JOHN ZAPATA, AN INDIVIDUAL AND AS AN ASSIGNEE. APPELLANT,
DONALD MCHUGH, AN INDIVIDUAL, ET AL., APPELLEES.
1. Motions to Dismiss: Pleadings:
Appeal and Error. A district court's grant of a
motion to dismiss on the pleadings is reviewed de novo,
accepting the allegations in the complaint as true and
drawing all reasonable inferences in favor of the nonmoving
Corporations: Attorney and Client. Business
entities existing separate from their owners are not their
own proper persons who may appear in court without the
representation of an attorney.
Attorney and Client. Persons not licensed to
practice law in Nebraska are prohibited from prosecuting an
action or filing papers in the courts of this state on behalf
__ . Abstractions cannot appear pro se.
__.A layperson's lack of professional skills and ethical
obligations imposes undue burdens on opposing parties and the
__ . The rule that a layperson cannot appear in
court in a representative capacity cannot be circumvented by
Corporations: Assignments: Attorney and
Client. An assignment of a distinct business
entity's cause of action to an assignee who then brings
such suit requires that the assignee must be represented by
counsel and cannot bring such action pro se.
__:__:__. To permit a distinct business entity to maintain
litigation through the device of an assignment would destroy
the salutary principle that a corporation cannot act in legal
matters or maintain litigation without the benefit of an
__: __: __ . When an assignee brings suit in his or her own
name, the assignee is still bound by the business
entity's limitation that any legal action arising out of
its interests must be represented by counsel.
Neb. 217] 10. Actions: Pleadings: Parties.
The character in which one is a party to a suit, and the
capacity in which a party sues, is determined from the
allegations of the pleadings and not from the caption alone.
from the District Court for Lancaster County: Steven D.
Burns, Judge. Affirmed.
Zapata, pro se.
appearance for appellees.
Heavican, C.J., Wright, Miller-Lerman, Cassel, Kelch, and
plaintiff, as both an individual and an assignee, filed an
action pro se to recover for wrongs allegedly committed
against the assignor, a limited liability corporation (LLC).
The district court dismissed the action on the grounds that
the plaintiff engaged in the unauthorized practice of law and
that the pleadings, accordingly, were a nullity. The district
court reasoned that an LLC is an entity incapable of
self-representation and that the policy reasons requiring
representation by an attorney of such entity's interests
cannot be circumvented through the assignment of the business
entity's cause of action to a layperson. The plaintiff
action was brought pro se by John Zapata. The first pleading
in the record is a "Mandatory Disclosure" filed
under the caption, "John Zapata, an individual and as an
Assignee, Plaintiff, v. Donald McHugh, an individual, et.
al., Defendant." The complaint is not in the record, but
documents attached to the mandatory disclosure purported to
describe $11, 100 in lost rent and $21, 973.41 in repair
costs owed by Lincoln Metal Recycling and Donald McHugh in
relation to an address on Saunders Avenue in Lincoln,
Neb. 218] At the pretrial conference on April 21, 2016, the
court asked the parties to submit a joint pretrial conference
order identifying the factual and legal issues to be tried.
The court gave the parties 10 days to complete the order. The
court, sua sponte, raised the issue whether Zapata could
bring an action pro se based upon assignments from
corporations on claims those organizations may have. The
court gave the parties time to brief the issue.
parties subsequently submitted a consolidated joint pretrial
conference order, which stated that it superseded all prior
pleadings in the case. The order stated that the claim was
based on the fact that McHugh Metal Brokerage, LLC, vacated
premises leased to it by Zapata's assignor, Coljo
Investments, LLC (Coljo), the owner of the premises. The
pretrial order stated that Zapata was "an individual and
an assignee" who filed his complaint pursuant to Neb.
Rev. Stat. § 25-302 (Reissue 2016). Zapata alleged that
he paid consideration to Coljo in order to collect the
alleged debt owed by the defendants.
parties presented as legal issues whether there was a valid
assignment to Zapata, whether Zapata was a real party in
interest and had standing to bring the action, and whether
the court had jurisdiction over the parties and the subject
matter of the action.
the underlying merits, the parties stated that the legal
issues were whether McHugh Metal Brokerage was liable to
Zapata or Coljo arising out of the lease agreement, the
nature and extent of any unpaid rentals, and the measure of
damages for the reasonable cost for repairs to Coljo's
19, 2016, the district court dismissed the action. The court
considered the defendants to have moved for dismissal in the
joint pretrial conference order. The court concluded that
even if the assignment of any right of action by Coljo to
Zapata was effective, Zapata could not proceed pro se with
the action on the assigned claims. The court explained that
the right to represent oneself pro se, as set forth in Neb.
[296 Neb. 219] Rev. Stat. § 7-101 (Reissue 2012), does
not extend to the representation of any other person or
entity. The court cited to several cases setting forth the
general propositions that corporate entities cannot be
represented pro se and that this rule cannot be circumvented
through an assignment of the corporate claims to a pro se
court also cited to an unpublished case in Indiana involving
Zapata himself, who brought the action as Zapata, doing
business as Zapata Collection Services, '"an
Individual and as Assignee.'" In that case, the
appellate court affirmed the dismissal of Zapata's
action. The court held that there was no bona fide
assignment, because Zapata and the corporate assignor were
inextricably linked; therefore, the alleged assignor of the
claim for damages was the real party in interest and, as a
corporate entity, was required to be represented by
the district court noted that in this case, Zapata did not
list Coljo as a party, it found that such fact was not
decisive, stating: "[Zapata] may not escape the fact
that what he is attempting to litigate is not his claim. It
is the claim of another which has merely been assigned to
him. This is true even if [Zapata] is the one who will
receive the entirety of any recovery."
Zapata's claim that he had a right to proceed pro se
under Neb. Rev. Stat. § 25-304 (Reissue 2016), the
district court stated that while Zapata had a right to bring
an assigned [296 Neb. 220] action in his own name, this did
not excuse the requirement that an attorney is required when
the action derives from a wrong to a corporation. The court
concluded that permitting the present action to go forward
would unlawfully circumvent § 7-101. The court found the
proceedings were a nullity. Zapata appeals.
has brought similar pro se actions in Nebraska. In Zapata
v. QBE Ins. Co.,  the Nebraska Court of Appeals, in an
unpublished opinion, affirmed the dismissal of an action
brought by Zapata after being assigned a corporation's
claims. The Court of Appeals reasoned in relevant part that
although Zapata may have identified himself as both an
individual and assignee, his claims were for damages to the
corporation. Citing to Steinhausen v. HomeServices of
Neb.,  the Court of Appeals concluded that Zapata
could not prosecute any claim on behalf of the corporation,
because he was not a licensed attorney.
assigns as error, summarized and restated, that the district
court erred in dismissing his complaint ...