Nelson v. Lusterstone Surfacing Co.

• Decision Date: 28 January 2000
• Docket Number: No. S-98-576.,S-98-576.
• Citation: 258 Neb. 678,605 N.W.2d 136
• Parties: Donald E. NELSON, appellee, v. LUSTERSTONE SURFACING COMPANY, a Nebraska corporation, and Stephen J. Myers, appellants.
• Court: Nebraska Supreme Court

605 N.W.2d 136

258 Neb. 678

Donald E. NELSON, appellee, v. LUSTERSTONE SURFACING COMPANY, a Nebraska corporation, and Stephen J. Myers, appellants.

No. S-98-576.

Supreme Court of Nebraska.

January 28, 2000.

S. Caporale, for appellants.

Joseph A. Jordano, of Fitzgerald, Schorr, Barmettler & Brennan, P.C., Omaha, for appellee.

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

CONNOLLY, J.

Donald E. Nelson, appellee, brought suit against Lusterstone Surfacing Company (Lusterstone) and Stephen J. Myers, appellants, for fraudulent representation, fraudulent concealment, and violation of Nebraska's Consumer Protection Act (CPA). A jury found for appellee on all three theories of recovery and awarded him damages in the amount of $14,000. On appeal, appellants contend that the trial court erred in various respects. The primary issue is whether the CPA applies to transactions that do not affect the public interest. We hold that the CPA does not apply to transactions that do not affect the public interest. However, we affirm the jury verdict because we find no reversible error in submitting the fraudulent misrepresentation and fraudulent concealment theories to the jury.

FACTS

In March 1995, appellee bought a 1993 Jeep Grand Cherokee from appellant Lusterstone. Appellant Myers, the president and co-owner of appellant Lusterstone, a Nebraska corporation engaged in the business of resurfacing driveways and patios, negotiated the sale with appellee.

Appellant Myers testified that in December 1994, he bought the Jeep from A.J. Motors in Denison, Iowa. Before appellant Myers purchased the Jeep, he learned that it had been involved in an accident and that the Iowa certificate of title carried a prior salvage designation. Appellant Myers purchased the Jeep for $17,800 and registered it in appellant Lusterstone's name with the Nebraska Department of Motor Vehicles. On the certificate of title that appellant Myers received from the State of Nebraska, the Jeep was erroneously classified as carrying an original title. Therefore, the prior salvage designation was not obvious on the face of the title that appellee subsequently received from the appellants.

Appellant Myers testified that it was his belief that once he received the Nebraska certificate of title, the Jeep no longer carried a prior salvage designation. In order to register the Jeep in Nebraska, he presented the required paperwork to the state and had the Jeep inspected. In return, he received an original Nebraska certificate of title. It was his belief that the prior salvage designation had been expunged once he had gone through the proper channels for registering the Jeep in Nebraska. When appellant Myers sold appellee the Jeep, he did not volunteer the fact that the Jeep had been classified as a prior salvage in Iowa because he did not feel that it was necessary to do so. Before appellee agreed to purchase the Jeep from appellant Lusterstone, he asked appellant Myers if it had ever been in an accident. Although the evidence is in conflict, appellee testified, and the jury must have believed, that appellant Myers essentially stated that the Jeep had been involved in a "fender-bender." Appellant Meyers did not point out any specific items of damage and did not disclose that it had been titled in Iowa as a prior salvage.

Almost immediately after he purchased the vehicle, appellee noticed problems with its performance. The day after he purchased the Jeep, he called appellant Myers and asked whether there was anything else he should know about the vehicle. Appellant Myers responded in the negative. The Jeep continued to have problems, and appellee called appellant Myers a second time and asked for his money back. Appellant Myers refused. On the third trip to the automobile repair shop, appellee learned that all warranties on the Jeep, including the manufacturer's warranty, had been released. Upon investigation, he learned that the Jeep's Iowa title carried a prior salvage designation. He then called appellant Myers for the third time and demanded his money back. According to appellee, when asked why he had not disclosed the prior salvage designation, appellant Myers responded, "Well Don [appellee], I got screwed and now you're screwed."

Appellee continued to use the Jeep because he could not sell it with a salvage title without losing money. However, he continued to have problems with it. Eventually, he filed this action against appellants for fraudulent concealment, fraudulent misrepresentation, and violation of the CPA, specifically, Neb.Rev.Stat. § 59-1602 (Reissue 1998).

The jury found for appellee on all three theories of recovery and awarded damages in the amount of $14,000.

