Ameritas Life Ins. Corp. v. Balka

Decision Date15 October 1999
Docket NumberNo. S-98-648.,S-98-648.
PartiesAMERITAS LIFE INSURANCE CORP., appellee, v. M. Berri BALKA, Tax Commissioner, appellee, and R.J. Nuernberger, Lancaster County Treasurer, and Lancaster County, Nebraska, appellants.
CourtNebraska Supreme Court

Gary E. Lacey, Lancaster County Attorney, and Michael E. Thew, Lincoln, for appellants.

Norman Krivosha, Omaha, and David M. Williams, Lincoln, for appellee Ameritas Life Insurance Corp.

HENDRY, C.J., WRIGHT, CONNOLLY, GERRARD, STEPHAN, McCORMACK, and MILLER-LERMAN, JJ.

MILLER-LERMAN, J.

NATURE OF CASE

R.J. Nuernberger, Lancaster County treasurer, and Lancaster County, Nebraska, appeal the order of the district court for Lancaster County dated April 30, 1998, granting the summary judgment motion of Ameritas Life Insurance Corp. (Ameritas), appellee, and entering orders thereon, in which the court concluded that the Employment and Investment Growth Act (the Act), Neb.Rev.Stat. § 77-4101 et seq. (Supp.1987), did not provide for interest on personal property taxes recaptured under the Act and that therefore, Ameritas owed no such interest. For the reasons recited below, we affirm.

STATEMENT OF FACTS

There are no factual disputes of a material nature among the parties in this case. In 1987, the Nebraska Legislature enacted L.B. 775, the Act, the goals of which were "to encourage new businesses to relocate to Nebraska, retain existing businesses and aid in their expansion, promote the creation and retention of new jobs in Nebraska, and attract and retain investment capital in the State of Nebraska." § 77-4102(2). The Act offered prescribed economic incentives, including tax benefits to businesses that made certain levels of capital investment and created certain numbers of new jobs in Nebraska. A business wishing to receive the benefits of the Act was required to apply to the Department of Revenue, detailing in the application the proposed project. If the Department of Revenue was satisfied that the application met the Act's requirements, the Tax Commissioner, on behalf of the state, would enter into an agreement with the business, which agreement described the project, the incentives available to the business, and the conditions the business was required to meet in order to receive the benefits. § 77-4104.

On September 1, 1987, Ameritas, under its former name of Bankers Life Insurance Company of Nebraska, entered into such an agreement (the Agreement) with the Department of Revenue. The specific terms of the Agreement are not relevant to the resolution of the instant appeal. In summary, the Agreement provided, inter alia, for Ameritas to invest at least $10 million and create at least 100 new jobs, in exchange for which Ameritas would receive incentives, including a personal property tax exemption on certain personal property Ameritas acquired during the 15year period following the execution of the Agreement. Consistent with § 77-4107, the Agreement also provided, in subsection (10), that if Ameritas did not meet its agreed-upon levels of investment and employment, all or a portion of the personal property tax exemption would be recaptured or disallowed. Subsection (10) is silent on the payment of interest.

In November or December 1992, Ameritas, recognizing that it would not meet the agreed-upon levels of development, inquired about the possibility of paying some or all of the previously exempted personal property tax. Ameritas was told, however, that the Lancaster County treasurer would not accept any such payments unless Ameritas agreed to amend the Agreement. Ameritas did not agree to an amendment.

On August 2, 1995, the Tax Commissioner notified Ameritas and Lancaster County tax officials that Ameritas had failed to meet its obligations under the Agreement and that as a result, all of the personal property taxes which had been exempted, $246,283.62, would be recaptured. On August 25, the treasurer of Lancaster County, the county where the previously exempted personal property was located, requested Ameritas pay to the county the recaptured personal property taxes in the amount noted above, together with interest computed at the rate of 14 percent per annum as of September 8. The interest which Lancaster County claimed was due was as follows:

1988 $ 2,560.78 1989 $35,749.06 1990 $28,747.06 1992 $17,626.57 1993 $10,311.11 1994 $ 2,693.45

Although Ameritas disputed its obligation to pay interest upon the recaptured personal property taxes prior to notice of recapture, it nevertheless paid the principal amount of the recaptured personal property taxes to the Lancaster County treasurer's office. On the same day, Ameritas also posted with the Lancaster County sheriff's office a cash bond in the amount of $104,583.73, representing an amount equal to the amount of interest allegedly due by that time. Thereafter, Ameritas filed the instant declaratory judgment action, naming as parties M. Berri Balka, the then current Tax Commissioner; Nuernberger; and Lancaster County. In its amended petition, Ameritas sought, inter alia, an order declaring that the named defendants were not entitled to retroactive interest on personal property taxes recaptured pursuant to § 77-4107.

