Kometscher v. Wade

• Decision Date: 05 June 1964
• Docket Number: No. 35618,35618
• Citation: 177 Neb. 299,128 N.W.2d 781
• Parties: Martin KOMETSCHER and Jeanne Kometscher, husband and wife, Appellees, v. Ted WADE, dba Ted's Mobile Homes, Lincoln, Nebraska, Appellee, Impleaded with Mobile Home Finance Company, a corporation, Appellant.
• Court: Nebraska Supreme Court

Page 781

128 N.W.2d 781

177 Neb. 299

Martin KOMETSCHER and Jeanne Kometscher, husband and wife, Appellees, v. Ted WADE, dba Ted's Mobile Homes, Lincoln, Nebraska, Appellee Impleaded with Mobile Home Finance Company, a corporation, Appellant.

No. 35618.

Supreme Court of Nebraska.

June 5, 1964.

Syllabus by the Court

1. Legislation affecting the merits of a controversy adopted subsequent to a trial in district court dealing with a subject matter with which the Legislature has the power to act retroactively is an exception to the requirement that only assignments of error assigned in the trial court may be inquired into in this court.

2. A liability imposed as a consequence of the doing or the omission to do an act which is not measured by any injury flowing from the act or omission is in the nature of a punishment.

3. A statute which imposes such a liability in effect inflicts a penalty and is of a penal character.

4. In case of a change of law providing for civil penalties this court, if the law so provides, will apply it to a case pending on appeal rather than apply the law in effect when the judgment was rendered.

5. A final judgment is one that disposes of the case either by dismissing it before hearing is had upon the merits, or after trial by rendition of judgment for the plaintiff or defendant.

6. Legislative Bill 17, Seventy-fourth (Extraordinary) Session of the Legislature of Nebraska, 1963, found not to be applicable to judgments entered on the merits in the trial court and pending herein on appeal.

Crosby, Pansing, Guenzel & Binning, Theodore L. Kessner, Donn E. Davis, Lincoln, for appellant.

Kier, Cobb & Luedtke, Dennis Sulc, Janice L. Gradwohl, Lincoln, for appellees.

Heard before WHITE, C. J., and CARTER, MESSMORE, YEAGER, SPENCER, BOSLAUGH, and BROWER, JJ.

SPENCER, Justice.

This action involved a conditional sales contract on a house trailer purchased by Martin Kometscher and Jeanne Kometscher, plaintiffs, hereinafter referred to as such, from Ted Wade, doing business as Ted's Mobile Homes, and assigned to Mobile Home Finance Company, a corporation, defendants. The trial court found the contract to be usurious, declared the note and contract void and uncollectible, ordered the defendants to deliver the certificate of title to the plaintiffs, and rendered a judgment against the defendants in the amount of $378.60.

Defendant Mobile Home Finance Company, a corporation, hereinafter referred to as defendant, perfected an appeal to this court. Subsequent to the filing of the appeal, defendant filed a motion for extension of brief day, supported by an affidavit indicating that it intended to restrict the issues of the appeal to the effect and validity of remedial legislation passed by the Seventy-fourth (Extraordinary) Session of the Legislature of Nebraska, 1963, and specifically Legislative Bills 16 and 17. Defendant's brief is restricted to these issues.

Plaintiffs challenged the right of the defendant under our rules to abandon its objection to the finding of the trial court on the evidence adduced and to perfect its appeal solely on the basis of the new legislation. Under Rule 8a 2(4) of the Revised Rules of the Supreme Court, 1963, only assignments of error urged in the trial court will be considered in this court. We are dealing here with a special situation which constitutes an exception to the rule. Legislation affecting the merits of a controversy adopted subsequent to a trial in the district court dealing with a subject matter with which the Legislature has the power to act retroactively is an exception to the requirement that only assignments of error assigned in the trial court may be inquired into in this court.

Plaintiffs argue also that a case in Nebraska must be determined on the law as it stands when the judgment of the lower court is rendered therein. On the general proposition, we can say generally that while courts appear to have reached different conclusions concerning the validity of curative statutes which impair judgments, the recent decisions indicate that the apparent disagreement can be almost entirely eliminated by making a distinction between public and private rights. 30A Am.Jur., Judgments, s. 7, p. 165. There is no question but that plaintiffs' position is correct if vested rights are involved. The question, therefore, is whether plaintiffs' rights are contractual or penal.

