Foundation One Bank v. Svoboda
303 Neb. 624
| Neb. | 2019Background
- Foundation One made a $200,000 commercial loan to Jason Svoboda secured by multiple vehicles, including a 2005 Mack and a 2014 Mack, based on title documents Svoboda provided.
- Foundation One paid off existing liens on the vehicles as part of protecting its security interest; Svoboda defaulted and was later convicted of title fraud.
- Foundation One filed a replevin action and initially obtained an order of delivery; Lehr, Inc. (owner of the trucks) intervened claiming record ownership and possession of both trucks and alleged Svoboda had fraudulently claimed title.
- The court vacated replevin as to the 2005 Mack but permitted intervention and allowed Foundation One to replevy and sell the 2014 Mack for $95,000.
- At trial, Lehr presented evidence of ownership and continuous possession of both trucks; the jury found Lehr entitled to possession and awarded Lehr $95,000 for the sold 2014 Mack.
- Foundation One appeals, arguing errors in denial of judgment on the pleadings, refusal of a fraud instruction, other jury-instruction omissions, and denial of a directed verdict.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether denial of pretrial motion for judgment on the pleadings as to Lehr was error | Lehr’s complaint in intervention sought declaratory relief only, so judgment on pleadings should have been granted | Pleadings and later trial on merits made the motion moot; intervention placed possession/ownership in issue | Denial was moot after trial; no reversible error |
| Whether the court erred by refusing Foundation One’s proposed fraud instruction assigning burden to Lehr to prove Svoboda committed fraud on Foundation One | Lehr should bear burden to prove Svoboda committed fraud that affected Foundation One | Proposed instruction omitted required fraud elements (reasonable reliance, damages) and was an incorrect statement of law | Rejection proper; instruction incorrect and unwarranted |
| Whether court should have instructed on effect/weight of title/MCO or on offsets for special benefit / damages calculation | Jury should be told title/MCO presumptions and allowed to offset lien payments when calculating damages | Evidence did not support entitlement by possession via MCO/title; jury had all evidence to calculate damages; no evidence Lehr was also a fraud victim | No plain error; instructions either unsupported by evidence or nonprejudicial |
| Whether district court erred in denying Foundation One’s motion for directed verdict | Because the 2014 Mack had been sold, Lehr sought only declaration of rights so directed verdict for Foundation One was proper | Replevin statutory scheme and Lehr’s pleadings put possession and damages before the jury; damages are available when property cannot be returned | Denial proper; reasonable minds could find Lehr entitled to possession and damages under replevin law |
Key Cases Cited
- Denali Real Estate v. Denali Custom Builders, 302 Neb. 984 (Neb. 2019) (standard for judgment on the pleadings and directed verdict)
- Armstrong v. Clarkson College, 297 Neb. 595 (Neb. 2017) (standards for reversible error from refusal to give a requested jury instruction)
- Cullinane v. Beverly Enters.-Neb., 300 Neb. 210 (Neb. 2018) (elements of fraudulent misrepresentation claim)
- InterCall, Inc. v. Egenera, Inc., 284 Neb. 801 (Neb. 2010) (justifiable/reasonable reliance requirement)
- Kuhnel v. BNSF Railway Co., 287 Neb. 541 (Neb. 2014) (plain-error review for unpreserved jury instruction claims)
- School District v. Shoemaker, 5 Neb. 36 (Neb. 1876) (replevin procedure requires jury to consider possession and damages)