Loop v. Mueller

30 Neb.App. 300

967 N.W.2d 749

Margo LOOP, as Guardian and Conservator of Lorine H. Mueller, appellee,

v.Cheryl MUELLER, appellant

Margo Loop, Individually, intervenor-appellee,

and

Gary Mueller and Ryan G. Tessendorf, Personal Representative of the Estate of Lorine H. Mueller, Deceased, appellees.

No. A-20-840.

Court of Appeals of Nebraska.

Filed October 26, 2021.

Clark J. Grant, of Grant & Grant, for appellant.

Neal J. Valorz, of Sipple, Hansen, Emerson, Schumacher, Klutman & Valorz, for appellee Margo Loop.

Ryan G. Tessendorf, pro se.

Riedmann and Arterburn, Judges.

Arterburn, Judge.

INTRODUCTION

In January 2016, Cheryl Mueller filed a confession of judgment in an action brought against her by Margo Loop (Margo), who was acting in her capacity as guardian and conservator for Lorine H. Mueller. The confession of judgment resulted in a judgment being entered against Cheryl in the amount of $340,846.52. More than 3½ years later, Cheryl filed a complaint seeking to vacate the judgment that had been entered against her. In response to the complaint, Margo filed a motion for summary judgment. The district court granted Margo's motion for summary judgment, finding that Cheryl's complaint to vacate was "time-barred as a matter of law." Cheryl appeals from the district court's decision, challenging the court's determination that her complaint was barred by the relevant statute of limitations. For the reasons set forth herein, we affirm the decision of the district court to grant Margo's motion for summary judgment and to dismiss Cheryl's complaint to vacate.

BACKGROUND

In 2015, Margo was acting as the guardian and conservator for her mother, Lorine. In her capacity as Lorine's guardian and conservator, Margo initiated an action against Cheryl, the widow of one of Lorine's two sons (2015 district court proceedings). The action alleged, among other claims, that Cheryl had breached her fiduciary duties and had committed acts of fraud, unjust enrichment, negligence, and conversion.

On January 8, 2016, Margo and Cheryl jointly filed a confession of judgment in the 2015 district court proceedings. The confession of judgment provided that Cheryl "understands and confesses that Judgment should be and hereby is entered in favor of [Margo] against [Cheryl] in the amount of Three Hundred Forty Thousand, Eight Hundred Forty-Six and 52/100 Dollars ($340,846.52)." That same day, Margo and Cheryl also jointly filed a stipulation for entry of judgment. Therein, they agreed that pursuant to the confession of judgment, a judgment should be entered against Cheryl in the amount of $340,846.52. The district court accordingly entered such judgment against Cheryl.

Cheryl's decision to confess judgment was apparently the result of a broader settlement agreement entered into by Cheryl, Margo, and other related parties, which agreement resolved not only the 2015 district court proceedings, but also resolved other pending and future claims between all the parties to the settlement agreement. The agreement explains:

[T]he parties, without admitting liability, fault or indebtedness, successfully negotiated a resolution of all issues, complaints and claims, and the parties desire to formalize their settlement of any and all claims, known or unknown, that they have or may have against each other, including, but not limited to, any claims raised or which could have been raised relating to their disputes, claims, and defenses in the Pending Litigation.

As is relevant to the 2015 district court proceedings, the settlement agreement provided as follows:

Cheryl shall execute the Confession of Judgment in the District Court Lawsuit ... simultaneously with the execution of this Agreement. Cheryl shall instruct her legal counsel to execute the Joint Stipulation for Entry of Judgment and the Order for Entry of Judgment ... simultaneously with the execution of this Agreement. Margo shall file the executed Confession of Judgment, the Joint Stipulation for Entry of Judgment and proposed Order for Entry of Judgment in the District Court Lawsuit. Each party shall bear her own attorney fees, expert fees and costs. Margo, and Lorine's estate shall not seek to collect the Confession of Judgment. The Confession of Judgment shall not be forgiven.

Later on in the settlement agreement, the parties, "[f]or purposes of clarification," stated that under the terms of the agreement, "Margo is not waiving or relinquishing any rights to file a will contest action, a challenge to a personal representative or any actions in any estate proceeding of Lorine after her passing."

