Shirley v. Neth, S-01-404.

• Decision Date: 21 June 2002
• Docket Number: No. S-01-404.,S-01-404.
• Citation: 646 N.W.2d 587,264 Neb. 138
• Parties: Edward SHIRLEY, Appellant, v. Beverly NETH, director of the Department of Motor Vehicles, State of Nebraska, Appellee.
• Court: Nebraska Supreme Court

646 N.W.2d 587

264 Neb. 138

Edward SHIRLEY, Appellant, v. Beverly NETH, director of the Department of Motor Vehicles, State of Nebraska, Appellee.

No. S-01-404.

Supreme Court of Nebraska.

June 21, 2002.

Jeffrey A. Silver, Omaha, for appellant.

Don Stenberg, Attorney General, and Jodi M. Fenner, Lincoln, for appellee.

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

MILLER-LERMAN, J.

I. NATURE OF CASE

Edward Shirley filed a petition under Neb.Rev.Stat. § 60-503 (Reissue 1998) in the district court for Douglas County in which he alleged in his first count that the suspension of his driver's license by Beverly Neth, director of the Department of Motor Vehicles, State of Nebraska, was improper and in his second count that the Motor Vehicle Safety Responsibility Act, Neb.Rev.Stat. § 60-501 et seq. (Reissue 1998), violated constitutional due process guarantees. The district court sustained the general demurrer of Neth and dismissed the petition. Shirley appeals. We affirm the sustaining of the demurrer as to the second count of Shirley's petition, but reverse, and remand for further proceedings with respect to the first count.

II. STATEMENT OF FACTS

Shirley was involved in an automobile accident on November 22, 1998. Because Shirley was an uninsured motorist, he was notified by the Department of Motor Vehicles (hereinafter Department) on March 26, 1999, that his license would be suspended effective April 15 unless he complied with the Motor Vehicle Safety Responsibility Act (hereinafter Act) by one of the methods prescribed therein. Shirley satisfied the requirements of the Act by depositing with the Department a bond in the amount of $1,002.

On December 7, 2000, the Department notified Shirley that the bond was no longer required because 2 years had passed since the accident. In order to receive a refund of the bond amount, Shirley signed an affidavit on December 19 in which he swore, inter alia, that no action had been instituted against him for any claim arising out of the accident. However, contrary to the statements in the affidavit and prior to the Department's issuing the scheduled refund, the Douglas County Small Claims Court notified the Department of an unsatisfied judgment against Shirley arising out of the November 22, 1998, accident. On December 18, the day before Shirley signed the affidavit, the Department suspended Shirley's driver's license. The suspension was effective until the judgment was satisfied.

On December 22, 2000, Shirley filed a petition in district court pursuant to § 60-503, appealing the suspension. Shirley alleged in the first count that the suspension was unconstitutional in an unspecified manner, was not supported by evidence, was arbitrary and capricious, and was contrary to law. In the second count, he alleged that the Act was unconstitutional on its face because it violated the due process clauses of the U.S. and Nebraska Constitutions. Neth demurred to Shirley's petition. The district court sustained the demurrer and dismissed Shirley's petition. Shirley appeals.

III. ASSIGNMENTS OF ERROR

Shirley asserts, restated, that the district court erred in sustaining the demurrer and dismissing his petition because (1) the district court could not consider a demurrer to a case brought under the Act and (2) his petition stated a cause of action.

IV. STANDARDS 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. Salkin v. Jacobsen, 263 Neb. 521, 641 N.W.2d 356 (2002).

In reviewing an order sustaining a demurrer, an appellate court accepts the truth of the facts which are well pled, together with the proper and reasonable inferences of law and fact which may be drawn therefrom, but does not accept the conclusions of the pleader. Spradlin v. Dairyland Ins. Co., 263 Neb. 688, 641 N.W.2d 634 (2002).

In determining whether a cause of action has been stated, the petition is to be construed liberally. If, as so construed, the petition states a cause of action, a demurrer based on the failure to state a cause of action must be overruled. Id.

Whether a petition states a cause of action is a question of law, regarding which an appellate court has an obligation to reach a conclusion independent of that of the inferior court. Id.

