Eicher v. Mid America Financial Inv. Corp.
| Decision Date | 12 August 2005 |
| Docket Number | No. S-04-1184., No. S-03-1257 |
| Citation | 270 Neb. 370,702 N.W.2d 792 |
| Parties | Ivan EICHER and Delores Eicher et al., appellees and cross-appellants, v. MID AMERICA FINANCIAL INVESTMENT CORPORATION et al., appellants and cross-appellees. Ivan Eicher and Delores Eicher et al., appellees, v. Mid America Financial Investment Corporation et al., appellants. |
| Court | Nebraska Supreme Court |
Betty L. Egan, of Walentine, O'Toole, McQuillan & Gordon, Omaha, for appellants.
Mark C. Laughlin, Andrea F. Scioli, and Tamara D. Borer, of Fraser, Stryker, Meusey, Olson, Boyer & Bloch, P.C., and Catherine Mahern, of Creighton Legal
Clinic, and D. Milo Mumgaard, of Nebraska Appleseed Center for Law in the Public Interest, Omaha, for appellees.
These appeals result from a single action in which 13 individual plaintiffs sought damages based upon allegations of fraud, civil conspiracy, unjust enrichment, rescission, and violations of Nebraska's Consumer Protection Act and Uniform Deceptive Trade Practices Act. Plaintiffs claimed that while their homes were in foreclosure, defendants, Mid America Financial Investment Corporation (Mid America), Scott W. Bloemer, and Elaina Hollingshead, told them they would loan them money to save their homes from foreclosure but instead fraudulently obtained title to the homes. Following a bench trial, the district court for Douglas County found in favor of 10 of the 13 plaintiffs and granted relief in the form of rescission, damages, and attorney fees. Defendants below appeal from the court's judgment and separately appeal from a subsequent nunc pro tunc order involving the award of fees. The district court dismissed the claims of plaintiffs William Street and David Welton, who have cross-appealed by filing a notice of appeal of those dismissals. In plaintiff's brief on cross-appeal, a third issue affecting all plaintiffs is addressed. We consolidated the appeals and moved them to our docket on our own motion, pursuant to our statutory authority to regulate the caseloads of the appellate courts of this state. See Neb.Rev.Stat. § 24-1106(3) (Reissue 1995).
In May 2001, plaintiffs Ivan Eicher and Delores Eicher, Patrick Sweeney and Lois Sweeney, Emmett Gulley, Steven W. Starman, Street, Welton, and Don Novachich filed an action against Mid America, Bloemer, and Hollingshead. Subsequently, Jerry Gills, Renee Righter, Lori Hill, and Jennifer Frans Griess were joined as additional plaintiffs in the operative third amended petition. Plaintiffs alleged that Bloemer and Hollingshead, acting through Mid America as their alter ego, conducted a fraudulent scheme in which they identified people whose homes were in foreclosure, approached them under the guise of loaning them money to stop the foreclosures, and then deceitfully acquired title to the homes by acquiring warranty deeds. Plaintiffs alleged they were victims of this scheme and prayed for relief, including rescission and reconveyance, damages, and attorney fees. Plaintiffs' action was based on multiple theories of recovery including fraud, civil conspiracy, unjust enrichment, and violations of the Consumer Protection Act (hereinafter CPA), Neb.Rev.Stat. §§ 59-1601 to 59-1622 (Reissue 1998 & Cum.Supp.2000), and the Uniform Deceptive Trade Practices Act (hereinafter UDTPA), Neb.Rev.Stat. §§ 87-301 to 87-306 (Reissue 1999).
At a bench trial, plaintiffs testified that Bloemer and Hollingshead, acting on behalf of Mid America, offered to loan them money to stop foreclosure so that defendants could keep their homes, but never disclosed that defendants were actually taking title to the homes. Bloemer and Hollingshead testified to the contrary, asserting that the terms of the transaction were fully explained to each plaintiff and that each plaintiff understood that he or she was conveying title to the home to defendants. During the trial, the district court dismissed the claim of plaintiff Gills without prejudice because he did not appear and could not be located. Following the bench trial, the district court entered an order, filed May 1, 2003, in which it dismissed the action with respect to plaintiff Street pursuant to a motion for partial summary judgment previously filed on behalf of defendants. In the same order, the court found the testimony of plaintiffs to be credible and the testimony of Bloemer and Hollingshead not credible. The court determined that defendants had engaged in a civil conspiracy to commit fraud and had fraudulently induced plaintiffs to enter into transactions of conveyance which were falsely represented as loans. The court further found that defendants had violated the CPA. It found defendants jointly and severally liable to all remaining plaintiffs except Welton. The court found that although Welton was induced by the fraudulent actions of defendants to enter into the transaction with Mid America, he did not incur any damages. The court stated in its order that attorney fees were to be awarded under the CPA and scheduled a hearing date to determine the amount of the fees.
