SID No. 2 of Knox Cty. v. Fischer, 957 N.W.2d 154

Sanitary Improvement District No. 2 (SID) in Knox County contains many platted lots and several hundred landowners; only about 27 landowners actually reside on platted lots. The total acreage in the SID is unclear in the record.
Nebraska statute § 31-735(2)(b) provides two trustee-election methods: normally 3 trustees elected by resident property owners and 2 by all property owners; but if "not less than ninety percent of the area of the district is owned for other than residential uses," then all 5 trustees are elected by all property owners.
Knox County election commissioner Joann Fischer determined more than 90% of the SID area was "owned for other than residential uses" (based on many vacant lots) and notified the board that the upcoming election would have all five trustees elected by all property owners.
Three sitting trustees and the SID filed a declaratory-judgment action seeking a judicial construction of "owned for other than residential uses," arguing recorded restrictive covenants render a significant portion residential (so <90% other-than-residential) and that the election commissioner erred.
The district court sided with the plaintiffs and ordered the election to follow the resident/nonresident split (3 by residents, 2 by all owners). The Nebraska Supreme Court vacated that judgment, holding the district court lacked jurisdiction because it failed to join all SID property owners as indispensable parties, and remanded with directions to dismiss without prejudice.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether all SID property owners are indispensable parties to a declaratory action interpreting § 31-735(2)(b)	Not all owners needed; plaintiffs (SID/trustees) sought declaration affecting voting rights without joinder of every owner	Many owners have direct interest in allocation of voting power and must be joined	All SID property owners are indispensable; failure to join deprived the district court of jurisdiction; judgment vacated and case dismissed
Proper construction of "owned for other than residential uses" for § 31-735(2)(b)	Restrictive covenants make platted lots residential; thus less than 90% is other-than-residential	Election commissioner: many lots are vacant/nonresidential in use; covenants may be unenforceable	Not reached on the merits due to jurisdictional defect
Whether the election commissioner’s determination is entitled to a presumption of regularity	Plaintiffs: presumption not dispositive; court may interpret statute	Fischer: official acts deserve presumption/deference	Not decided — merits not reached because of indispensable-party defect
Whether recorded covenants/easements should be considered when computing area owned for residential uses	Plaintiffs: recorded covenants indicate residential ownership and are relevant	Defendants: covenants may be unenforceable and should not control; focus on present/prospective use	Not decided — merits not reached because of indispensable-party defect

Sandoval v. Ricketts, 302 Neb. 138, 922 N.W.2d 222 (Neb. 2019) (appellate review standard for jurisdictional questions)
Dunn v. Daub, 259 Neb. 559, 611 N.W.2d 97 (Neb. 2000) (defines "indispensable" party test in declaratory-judgment context)
Taylor Oil Co. v. Retikis, 254 Neb. 275, 575 N.W.2d 870 (Neb. 1998) (explains requirement to join all interested and necessary persons in declaratory actions)
SID No. 57 v. City of Elkhorn, 248 Neb. 486, 536 N.W.2d 56 (Neb. 1995) (residents of an SID were indispensable parties in a declaratory action affecting district status)
Concerned Citizens v. Department of Environmental Control, 244 Neb. 152, 505 N.W.2d 654 (Neb. 1993) (reinforces necessity of joining all interested and necessary persons under the declaratory-judgment statute)
Carlson v. Allianz Versicherungs-AG, 287 Neb. 628, 844 N.W.2d 264 (Neb. 2014) (examples confirming presence of indispensable parties is jurisdictional and cannot be waived)