, 276 N.W.2d at 215.
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concern of plaintiff as a taxpayer is not primarily con-
fined to himself alone, but is of ‘great public concern’. .
. . If a taxpayer and citizen of the community be denied
the right to bring such an action under the circumstances
presented by this record, then the wrong must go unchal-
lenged, and the citizen and taxpayer reduced to mere
spectator without redress.”[56] . . . The Colorado Supreme
Court later reaffirmed [this] holding . . . with respect to
statutory provisions involving a reorganization of state
government and said: “The rights involved extend beyond
self-interest of individual litigants and are of ‘great pub-
lic concern.’”57
In Cunningham, we concluded that this exception, which
permitted citizens to challenge unlawful statutes and ordi-
nances, applied even more strongly to an action challenging the
validity of a constitutional amendment:
There can be no doubt that the amendment . . . raises
issues of great public interest and concern . . . . It is also
obvious that if the amendment . . . cannot be challenged
by a citizen and taxpayer unless and until he has a special
pecuniary interest or injury different from that of the pub-
lic generally, it is entirely possible that no one may have
standing to challenge it. An amendment which changes
the provisions of a state constitution as to the use of pub-
lic funds for sectarian and educational purposes is of such
great public interest and concern that a citizen taxpayer
should have standing sufficient to maintain an action for
a declaratory judgment . . . without the necessity of show-
ing that he has sustained some special injury peculiar to
himself and distinct from that of the public generally.58
56
Id. (emphasis supplied), quoting Howard v. Boulder, 132 Colo. 401, 290
P.2d 237 (1955).
57
Id. at 567-68, 276 N.W.2d at 215, quoting Civil Serv. Emp. v. Love,
167 Colo. 436, 448 P.2d 624 (1968), and citing Portmann v. Board of
Elections, 60 Ohio App. 54, 19 N.E.2d 531 (1938), and Abbott v. Iowa
City, 224 Iowa 698, 277 N.W. 437 (1938).
58
Cunningham, supra note 51, 202 Neb. at 568-69, 276 N.W.2d at 216
(citation omitted) (emphasis supplied).
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[9] The “great public concern” exception is another name
for the “public interest” exception59 that we recognized in our
early mandamus cases. That is, in our early mandamus cases,
we distinguished between private rights and the public’s inter-
est and held that a plaintiff has standing to enforce a public
right. Our earliest decision regarding standing to raise a public
interest was State, ex rel., Ferguson v. Shropshire.60 There,
the Legislature had passed a law that a justice of the peace
could hold court in any precinct of a city regardless of where
he lived, despite a constitutional provision that such officials
shall reside in the precinct where they were elected. We held
that the statute was unconstitutional. We determined that the
plaintiff need not show an interest peculiar to himself to seek
a writ of mandamus to compel the defendant to comply with
this duty:
“Where the question is one of public right, and the object
of the mandamus is to procure the enforcement of a pub-
lic duty, the people are regarded as the real party, and the
relator, at whose instigation the proceedings are instituted,
need not show that he has any legal or special interest in
the result, it being sufficient to show that he is a citizen,
and as such interested in the execution of the laws.”61
Contrary to the dissent, we do not conclude that our early
mandamus cases are distinguishable because the landowners
sought a declaratory judgment here instead of a writ of man-
damus. In either case, a plaintiff’s standing rests upon a public
interest, not a private one. The primary difference between
our early mandamus cases and more recent cases lies in our
narrowing of the public interest that is sufficient to invoke tax-
payer standing, and in State ex rel. Reed v. State,62 we implic-
itly recognized the commonality in these lines of cases.
In State ex rel. Reed, we stated that the exception in our
early mandamus cases to permit citizens to enforce a public
59
See 81A C.J.S. States § 457 at 679 (2004).
60
State, ex rel., Ferguson v. Shropshire, 4 Neb. 411 (1876).
61
Id. at 413-14. See, also, Van Horn v. State, 51 Neb. 232, 70 N.W. 941
(1897).
62
State ex rel. Reed v. State, 278 Neb. 564, 773 N.W.2d 349 (2009).
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right had been clarified in Cunningham. And we noted that
since Cunningham, we have declined to find an exception
to the requirement that the plaintiff have a personal stake
in the outcome of the controversy. Specifically, we declined
to extend Cunningham when the plaintiff claimed that (1)
city officials had unlawfully entered into a cable television
contract for the residents63 and (2) commissioners of the
Nebraska State Racing Commission had exceeded their statu-
tory authority in approving license applications for simulcast
racing.64 We distinguished Cunningham as involving a consti-
tutional issue.
In another case, Ritchhart v. Daub,65 the plaintiff conceded
that she had not alleged a taxpayer’s action and she did not
raise the exception for a matter of great public concern. We
held she lacked standing to seek a declaratory judgment that
a mayor’s hiring agreements with two city officials violated
the city’s charter. The officials had agreed that if the mayor
discharged them, they would not appeal to the personnel board.
We recognized a trend to expand standing requirements, but
concluded that the trend rested on concerns that if the plaintiff
were denied standing, no party could represent the public’s
interest: “The threshold question, then, when a party attempts
to base standing on an injury common to the general public,
has been whether or not there exists another party whose
interests are more at issue in the action, and who is thus more
appropriately entitled to present the claim.”66 We concluded
that the officials who signed the agreements would be the more
appropriate plaintiffs to challenge the mayor’s authority if he
ever attempted to enforce their waivers.
We summarized our public interest case law in State ex
rel. Reed:
Exceptions to the rule of standing must be care-
fully applied in order to prevent the exceptions from
63
Green v. Cox Cable of Omaha, 212 Neb. 915, 327 N.W.2d 603 (1982).
64
Neb. Against Exp. Gmblg. v. Neb. Horsemen’s Assn., 258 Neb. 690, 605
N.W.2d 803 (2000).
65
Ritchhart v. Daub, 256 Neb. 801, 594 N.W.2d 288 (1999).
66
Id. at 808, 594 N.W.2d at 293.
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swallowing the rule. Other than for challenges to the
unauthorized or illegal expenditure of public funds, our
more recent cases have narrowed such exceptions to situ-
ations where matters of great public concern are involved
and a legislative enactment may go unchallenged unless
the plaintiff has the right to bring the action.67
In State ex rel. Reed, we concluded the plaintiff’s claim that
state officials had violated their duties was really his attempt to
impose his opinions on how they should exercise their duties.
He lacked standing to try to influence state officials’ discre-
tionary duties through a legal action. But we clearly recog-
nized that taxpayers could have standing to challenge unlawful
governmental acts involving a matter of great public concern.
And we have more recently suggested that one of our illegal
expenditure cases should be treated as raising a matter of great
public concern.
In Chambers v. Lautenbaugh,68 the illegal expenditure case,
the plaintiff alleged that the Douglas County election com-
missioner had illegally redrawn the district boundary lines
for the election of city council members. We concluded that
the plaintiff had standing because he had alleged an ille-
gal expend­ iture of public funds. Our conclusion rested on
the plaintiff’s allegations that the commissioner’s office had
spent and would continue to spend public money and public
employees’ time to implement the allegedly illegal bound-
ary lines.
Under Chambers, preventing the use of public time and
money to implement and enforce allegedly invalid rules is a
sufficient interest to confer taxpayer standing to challenge the
rules.69 That holding would have obvious application here.
But in Project Extra Mile,70 we recognized a tension between
Chambers and other cases in which we had held that a claim
of unauthorized government action was insufficient to confer
67
State ex rel. Reed, supra note 62, 278 Neb. at 571, 773 N.W.2d at 355.
68
Chambers v. Lautenbaugh, 263 Neb. 920, 644 N.W.2d 540 (2002).
69
See Project Extra Mile, supra note 40.
70
Id.
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standing absent an individualized injury in fact. We suggested
that Chambers should be treated as a case raising a matter of
great public concern:
This conflict [in our case law] occurs because of the
competing considerations frequently presented by tax-
payer actions. Primarily, government officials must per-
form their duties without fear of being sued whenever
a taxpayer disagrees with their exercise of authority.
But courts also recognize that a taxpayer may be the
only party who would challenge an unlawful govern-
ment action because the persons or organizations directly
affected by the government action have benefited from it.
Additionally, a taxpayer’s action sometimes raises matters
of great public concern that far exceed the type of injury
in fact that an individual could normally assert in an
action against government officials or entities.
These competing concerns explain the tension between
Chambers and our cases holding that an allegation of
unlawful government action is insufficient to show an
illegal expenditure of public funds. Arguably, Chambers
would have been more correctly presented as raising a
matter of great public concern: If true, the county election
commissioner’s alleged statutory violation would have
unlawfully altered the way that the city’s residents elected
their city council representatives.71
Our suggestion in Project Extra Mile that Chambers should
be treated as raising a matter of great public concern is
con­sistent with our reasoning in Cunningham. That is, a
citizen taxpayer’s interest in his or her form of govern-
ment exceeds any pecuniary interests he or she may have
in other types of government action. In both Chambers and
Cunningham, because all citizens had an interest in their
representatives’ obeying the law, no resident taxpayer could
have claimed a greater interest than any other to challenge
the alleged violations. Of course, that was also true in cases
decided after Cunningham. But Cunningham involved a claim
that the Legislature had unlawfully changed the constitution,
71
Id. at 389-90, 810 N.W.2d at 159-60 (emphasis supplied).
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and Chambers involved a claim that an election commis-
sioner had unlawfully changed the way citizens elected their
local representatives.
Like claims involving the election of representatives and
the way the constitution can be changed, the claims here
also involve the citizens’ interest in their form of govern-
ment. Specifically, the landowners alleged violations of the
constitutionally required distribution of political powers in
this state. The substantive issues are whether the Legislature
(1) unlawfully delegated a duty constitutionally conferred on
the PSC to the Governor and (2) unlawfully delegated to the
Governor the Legislature’s power to bestow the State’s right
of eminent domain on private organizations. These issues nec-
essarily involve the delegation of powers under the Nebraska
Constitution, which are fundamental matters of great public
concern to all resident taxpayers.
In deciding this appeal, we are cognizant that our standing
rules are circumscribed by case law. Unlike federal courts,
we are not bound by the strictures of constitutional standing
requirements.72 Nebraska, like most state courts, has no consti-
tutional “case” or “controversy” requirement that has resulted
in the federal courts’ strict application of standing rules. For
example, unlike taxpayer standing in state courts, this concept
is almost nonexistent in federal courts.73 Our common-law
standing rules, like all doctrines of justiciability, arise out of
prudential considerations of the proper role of the judiciary
in a democratic government with coequal branches of govern-
ment.74 Thus, in the vast majority of cases, we will not deter-
mine whether the Legislature has exceeded its powers unless
the issue is raised by a party who is entitled to judicial resolu-
tion of a dispute involving his or her interests.
