Gerber v. P & L Finance Co.Gerber v. P & L Finance Co.
Case Information
*1 Nеbraska Supreme Court Online Library www.nebraska.gov/apps-courts-epub/ 11/23/2018 12:11 AM CST - 463 -
N ebraska s upreme C ourt a dvaNCe s heets 301 N ebraska r eports GERBER v . P & L FINANCE CO.
Cite as
___ N.W.2d ___ Filed November 2, 2018. No. S-17-710.
1.
Statutes: Appeal and Error.
Statutory interpretation is a question of
law, which an appellate court resolves indeрendently of the trial court.
2.
Pleadings.
When the title of a filing does not reflect its substance, it is
proper for a court to treat a pleading or motion based on its substance
rather than its title.
3.
Attorney Fees: Statutes: Words and Phrases: Appeal and Error.
“Proceeding” as used in
2017) provides that a director may apply for indemnification for attor-
ney fees “to the court conducting the proceeding” and because “proceed-
ing” includes an appeal,
Petition for further review from the Court of Appeals, m oore , Chief Judge, and p irtle and a rterburN , Judges, on appeal thereto from the District Court for Douglas County, p eter C. b atailloN , Judge. Judgment of Court of Appеals reversed, and cause remanded with directions.
Brian E. Jorde and Christian T. Williams, of Domina Law Group, P.C., L.L.O., for appellant.
Edward D. Hotz, of Pansing, Hogan, Ernst & Bachman, L.L.P, for appellees P & L Finance Co. and Laurie Langdon.
James Polack, P.C., L.L.O., for appellee Paul Gerber. *2 h eaviCaN , C.J., m iller -l ermaN , C assel , s taCy , F uNke , p apik , and F reudeNberG , JJ.
m iller -l ermaN , J.
NATURE OF CASE
We granted appellee Paul Gerber’s petition for further review of the order of the Nebraska Court of Appeals which overruled his motion in which he sought to recover attorney fees from coappellee P & L Finance Co., Inc. (P & L). Paul styled his pleading as a “Motion for Attorney Fees.” However, in the filing, Paul sought an order requiring P & L, of which he is a director, to indemnify him for attorney fees he incurred in the appeal of a case where he was made a party because he was a direсtor. We reverse the order of the Court of Appeals which denied Paul’s request, and we remand the cause to the Court of Appeals with directions to consider the filing as an application for an order for indemnification rather than as a motion for an award of attorney fees.
STATEMENT OF FACTS
Elisa Gerber filed an action in the district court for Douglas County against P & L seeking, inter alia, issuance of a stock certificate. She also named as defendants Laurie Langdon and Paul, who are directors of P & L. The defendants moved for summary judgment. The district court determined that Elisa’s claim for issuance of a stock certificate was barred by the statute of limitations and, consequently, that her other claims were also barred. The district court granted summary judg- ment in favor of the defendants. Elisa appealed to the Court of Appeals. On April 24, 2018, the Court of Appeals affirmed the district court’s grant of summary judgment in a memorandum opinion. Gerber v. P & L Finance Co. , No. A-17-710, 2018 WL 1920600 (Neb. App. Apr. 24, 2018) (selected for posting to court website).
After the Court of Appeals filed its decision, Paul filed a
motion titled “Motion for Attorney Fees.” Paul, an appellee
in the appeal, did not seek an award of attorney fees from the
appellant, Elisa. Instead, Paul requested an order requiring
another appellee, P & L, to pay his attorney fees. In his motion,
Paul made reference to
Any person who claims the right under the law or a uni- form course of practice to an attorney fee in a civil case appealed to the Supreme Court or the Court of Appeals must file a motion for the allowance of such a fee sup- ported by an affidavit which justifies the amount of the fee sought for serviсes in the appellate court.
The affidavit of his attorney setting forth attorney fees in the amount of $ 5,381.25 incurred in connection with the appeal to the Court of Appeals was attached to the motion. Paul also referred to P & L’s articles of incorporation.
Paul alleged in the motion that he was made a party to
*3
this case based solely on his status аs an officer, director,
and shareholder of P & L. He further alleged that P & L’s
“Articles of Incorporation” provided that P & L indemnify him
for attorney fees he incurred in the appeal of this action. Paul
cited provisions of the Nebraska Model Business Corporation
Act,
P & L and Langdon objected and noted that Rule 2-109(F) provides for an award of attorney fees when a party is enti- tled to such “under the law or a uniform course of prac- tice.” Supplemental brief for appellees P & L and Langdon in response to petition for further review at 1. P & L and Langdon argued that under the law and uniform course of practiсe in Nebraska, one can recover attorney fees only from an adverse party, not from a “co-party.” Id. at 2. They asserted that Paul’s request should be denied, because Paul was seeking attorney fees from a coparty and “[t]here is no law or uniform course of procedure which recognizes the recovery of attorney fees from a non-adverse party . . . .” Id. at 1.
The Court of Appeals denied Paul’s request. In a minute entry, the Court of Appeals stated, “Appellee, Paul Gerber’s motion for attorney fees is denied. There is no law or uniform course of practice in the appellate courts which recognizes the recovery of аttorney fees from a non-adverse party. See [Rule] 2-109(F).”
We granted Paul’s petition for further review of the order of the Court of Appeals which overruled his motion.
ASSIGNMENT OF ERROR
Paul generally claims that the Court of Appeals erred when it overruled his request for attorney fees.
STANDARD OF REVIEW
[1] Statutory interpretation is a question of law, which an
appellаte court resolves independently of the trial court.
In re
Guardianship of S.T.