Lorine died in February 2017, a little over a year after Cheryl agreed to confess judgment in the 2015 district court proceedings. At the time of her death, Lorine was a resident of Kansas. Shortly after Lorine's death, Margo filed a petition in the district court for Sedgwick County, Kansas, to probate a will authored by Lorine in 1979. This will identified Margo and her surviving brother, Gary Mueller, as the devisees.

One week after Margo filed her petition to probate the 1979 will, Ryan G. Tessendorf also filed a petition to probate a will authored by Lorine. However, this will was authored in 2007 and identified the devisees as Margo, Gary, and Cheryl. In fact, the 2007 will devised to Cheryl the majority of Lorine's estate. In the 2007 will, Tessendorf was appointed by Lorine to serve as her personal representative.

Ultimately, in an order dated October 10, 2019, the district court in Kansas determined that the 2007 will should be probated. The court appointed Tessendorf as the personal representative.

During the pendency of the will contest proceedings, the district court in Kansas appointed a special administrator for Lorine's estate in order to preserve the assets of the estate and to pay all necessary expenses of the estate, pending the decision regarding which will to probate. In November 2017, a few months after the special administrator was appointed, Margo filed a motion with the Kansas district court, asking that the special administrator be given the authority to obtain a certified copy of the confession of judgment entered by Cheryl in the 2015 district court proceedings. Margo further requested that the special administrator register that confession of judgment in the Kansas district court "for the purpose of offset of the obligation due under the Confession of Judgement and, to the extent not otherwise satisfied, for execution against the assets of Cheryl." In the motion, Margo explained her request as follows:

In the event that the Court determines that Cheryl ... is a beneficiary under the Estate of Lorine ... and would otherwise be entitled to a distribution from the Estate, the amount due to the Estate under the Confession of Judgment should be repaid prior to [Cheryl's] receipt of any distribution from the Estate. In the event Cheryl ... has not satisfied the judgment or any other obligation prior to any potential distribution from the Estate, the Court should order that any distribution due to Cheryl ... be applied to any remaining obligation due the Estate.

In response to Margo's motion requesting the special administrator to register the confession of judgment from the 2015 district court proceedings in the Kansas district court, on December 5, 2017, Cheryl filed a motion indicating that the confession of judgment was fraudulently obtained and should not be accorded "lien status" in the estate proceedings. Specifically, Cheryl asserted that Margo was attempting to collect the judgment from her in direct violation of the terms of the settlement agreement which provided, "Margo, and Lorine's estate shall not seek to collect the Confession of Judgment."

In addition to the motion filed in the Kansas district court, Cheryl also filed a verified motion for an ex parte order for enforcement of the settlement agreement in the district court for Platte County, Nebraska, in November 2017. Cheryl's motion indicates it was filed using the same case number as the 2015 district court proceedings. Therein, Cheryl requested that the district court enforce the terms of the parties’ settlement agreement by prohibiting Margo or any other party from registering the confession of judgment in the Kansas probate proceedings. There is nothing in our record which indicates the district court took any action on the verified motion for an ex parte order.

Cheryl filed a third motion objecting to the registration of the confession of judgment in the Kansas probate proceedings in the Kansas district court in June 2018. Essentially, Cheryl argued that the Kansas district court lacked the authority to consider the confession of judgment.

The Kansas district court considered whether it should enforce the confession of judgment. At the close of a hearing held on March 3, 2020, related to this topic, the court stated:

I'll just say, I believe I have jurisdiction to enforce a judgment....

With that said and to that end, after considering the arguments of the parties, I do believe that I have authority to set off the amount of the confession of judgment plus accrued interest against [Cheryl's] distributive share of the estate .... I'll withhold enforcing that judgment until you have had an opportunity to go through the process up in Platte County, Nebraska, to attempt to set aside the judgment ....

The court concluded that it would withhold ordering the executor to apply the equitable setoff until the Nebraska court had an opportunity to determine whether the judgment should be set aside.

A few months prior to that hearing in the Kansas district court, on November 19, 2019, in the district court for Platte County, Cheryl had filed a complaint to vacate the January 2016 confession of judgment and resulting court order pursuant to Neb. Rev. Stat. § 25-2001 (Reissue 2016). The complaint listed the name of the case and the case number from the 2015 district court proceedings. On November 27, Cheryl filed an amended complaint.

Tessendorf...