72
See, e.g., Susan B. Anthony List v. Driehaus, ___ U.S. ___, 134 S. Ct.
2334, 189 L. Ed. 2d 246 (2014); Mullendore v. Nuernberger, 230 Neb.
921, 434 N.W.2d 511 (1989).
73
13B Charles Alan Wright et al., Federal Practice and Procedure § 3531.10.1
(2008 & Supp. 2014).
74
See Nebraska Coalition for Ed. Equity v. Heineman, 273 Neb. 531, 731
N.W.2d 164 (2007).
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But without an exception for matters of great public concern,
elected representatives could flout constitutional violations
with impunity. As we explained in Project Extra Mile, we have
recognized taxpayer standing because “[a] good deal of unlaw-
ful government action would otherwise go unchallenged”75 and
“following the law would be ‘irrelevant to those entrusted to
uphold it.’”76 The same reasoning applies here. The exception
for matters of great public concern ensures that no law or pub-
lic official is placed above our constitution.
So when a taxpayer claims that the Legislature enacted a law
that undermines the fundamental limitations on government
powers under the Nebraska Constitution, this court has full
power and the responsibility to address the public rights raised
by a challenge to that act. Without the prudent exercise of
such judicial responsibility, the Legislature might successfully
define the role of all government bodies. Where, as here, the
Governor and the current members of the PSC have acquiesced
in the Legislature’s disregard of the Nebraska Constitution’s
distribution of powers,77 the need for citizens to have stand-
ing to raise a matter of great public concern is apparent.
How could a taxpayer show a direct injury if the Legislature
statutorily abolished the PSC? Which taxpayer does not have
a right to the PSC’s continued existence under the Nebraska
Constitution? Additionally, the landowners have alleged that
the Legislature has unconstitutionally authorized the Governor
to decide who can exercise the power of eminent domain in
Nebraska. These claimed violations of constitutional law, if
true, undermine the structure of state government. Thus, the
issues raised here “far exceed the type of injury in fact that an
75
Project Extra Mile, supra note 40, 283 Neb. at 390, 810 N.W.2d at 160.
76
Id. at 388, 810 N.W.2d at 158.
77
See, Nebraska Public Service Commission, No. 183, Order Releasing
Third Set of Proposed Rules and Seeking Comment (Aug. 21, 2012)
(proposing rules to define “pipeline,” “pipeline carrier,” and “major oil
pipeline” in title 291, ch. 9; promulgating § 023 to govern routing of
“major oil pipelines” if Governor has not approved route under L.B. 4);
291 Neb. Admin. Code, ch. 9, §§ 001 and 023 (2013).
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individual could normally assert in an action against govern-
ment officials or entities.”78
So we reject the State’s argument that recognizing taxpayer
standing in this case would essentially eliminate any standing
requirements for taxpayers. As we stated in Project Extra Mile,
public officials must be free to perform their duties without
fear of being sued whenever a citizen disagrees with their
exercise of authority. But there is a critical distinction between
exercising legitimate authority and a claim that public officials
ignored constitutional constraints on that authority.
This does not mean that taxpayers may challenge any leg-
islation that allegedly violates a constitutional provision with-
out the need to show an injury in fact. Legislative missteps
often will not raise a matter of great public concern. But
when a taxpayer’s action raises every citizen’s interest in
the Legislature’s obedience to the fundamental distribution of
power in this state, the public interest necessarily rises to the
level of a “great public concern.” If the exercise of eminent
domain over private property and the constitutional require-
ments for the organization of state government do not raise
matters of great public concern, then no issue could be suffi-
ciently potent to give citizens the right to challenge an unlaw-
ful government action. So to deny standing here would likely
slam the courthouse doors on future taxpayer actions raising a
public interest.
The inscription above the main entrance to this Capitol pro-
claims that the “Salvation of the State is Watchfulness in the
Citizen.” For that inscription to have meaning, someone must
have standing to defend the Nebraska Constitution, regardless
of whether a direct injury can be shown.
Finally, the State argues that under Project Extra Mile, any
taxpayer who cannot show a direct injury should be required
to show that there is no better suited party to bring the action.
We disagree. As noted, in Cunningham, the State specifically
78
See Project Extra Mile, supra note 40, 283 Neb. at 390, 810 N.W.2d at
159-60.
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argued that the only persons who had standing to challenge
the constitutional amendments were those persons who could
lose federal funding because of the change. And we rejected
that argument.
[10] The State misconstrues Project Extra Mile by omitting
a crucial limitation on the holding that a taxpayer must show
there is no better suited party to bring the action:
We hold that a taxpayer has standing to challenge a
state official’s failure to comply with a clear statutory
duty to assess or collect taxes—as distinguished from
legitimate discretion to decide whether to tax. But the
taxpayer must show that the official’s unlawful failure
to comply with a duty to tax would otherwise go unchal-
lenged because no other potential party is better suited to
bring the action. . . . We further hold that no other poten-
tial parties are better suited than a taxpayer to claim that
a state agency or official has violated a statutory duty
to assess taxes when the persons or entities directly and
immediately affected by the alleged violation are benefi-
cially, instead of adversely, affected.79
This discussion was obviously directed at cases involv-
ing an unlawful failure to assess or collect taxes. And the
italicized holding was clearly intended to preclude the argu-
ment that a plaintiff must rule out every other possible plain-
tiff. Instead, under Project Extra Mile, a plaintiff satisfies
the burden to show that there is no better party to bring the
action if the plaintiff shows that persons or entities directly
and immediately affected by the unlawful act are beneficially
affected by it.
So even if we extended Project Extra Mile to other types of
taxpayer actions, the burden would be met here. TransCanada,
in particular, and all major pipeline carriers, benefited from
having a procedural choice. First, the Governor’s approval of
a route under the DEQ procedures was not subject to judicial
review. Second, even if the Governor denied approval of a
79
Id. at 391, 810 N.W.2d at 160-61 (emphasis supplied).
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route, a major oil pipeline carrier could seek PSC approval.
These two advantages alone are sufficient to show that major
oil pipeline carriers benefited from the passage of L.B. 1161.
More important, the exception for matters of great public
concern, by definition, must involve an issue that affects
many citizens. Obviously, the plaintiff in Cunningham could
not have satisfied a burden to show there was no better suited
party if that phrase is interpreted to mean that a taxpayer
has the burden to demonstrate and rule out all those persons
who might sustain a more direct injury. So Cunningham
clearly shows that either there is no such requirement for this
exception or there is no better suited party to challenge an
allegedly unconstitutional legislative act when every citizen
has an equal interest in the Legislature’s compliance with
the constitution.
Similarly, the State argued to the district court that the only
persons who should have standing to challenge L.B. 1161 are
those facing a condemnation proceeding when TransCanada
exercises the power of eminent domain. But the challenge here
is that the Governor has no constitutional authority to decide
whether TransCanada can exercise that power. A challenge
in which every citizen has an interest should not hinge upon
whether any particular landowner in an approved pipeline
route has the resources and ability to resist a condemnation
proceeding on constitutional grounds. Equally important, any
landowner resisting condemnation would be required to chal-
lenge the legislation as unconstitutional for the same issues
that are presented here. Given the widespread significance of
these constitutional issues, we will not deny standing on the
chance that a different citizen could raise the issue. We con-
clude that the holding in Project Extra Mile—that a taxpayer
must show an alleged unlawful act would otherwise go unchal-
lenged because no other potential party is better suited to bring
the action—has no application to taxpayer actions raising a
matter of great public concern.
Before concluding our standing analysis, we address some
of the dissent’s comments. The dissent erroneously asserts
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that the division of opinion regarding standing creates an
“impasse” that prevents its consideration of the constitutional
claims. There is no impasse. The four judges of this court who
have concluded that the landowners have standing are not a
“plurality,” as the dissent asserts. We are the majority on the
issue of standing, and our decision controls. That is, our deci-
sion is the court’s decision on standing and the law governing
this case.
The dissent correctly notes that “[j]urisdictional require-
ments apply equally to all cases.” In this seven-member court,
it takes only four judges to determine if the case meets the
jurisdictional requirements for this court to consider the merits.
We apply this rule of majority “equally to all cases,” including
the one before us.
The dissent incorrectly claims that five votes are required
to determine standing and hence jurisdiction. The dissent cites
no constitutional provision and no authority to support this
imaginative assertion. Neb. Const. art. V, § 2, in relevant part,
provides the following:
A majority of the judges shall be necessary to constitute
a quorum. A majority of the members sitting shall have
authority to pronounce a decision except in cases involv-
ing the constitutionality of an act of the Legislature. No
legislative act shall be held unconstitutional except by the
concurrence of five judges.
While the supermajority provision in this passage clearly
requires five judges to concur on the conclusion that a legisla-
tive act is unconstitutional, the dissent reads into this provision
the additional requirement that five judges concur on the con-
clusion that this court has jurisdiction to decide the question.
The dissent, however, does not have four votes for its con-
stitutional interpretation, and we, the majority, conclude that
the dissent’s interpretation is not warranted and, in any event,
not controlling.
The quorum provision in article V, § 2, sets the minimum
number of judges who must sit before this court can decide a
case. Quorum provisions ensure that a case is not decided by
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one or two judges on a court.80 In contrast, minimum concur-
rence and supermajority requirements are intended to ensure
deference to legislative enactments.81 And unlike the quorum
provision in article V, § 2, the supermajority provision is a
voting requirement on the resolution of the case—as distin-
guished from a preliminary requirement that merely deter-
mines whether the court can take action.82 The supermajority
requirement comes into play only after this court determines
that quorum requirements and jurisdictional requirements
are satisfied.
The plain language of the supermajority requirement in
article V, § 2, applies only to our voting on the merits of the
constitutional challenge. That is, it is limited by its terms to
requiring five votes to hold that an enactment is unconstitu-
tional. We have never held that this provision requires five
votes to decide any procedural or jurisdictional issue in a case
presenting a constitutional challenge to a statute.
So we reject the dissent’s interpretation of the supermajor-
ity requirement and the dissent’s assertion that our approach
would yield “absurd” results. It is true that this provision can
lead to unusual results. But the dissent’s hypothetical voting
outcomes are not absurd results. They simply flow from the
Nebraska Constitution’s unusual supermajority requirement.83
The only “absurd” result would be for a minority of judges,
who disagree with the court’s decision on standing, to control
whether the court can consider the constitutionality of a legis-
lative enactment.
