Fisher v. Heirs & Devisees of T.D. Lovercheck
| Decision Date | 05 June 2015 |
| Docket Number | No. S–14–529,S–14–529 |
| Parties | David Fisher and Pamela W. Fisher, husband and wife, and David Fisher and Pamela W. Fisher, Trustees, appellants, v. The Heirs and Devisees of T.D. Lovercheck et al., appellees. |
| Court | Nebraska Supreme Court |
Philip M. Kelly and Jerald L. Ostdiek, of Douglas, Kelly, Ostdiek & Ossian, P.C., Scottsbluff, for appellants.
Leslie A. Shaver and John F. Simmons, of Simmons Olsen Law Firm, P.C., for appellees.
1. Equity: Appeal and Error.On appeal from an equity action, an appellate court tries factual questions de novo on the record and reaches an independent conclusion.
2. Statutes: Appeal and Error.The meaning and interpretation of a statute are questions of law, which an appellate court independently reviews.
3. Pleadings: Parties: Limitations of Actions.Under Neb.Rev.Stat. § 25–301 (Reissue 2008), an amendment joining the real parties in interest relates back to the date of the original pleading.
4. Garnishment: Statutes: Appeal and Error.An appellate court applies the ordinary rules of interpretation to statutes in chapter 25 of the Nebraska Revised Statutes.
David Fisher and Pamela W. Fisher sued, among others, U.S. Bank National Association (U.S. Bank) to terminate severed mineral interests. The Fishers filed their complaint as “Husband and Wife” and alleged that they had owned the land since 1986. In its answer, U.S. Bank noted that in 2001, the Fishers conveyed the land to themselves as trustees for the David and Pamela Fisher Living Trust. Thus, U.S. Bank argued that the Fishers, as husband and wife, were not the real parties in interest.
Before the Fishers filed an amended complaint adding themselves in their capacity as trustees as plaintiffs, U.S. Bank recorded a verified claim of mineral interest. Because U.S. Bank did not otherwise publicly exercise its right of ownership, whether it recorded a claim of interest before the Fishers commenced the action was the decisive issue. The court held that the amended complaint did not relate back to the original complaint and sustained U.S. Bank's motion for summary judgment. As a matter of first impression, we conclude that the amended complaint relates back under Neb.Rev.Stat. § 25–301 (Reissue 2008) because it joined the real parties in interest. We reverse, and remand with directions.
In 1986, “DAVID FISHER and PAMELA W. FISHER, husband and wife,” received by warranty deed 400 acres in Banner County, Nebraska, as joint tenants. In 2001, the Fishers quitclaimed the land to “DAVID FISHER and PAMELA W. FISHER, TRUSTEES OF THE DAVID AND PAMELA FISHER LIVING TRUST.” David and Pamela Fisher are the initial trustees and beneficiaries of the trust.
US Bank is the trustee of the L.T. Lovercheck Trust. US Bank claims that the corpus of the Lovercheck trust includes an undivided one-quarter interest in the minerals produced on the land in question.
The parties generally agree that the mineral estate has not been active. David averred that since he and Pamela acquired the land in 1986, no well drilling occurred and no mineral leases were executed. US Bank admitted that, to its knowledge, no drilling activity occurred on the land and that it had not filed a claim of interest before this litigation.
On March 4, 2013, “DAVID FISHER and PAMELA W. FISHER, Husband and Wife,” filed a complaint to terminate severed mineral interests. The defendants included U.S. Bank as the trustee of the Lovercheck trust. To succeed, the Fishers had to prove three negatives. Generally, they had to show that the record owners of the severed mineral interests did not, in the 23 years before the Fishers filed suit, publicly exercise their ownership rights by (1) transferring, leasing, or encumbering their interest; (2) drilling for or removing minerals; or (3) recording a verified claim of interest.1
On May 2, 2013, U.S. Bank filed an answer alleging that the Fishers did not bring suit in the name of the real party in interest, i.e., the trustees of their trust. On the same day, U.S. Bank recorded a verified claim of mineral interest. On May 29, U.S. Bank filed another claim of interest to “further clarify the ownership of title.”
On June 14, 2013, the Fishers moved for leave to file an amended complaint. The court sustained their motion, and the Fishers filed an amended complaint that added “DAVID FISHER and PAMELA W. FISHER, Trustees,” as plaintiffs. The amended complaint did not change the substance of the Fishers' claims. In its answer to the amended complaint, U.S. Bank alleged that it recorded a claim of interest before the Fishers filed their amended complaint.
