McCoy v. Albin
298 Neb. 297
| Neb. | 2017Background
- In 1995 the Nebraska Department of Labor (Department) mailed Troy McCoy a notice that he had been overpaid $850 in unemployment benefits; McCoy did not appeal or repay.
- In 2016 the Department intercepted McCoy’s Nebraska income tax refund ($293) to apply toward that overpayment; McCoy appealed the interception pro se.
- An appeal tribunal held the interception was barred by Nebraska statutes of limitations (§§ 25-206/25-218 and alternatively § 25-1515) and ruled for McCoy.
- The Department sought review in Sarpy County District Court; the district court affirmed the tribunal’s decision.
- The Department appealed to the Nebraska Supreme Court, arguing no limitations period applies to setoff of state tax refunds under Neb. Rev. Stat. § 48-665(1)(c), and that limitations is an affirmative defense McCoy waived.
- The Supreme Court considered statutory text, legislative intent, and parity with federal refund offsets and reversed, holding no statute of limitations bars state-refund setoff under § 48-665(1)(c).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a statute of limitations bars the Department from offsetting a state income tax refund to satisfy an unemployment overpayment | McCoy: §§ 25-206/25-218 (and § 25-1515) bar recovery by setoff because the overpayment arose long ago | Department: § 48-665(1)(c) permits setoff against state refunds and contains no limitations period; setoff is not a "civil action" and limitations statutes do not apply; limitations is an affirmative defense | Held: No statute of limitations applies to the state-refund setoff under § 48-665(1)(c); reversal ordered |
Key Cases Cited
- Marion’s v. Nebraska Dept. of Health & Human Servs., 289 Neb. 982 (Neb. 2015) (administrative-review standard; record-based review)
- ML Manager v. Jensen, 287 Neb. 171 (Neb. 2014) (statutory interpretation is reviewed de novo)
- Arthur v. Microsoft Corp., 267 Neb. 586 (Neb. 2004) (rules for ascertaining legislative intent and statutory construction)
- Tiedtke v. Whalen, 133 Neb. 301 (Neb. 1937) (definition of when a civil action is commenced)