80
See Jonathan Remy Nash, The Majority That Wasn’t: Stare Decisis,
Majority Rule, and the Mischief of Quorum Requirements, 58 Emory L.J.
831, 839-50 (2009).
81
See Jonathan L. Entin, Judicial Supermajorities and the Validity of
Statutes: How Mapp Became a Fourth Amendment Landmark Instead of a
First Amendment Footnote, 52 Case W. Res. L. Rev. 441, 450, 473 (2001).
82
See Nash, supra note 80.
83
See id. at 851 n.75 (stating that “[c]urrently two states—Nebraska and
North Dakota—have constitutional requirements for the invalidation of
statutes on state constitutional grounds by the state supreme court”).
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We note that there are numerous examples of judges who
dissented on a jurisdictional matter and reached the merits of
the appeal, if only to express his or her disagreement.84 It is
true that other appellate judges who dissented on a jurisdic-
tional issue limited their opinion to that issue.85 These cases
may reflect a tension between a judge’s desire to be consistent
with his or her opinion that jurisdiction is lacking and a court’s
duty to decide cases. But they also illustrate that whether a
judge reaches the merits of an appeal when he or she is out-
voted on a jurisdictional issue is a matter of discretion with
each judge. Moreover, in those cases, whether the dissenting
judges reached the merits of the appeal or not, their opinion
on those issues was not dispositive. That is not true here. By
declining to participate in deciding the merits of this appeal,
the three justices dissenting on standing have effectively pre-
vailed without providing a rationale which is due the parties
and citizens of Nebraska.
In sum, although the dissent disagrees with the court’s deci-
sion on standing, there is no constitutional or jurisprudential
barrier that precludes the dissenting judges from proceeding to
decide the landowners’ constitutional challenge to L.B. 1161.
And because the case presents a matter of great public concern,
the citizens of this state deserve a decision on the merits.
Clearly, the dissent would narrow Cunningham’s standing
exception for matters of great public concern to the point
that the exception is nonexistent. But Cunningham is not an
outlier case; it is consistent with our early mandamus cases.
84
See, e.g., Massachusetts v. EPA, 549 U.S. 497, 127 S. Ct. 1438, 167 L.
Ed. 2d 248 (2007) (Scalia, J., dissenting); Gratz v. Bollinger, 539 U.S.
244, 123 S. Ct. 2411, 156 L. Ed. 2d 257 (2003) (Souter, J., dissenting);
Hammer v. Sam’s East, Inc., 754 F.3d 492 (8th Cir. 2014) (Riley, Chief
Judge, dissenting); Patel v. U.S. Citizenship and Immigration Services, 732
F.3d 633 (6th Cir. 2013) (Daughtrey, Circuit Judge, dissenting); Harris v.
City of Zion, Lake County, Ill., 927 F.2d 1401 (7th Cir. 1991) (Easterbrook,
Circuit Judge, dissenting).
85
See, e.g., Sprint Communications Co. v. APCC Services, Inc., 554 U.S.
269, 128 S. Ct. 2531, 171 L. Ed. 2d 424 (2008) (Roberts, C.J., dissenting);
EPA, supra note 84 (Roberts, C.J., dissenting).
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More important, Cunningham is the law of this jurisdiction.
Obviously, Cunningham did not require the plaintiff to show an
injury in fact or to rule out potential parties who would have
a more direct interest in the controversy to establish standing.
And that conclusion was correct.
Cunningham’s great public concern exception to traditional
standing exists for a reason. The primary hurdle for application
of the great public concern exception, as we have narrowed it,
is the existence of a great public concern—not the availability
of a perfect plaintiff with injury-in-fact standing. The dissent’s
reasoning on standing would so limit the pool of effective
plaintiffs as to render taxpayers mere spectators without a
forum to challenge a perceived manipulation by the Legislature
of the fundamental limits on political power in Nebraska. This
we will not do.
2. L.B. 1161 Unconstitutionally Delegates
the PSC’s R egulatory Authority
to the Governor
The landowners contend that the court correctly ruled that
L.B. 1161 violates article IV, § 20, because it divests the PSC
of its control over a class of common carriers and transfers its
powers to the Governor.
The State counters that because the landowners presented a
facial challenge to L.B. 1161, they must show that the legisla-
tion is invalid in every circumstance. They conclude that the
court erred in determining that L.B. 1161 is facially unconsti-
tutional for three reasons. First, the State contends that under
Nebraska’s statutes, only intrastate pipeline carriers—and not
interstate pipeline carriers—transporting oil products are com-
mon carriers subject to the PSC’s regulatory control. It argues
that the court should have interpreted L.B. 1161 as apply-
ing only to interstate carriers, which would be constitutional.
Second, the State contends that because private pipeline carri-
ers could validly seek the Governor’s approval of their routes,
L.B. 1161 is not invalid in every circumstance. Finally, the
State contends that even if the PSC has exclusive control over
pipeline carriers, routing decisions are not within its enumer-
ated powers.
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[11] The landowners have the burden of establishing that
L.B. 1161 is unconstitutional.86 We presume that statutes
are constitutional and will not strike down a statute unless
its unconstitutionality is clearly established.87 But the State
devotes much of its brief to arguing that L.B. 1161 is dis-
tinguishable from other legislation that we have previously
struck down as unconstitutional. So before discussing the
parties’ arguments, we set out the relevant laws underlying
their arguments.
(a) The PSC’s Powers and the Legislature’s
Power to Restrict Them
[12] The PSC is not a statutorily created state agency.
Until 1972, it was called the State Railway Commission
(Commission).88 It is an independent regulatory body for com-
mon carriers89 created by the Nebraska Constitution in arti-
cle IV, § 20:
There shall be a Public Service Commission . . . . The
powers and duties of such commission shall include the
regulation of rates, service and general control of com-
mon carriers as the Legislature may provide by law. But,
in the absence of specific legislation, the commission
shall exercise the powers and perform the duties enumer-
ated in this provision.
We have previously explained the historical facts leading up
to the voters’ adoption in 1906 of article IV, § 20.90 In short,
state voters rejected three legislative proposals to create a regu-
latory body over common carriers that was part of the execu-
tive branch of government. It was not until the Legislature pro-
posed a permanent and independent commission—limited only
as the Legislature may provide by specific legislation—that the
voters approved an amendment to the constitution.
86
See Big John’s Billiards v. State, 288 Neb. 938, 852 N.W.2d 727 (2014).
87
Hobbs, supra note 44.
88
See 1972 Neb. Laws, L.B. 347.
89
See, e.g., Swanson v. Sorenson, 181 Neb. 312, 148 N.W.2d 197 (1967).
90
See State ex rel. State Railway Commission v. Ramsey, 151 Neb. 333, 37
N.W.2d 502 (1949).
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[13] Consistent with this constitutional history, we have held
that the PSC has “independent legislative, judicial, and execu-
tive or administrative powers” over common carriers,91 which
powers are plenary and self-executing.92 Absent specific legis-
lation, the PSC’s enumerated powers over common carriers are
absolute and unqualified.93
[14-18] Later, in State ex rel. Spire v. Northwestern Bell Tel.
Co.,94 we summarized our case law in five rules that govern
the PSC’s regulatory authority and the Legislature’s power to
restrict it:
• First, in any field where the Legislature has not acted, the
constitution authorizes the PSC to exercise its plenary powers
over common carriers.95
• Second, under article IV, § 20, the Legislature can restrict the
PSC’s plenary powers only through specific legislation.96
• Third, the term “specific legislation” means specific restric-
tions. It does not include general legislation to divest the
PSC of its jurisdiction and transfer its powers to another
governmental entity or official besides the Legislature: “The
Legislature cannot constitutionally divest the PSC of jurisdic-
tion over a class of common carriers by vesting a governmen-
tal agency, body of government, or branch of government,
except the Legislature, with control over the class of com-
mon carriers.”97
• Fourth, the Legislature can divest the PSC of jurisdiction over
a class of common carriers by passing specific legislation
91
Swanson, supra note 89, 181 Neb. at 316, 148 N.W.2d at 200.
92
See, e.g., Myers v. Blair Tel. Co., 194 Neb. 55, 230 N.W.2d 190 (1975).
93
Nebraska Pub. Serv. Comm. v. Nebraska Pub. Power Dist., 256 Neb. 479,
590 N.W.2d 840 (1999).
94
State ex rel. Spire v. Northwestern Bell Tel. Co., 233 Neb. 262, 445
N.W.2d 284 (1989).
95
Id.
96
Id., citing Chicago & N. W. Ry. Co. v. County Board of Dodge County, 148
Neb. 648, 28 N.W.2d 396 (1947).
97
Id. at 276, 445 N.W.2d at 294 (emphasis supplied).
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that occupies a regulatory field, thereby preempting the
PSC’s control.98
• Fifth, if the Legislature passes specific legislation to divest
the PSC of jurisdiction in a regulatory field, the Legislature
cannot abandon control over the common carriers in that
field. Under article IV, § 20, regulatory control over common
carriers must reside either in the PSC or in the Legislature.99
[19] Specifically, because of the Commission’s constitu-
tional jurisdiction over common carriers, we have held that a
party cannot initiate an action in district court to enforce a stat-
ute requiring a common carrier to provide reasonable accom-
modations.100 And in State ex rel. State Railway Commission v.
Ramsey,101 we held that the Legislature has no power to divest
the Commission of its constitutional jurisdiction to regulate
and control common carriers by transferring its power to a
statutorily created agency. Although statutes are presumed to
be constitutional, we concluded that the controlling principles
were the Constitution’s supremacy and this court’s duty to
“trace the line which marks the limit of power, and to cause
compliance with it.”102 So unless the Legislature enacts leg-
islation to specifically restrict the PSC’s authority and retains
control over that class of common carriers, it cannot constitu-
tionally deprive the PSC of its regulatory powers.
(b) The Meaning of a “Common Carrier”
in Nebraska
[20,21] The PSC’s constitutional authority to regulate “com-
mon carriers” is limited to the common-law meaning of that
term unless the Legislature has authorized the PSC to exercise
98
See State ex rel. Spire, supra note 94, citing Rodgers v. Nebraska State
Railway Commission, 134 Neb. 832, 279 N.W. 800 (1938), and State v.
Chicago & N. W. Ry. Co., 147 Neb. 970, 25 N.W.2d 824 (1947).
99
See id.
100
Rivett Lumber & Coal Co. v. Chicago & N. W. R. Co., 102 Neb. 492, 167
N.W. 570 (1918).
101
Ramsey, supra note 90.
102
Id. at 347, 37 N.W.2d at 510.
