Thrift Mart, Inc. v. State Farm Fire & Cas. Co.

• Citation: 251 Neb. 448,558 N.W.2d 531
• Decision Date: 10 January 1997
• Docket Number: No. S-94-1122,S-94-1122
• Parties: THRIFT MART, INC., f/d/b/a Heartland Thriftmart, Appellant, v. STATE FARM FIRE & CASUALTY CO., Appellee.
• Court: Supreme Court of Nebraska

Page 531

558 N.W.2d 531

251 Neb. 448

THRIFT MART, INC., f/d/b/a Heartland Thriftmart, Appellant, v. STATE FARM FIRE & CASUALTY CO., Appellee.

No. S-94-1122.

Supreme Court of Nebraska.

Jan. 10, 1997.

Syllabus by the Court

1. Final Orders. An order in a civil action is final when no further act of the trial court is required to dispose of the cause.

2. Motions to Vacate: Proof: Appeal and Error. An appellate court will reverse a decision on a motion to vacate or modify a

judgment only if the litigant shows that the district court abused its discretion.

3. Pleadings: Appeal and Error. Permission to amend a pleading is addressed to the discretion of the trial court, and the trial court's decision will not be disturbed absent an abuse of discretion.

4. Trial: Evidence: Appeal and Error. To constitute reversible error in a civil case, the admission or exclusion of evidence must unfairly prejudice a substantial right of a litigant complaining about evidence admitted or excluded.

5. Actions: Dismissal and Nonsuit. A dismissal of a cause of action is the equivalent of a discontinuance of it in the court. The rights of the parties in the cause of action are determined insofar as the court rendering the order of dismissal is concerned.

6. Actions: Words and Phrases. A cause of action consists of the set of facts on which a recovery may be had.

7. Judgments: Equity: Time. In an action to vacate a judgment after the adjournment of the term of the rendering court, the applicant may proceed either under Neb.Rev.Stat. § 25-2001 (Reissue 1995) or under the court's independent equity jurisdiction.

8. Judgments: Equity: Time: Pleadings: Proof. To invoke the equity powers set forth in Neb.Rev.Stat. § 25-2001 (Reissue 1995), the applicant, to be successful, must first allege and prove that he or she exercised due diligence and that his or her failure to secure a proper decision in the prior term was not due to his or her own fault or negligence.

9. Equity. Any litigant who seeks equity must also do equity.

10. Demurrer: Pleadings. When a demurrer to a petition is sustained, the court must grant leave to amend unless it is clear that no reasonable possibility exists that an amendment will correct the defect.

11. Demurrer: Pleadings: Appeal and Error. Before error can be predicated upon the refusal of a trial court to permit an amendment to a petition after a demurrer is sustained, the record must show that, under the circumstances, the ruling of the court was an abuse of discretion.

12. Pleadings: Appeal and Error. The overruling of a motion in limine is not reviewable on appeal.

13. Trial: Pleadings: Proof: Appeal and Error. In order to preserve any error before an appellate court, the party opposing a motion in limine which was granted must make an offer of proof outside the presence of the jury unless the evidence is apparent from the context in which the questions were asked.

14. Insurance: Contracts. In order to recover under an insurance policy of limited liability, an insured must bring himself or herself within its express provisions.

Michael B. Kratville, of Terry & Kratville Law Offices, Omaha, for appellant.

John M. Ryan and Roger L. Shiffermiller, of Fraser, Stryker, Vaughn, Meusey, Olson, Boyer & Bloch, P.C., Omaha, for appellee.

WHITE, C.J., CAPORALE, FAHRNBRUCH, WRIGHT, CONNOLLY, and GERRARD, JJ., and CASSEL, D.J.

WHITE, Chief Justice.

Thrift Mart, Inc. (Thrift Mart), appeals after a jury verdict finding that State Farm Fire & Casualty Company (State Farm) did not breach its fire insurance policy with Thrift Mart. We affirm.

Thrift Mart's store, located at 5033 1/2 South 24th Street in Omaha, Nebraska, was destroyed by fire on August 19, 1989. Thrift Mart reported the fire to its insurance carrier, State Farm, on August 22, 1989, and a State Farm representative came to investigate that day.

Thrift Mart's fire insurance policy provided for coverage of debris removal, loss of business personal property, and loss of business income. State Farm paid the policy limit for the debris removal and loss of business personal property coverages within a month of the fire. Thrift Mart claimed loss of business income damages in the amount of $3.6 million, and State Farm denied that claim, instead tendering $29,567.78 in satisfaction of coverage. Thrift Mart refused this offer and filed suit.