,
ANALYSIS
Paul claims that the Court of Appeals erred when it over-
ruled his request for attorney fees. We determine that, although
the request was fashioned as a motion for an award of attor-
ney fees pursuant to Rule 2-109(F), the substance of Paul’s
filing was a request for an order for indemnificatiоn from
P & L under the Nebraska Model Business Corporation Act.
We further determine that under the relevant statute, a director
may apply to an appellate court which conducted the proceed-
ing for an order for indemnification. We therefore reverse the
order which overruled Paul’s request and remand this appеal to
the Court of Appeals with directions to consider Paul’s filing
consistent with
Paul contends that the Court of Appeals erroneously read a “‘non-adverse party’ requirement” into Rule 2-109(F) and erred when it stated that there was “nо law” that would allow recovery in the Nebraska appellate courts of attorney fees from a nonadverse party. He asserts that the Nebraska Model Business Corporation Act is the law that authorizes recovery of attorney fees in this case. In response, P & L and Langdon contend that Rule 2-109(F) controls and allows attоrney fees only when a prevailing party is seeking an award of attorney fees from an adverse party. Although our reasoning differs somewhat, we agree with Paul that the Court of Appeals may determine whether he is entitled to indemnification for attorney fees in this appeal.
[2] Our review of the proceedings shows that certain par- ties and the Court of Appeals focused on the form of Paul’s request but failed to consider its substance. As noted, Paul fashioned the filing as a motion for an award of attorney fees; he titled it as a “Motion for Attorney Fees” and stated that it was filed pursuant to Rule 2-109(F). But, given the content of the motion, we read the substance of his filing as an аpplication for an order of indemnification under the Nebraska Model Business Corporation Act. We have indicated that when the title of a filing does not reflect its substance, it is proper for a court to treat a pleading or motion based on its substance rather than its title. See Linda N. v. William N. , 289 Neb. 607, 856 N.W.2d 436 (2014) (stating that it is proper for court to look at substance of petitioner’s actual request, instead of simply title of petition); State v. Loyd , 269 Neb. 762, 696 N.W.2d 860 (2005) (stating that determi- nation as to how motion should be regarded depends upon substance of motion, not its title). See, also, Dugan v. State , 297 Neb. 444, 900 N.W.2d 528 (2017) (stating how motion should be regarded for purposes of determining whether its denial is final order depends upon substancе of motion and not its title).
The relief Paul sought was not per se an award of attorney fees under Rule 2-109(F), which, when allowed, is typically granted to a prevailing party and against an adverse party. Paul and P & L differ in this appeal as to whether attorney fees may be awarded against a nonadverse party under Rule 2-109(F). However, for purposes of this appeal, we need not resolve this disagreement, because we do not read the *5 - 468 -
N ebraska s upreme C ourt a dvaNCe s heets 301 N ebraska r eports GERBER v . P & L FINANCE CO.
Cite as
Instead, the substance of Paul’s filing shows that as a direc-
tor, he is seeking indemnificatiоn from P & L for attorney fees
he incurred in this appeal as authorized by the Nebraska Model
Business Corporation Act. In particular, Paul cites
(a) A director who is a party to a proceeding because he or she is a director may apply for indemnification or an advance for expenses to the court conducting the proceed- ing or to another court of competent jurisdiction. After receipt of an application and after giving any notice it considers necessary, the court shall: (1) Order indemnification if the court determines that the director is entitled to mandatory indemnification undersection 21-2 ,112;
(2) Order indemnification or advance for expenses if
the court determines that the director is entitled to indem-
nification or advance for expenses pursuant to a provision
authorized by subsection (a) of
A corporation shall indemnify a director who was wholly successful, on the merits or otherwise, in the defense of any proceeding to which the director was a party because he or she was a director of the corporation against expenses incurred by the director in connection with the proceeding.
A corporation may, by a provision in its articles of
incorporation or bylaws or in a resolution adopted or a
contract approved by its board of directors or sharehold-
ers, obligate itself in advance of the act or оmission
giving rise to a proceeding to provide indemnification
in accordance with
Referring to such statutory authority, Paul alleged that he was made a party to this case and to this appeal based on his *6 status as an officer, director, and shareholder of P & L and that P & L’s articles of incorporation require indemnification of directors. Paul referred, inter alia, to an exhibit of P & L’s articles of incorporation and attached his attorney’s affidavit and billing for services related to the appeal.
Based on the substance of Paul’s filing, we determine that
the filing was аn application under
The broad definition of “proceeding” ensures that the benefits of this subchapter will be available to directors in new and unexpected, as well as traditional, types of litigation or other advеrsarial matters, whether civil, criminal, administrative, or investigative. It also includes arbitration and other dispute resolution proceedings, lawsuit appeals and petitions to review administrative actions.
ABA Committee on Corporate Laws, Changes in the Model Business Corporation Act—Amendments Pertaining to Indemnification and Advance for Expenses , 49 Bus. Law. 741, 755-56 (1994) (emphasis supplied).
[3,4] We read “proceeding” as used in
As noted,
But in the present case, in its order granting summary judg-
ment, the district court found withоut challenge on appeal that
it was “undisputed” that Paul was a director of P & L and the
district court also granted Paul’s claim for indemnification
for fees incurred at the district court level without objection.
At oral argument, the only issue that P & L identified as in
need of resolution was the reasonableness of the appellate-
related fee for which Paul requested indemnification. We see
no need to refer this request for indemnification to the district
court. Appellate courts can, and often do, decide whether fee
requests for services performed in appeals before them are
reasonable. Therefore, there is no appаrent reason that the
Court of Appeals could not determine Paul’s application in this
appeal consistent with
CONCLUSION
In this case, Paul was a party because he was a director.
We conclude that Paul’s request for attorney fees was, in sub-
stance, an application under
r eversed aNd remaNded with direCtioNs .