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control over carriers that are outside of that meaning.103 A car-
rier refers to an “individual or organization . . . that contracts
to transport passengers or goods for a fee.”104 The common
law recognizes only two types of carriers: common carriers
and private carriers,105 although the terms “private carrier” and
“contract carrier” are used interchangeably.106
[22,23] In City of Bayard v. North Central Gas Co.,107 we set
out definitions for both private carriers and common carriers.
We defined a private carrier as one that, without being in the
business of transporting for others or holding itself out to the
public as willing to do so, undertakes only by special agree-
ment to transport property, either gratuitously or for a consid-
eration.108 In contrast, under our case law,
any person, corporation, or association holding itself out
to the public as offering its services to all persons simi-
larly situated and performing as its public vocation the
services of transporting passengers, freight, messages, or
commodities for a consideration or hire, is a common car-
rier in the particular spheres of such employment.109
In City of Bayard, the evidence showed that the defendant
gas company was using its own pipelines and distribution
systems to transport gas it purchased to consumers in cit-
ies that had granted it a franchise by contract. No evidence
showed that it transported gas for others, gratuitously or for
a consideration. We held that the company was not a com-
mon carrier and could not be subjected to the Commission’s
control.110
103
Nebraska Pub. Serv. Comm., supra note 93.
104
Black’s Law Dictionary 256 (10th ed. 2014).
105
State v. Union Stock Yards Co., 81 Neb. 67, 115 N.W. 627 (1908).
106
See Black’s Law Dictionary, supra note 104 at 256-57.
107
City of Bayard v. North Central Gas Co., 164 Neb. 819, 83 N.W.2d 861
(1957).
108
See id.
109
Id. at 830, 83 N.W.2d at 867.
110
See City of Bayard, supra note 107. See, also, The Pipe Line Cases, 234
U.S. 548, 34 S. Ct. 956, 58 L. Ed. 1459 (1914).
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[24] As the above definition of common carrier implies,
under Nebraska’s common law, whether a carrier offers its
services to the general public—like a passenger carrier, for
example—is not always relevant to determining whether it
is a common carrier. Instead, a carrier is a common carrier
if its “vocation is of a public nature, although limited to the
transportation of certain classes or kinds of freight, and it
may be of service to a limited few who by their peculiar sit­
uation or business may have occasion to employ it.”111 Under
the City of Bayard definition, transporting commodities for
others is a vocation of a public nature even if the service is
not available to the public at large. We have specifically held
that a railyard switching company, which served a limited
number of railroads, was a common carrier because it held
itself out as willing to transport goods for all railroads enter-
ing the railyard.112
[25] Under our definition of a common carrier, an oil pipe-
line carrier is a common carrier if it holds itself out as willing
to transport oil products for a consideration to all oil producers
in the area where it offers its transportation services. The State
does not dispute the landowners’ contention that TransCanada
is a common carrier, and a Texas case supports that conclu-
sion.113 For this appeal, we assume that this is true.
As stated, the landowners contend that the court correctly
ruled that L.B. 1161 violates article IV, § 20, because it divests
the PSC of its control over a class of common carriers and
transfers its powers to the Governor. The rules that we have set
out above clearly support that contention. We therefore turn to
the State’s arguments that L.B. 1161 is not facially unconstitu-
tional in every circumstance.
First, the State argues that the court erred in concluding
that all oil pipeline carriers are common carriers. It claims
that interstate pipeline carriers are not common carriers under
111
Union Stock Yards Co., supra note 105, 81 Neb. at 75, 115 N.W. at 631
(citations omitted).
112
See Union Stock Yards Co., supra note 105.
113
See Crawford Family v. TransCanada Keystone, 409 S.W.3d 908 (Tex.
App. 2013).
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Nebraska’s statutes and that the court erred in failing to inter-
pret L.B. 1161 as applying to only interstate pipeline carriers.
(c) Analysis
[26] The State correctly contends that a plaintiff can succeed
in a facial challenge only by establishing that no set of cir-
cumstances exists under which the act would be valid, i.e., that
the law is unconstitutional in all of its applications.114 But it
incorrectly argues that because some Nebraska statutes distin-
guish between interstate and intrastate oil pipelines, the court
should have relied on these statutes to conclude that L.B. 1161
applies only to interstate pipeline carriers. The State argues that
interstate carriers are not common carriers subject to the PSC’s
control. The State points to no statute that explicitly restricts
the PSC’s powers, but it argues that courts must try to interpret
statutes to be constitutional.
(i) Nebraska’s Statutes Are Not Specific
Legislation to Restrict the PSC’s
Regulatory Powers
As stated, unless the Legislature enacts legislation to specifi-
cally restrict the PSC’s authority and retains control over that
class of common carriers, it cannot constitutionally deprive the
PSC of its regulatory powers. The State points to Neb. Rev.
Stat. § 75-501 (Reissue 2009), which provides that pipeline
carriers transporting oil for hire in Nebraska intrastate com-
merce “shall be a common carrier subject to commission [the
PSC] regulation.” It contends that this statute defines a pipe-
line common carrier as one that transports oil for hire only
in intrastate commerce (i.e., only within Nebraska’s borders).
The State also relies on Neb. Rev. Stat. § 75-502 (Cum. Supp.
2014), which was amended by L.B. 1115 to provide the follow-
ing underlined text: “Pipeline carriers which are declared com-
mon carriers under section 75-501, pipeline carriers approved
under [MOPSA], and pipeline carriers for which the Governor
approves a route under section 57-1503 may store, transport,
114
See Lindner v. Kindig, 285 Neb. 386, 826 N.W.2d 868 (2013).
115
See L.B. 1, § 20.
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or convey any liquid or gas [and] may lay down, construct,
maintain, and operate pipelines . . . .” The State contends that
the delineation of different types of carriers in § 75-502 shows
that the Legislature did not intend for all pipeline carriers to be
considered common carriers.
The State’s reliance on these statutes is misplaced. Although
it argues that interstate carriers are not common carriers under
Nebraska law, it does not argue that they are private carriers.
It appears to argue that interstate pipeline carriers of oil are a
class by themselves—neither common nor private carriers. But
under Nebraska common law, there are only two classes of car-
riers: private and common. “Interstate” is not a class by itself.
Interstate pipeline carriers under federal law are also classi-
fied as private or common, and pipeline carriers transporting
oil in interstate commerce are subject to federal regulation as
common carriers.116 So we will not interpret § 75-502’s mere
description by statute of the carriers that can lay pipelines
in this state as a legislative declaration—contrary to federal
law—that interstate carriers are not common carriers when
they cross Nebraska.
We also reject the State’s argument that § 75-501 defines the
term “common carrier” for persons transporting oil products.
Section 75-501 provides:
Any person who transports, transmits, conveys, or
stores liquid or gas by pipeline for hire in Nebraska
intrastate commerce shall be a common carrier subject
to commission regulation. The commission [PSC] shall
adopt, promulgate, and enforce reasonable rules and
regulations establishing minimum state safety standards
for the design, construction, maintenance, and operation
of pipelines which transport liquefied petroleum gas or
anhydrous ammonia in intrastate commerce by common
carriers. Such rules and regulations, and the interpre-
tations thereof, shall conform with the rules, regula-
tions, and interpretations of the appropriate federal agen-
cies with authority to regulate pipeline common carriers
in interstate commerce. Any person may determine the
116
See The Pipe Line Cases, supra note 110.
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validity of any such rule or regulation in such manner as
provided by law.
(Emphasis supplied.)
[27] Section 75-501 does not explicitly state that it is
defining a term or limiting the PSC’s authority to intrastate
carriers. Interpreting § 75-501 to define the whole field of
pipeline common carriers would be an expansive reading
and contrary to the statute’s historical context. The statute
explicitly acknowledges that federal agencies regulate inter-
state pipeline carriers, and it is this tension that explains
why the statute’s reach is limited to intrastate pipeline car-
riers. Section 75-501’s historical context shows that the
Legislature intended only to ensure that intrastate carriers
are regulated.
In 1906, Congress amended the federal Interstate Commerce
Act (ICA) to make interstate oil transporters common carri-
ers subject to federal regulation.117 In 1914, the U.S. Supreme
Court held that Congress could require federal regulation of
interstate pipeline carriers that were operating as common car-
riers.118 But the ICA, both before and after the 1906 amend-
ment, included an exception for common carriers engaged in
the transportation of passengers or property “wholly within
one State.”119
In 1903, the Nebraska Legislature passed the first law giving
pipeline carriers an unconditional right to exercise the power of
eminent domain in Nebraska to construct a pipeline.120 The law
did not distinguish between interstate and intrastate carriers
and imposed no regulatory control over carriers. In 1903, the
Commission did not exist.
In 1917, the Legislature repealed the 1903 law and replaced
it with a statute declaring that pipelines transporting oil prod-
ucts or gases from one point in Nebraska to another point for
a consideration are common carriers. These carriers could
117
See id.
118
See id.
119
See Interstate Commerce Act, 24 Stat. 379 (1887) and 34 Stat. 584 (1906).
120
See 1903 Neb. Laws, ch. 67, § 1, p. 364.
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exercise the power of eminent domain but were subject to the
Commission’s control and regulation.121 Because the Legislature
repealed the 1903 law, no statute authorized interstate carriers
to exercise eminent domain. But that omission is not surpris-
ing. In 1917, Nebraska’s lawmakers would have understood
that they had authority to regulate intrastate common carriers
and that the Commerce Clause prohibited them from burdening
interstate commerce.122
It is true that absent preemptive federal laws, the Legislature
probably could have enacted siting laws to protect the health
of its citizens if those laws did not unnecessarily impede inter-
state commerce.123 But in 1917, the law defining the limits of a
state’s power over interstate carriers was not clear. So viewed
through the prism of federal law, Nebraska’s 1917 enactment
was not a limitation of the Commission’s power to regulate
only intrastate carriers. It was an assertion of the Commission’s
power to regulate such carriers.
In 1923, the Legislature passed a bill giving interstate
pipeline carriers an unconditional right to exercise eminent
domain.124 The statute did not declare interstate carriers to be
common carriers or subject them to the Commission’s control.
In 1963, the Legislature enacted comprehensive legislation
to reorganize statutes related to the Commission’s powers.125
The reorganization resulted in a separation of the eminent
domain statute for pipelines from the statutes dealing with
the Commission’s powers over pipelines. One bill authorized
both interstate and intrastate pipeline carriers to exercise
eminent domain under the same procedures.126 Another bill,
121
See 1917 Neb. Laws, ch. 112, § 1, p. 284.