Following the filing of cross-motions for summary judgment and an evidentiary hearing, the trial court ruled in favor of Ameritas and against Balka, Nuernberger, and Lancaster County, concluding, inter alia, that the Act did not provide for interest on recaptured personal property taxes and that recaptured personal property taxes are not "delinquent" tax payments for purposes of Neb.Rev.Stat. § 45-104.01 (Reissue 1998), which statutory section sets forth the rate of interest assessed against delinquent taxes. Ameritas' motion for summary judgment was granted, and the summary judgment motions of Balka, Nuernberger, and Lancaster County were denied and orders entered accordingly. Nuernberger and Lancaster County appealed.

ASSIGNMENTS OF ERROR

On appeal, Nuernberger and Lancaster County claim the trial court erred in concluding that (1) personal property taxes recaptured pursuant to § 77-4107 are not subject to interest and (2) such taxes are not delinquent tax payments for purposes of § 45-104.01.

STANDARDS OF REVIEW

A declaratory judgment action is the proper judicial proceeding to determine a party's rights and obligations under a particular statute. Neb.Rev.Stat. § 25-21,150 (Reissue 1995); Hooper v. City of Lincoln, 183 Neb. 591, 163 N.W.2d 117 (1968).

To the extent that an appeal calls for statutory interpretation or presents questions of law, this court must reach an independent conclusion irrespective of the determination made by the court below. Miller v. M.F.S. York/Stormor, 257 Neb. 100, 595 N.W.2d 878 (1999); Kratochvil v. Motor Club Ins. Assn., 255 Neb. 977, 588 N.W.2d 565 (1999); Doe v. Zedek, 255 Neb. 963, 587 N.W.2d 885 (1999).

ANALYSIS

Initially, we note that Balka has not appealed the grant of Ameritas' motion for summary judgment or the denial of his motion for summary judgment and has not submitted a brief in the instant appeal. In the instant appeal, Nuernberger and Lancaster County ask this court to construe provisions of Nebraska's tax statutes so as to permit the assessment of retroactive interest on personal property taxes recaptured pursuant to § 77-4107. This appeal is thus resolved on the basis of statutory construction. The dispositive question in this appeal is whether interest may be imposed on personal property taxes recaptured under § 77-4107. We conclude that interest may not be so imposed, and we, therefore, affirm.

In connection with statutory construction, in the absence of anything to the contrary, statutory language is to be given its plain and ordinary meaning; an appellate court will not resort to interpretation to ascertain the meaning of statutory words which are plain, direct, and unambiguous. State ex rel. City of Elkhorn v. Haney, 252 Neb. 788, 566 N.W.2d 771 (1997). We recently stated: "It is not for the courts to supply missing words or sentences to a statute to make clear that which is indefinite, or to supply that which is not there." State v. Woods, 255 Neb. 755, 764, 587 N.W.2d 122, 128 (1998). In considering the meaning of a statute, this court will, if possible, discover the legislative intent from the language of the statute and give it effect. Cass Constr. Co. v. Brennan, 222 Neb. 69, 382 N.W.2d 313 (1986). This court will not read a statute as if open to construction as a matter of course. Id.

Section 77-4107 provides, in pertinent part, as follows:

(1) If the taxpayer fails either to meet the required levels of employment or investment for the applicable project by the end of the sixth year after the end of the year the application was submitted for such project ... all or a portion of the incentives set forth in the Employment and Investment Growth Act shall be recaptured or disallowed.
(2) The recapture or disallowance shall be as follows:
(a) In the case of a taxpayer who failed to meet the required levels within the required time period, all reduction in the personal property tax because of the Employment and Investment Growth Act shall be recaptured....
....
(4) Any personal property tax that would have been due except for the exemption allowed under the Employment and Investment Growth Act, to the extent it becomes due under subdivision(2)(a) of this section, shall be considered an underpayment of such tax and shall be immediately due and payable to the county in which the property is located.
(5) Notwithstanding any other limitations contained in the laws of this state, collections of any taxes deemed to be underpayments by this section shall be allowed for a period of ten years after the signing of the agreement or three years after the end of the entitlement period, whichever is later.

(Emphasis supplied.)

By its terms, § 77-4107 does not provide for the assessment of interest on recaptured...

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