ASSIGNMENTS OF ERROR

Appellants make the following assignments of error, as restated and renumbered by this court. The trial court erred when it (1) applied the CPA to the transaction between appellee and appellants, (2) submitted the CPA claim to the jury for damages, (3) gave certain jury instructions over appellants' objections, (4) refused to give certain jury instructions requested by appellants, and (5) overruled appellants' motion for a directed verdict as to appellant Myers.

STANDARD OF REVIEW

When an appeal calls for statutory interpretation or presents questions of law, an appellate court must reach an independent, correct conclusion irrespective of the determination made by the court below. In re Estate of Poach, 257 Neb. 663, 600 N.W.2d 172 (1999).

Jury instructions are subject to the harmless error rule, and an erroneous jury instruction requires reversal only if the error adversely affects the substantial rights of the complaining party. Corcoran v. Lovercheck, 256 Neb. 936, 594 N.W.2d 615 (1999); Cobb v. Sure Crop Chem. Co., 255 Neb. 625, 587 N.W.2d 355 (1998).

Failure to object to a jury instruction after it has been submitted to counsel for review precludes raising an objection on appeal absent plain error. State on Behalf of Minor Child Joseph F. v. Rial, 251 Neb. 1, 554 N.W.2d 769 (1996); Evergreen Farms v. First Nat. Bank & Trust, 250 Neb. 860, 553 N.W.2d 728 (1996).

In order to be considered by an appellate court, an alleged error must be both specifically assigned and specifically argued in the brief of the party asserting the error. Schindler v. Walker, 256 Neb. 767, 592 N.W.2d 912 (1999).

To establish reversible error from a court's refusal to give a requested instruction, an appellant has the burden to show that (1) the appellant was prejudiced by the court's refusal to give the tendered instruction, (2) the tendered instruction is a correct statement of the law, and (3) the tendered instruction is warranted by the evidence. Hausman v. Cowan, 257 Neb. 852, 601 N.W.2d 547 (1999).

A trial court should direct a verdict as a matter of law only when the facts are conceded, undisputed, or such that reasonable minds can draw but one conclusion therefrom. Alexander v. J.D. Warehouse, 253 Neb. 153, 568 N.W.2d 892 (1997).

CONSUMER PROTECTION ACT

The main issue on appeal is whether the trial court correctly applied the CPA to the private transaction between the parties. Whether a transaction of this type falls within the ambit of the CPA is an issue of first impression. Essentially, appellants argue that because the isolated sale of the Jeep was strictly private and affected no one but the parties, it does not fall within the purview of the CPA. In reply, appellee argues that the CPA is not limited to transactions occurring in business settings, nor is it limited to merchants. Appellee argues that the very absence of such limiting language provides evidence that the Legislature intended the CPA to cover private transactions between individuals.

The CPA is found at Neb.Rev.Stat. § 59-1601 et seq. (Reissue 1998). Under § 59-1602, "[u]nfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce shall be unlawful." The terms "trade" and "commerce" are defined by § 59-1601(2) as "the sale of assets or services and any commerce directly or indirectly affecting the people of the State of Nebraska."

Section 59-1609 creates a private right of action to persons injured by certain violations of the CPA, including violations of § 59-1602. Any person so injured "may bring a civil action in the district court to enjoin further violations, to recover the actual damages sustained by him, or both, together with the costs of the suit, including a reasonable attorney's fee." § 59-1609.

We note that several other states have similar consumer protection acts that have been interpreted in various ways. The determination of the issue here, however, depends on how we interpret the language of this state's CPA. When an appeal calls for statutory interpretation or presents questions of law, an appellate court must reach an independent, correct conclusion irrespective of the determination made by the court below. In re Estate of Poach, 257 Neb. 663, 600 N.W.2d 172 (1999).

The CPA contains limiting language that cannot be ignored. While it is true that the CPA does not limit its reach to conduct in the course of business, vocation, or occupation, as does the Uniform Deceptive Trade Practices Act found at Neb.Rev.Stat. § 87-301 et seq. (Reissue 1999), see § 87-302(a), the Legislature's intent to limit the application of the CPA is clear. The CPA defines "trade and commerce" as "the sale of assets or services and any commerce directly or indirectly affecting the people of the State of Nebraska." (Emphasis supplied.) § 59-1601(2). We read this definition to limit the disputes that fall within the ambit of § 59-1602 to unfair or deceptive acts or practices that affect the public interest. See, LaMotte v. The Punch Line of Columbia, Inc., 296 S.C. 66, 370 S.E.2d 711 (1988) (public impact requirement recognized by South Carolina Supreme Court); Noack Enterprises, Inc. v. Country Corner Interiors, ...