122
See, e.g., The Pipe Line Cases, supra note 110.
123
See, Pike v. Bruce Church, Inc., 397 U.S. 137, 142, 90 S. Ct. 844, 25 L.
Ed. 2d 174 (1970); Southern Pacific Co. v. Arizona, 325 U.S. 761, 65 S.
Ct. 1515, 89 L. Ed. 1915 (1945).
124
See 1923 Neb. Laws, ch. 173, § 1, p. 409; Neb. Rev. Stat. § 75-609
(Reissue 1958).
125
See 1963 Neb. Laws, L.B. 82, ch. 425, p. 1354.
126
See 1963 Neb. Laws, L.B. 789, ch. 323, p. 979 (codified at Neb. Rev. Stat.
§§ 57-1101 to 57-1106 (Reissue 2009 & Cum. Supp. 2014)).
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governing the Commission’s regulatory powers, reasserted
its powers over intrastate carriers, but did not make any sub-
stantive changes to the 1917 statute.127 Again, the Legislature
did not assert any regulatory power over interstate pipeline
carriers. But states’ power to regulate the siting of interstate
pipelines was unclear before 1979.
Current federal law expressly preempts state regulation of
safety issues related to interstate oil pipelines.128 But since
Congress enacted the Hazardous Pipeline Safety Act of 1979,
federal law does not preempt a state’s right to determine
the siting of an interstate pipeline if the state laws are unre-
lated to safety.129 Before 1979, however, there was no fed-
eral statute expressly stating that states had this right. So in
1963, the Legislature could have justifiably concluded that the
Commerce Clause precluded state laws governing the location
or siting of interstate pipelines that were inconsistent with the
laws of other states or that imposed unnecessary costs on inter-
state carriers.130
Given this history, we do not interpret the Legislature’s
silence on the State’s regulation of interstate carriers as its
determination that the Commission could have no regulatory
powers over interstate carriers to the extent state regulation
is permitted by federal law. Notably, when the Legislature
restricted the PSC’s authority to regulate some natural gas utili-
ties, the restriction was explicit.131
[28,29] It is true that we will interpret a statute to be con-
stitutional if we can do so reasonably.132 But we liberally
127
See 1963 Neb. Laws, L.B. 82, ch. 425, art. V, p. 1416-17.
128
See 49 U.S.C. § 60104(c).
129
See sources cited supra note 10.
130
See, e.g., Shell Oil Co. v. City of Santa Monica, 830 F.2d 1052 (9th Cir.
1987); Chicago, B. & Q. R. Co. v. Illinois Commerce Commission, 82 F.
Supp. 368 (N.D. Ill. 1949).
131
See Neb. Rev. Stat. § 66-1803(1) (Reissue 2009).
132
Traveler’s Indem. Co. v. Gridiron Mgmt. Group, 281 Neb. 113, 794
N.W.2d 143 (2011).
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construe the constitutional provision creating the PSC and
delineating its powers.133 And a canon of statutory construction
must yield to constitutional requirements governing the same
subject matter. We conclude that none of the statutes cited by
the State constitute a “definite restriction” on the PSC’s pow-
ers.134 That is, they are not specific legislation to restrict the
PSC’s regulatory powers over interstate carriers. But the State
makes another argument that L.B. 1161 does not apply to all
pipeline carriers.
(ii) Only Common Carriers Can Constitutionally
Exercise the State’s Power
of Eminent Domain
The State argues that the court erred in implicitly assuming
that all pipeline carriers operate on a “for hire” basis. It con-
tends that L.B. 1161 could be facially unconstitutional only if
every pipeline carrier satisfied the “for hire” requirement for
common carriers. In that same vein, it argues that the court
erred in determining that a state’s authority for a carrier to
exercise the power of eminent domain is the essential char-
acteristic of common carrier status. In effect, the State argues
that L.B. 1161 is not facially invalid because some of the car-
riers seeking the Governor’s authorization to exercise eminent
domain could be private carriers. We disagree that a private
carrier serving no public purpose could exercise the power of
eminent domain.
The State relies on City of Bayard135 to support its argu-
ment that a private carrier could exercise the right of eminent
domain. As explained, we held there that a natural gas com-
pany was not a common carrier. The Wyoming company had
built two pipelines to deliver gas to consumers in Nebraska
133
Myers, supra note 92; In re Yellow Cab & Baggage Co., 126 Neb. 138,
253 N.W. 80 (1934).
134
State ex. rel. Spire, supra note 94, 233 Neb. at 276, 445 N.W.2d at 294,
quoting Ramsey, supra note 90.
135
City of Bayard, supra note 107.
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cities that had granted it a franchise by contract. An interstate
pipeline was connected to a gas field in Wyoming where it
purchased natural gas, and an intrastate pipeline was connected
to a gas field in Nebraska where it purchased natural gas. In
reaching our conclusion that the company was not a common
carrier, we rejected the city’s contention that the gas company
was a common carrier because it had exercised the right of
eminent domain:
First, [the company] does not render the service of trans-
porting gas for a consideration. Second, [the company]
exercised the right of eminent domain as an interstate
pipe line, as distinguished from an intrastate pipe line,
under the provisions of section 75-609, . . . which it con-
cededly had a right to do.136
It is true that § 75-609 granted interstate pipeline carriers
the right to exercise eminent domain without declaring them
common carriers or imposing any regulatory control. But as
explained above, in 1957, when City of Bayard was decided,
Congress had not passed any law clarifying that states could
regulate interstate pipeline carriers. More important, our hold-
ing in City of Bayard rested on the lack of evidence that
the company transported gas for others. We assumed for the
analysis that the company could be a common carrier if it had
held itself out as transporting gas for hire, but concluded there
was no evidence that it had done so.137 So our reliance there
on the absence of any regulation of interstate carriers exercis-
ing eminent domain was dicta, because it was unnecessary to
the holding.
[30] Equally important, the company was transporting natu-
ral gas for a public purpose. We specifically noted that the
city had statutory authority138 to renew the gas company’s
franchise and to regulate the company’s rates. It is the public
nature of a corporate utility’s operations and the public fran-
chise that authorizes its operations which justify government
136
Id. at 829, 83 N.W.2d at 867.
137
See City of Bayard, supra note 107.
138
See Neb. Rev. Stat. § 17-528.02 (Reissue 2012).
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regulation of its rates.139 So the statement the State relies on is
not persuasive authority for the State’s implicit argument that
a private carrier could exercise the right of eminent domain
in this state for a nonpublic purpose. That argument is sim-
ply wrong.
[31-33] As our definition of common carriers suggests,
the reason common carriers can exercise the right of eminent
domain lies in their quasi-public vocation of transporting pas-
sengers or commodities for others. A citizen’s property may not
be taken against his or her will, except through the sovereign
powers of taxation and eminent domain, both of which must be
for a public purpose.140 Eminent domain is the State’s inherent
power to take private property for a public use.141
[34-36] The State’s eminent domain power resides in
the Legislature and exists independently of the Nebraska
Constitution.142 But the constitution has limited the power
of eminent domain, and the Legislature can limit its use
further through statutory enactments.143 Under Neb. Const.
art. I, § 21, the State can take private property only for a
public use and only if it pays just compensation.144 Only the
Legislature can authorize a private or public entity to exer-
cise the State’s power of eminent domain. 145 But it ­obviously
139
See, City of University Place v. Lincoln Gas & Electric Light Co., 109
Neb. 370, 191 N.W. 432 (1922) (cited in City of Bayard, supra note
107); 12 Eugene McQuillin, The Law of Municipal Corporations §§ 34:2,
34:107 (3d ed. 2006).
140
See, Burlington Northern Santa Fe Ry. Co. v. Chaulk, 262 Neb. 235, 631
N.W.2d 131 (2001); Burger v. City of Beatrice, 181 Neb. 213, 147 N.W.2d
784 (1967).
141
See Fulmer v. State, 178 Neb. 20, 131 N.W.2d 657 (1964).
142
See, Burger, supra note 140; Burnett v. Central Nebraska Public Power
and Irrigation District, 147 Neb. 458, 23 N.W.2d 661 (1946); Consumers
Public Power District v. Eldred, 146 Neb. 926, 22 N.W.2d 188 (1946).
143
See id.
144
See Burlington Northern Santa Fe Ry. Co., supra note 140.
145
See Burlington Northern Santa Fe Ry. Co., supra note 140, citing SID
No. 1 v. Nebraska Pub. Power Dist., 253 Neb. 917, 573 N.W.2d 460
(1998).
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cannot confer a power that it does not possess under the
constitution.146
[37] In short, because a common carrier performs a public
transportation service, the Legislature can grant it the sover-
eign power to take private property for a public use and the
State can control its operations, to the extent that the regula-
tion is not precluded by federal law.147 As early as 1908, this
court stated that the State’s power to regulate common carriers,
especially those that were authorized to exercise the power of
eminent domain, was firmly established.148
[38] But the Nebraska Constitution prohibits the taking of
private land for a private purpose.149 The Texas Supreme Court
has addressed this issue in the context of pipeline carriers.150
It reversed a court of appeals’ decision that a property owner
could not challenge a common carrier certification by a pub-
lic service commission. Like the Nebraska Constitution, the
Texas Constitution restricts the exercise of eminent domain to
a public use. And like this court, Texas courts strictly construe
statutes delegating the power of eminent domain. The court
held that the commission’s certification did not conclusively
establish the applicant’s common carrier status because the
commission undertook no inquiry to confirm that the appli-
cant’s pipeline would be for a public purpose. And it held that
Texas statutes authorizing eminent domain power for common
carriers do not include the owner of a pipeline built for the
owner’s exclusive use.
146
See, Burger, supra note 140; Fulmer, supra note 141.
147
See Edholm v. Missouri P. R. Corporation, 114 Neb. 845, 211 N.W. 206
(1926). See, also, Krauter v. Lower Big Blue Nat. Resources Dist., 199
Neb. 431, 259 N.W.2d 472 (1977); Van Patten v. City of Omaha, 167 Neb.
741, 94 N.W.2d 664 (1959).
148
State v. Pacific Express Co., 80 Neb. 823, 115 N.W. 619 (1908).
149
See, e.g., Chimney Rock Irr. Dist. v. Fawcus Springs Irr. Dist., 218 Neb.
777, 359 N.W.2d 100 (1984); Burger, supra note 140; Vetter v. Broadhurst,
100 Neb. 356, 160 N.W. 109 (1916).
150
See Texas Rice Land v. Denbury Green Pipeline, 363 S.W.3d 192 (Tex.
2012).
