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Foundation One Bank v. Svoboda

Supreme Court of Nebraska

July 12, 2019

Foundation One Bank, a banking corporation. APPELLANT,
v.
JASON SVOBODA, AN INDIVIDUAL, ET AL., APPELLEES, AND LEHR, INC., INTERVENOR-APPELLEE.

         1. Judgments: Pleadings. A motion for judgment on the pleadings is properly granted when it appears from the pleadings that only questions of law are presented.

         2. Jury Instructions: Proof: Appeal and Error. To establish reversible error from a court's failure to give a requested jury instruction, an appellant has the burden to show that (1) the tendered instruction is a correct statement of the law, (2) the tendered instruction was warranted by the evidence, and (3) the appellant was prejudiced by the court's failure to give the requested instruction.

         3. Jury Instructions: Appeal and Error. Where jury instructions are claimed deficient on appeal and such issue was not raised at trial, an appellate court reviews for plain error.

         4. Appeal and Error: Words and Phrases. Plain error exists where there is an error, plainly evident from the record but not complained of at trial, which prejudicially affects a substantial right of a litigant and is of such a nature that to leave it uncorrected would cause a miscarriage of justice or result in damage to the integrity, reputation, and fairness of the judicial process.

         5. Directed Verdict: Appeal and Error. A directed verdict is proper at the close of all the evidence only when reasonable minds cannot differ and can draw but one conclusion from the evidence, that is, when an issue should be decided as a matter of law.

         6. Rules of the Supreme Court: Pleadings: Moot Question. A denial of a motion for judgment on the pleadings under Neb. Ct. R. Pldg. § 6-1112(c) is generally moot on appeal after the case has been tried on the merits.

         [303 Neb. 625] 7. Fraud: Proof. A proper fraudulent misrepresentation claim requires a party to prove that (1) a representation was made; (2) the representation was false; (3) when made, the representation was known to be false or made recklessly without knowledge of its truth and as a positive assertion; (4) the representation was made with the intention that the plaintiff should rely on it; (5) the plaintiff did so rely on it; and (6) the plaintiff suffered damage as a result.

         8. Directed Verdict. In a motion for directed verdict, the moving party admits the truth of all well-pleaded facts, together with all reasonable inferences to be drawn therefrom.

         9. Replevin: Damages. In a replevin case, when a defendant or intervener is found to have ownership and right of possession of property, the replevin statutes necessarily place the issue of damages at issue.

          Appeal from the District Court for Platte County: Robert R. Steinke, Judge.

          Aaron F. Smeall and Jacob A. Acers, of Smith, Slusky, Pohren & Rogers, L.L.P., for appellant.

          Brian J. Brislen, Eric W. Tiritilli, and Karson S. Kampfe, of Lamson, Dugan & Murray, L.L.P, for intervenor-appellee.

          No appearance for appellees.

          Heavican, C.J., Miller-Lerman, Cassel, Stacy, Funke, Papik, and Freudenberg, JJ.

          MILLER-LERMAN, J.

         I. NATURE OF CASE

         The plaintiff, Foundation One Bank (Foundation One), appeals from the judgment entered by the district court for Platte County upon the verdict of the jury in favor of defendant-intervenor, Lehr, Inc. Foundation One sought replevin of two motor vehicles pledged by Jason Svoboda as collateral to secure payment of a loan. Lehr intervened in the case and sought possession of the motor vehicles. The jury determined that Lehr was entitled to possession of two disputed motor vehicles, and because Foundation One had [303 Neb. 626] sold one of the vehicles for $95, 000, the jury awarded Lehr $95, 000. Foundation One claims that the district court erred in several respects in connection with its jury instructions and when it denied Foundation One's motions for judgment on the pleadings and for a directed verdict. We affirm and, in so doing, reiterate that in a replevin case, a defendant or intervener's general denial and assertion of ownership necessarily place the questions of possession, ownership, and damages before the jury under Neb. Rev. Stat. § 25-1093 et seq. (Reissue 2016).

         II. STATEMENT OF FACTS

         In 2016, Svoboda sought a commercial loan from Foundation One for his struggling automobile business. Svoboda had been in the automobile business before, operating as RPM Motors, Inc., an entity which had become an inactive Nebraska corporation. Svoboda claimed he needed a loan to consolidate debt from that business. On March 25, 2016, Svoboda and Foundation One executed a promissory note and commercial security agreement for a $200, 000 loan. Svoboda offered various motor vehicles as collateral to secure the loan, and purported to grant Foundation One a security interest in that property, including a 2005 Mack CV 713 Truck (2005 Mack) and a 2014 Mack GU 800 Conventional Cab (2014 Mack). The present dispute between the parties concerns only the 2005 Mack and the 2014 Mack.

         Svoboda provided Foundation One with a manufacturer's certificate of origin (MCO) for the 2005 Mack and a certificate of title for the 2014 Mack. The MCO for the 2005 Mack showed the original transfer from Dallas Mack Sales, L.R, to Lehr on February 24, 2005, followed by an undated transfer from RPM Motors to "RPM Motors/Iason Svoboda." Notably, the MCO contained a gap; the assignments on the MCO did not include a transfer from Lehr to RPM Motors. The title for the 2014 Mack indicated it had been purchased by Svoboda from RPM Motors on December 30, 2013.

         [303 Neb. 627] In an attempt to protect its priority to a lien on the vehicles, and as part of the $200, 000 loan between Foundation One and Svoboda individually, Foundation One paid off other liens on the disputed motor vehicles totaling $85, 141.40.

         Svoboda soon defaulted on the promissory note. After receiving numerous reports of fraudulent behavior, the Nebraska Motor Vehicle Industry Licensing Board closed RPM Motors in March 2016. Svoboda was ultimately convicted of title fraud for obtaining a second MCO on a ...


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