On June 17, 2003, the district court entered an order awarding attorney fees to the prevailing plaintiffs. The order made no reference to the CPA, but instead referred to the UDTPA as the basis for the award. After considering the time spent and reasonable hourly charge of plaintiffs' attorneys, the court awarded fees using a multiplier of 1.3 to arrive at a final amount. This resulted in plaintiffs' primary attorneys receiving a fee of $374,224.50, and their other attorneys receiving fees of $1,045.20 and $2,053.70, respectively.
Defendants filed a motion for new trial. Welton and Street filed a motion for judgment notwithstanding the verdict or, in the alternative, a new trial. In addition, all plaintiffs filed a motion requesting the district court to clarify its prior orders by making specific findings of fact with respect to their claims under the UDTPA. All plaintiffs also asked the court to clarify that the award of attorney fees was pursuant to both the UDTPA and the CPA. The district court entered an order overruling the motions for new trial and specifically finding that plaintiffs were not entitled to relief under the UDTPA. From that order, defendants perfected a timely appeal, and plaintiffs cross-appealed. The appeal and cross-appeal were docketed in this court as case No. S-03-1257.
While the parties were submitting appellate briefs to this court, plaintiffs filed a motion in the district court for an order nunc pro tunc declaring that the award of attorney fees was pursuant to the CPA and that the reference to the UDTPA was a clerical error. The court entered such an order on October 7, 2004, and defendants, who are the appellants herein, filed a timely appeal. That appeal was docketed in this court as case No. S-04-1184 and, as previously noted, consolidated with case No. S-03-1257.
Additional facts relevant to specific assignments of error are included in the analysis.
In defendants' first assignment of error, they contend that the district court erred in denying a pretrial motion to sever and separately try the claims of the individual plaintiffs. Whether claims should be joined for purposes of trial is within the discretion of the district court. See Mondelli v. Kendel Homes Corp., 262 Neb. 663, 641 N.W.2d 624 (2001) (supplemental opinion). Accordingly, we review the district court's overruling of the motion to sever for abuse of discretion. Neb.Rev.Stat. § 25-705 (Cum.Supp. 2004) provides in relevant part:
The relevant joinder statute, Neb.Rev. Stat. § 25-311 (Cum.Supp.2004), provides:
All persons may join in one action as plaintiffs if they assert any right to relief jointly, severally, or in the alternative in respect of or arising out of the same transaction, occurrence, or series of transactions or occurrences and if any question of law or fact common to all these persons will arise in the action.
Defendants contend that the "same transaction, occurrence, or series of transactions or occurrences" requirement of § 25-311 is not met in this case and that the trial court's failure to sever plaintiffs' claims was prejudicial to them.
The record does not reflect either misjoinder or prejudice resulting from denial of the motion to sever. The operative petition alleged and the evidence presented at trial generally demonstrated that each plaintiff asserted the same causes of action against defendants. Each plaintiff alleged that his or her right to relief arose out of the same series of transactions occurring between September 1997 and June 2000, in which defendants told plaintiffs they would loan them money in order to stop the foreclosure of their homes. Plaintiffs generally alleged and testified that Bloemer and Hollingshead never told them they would be selling their homes to Mid America. Plaintiffs alleged and testified that they were told they were signing loan documents and did not realize that defendants were actually presenting them with purchase agreements. Due to the similar nature of all the transactions, joinder of the claims was proper, particularly in a bench trial where there is no concern about jury confusion and it is presumed that the court considered only competent and relevant evidence in rendering its decision. See Nelson v. Metropolitan Utilities Dist., ...
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