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[39] We agree with this reasoning, which is consistent
with our holding in other cases prohibiting the use of emi-
nent domain for a private purpose.151 Under the Nebraska
Constitution’s limitation on the power of eminent domain,
pipeline carriers can take private property only for a public use.
That minimally means that a pipeline carrier must be provid-
ing a public service by offering to transport the commodities
of others who could use its service, even if they are limited
in number. So we reject the State’s argument that L.B. 1161
is not facially invalid in every circumstance because a private
carrier could possibly seek the Governor’s approval to exercise
the right of eminent domain. The Legislature’s authorization of
that act would also be unconstitutional.
(iii) Routing Decisions Are Within
the PSC’s Enumerated Powers
The State argues that even if the PSC has exclusive regula-
tory control over pipeline carriers, an environmental review
of a pipeline route is not one of its enumerated powers over
common carriers: i.e., the PSC’s regulation of their rates and
service, or exercise of “general control.”152 But the State’s
argument ignores the Governor’s designation under L.B. 1161
as the final arbitrator who approves a pipeline route and our
case law that supports the PSC’s authority to make this regula-
tory decision. “[U]nlike some public service commissions, the
[PSC], in the different aspects of its constitutional functions,
exercises legislat[ive], administrative, and judicial powers.”153
As relevant here, in In re Application of Chicago, Burlington
& Quincy Railroad Co.,154 we held that the commission had
jurisdiction to decide a dispute over the location of a railway
151
See cases cited supra note 149.
152
See Neb. Const. art. IV, § 20.
153
Myers, supra note 92, 194 Neb. at 62, 230 N.W.2d at 196. Accord Ramsey,
supra note 90.
154
In re Application of Chicago, Burlington & Quincy Railroad Co., 152 Neb.
352, 41 N.W.2d 157 (1950).
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service, an issue that requires weighing the carrier’s profitabil-
ity against public necessity. Similarly, we have held that only
the Commission could decide a request to compel a railroad
company to build a branch to service the petitioners.155 And
we have stated that the Commission, “under the Constitution,
has original jurisdiction and sole power to grant, deny, amend,
revoke, or transfer common carrier certificates of convenience
and necessity.”156
[40] These decisions refute the State’s arguments that rout-
ing decisions are not part of the PSC’s constitutional pow-
ers. Furthermore, the Legislature’s requirement that the PSC
approve the routes for some pipelines confirms that the PSC
has such powers. So, although the Legislature could validly
authorize the DEQ to assist the PSC in determining whether
to approve the siting of a pipeline carrier’s proposed route,
L.B. 1161 unconstitutionally allows the Governor to approve
the route. This is a regulatory decision that the constitution
reserves to the PSC.
VII. CONCLUSION
This appeal is not about the wisdom or necessity of con-
structing an oil pipeline but instead is limited to the issues
of great public concern raised here: which entity has consti-
tutional authority to determine a pipeline carrier’s route and
whether L.B. 1161 comports with the Nebraska Constitution’s
provisions controlling this issue.
Four members of this court, a majority of its seven mem-
bers, conclude that the district court correctly ruled the land-
owners have standing to challenge the constitutionality of
L.B. 1161. Because their complaint alleged that the act violated
limits on political power under the Nebraska Constitution, it
raised matters of great public concern. Under our established
case law, such matters are an exception to the injury-in-fact
requirement for standing. Thus, contrary to the dissent, we hold
that the landowners had standing before the district court and
this court.
See Rivett Lumber & Coal Co., supra note 100.
155
Ramsey, supra note 90, 151 Neb. at 340, 37 N.W.2d at 507.
156
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The same four members of this court conclude that the
court correctly determined that L.B. 1161 is unconstitutional.
L.B. 1161 unconstitutionally transfers to the Governor the
PSC’s enumerated constitutional powers over common carri-
ers. When a common carrier seeks the Governor’s approval
of a pipeline route under the DEQ procedures, L.B. 1161
unconstitutionally gives the Governor the authority to approve
the route and bestow the power of eminent domain on the
carrier. The Nebraska Constitution prohibits this transfer of
power. Because we conclude that L.B. 1161 is facially uncon-
stitutional for this reason, we do not address the landowners’
other claims.
No member of this court opines that the law is constitutional.
But the four judges who have determined that L.B. 1161 is
unconstitutional, while a majority, are not a supermajority as
required under the Nebraska Constitution. Neb. Const. art. V,
§ 2, in relevant part, provides that “[n]o legislative act shall
be held unconstitutional except by the concurrence of five
judges.” We reject the dissent’s interpretation of this provision
as requiring five of the seven members of this court to concur
on jurisdictional requirements to hear a case, in addition to
requiring five judges to concur that a legislative enactment
is unconstitutional.
As explained, the supermajority requirement is a voting
requirement on the disposition of a constitutional challenge to
a statute. It is not a requirement that must be satisfied in order
for a court to determine if it may proceed to take action in a
case and has no application to jurisdictional decisions. Having
been outvoted on the issue of standing, the dissent compounds
its error by declining to exercise its option to decide the sub-
stantive issues.
Under these circumstances, the constitutional supermajor-
ity provision controls the outcome. Although four members
of the court conclude that L.B. 1161 violates fundamen-
tal constitutional limits on government power in Nebraska,
our power is also limited by article V, § 2. We believe that
Nebraska citizens deserve a decision on the merits. But the
supermajority requirement of article V, § 2, coupled with the
dissent’s refusal to reach the merits, means that the citizens
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cannot get a binding decision from this court. Although we
have four judges who conclude that L.B. 1161 is unconstitu-
tional, we do not have five judges voting on the constitution-
ality of this enactment. Accordingly, we vacate the district
court’s judgment.
Judgment vacated.
Wright, J., not participating.
Heavican, C.J., and Stephan and Cassel, JJ., dissenting in
part, and in part concurring in the result.
According to the plurality, all that is now required for
standing to challenge the constitutionality of a statute is a
tax receipt and a cause. To reach the merits of this case, the
plurality expands an exception to the general rule of common
law standing that has been employed only once before in the
history of this court. Although this exception was not briefed
by the parties and was mentioned only in passing by the dis-
trict court, the plurality concludes that the appellees, solely
in their capacities as citizen taxpayers, have standing to chal-
lenge the constitutionality of L.B. 1161 because it presents
“a matter of great public concern.” But the plurality ignores
the requirement that in order for this exception to apply, it
must be shown that the legislative enactment at issue may go
unchallenged unless the taxpayer has the right to bring the
action. That requirement has not been and cannot be met in
this case.
And the plurality is in fact a plurality. While it represents
the larger numerical block of votes, that number is insufficient
under our constitution to declare a statute unconstitutional.
STANDING
Courts are obligated to decide the merits of cases which
are properly before them, but they have an equally important
obligation to refrain from deciding matters over which they
lack jurisdiction. A ruling made in the absence of subject mat-
ter jurisdiction is a nullity.1 It is not the office of this court to
1
Spady v. Spady, 284 Neb. 885, 824 N.W.2d 366 (2012); Hunt v. Trackwell,
262 Neb. 688, 635 N.W.2d 106 (2001); In re Estate of Andersen, 253 Neb.
748, 572 N.W.2d 93 (1998).
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render advisory opinions.2 Our responsibility to avoid such
rulings is the reason for the oft-cited proposition that before
reaching the legal issues presented for review, it is the power
and duty of an appellate court to determine whether it has
jurisdiction over the matter before it.3 When a lower court
lacks the authority to exercise its subject matter jurisdiction
to adjudicate the merits of the claim, issue, or question, an
appellate court also lacks the power to determine the merits
of the claim, issue, or question presented to the lower court.4
Jurisdictional requirements apply equally to all cases, large or
small, high profile or obscure. We have properly declined to
reach even constitutional issues where all jurisdictional prereq-
uisites are not met.5 Strict adherence to jurisdictional require-
ments is not a device by which judges avoid making difficult
decisions; rather, it is a recognition that judicial authority, like
any other form of governmental authority, is subject to cer-
tain limitations.
One long-honored limitation on judicial power is the prin-
ciple of standing. Standing refers to whether a party had,
at the commencement of the litigation, a personal stake in
the outcome of the litigation that would warrant a court’s or
tribunal’s exercising its jurisdiction and remedial powers on
the party’s behalf.6 Standing is a component of jurisdiction;
only a party that has standing—a legal or equitable right,
title, or interest in the subject matter of the controversy—
may invoke the jurisdiction of a court or tribunal.7 Generally,
a litigant must assert the litigant’s own rights and interests,
and cannot rest a claim on the legal rights or interests of
2
Kramer v. Miskell, 249 Neb. 662, 544 N.W.2d 863 (1996).
3
In re Estate of Potthoff, 273 Neb. 828, 733 N.W.2d 860 (2007); In re
Estate of Rose, 273 Neb. 490, 730 N.W.2d 391 (2007); In re Interest of
Sean H., 271 Neb. 395, 711 N.W.2d 879 (2006); Malolepszy v. State, 270
Neb. 100, 699 N.W.2d 387 (2005).
4
Engler v. State, 283 Neb. 985, 814 N.W.2d 387 (2012).
5
See, e.g., Nichols v. Nichols, 288 Neb. 339, 847 N.W.2d 307 (2014).
6
Field Club v. Zoning Bd. of Appeals of Omaha, 283 Neb. 847, 814 N.W.2d
102 (2012).
7
Id.
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third parties.8 We have often referred to this as common-
law standing.9 And we have explained that under traditional,
common-law standing, the persons seeking court action must
show some special injury peculiar to themselves aside from
a general injury to the public, and it is not sufficient that
they have merely a general interest common to all members
of the public.10
A party invoking a court’s or a tribunal’s jurisdiction bears
the burden of establishing the elements of standing.11 At one
point in these proceedings, the appellees claimed that their
interests in the siting of the proposed pipeline were distinct
from the interests of the general public, because they owned
lands which “‘w[ere], or still [are], in the path of one or more
proposed pipeline routes suggested by a pipeline carrier appli-
cant who has invoked [L.B.] 1161.’”
But there was a failure of proof. The district court con-
cluded that it was “unable to determine, from the evidence
presented, whether the [appellees’] property sits on the cur-
rent pipeline route . . . or instead sits on a route previously
proposed.” As such, the district court was “unable to deter-
mine whether [the appellees’] alleged injury—as it regards
land in the path of the pipeline—is actual and imminent, or
merely conjectural and hypothetical.” Accordingly, the district
court found that the appellees had failed to establish “tradi-
tional standing.”