V. ANALYSIS

1. DEMURRER AS PROPER PLEADING

On appeal, Shirley asserts that a demurrer is not a proper pleading in response to a petition filed pursuant to § 60-503 and that as a consequence, the district court erred in considering Neth's demurrer to his petition. The thrust of Shirley's argument is that an action brought under § 60-503 is akin to an appeal, to which a demurrer is inappropriate. We reject Shirley's claim and conclude that a demurrer is allowed as a responsive pleading to a petition filed under § 60-503.

Section 60-503(1) provides:

Any person aggrieved by an order or act of the department under the Motor Vehicle Safety Responsibility Act may, within thirty days after notice thereof, file a petition in the district court of the county where the aggrieved person resides, but in the event the aggrieved person is a nonresident, then such petition shall be filed in the district court of Lancaster County for a review thereof. The filing of such petition shall suspend the order or act pending a final determination of the review. The license or registration of any person claiming to be aggrieved shall not be restored to such person in the event the final judgment of a court finds against such person until the full time of revocation as fixed by the department shall have elapsed. The court shall summarily hear the petition as a case in equity without a jury and may make any appropriate order or decree.

(Emphasis supplied.)

Although § 60-503 provides that the district court shall summarily hear the petition, as a matter of statutory interpretation, we conclude that the explicit provision in § 60-503 that a petition filed pursuant to that section is to be heard "as a case in equity" and the further provision that the court "may make any appropriate order or decree," taken together, indicate that a case brought under § 60-503 is not a summary proceeding. A case brought "in equity" presupposes a civil action. See Neb.Rev.Stat. § 25-101 (Reissue 1995). In considering the process under § 60-503, we have stated that a petitioner proceeding under § 60-503 is "afforded an opportunity to present evidence and cross-examine witnesses at the hearing held in the district court." Wollenburg v. Conrad, 246 Neb. 666, 671, 522 N.W.2d 408, 412 (1994). Because an action brought on by a petition under § 60-503 is to be heard as a case in equity, including the opportunity to present evidence and to cross examine witnesses, the process to be followed under § 60-503 is that applicable to civil actions.

Neb.Rev.Stat. § 25-803 (Reissue 1995) provides that in civil actions, including cases in equity, "[t]he only pleadings allowed are (1) the petition by the plaintiff; (2) the answer or demurrer by the defendant; (3) the demurrer or reply by the plaintiff; and (4) the demurrer to the reply by the defendant." We further note that Neb.Rev.Stat. § 25-806 (Reissue 1995) provides:

The defendant may demur to the petition only when it appears on its face (1) that the court has no jurisdiction of the person of the defendant or the subject of the action; (2) that the plaintiff has not legal capacity to sue; (3) that there is another action pending between the same parties for the same cause; (4) that there is a defect of parties, plaintiff or defendant; (5) that several causes of action are improperly joined; or (6) that the petition does not state facts sufficient to constitute a cause of action.

Taking §§ 25-803 and 25-806 together, it is clear that a demurrer is a proper responsive pleading to a civil action, including one brought "as a case in equity" under § 60-503, and that the grounds for a demurrer listed in § 25-806 may be raised against a petition filed pursuant to § 60-503.

Because petitions filed pursuant to § 60-503 are to be heard as civil cases in equity and because the challenges that may be raised by demurrer may be raised against a petition filed pursuant to § 60-503, we conclude that a demurrer is a permissible responsive pleading to a petition filed pursuant to § 60-503. We therefore conclude that the district court did not err in considering the demurrer filed by Neth, and we reject Shirley's first assignment of error.

2. DEMURRER IN PRESENT CASE

Shirley next asserts that even if a demurrer is a proper pleading to challenge a petition filed under § 60-503, the demurrer in this case should not have been sustained because his petition did not fail to allege facts stating a cause of action. Shirley fashioned his petition as containing two counts, and we will consider each count separately in reviewing whether the district court properly sustained Neth's demurrer as to that count.

(a) First Count

In his first count, Shirley alleged that the suspension of December 18, 2000, was "(a) in violation of constitutional provision; (b) unsupported by competent, material, and substantial evidence in view of the entire record as made on review; (c) arbitrary and capricious; or (d) contrary to law and should be reversed by the Court." Shirley's allegation in the first count that the suspension of his driver's license by the Department was "in violation of constitutional provision" is apparently intended to be a challenge to the Act as applied to Shirley, not a facial challenge to the Act itself. Neth demurred to this count, and the district court sustained the demurrer.

On appeal, Shirley claims that the allegations contained in the first count of his petition were adequate to state a cause of action and that the demurrer was improperly sustained. Neth argues that...