US Bank and the Fishers filed cross-motions for summary judgment. The court sustained the Fishers' motion for a default judgment against all defendants except U.S. Bank.
In its order disposing of the cross-motions for summary judgment, the court stated that U.S. Bank recorded a valid claim of interest after the Fishers filed the original complaint but before they filed the amended complaint. So, the “critical conclusion” was whether the amended complaint related back to the original complaint. Because the Fishers' trust owned the surface estate, the court stated that “[t]he real parties in interest in this matter are David and Pamela Fisher, as trustees of the trust, not as husband and wife.”
After deciding that the general relation-back statute, Neb.Rev.Stat. § 25–201.02 (Reissue 2008), does not apply to amendments that add plaintiffs, the court turned to § 25–301, the real party in interest statute. Section 25–301 provides that joinder of the real party in interest “shall have the same effect as if the action had been commenced by the real party in interest.” The court stated that § 25–301 “can be used to ‘save’ cases that might otherwise be dismissed due to the statute of limitations.” But the court determined that § 25–301 must be read in the context of “the interplay between the general rules related to civil procedure and those specific rules related to dormant mineral interests.” Reasoning that equity abhors forfeitures and that the dormant mineral interest statutes must be strictly construed, the court decided that the Fishers' amended complaint did not relate back to the original complaint under § 25–301. The court sustained U.S. Bank's motion for summary judgment.
The Fishers assign, restated and consolidated, that the court erred by (1) deciding that the amended complaint did not relate back to the original complaint, (2) sustaining U.S. Bank's motion for summary judgment, and (3) overruling the Fishers' motion for summary judgment.
On appeal from an equity action, an appellate court tries factual questions de novo on the record and reaches an independent conclusion.2
The meaning and interpretation of a statute are questions of law.3 An appellate court independently reviews questions of law.4
The Fishers offer two theories for why the amended complaint relates back to the original: First, they contend that it relates back under § 25–201.02 because the claims asserted in the original and amended complaints arose out of the same transaction. Second, they argue that the amended complaint relates back under § 25–301 because it merely joins the real parties in interest. US Bank responds that § 25–201.02 does not apply to amendments that add plaintiffs and that § 25–301 “says nothing about relation back.”5
As an initial matter, we note that the court found that the Fishers as trustees, and not as husband and wife, were the real parties in interest. Thus, the court implicitly decided that the beneficiaries of a revocable trust are not “owners of the surface” under Neb.Rev.Stat. § 57–228 (Reissue 2010). The focus of the real party in interest inquiry is standing to sue.6 If the statute that creates the cause of action specifies the persons who have standing to sue, those persons are the real parties in interest.7 The Fishers do not argue that they are “owners” in their capacity as beneficiaries. So, the meaning
of “owners” in § 57–228 is not before us.8 We do not review the court's conclusion that the Fishers as beneficiaries are not real parties in interest.
Turning to the civil procedure statutes, § 25–201.02 generally provides that an amendment relates back if it arises out of the same transaction set forth in the original pleading. Under § 25–201.02(2), if the amendment “changes the party or the name of the party against whom a claim is asserted,” the proponent of the amendment must also show that the party in the amended pleading had, within the relevant limitations period, (1) notice of the action such that it will not be prejudiced and (2) notice that the action would have been brought against it absent some mistake. Section 25–201.02 is substantially similar to Fed. R. of Civ. P. 15(c).9 So, we have looked to federal decisions for guidance.10
Section 25–301, Nebraska's real party in interest statute, provides:
Every action shall be prosecuted in the name of the real party in interest.... An action shall not be dismissed on the ground that it is not prosecuted in the name of the real party in interest until a reasonable time has been allowed after objection for joinder or substitution of the real party in interest. Joinder or substitution of the real party in interest shall have the same effect as if the action had been commenced by the real party in interest.
Before a 1999 amendment,11 § 25–301 simply provided that, subject to an exception not applicable here, “[e]very action
must be prosecuted in the name of the real party in interest....”12 The added language is substantially similar to Fed.R.Civ.P. 17,13 particularly to rule 17 as it existed before a 2007 stylistic amendment.14 Because § 25–301 is similar to rule 17, we may look to federal decisions for guidance.15
The Fishers amended their complaint to join the real parties in...
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