The appellees did not cross-appeal from this determina-
tion, and as all members of this court agree, they have not
established traditional common-law standing to challenge the
constitutionality of the legislation at issue here. Thus, their
ability to invoke the jurisdiction of a court to adjudicate the
constitutionality of L.B. 1161 depends upon whether they
fall within one of the exceptions to the common-law stand-
ing requirement.
8
Id.
9
See, e.g., Project Extra Mile v. Nebraska Liquor Control Comm., 283 Neb.
379, 810 N.W.2d 149 (2012).
10
See State ex rel. Reed v. State, 278 Neb. 564, 773 N.W.2d 349 (2009).
11
Field Club v. Zoning Bd. of Appeals of Omaha, supra note 6.
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This court has recognized very limited exceptions to the
standing requirement that a litigant have a personal stake in
the outcome of a controversy. Our approach in this regard has
been careful and conservative. We have specifically rejected
invitations to liberalize our standing requirements.12 And we
have noted that exceptions to the general rule of standing
should be “carefully applied”13 in order to “prevent the excep-
tions from swallowing the rule.”14 We have recognized three
exceptions to traditional standing, stated in the chronological
order of their development in our case law:
• Enforcement of a public duty by a mandamus action of a citi-
zen interested in the execution of the laws.15
• Action by a resident taxpayer to prevent or recover an illegal
expenditure of public funds or to prevent an increase in the
burden of taxation.16
• Matters of “great public concern” that otherwise would likely
go unchallenged.17
There is one characteristic shared by all of the excep-
tions—scarcity of application. The traditional, common-law
rule dominates our jurisprudence. The exceptions are few, and
resort to them is rare.
Mandamus to Enforce Public Duty
The first exception to develop has nearly been lost in antiq-
uity. As this court recently summarized,
In the 19th and early 20th centuries, this court dis-
cussed an exception to the requirement that a litigant
have a personal stake in the outcome of the controversy.
We stated that if the question was one of a public right
and the object of mandamus was to procure the enforce-
ment of a public duty, the people were regarded as the
12
See, e.g., Ritchhart v. Daub, 256 Neb. 801, 594 N.W.2d 288 (1999).
13
State ex rel. Reed v. State, supra note 10, 278 Neb. at 571, 773 N.W.2d at
355.
14
Id.
15
See, e.g., The State v. Stearns, 11 Neb. 104, 7 N.W. 743 (1881).
16
See, e.g., Rath v. City of Sutton, 267 Neb. 265, 673 N.W.2d 869 (2004).
17
See State ex rel. Reed v. State, supra note 10.
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real party in interest. In that situation, the individual
bringing the action, the relator, did not need to show
that he [or she] had any legal or special interest in
the result.18
We need not consider this exception further, because the
appellees sought a declaratory judgment rather than proceed-
ing for a writ of mandamus. We focus instead on the remain-
ing two exceptions, both of which involve actions brought by
persons who have no interest in the subject matter of the suit
distinct from that of the general public.
R esident Taxpayer Exception
The resident taxpayer exception, though rare in comparison
to traditional, common-law standing, is much more common
than either of the other exceptions.19 The district court relied on
this exception in concluding that the appellees had standing to
challenge the constitutionality of L.B. 1161.
Under this exception, a resident taxpayer, without showing
any interest or injury peculiar to himself or herself, may bring
an action to (1) enjoin the illegal expenditure of public funds
raised for governmental purposes20 or (2) restrain the act of
a public board or officer which would increase the burden
of taxation without an actual illegal expenditure of public
18
Id. at 568, 773 N.W.2d at 354, citing City of Crawford v. Darrow, 87 Neb.
494, 127 N.W. 891 (1910); Van Horn v. State, 51 Neb. 232, 70 N.W. 941
(1897); State, ex rel., Ferguson v. Shropshire, 4 Neb. 411 (1876).
19
See, Rath v. City of Sutton, supra note 16; Wasikowski v. Nebraska
Quality Jobs Bd., 264 Neb. 403, 648 N.W.2d 756 (2002); Chambers v.
Lautenbaugh, 263 Neb. 920, 644 N.W.2d 540 (2002); State ex rel. Steinke
v. Lautenbaugh, 263 Neb. 652, 642 N.W.2d 132 (2002); Hagan v. Upper
Republican NRD, 261 Neb. 312, 622 N.W.2d 627 (2001); Ritchhart v.
Daub, supra note 12; Fitzke v. City of Hastings, 255 Neb. 46, 582 N.W.2d
301 (1998); Professional Firefighters of Omaha v. City of Omaha, 243
Neb. 166, 498 N.W.2d 325 (1993); Rexroad, Inc. v. S.I.D. No. 66, 222
Neb. 618, 386 N.W.2d 433 (1986); Nebraska Sch. Dist. No. 148 v. Lincoln
Airport Auth., 220 Neb. 504, 371 N.W.2d 258 (1985); Haschke v. School
Dist. of Humphrey, 184 Neb. 298, 167 N.W.2d 79 (1969); Martin v. City
of Lincoln, 155 Neb. 845, 53 N.W.2d 923 (1952).
20
Mart. v. City of Lincoln, supra note 19.
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funds.21 To plead a resident taxpayer’s action, the plaintiff
must allege a demand made upon the municipal or public
corporation and a refusal by the corporation to bring the
action itself, or facts which show that such a demand would
be useless.22
In Project Extra Mile v. Nebraska Liquor Control Comm.,23
standing was based on a challenger’s status as a taxpayer. This
court held the taxpayer was also required to show the unlawful
action would otherwise go unchallenged:
We hold that a taxpayer has standing to challenge a
state official’s failure to comply with a clear statutory
duty to assess or collect taxes—as distinguished from
legitimate discretion to decide whether to tax. But the
taxpayer must show that the official’s unlawful failure
to comply with a duty to tax would otherwise go unchal-
lenged because no other potential party is better suited
to bring the action. In an action brought under [Neb.
Rev. Stat.] § 84-911 [(Reissue 2008)], this rule means a
taxpayer has standing to challenge an agency’s unlaw-
ful regulation that negates the agency’s statutory duty to
assess taxes. We further hold that no other potential par-
ties are better suited than a taxpayer to claim that a state
agency or official has violated a statutory duty to assess
taxes when the persons or entities directly and immedi-
ately affected by the alleged violation are beneficially,
instead of adversely, affected.24
In its analysis of taxpayer standing in this case, the district
court erroneously concluded that Project Extra Mile “does not
require [the appellees] to show [L.B.] 1161 would otherwise
go unchallenged unless taxpayers have the right to bring the
action.” In Project Extra Mile, we concluded that the taxpayer
had met her “burden” of establishing standing to challenge
the Nebraska Liquor Control Commission’s classification of
21
See Rath v. City of Sutton, supra note 16.
22
Nebraska Sch. Dist. No. 148 v. Lincoln Airport Auth., supra note 19.
23
Project Extra Mile v. Nebraska Liquor Control Comm., supra note 9.
24
Id. at 391, 810 N.W.2d at 160-61 (emphasis supplied).
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malt beverages as beer for purposes of taxation by showing
that the only parties directly affected by the classification
were sellers of malt liquor who were beneficially affected by
the classification and thus had no incentive to challenge it. If
it had been unnecessary for the taxpayer to show that there
was no one better suited to maintain the action challenging
the classification, we would not have characterized such a
showing as a component of the taxpayer’s burden to estab-
lish standing.
Exception for Matters of
Great Public Concern
The exception for matters of “great public concern” appears
to have entered our jurisprudential lexicon in 1979 via this
court’s opinion in Cunningham v. Exon.25 Drawing on cases
from other jurisdictions, this court recognized an exception
“where matters of great public concern are involved and a leg-
islative enactment may go unchallenged unless [the] plaintiff
has the right to bring the action.”26 In that case, a constitutional
amendment changed the provisions regarding the use of pub-
lic funds for sectarian and educational purposes. The question
was whether a portion of the Nebraska Constitution had been
omitted inadvertently when the Secretary of State printed the
constitution following an election of the people to amend the
constitution. The Cunningham court recognized that without an
exception to the general rule, no person was likely to have a
special injury peculiar to himself and distinct from that of the
public generally.
Cunningham is the only case in which we have applied this
exception to the general rule of common-law standing before
today. Perhaps that is because Cunningham provides no objec-
tive basis for determining whether a particular issue is one of
“great public concern.” Moreover, the issue in Cunningham
involved the structural integrity of the state Constitution itself,
not whether one of hundreds of laws enacted by the Legislature
violated a constitutional provision, as is the claim here. As the
25
Cunningham v. Exon, 202 Neb. 563, 276 N.W.2d 213 (1979).
26
Id. at 567, 276 N.W.2d at 215.
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plurality correctly notes, we have specifically declined to apply
the exception in similar contexts.27
At this point, it is worth noting that the appellees have
never claimed standing based upon this exception. Instead,
they alleged that they had standing as “taxpayers with inter-
ests in unlawful expenditure of state funds as required by
[L.B.] 1161.” Not surprisingly, the only exception to the tradi-
tional standing requirement analyzed by the district court was
“taxpayer standing.” At one point in that analysis, the district
court noted that “[t]he issues involved in this case are of great
public concern . . . .” But it did not cite Cunningham or spe-
cifically analyze the exception which that case recognized. And
there is no reference to Cunningham or its holding in any of
the appellate briefs.
Nevertheless, the plurality invokes the holding of
Cunningham, which until now has been limited to the spe-
cific facts of that case. First, it observes that the “great public
concern” exception recognized in Cunningham is “another
name for the ‘public interest’ exception that we recognized in
our early mandamus cases.” But our opinion in Cunningham
makes no reference to any mandamus cases decided by this
court. It adopts the “great public concern” exception from
the law of other jurisdictions, primarily Colorado. In an
attempt to make the connection between the early mandamus
cases and Cunningham, the plurality reads too much into our
recent case law, which simply does not link the two lines
of authority.
Next, the plurality attempts to identify the issue of “great
public concern” presented in this case. As the district court cor-
rectly and properly observed in the first paragraph of its order,
the issue in this case is not whether the proposed pipeline
approved by the Governor should be built, but only whether
L.B. 1161, which authorized such approval, is constitutional.
The plurality elevates this rather narrow and straightforward
separation of powers issue into an issue of “great public
27
See Green v. Cox Cable of Omaha, Inc., 212 Neb. 915, 327 N.W.2d 603
(1982). See, also, Neb. Against Exp. Gmblg. v. Neb. Horsemen’s Assn., 258
Neb. 690, 605 N.W.2d 803 (2000).
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concern” by characterizing the challenge to L.B. 1161 as one
involving “the citizens’ interest in their form of government”
and “fundamental limitations on government powers under the
Nebraska Constitution.”