In its petition filed on November 5, 1990, Thrift Mart alleged that State Farm had (1) breached its fire insurance policy, (2) acted in tortious bad faith, and (3) violated Nebraska's Unfair Competition and Trade Practices Act. Thrift Mart alleged that State Farm acted in bad faith during the course of negotiations when it allegedly accused Thrift Mart of setting fire to its own store, stated that Thrift Mart's president would be arrested for arson, and refused to provide an explanation for its failure to pay Thrift Mart for certain claimed damages. On January 11, 1991, the trial court sustained State Farm's demurrer for failure to state facts sufficient to constitute a claim as to the tortious bad faith and violation of the Unfair Competition and Trade Practices Act causes of action. The trial court dismissed those causes of action at Thrift Mart's cost.

Eight days later, on January 18, 1991, the Nebraska Supreme Court formally recognized a first-party bad faith cause of action in Braesch v. Union Ins. Co., 237 Neb. 44, 464 N.W.2d 769 (1991). On August 20, 1992, 19 months later, Thrift Mart filed a motion to vacate and/or reconsider the order dismissing the bad faith cause of action in light of Braesch, and on December 29, also filed a motion for leave to amend. The trial court overruled the motion to vacate and/or reconsider and stated that "an Order of Dismissal--whether pertaining to one cause of action in a petition which contains several causes of action or to the entire petition--is an appealable Order. The Defendant should have appealed...." The trial court also stated that Thrift Mart failed to show why the motion was not filed in the term in which the dismissal was entered.

On March 1, 1994, Thrift Mart filed another motion to reconsider and/or vacate the dismissal of the tortious bad faith cause of action. The trial court also overruled this motion.

Prior to trial on the breach of contract action, State Farm filed two motions in limine. The first motion sought to exclude testimony at trial by Thrift Mart's expert, Dr. Jerome Sherman, involving Thrift Mart's operating losses or loss of investment. The trial court sustained this motion. The second motion sought to exclude any testimony involving loss of business income for the liquidation of Thrift Mart's inventory at its separate warehouse location after the fire. The trial court sustained this motion as well, stating:

The insurance policy covers "loss of business income during the restoration period". These alleged losses at the warehouse are not recoverable under the policy as they are not continuing losses and, at best, may be consequential expenses which are speculative and not expenses to minimize the interruption of business if "operations" cannot continue.

The breach of contract action was tried to a jury on October 3 and 4, 1994. During trial, Thrift Mart made one offer of proof as to the testimony excluded in the second motion in limine. The offer of proof consisted of two exhibits, and the court received those exhibits for the purposes of the offer of proof. The jury returned a verdict for State Farm.

Thrift Mart timely appealed to the Nebraska Court of Appeals. Pursuant to our power to regulate the docket of the Court of Appeals, we removed this case to our docket.

On appeal, Thrift Mart assigns various errors, which may be summarized as follows: (1) The trial court erred in sustaining State Farm's demurrer as to the tortious bad faith and unfair trade practices causes of action; (2) the trial court erred in failing to vacate its prior order sustaining the demurrer with regard to the tortious bad faith cause of action; (3) the trial court erred in not allowing Thrift Mart to amend its petition to include the bad faith cause of action; and (4) the trial court erred in granting both of State Farm's motions in limine.

An appellate court lacks jurisdiction to entertain appeals from other than final orders; an order in a civil action is final when no further act of the trial court is required to dispose of the cause. Jaramillo v. Mercury Ins. Co., 242 Neb. 223, 494 N.W.2d 335 (1993), abrogated on different grounds by Powell v. American Charter Fed. Sav. & Loan Assn., 245 Neb. 551, 514 N.W.2d 326 (1994). An appellate court will reverse a decision on a motion to vacate or modify a judgment only if the litigant shows that the district court abused its discretion. Roemer v. Maly, 248 Neb. 741, 539 N.W.2d 40 (1995). Permission to amend a pleading is addressed to the discretion of the trial court, and the trial court's decision will not be disturbed absent an abuse of discretion. Stephens v. Radium Petroleum Co., 250 Neb. 560, 550 N.W.2d 39 (1996); Postma v. B & R Stores, 250 Neb. 466, 550 N.W.2d 34 (1996). To constitute reversible error in a civil case, the admission or exclusion of evidence must unfairly prejudice a substantial right of a litigant complaining about evidence admitted or excluded. McIntosh v. Omaha Public Schools, 249 Neb. 529, 544 N.W.2d 502 (1996), abrogated on different grounds by Heins v. Webster County, 250 Neb. 750, 552 N.W.2d 51 (1996); Equitable Life v. Starr, 241 Neb. 609, 489 N.W.2d 857 (1992); Huffman v. Huffman, 236 Neb. 101, 459 N.W.2d 215 (1990).

Thrift Mart's first assignment of error alleges that the trial court erred in sustaining State Farm's demurrer as to the tortious bad faith and unfair trade practices causes of action. State Farm argues that Thrift Mart cannot contest the trial court's order sustaining the demurrers as to the tortious bad faith and unfair trade practices causes of action because...