In the early case of Kleckner v. Turk, 45 Neb. 176, 63 N.W. 469, we held that a liability imposed as a consequence of the doing or the omission to do an act which is not measured by any injury flowing from the act or omission is in the nature of a punishment. A statute, therefore, which imposes such a liability in effect inflicts a penalty and is of a penal character. The penal character of the remedy herein is fully discussed in Davis v. General Motors Acceptance Corp., 176 Neb. 865, 127 N.W.2d 907, in which we held usury statutes are generally held to be penal in nature and subject to amendment or repeal by retroactive legislation.

Since the submission of the case herein, L.B. 16, Laws 1963, Special Session, chapter 8, page 98, has been determined to be special legislation and in violation of Article III, section 18, Constitution of Nebraska, and therefor unconstitutional. Davis v. General Motors Acceptance Corp., supra. L.B. 16, therefore, will not be discussed further herein.

L.B. 17, Laws 1963, Special Session, chapter 9, page 103, which amends the penalty sections of the Installment Loan Act, was held to be valid and constitutional and to be applicable to all loans which are subject to the Installment Loan Act, except where an action on such loan has been reduced to final judgment. Davis v. General Motors Acceptance Corp., supra.

On this latter point, L.B. 17 specifically provides as follows: 'Sec. 5. Except as to those transactions on which an action at law or in equity has been reduced to a final judgment as of the effective date of this act, the penalty provisions of section 45-137, Reissue Revised Statutes of Nebraska, 1943, as amended by Legislative Bill 513, enacted by the Seventy-third Session of the Legislature of Nebraska and as further amended by this act and the penalty provisions of sections 45-138, 45-154 and 45-155, Reissue Revised Statutes of Nebraska, 1943, as amended by this act, shall apply to all transactions made prior to the effective date of this act.' L.B. 17 became effective November 15, 1963. Judgment herein was rendered in the district court July 18, 1963. Motion for a new trial was overruled August 2, 1963, and the action was pending in this court on appeal on November 15, 1963.

Inasmuch as many of the issues raised by the parties herein have been exhaustively discussed in Davis v. General Motors Acceptance Corp., supra, we concern ourselves in this opinion only with two narrow problems. Has the action herein been reduced to final judgment, and if not, is the new law applicable because the action of the Legislature took place after judgment was rendered in the district court and while the appeal was pending in this court? We will consider them in reverse order.

There is some disagreement as to what law should be applied where judgment has been rendered in a court of original jurisdiction and is pending in an appellate court on appeal when a change is made in the law. There seems, however, to be very little disagreement as to what law should be applied where penalties are involved, as noted in the following found at page 1332 of an Annotation in 111 A.L.R. 1317: 'Although there is some authority to the contrary (Taylor v. Rushing (1829) 2 Stew. (Ala.) 160; Dunham v. Anders (1901) 128 N.C. 207, 38 S.E. 832, 83 Am.St.Rep. 668), by the great weight of authority, in case of a change of law providing for civil penalties (as is also the rule in case of change of criminal law, not within the scope of the annotation), the rule generally adopted is that the appellate court will determine the question on appeal according to the law prevailing at the time of the decision on appeal, and not according to the law prevailing at the time of the rendition of the judgment appealed from.' (Citing cases.)

In 5 Am.Jur.2d, Appeal and Error, s. 729, p. 173, we find the following: 'Where the controlling law has changed between the entering of the decision below and the consideration of the matter on appeal, it has been said that the case should be determined in the light of the current law, as it existed at time of the appellate decision, at least where the change in the law was intended to be retroactive.'

Where the Legislature has the right to act retroactively, the law appears to be settled in Nebraska. If it desires to do so, it may apply the legislation to cases pending on appeal. In City of Beatrice v. Gage County, 130 Neb. 850, 266 N.W. 777, we said as follows: 'There is a much older case decided in 1801 by John Marshall, C. J., and entitled United States v. Schooner Peggy, 1 Cranch (U.S.) *103, 2 L.Ed. 49, which concerns the small Schooner Peggy, navigated by ten men, which ran ashore on the island ruled by General Toussaint L'Ouverture, and was there captured by an American vessel as a prize and condemned as forfeited, one-half to the use of the United States and the other half to the officers and men of the armed vessel Trumbull. Before the supreme court of the United States gave judgment on the writ of error, a treaty was entered into with France on December 21, 1801, which provided that property not yet definitely condemned should be mutually restored. Chief Justice Marshall held that the property had not been definitely condemned, since the judgment of condemnation had been appealed from and was undecided at the time when the treaty took effect; that, therefore, the property should be restored, the chief justice holding: 'It is in the general true that the province of an appellate court is only to inquire whether a judgment when rendered was...