Any challenge to the constitutionality of a statute can be
characterized as involving the “fundamental limitations on
government,” because by enacting an unconstitutional statute,
the Legislature necessarily exceeds its lawful authority. For the
same reason, it could always be said that an allegedly unconsti-
tutional statute would fall within “the citizens’ interest in their
form of government.” But we have never held that any citizen
has standing to challenge the constitutionality of any statute.
The plurality attempts to limit the scope of its reasoning but
provides no objective basis for doing so. It observes that “the
exception for matters of great public concern, by definition,
must involve an issue that affects many citizens,” but does
not explain how approval of a pipeline route by the Governor
instead of the Public Service Commission would affect anyone
other than the pipeline company and the owners of property in
the path of the approved pipeline route.
Even if we could accept this reasoning and agree an issue
of “great public concern” is presented, the plurality’s analysis
would still fail. Cunningham requires not only that the issue
presented be of “great public concern,” but also that the “leg-
islative enactment may go unchallenged unless [the] plaintiff
has the right to bring the action.”28 This second requirement
was not simply a throwaway line in the opinion. Rather, it is an
important and necessary counterbalance to the exception to the
general rule that a party must have a personal stake in a con-
troversy in order to have standing. As we stated in Ritchhart v.
Daub,29 “[t]he threshold question, . . . when a party attempts to
base standing on an injury common to the general public, has
been whether or not there exists another party whose interests
are more at issue in the action, and who is thus more appro-
priately entitled to present the claim.” It is not a question of
whether this principle should be imported from Project Extra
28
Cunningham v. Exon, supra note 25, 202 Neb. at 567, 276 N.W.2d at 215.
29
Ritchhart v. Daub, supra note 12, 256 Neb. at 808, 594 N.W.2d at 293.
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Mile, as the plurality suggests, because it has always been an
integral part of the holding in Cunningham.
In Cunningham, we rejected an argument that the only per-
sons who would have standing to challenge the constitutional
amendment were “potential” recipients of federal funds who
“may have been” affected by the amendment.30 We reasoned
that if the amendment could not be challenged by a citizen and
taxpayer “unless and until he [or she] has a special pecuniary
interest or injury different from that of the public generally,
it is entirely possible that no one may have standing to chal-
lenge it.”31
But that cannot be said here. When the Governor signed
the pipeline siting authorization pursuant to the authority
conferred by L.B. 1161, every owner of real property which
became subject to condemnation for the pipeline acquired
a special pecuniary interest or injury different from that of
the public generally, and thus had traditional standing to
challenge L.B. 1161. Anyone mildly familiar with Nebraska
geography would understand that the route approved by the
Governor measures in the hundreds of miles. There must
be dozens, if not hundreds, of potential plaintiffs who own
property along the proposed pipeline route who would have
traditional, common-law standing to bring a declaratory judg-
ment action to challenge the constitutionality of L.B. 1161,
or to assert the constitutional issue in condemnation proceed-
ings. Indeed, one or more of the appellees may have a direct
interest sufficient to establish traditional standing but simply
failed to prove it.
The plurality states that “the landowners have alleged that
the Legislature has unconstitutionally authorized the Governor
to decide who can exercise the power of eminent domain
in Nebraska.” Certainly a “landowner” whose property was
subject to condemnation for a pipeline route approved by the
Governor would have standing to assert this claim. But the
appellees did not establish that their property was subject to
condemnation for the pipeline. For purposes of standing, they
30
Cunningham v. Exon, supra note 25, 202 Neb. at 567, 276 N.W.2d at 215.
31
Id. at 568, 276 N.W.2d at 216.
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are no different than the owner of an office building in down-
town Omaha.
It is true, as the plurality states, that a pipeline company
whose proposed route was approved by the Governor would
have no incentive to challenge L.B. 1161. But it cannot be
seriously contended that property owners facing condemna-
tion of large swaths of their farmland to make way for the
pipeline were “beneficially affected” by L.B. 1161 so as to
have no incentive to challenge it. Also, if the Public Service
Commission believed that its constitutional jurisdiction were
threatened by L.B. 1161, it would have traditional standing
to challenge it.32 This is simply not a case where a legisla-
tive enactment is likely to go unchallenged unless a taxpayer
or other citizen who lacks traditional standing is permitted
to mount the challenge. And because of that, the very nar-
row exception to the general rule of standing recognized in
Cunningham is not applicable.
In support of its reasoning, the plurality asks, “How could
a taxpayer show a direct injury if the Legislature statutorily
abolished the [Public Service Commission]?” If those were the
facts before us, we might agree that the Cunningham exception
applied. Legislative abolition of a constitutional agency would
be a structural alteration of the state Constitution which would
not produce an immediate adverse impact on any specific citi-
zen, as was the case in Cunningham. But here, the Legislature
did not abolish the Public Service Commission or take away
any of its powers. Instead, it conferred alternative jurisdiction
on the executive to approve the site of a proposed pipeline. The
Governor’s actions based on that authority had a direct impact
on owners of property in the path of the pipeline and, argu-
ably, the Public Service Commission itself. Those parties have
traditional standing, and are thus better suited than a citizen or
taxpayer who is not directly affected by L.B. 1161 to challenge
its constitutionality.
32
See, e.g., State ex rel. Spire v. Northwestern Bell Tel. Co., 233 Neb. 262,
445 N.W.2d 284 (1989); Ritums v. Howell, 190 Neb. 503, 209 N.W.2d 160
(1973); State ex rel. State Railway Commission v. Ramsey, 151 Neb. 333,
37 N.W.2d 502 (1949).
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This court has in the past carefully applied exceptions to the
traditional, common-law rule of standing in order to “prevent
the exceptions from swallowing the rule.”33 The plurality’s new
and expansive interpretation of the exception for matters of
great public concern consumes the time-honored common-law
rule in a single gulp. Under its reasoning, any resident tax-
payer or citizen has standing to challenge any public act which
can be subjectively characterized as a matter of “great public
concern,” despite the fact that the would-be plaintiff can dem-
onstrate no personal stake in the matter, and regardless of the
existence of other persons who can.
Whether or not it constitutes a matter of “great public con-
cern,” the constitutional challenge to L.B. 1161 is a legitimate
issue which should be decided by a court as expeditiously as
possible. But it must be decided by a court with jurisdiction to
do so, or the entire judicial process is for naught. Courts can-
not choose to overlook jurisdictional defects; we are obligated
to resolve cases on the basis of how they are actually brought
to us, not on the basis of how they should have been brought
to us. With due respect to our colleagues, we are unwilling
to rewrite the law of standing in order to reach the merits of
this case. Because these appellees did not meet their burden
of establishing that they had standing when the suit was com-
menced, the district court did not have jurisdiction to decide
the constitutional issue, and neither does this court.
JUDICIAL RESTRAINT
Because we believe that we lack jurisdiction to do so, we
express no opinion as to the constitutionality of L.B. 1161, and
we see no purpose to be served by the plurality’s willingness
to do so. Given this court’s division on the issue of standing in
this case, there is neither a five-member supermajority to hold
that L.B. 1161 is unconstitutional nor a three-member minority
which could uphold its constitutionality. Due to this impasse,
the constitutional challenge to L.B. 1161 cannot be resolved
one way or the other in this case.
33
State ex rel. Reed v. State, supra note 10, 278 Neb. at 571, 773 N.W.2d at
355.
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Contrary to the view of the plurality, we do not have an
“option” to opine on the merits after concluding that we lack
jurisdiction to do so. The plurality cites to case law from
other jurisdictions, including the U.S. Supreme Court, for the
proposition that a judge may dissent on a jurisdictional issue
and simultaneously reach the merits of the appeal. But as the
plurality itself acknowledges, none of the cited law involves
the dissenting judge’s issuing an opinion on the merits having
precedential value. In other words, while the judges opined on
the merits even after finding the court lacked jurisdiction, their
opinions did not affect the ultimate resolution of the case by
the court.
But as the plurality acknowledges, that is not the situation
here. Instead, it invites us to reach the merits in order to resolve
the constitutional issue. Apparently, the plurality believes that
the constitutional supermajority requirement could be achieved
in this fashion. We do not share that view.
Our constitution provides: “A majority of the members [of
the Supreme Court] sitting shall have authority to pronounce
a decision except in cases involving the constitutionality of an
act of the Legislature. No legislative act shall be held uncon-
stitutional except by the concurrence of five judges.”34 Where
four members of the court conclude that a statute is unconsti-
tutional, a contrary conclusion by the remaining three members
is sufficient to affirm the constitutionality of the statute.35 The
plurality announces that it is a “majority” on the issue of juris-
diction. That would be true only if its decision were to uphold
the constitutionality of L.B. 1161.
We understand the constitutional supermajority requirement
to mean a statute cannot be declared unconstitutional unless at
least five members of this court (1) conclude that they have
jurisdiction to decide the case and (2) determine on the merits
that the statute is unconstitutional. Otherwise, a statute could
be declared unconstitutional by four judges who believe they
have jurisdiction to decide the issue and one who does not.
34
Neb. Const. art. V, § 2 (emphasis supplied).
35
See, e.g., State v. Cavitt, 182 Neb. 712, 157 N.W.2d 171 (1968).
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Or, under the plurality’s reasoning, the constitutionality of a
statute could be upheld by three judges who do not believe
they have jurisdiction to decide the issue but address the merits
anyway, if there were four judges who held opposing views as
to jurisdiction and constitutionality. Surely, the framers of the
constitution did not intend such absurd results.
In our view, participating in what could be a binding opinion
on the merits of a constitutional issue while at the same time
opining that the court lacks jurisdiction to reach the constitu-
tional issue would be judicially irresponsible and cast grave
doubt upon the constitutional validity of the decision of the
court. To the extent that the plurality analyzes the merits of
the constitutional issue which it lacks the votes to resolve, its
opinion is merely advisory. A more prudent course, and the one
that we follow, is to refrain from addressing the constitutional
issues which cannot be decided in this case because of our
division on the jurisdictional issue of standing.
CONCLUSION
In summary, we disagree with the plurality that the appel-
lees, having failed to establish that they have traditional stand-
ing, may nevertheless have standing as resident taxpayers
asserting a matter of “great public concern” without a showing
that there are no better suited parties to assert such claims. Our
established case law requires such a showing. In this case, it
was not and cannot be made.
We conclude that the district court erred by not dismissing
the action for lack of jurisdiction due to the failure of the plain-
tiffs below, the appellees herein, to establish standing. For the
foregoing reasons, we respectfully dissent from the plurality’s
analysis of standing but concur in the result vacating the judg-
ment of the district court.