Oltman v. Parde

1

32 Neb.App. 725

Steve A. Oltman and Diane Oltman, appellants, v. Doug Parde and Cindy Parde, appellees.

No. A-23-353

Court of Appeals of Nebraska

March 26, 2024

1. Motions to Dismiss: Pleadings: Appeal and Error. An appellate court reviews a district court's order granting a motion to dismiss de novo accepting the allegations in the complaint as true and drawing all reasonable inferences in favor of the nonmoving party.

2. Motions to Dismiss: Pleadings. To prevail against a motion to dismiss for failure to state a claim, a plaintiff must allege sufficient facts to state a claim to relief that is plausible on its face. In cases in which the plaintiff does not or cannot allege specific facts showing a necessary element, the factual allegations, taken as true are nonetheless plausible if they suggest the existence of the element and raise a reasonable expectation that discovery will reveal evidence of the element or claim.

3. Motions to Dismiss: Pleadings: Appeal and Error. When reviewing an order dismissing a complaint, an appellate court accepts as true all facts which are well pled and the proper and reasonable inferences of law and fact which may be drawn therefrom, but not the plaintiff's conclusion.

4. Motions to Dismiss: Pleadings. As a general rule, when a court grants a motion to dismiss, a party should be given leave to amend absent undue delay, bad faith, unfair prejudice, or futility.

5 Pleadings. Leave to amend should not be granted when it is clear that the defect cannot be cured by amendment.

6. Motions to Dismiss: Rules of the Supreme Court Pleadings. Because a motion to dismiss under Neb. Ct. R. Pldg. § 6-1112(b)(6) tests the legal sufficiency of the complaint, not the claim's substantive merits, a court may typically look only at the face of the complaint to decide a motion to dismiss.

7. Motions to Dismiss: Pleadings. A motion to dismiss should be granted only in the unusual case in which a plaintiff includes allegations that show on the face of the complaint that there is some insuperable bar to relief.

8. Limitations of Actions: Statutes. Limitations are created by statute and derive their authority therefrom.

9. Limitations of Actions: Presumptions. The statute of limitations is enacted upon the presumption that one having a well-founded claim will not delay enforcing it beyond a reasonable time if that person has the right to proceed.

10. Limitations of Actions. The mischief which statutes of limitations are intended to remedy is the general inconvenience resulting from delay in the assertion of a legal right which is practicable to assert.

11. Conversion: Property: Words and Phrases. Conversion is any distinct act of dominion wrongfully exerted over another's personal property in denial of or inconsistent with the rights therein.

12. Fraud: Estoppel: Limitations of Actions: Proof. In order to successfully assert the doctrine of fraudulent concealment and thus estop the defendant from claiming a statute of limitations defense, the plaintiff must show that the defendant has, either by deception or by a violation of a duty, concealed from the plaintiff material facts which prevent the plaintiff from discovering the misconduct.

13. Motions to Dismiss: Fraud: Pleadings: Proof. In order to survive a motion to dismiss, a complaint alleging fraudulent concealment must plead with particularity how material facts were concealed to prevent the plaintiff from discovering the misconduct and how, through due diligence, the plaintiff failed to discover the injury.

Appeal from the District Court for Gage County: Ricky A. Schreiner, Judge.

Lyle Joseph Koenig, of Koenig Law Firm, for appellants.

J.L. Spray and Jacob C. Garbison, of Mattson Ricketts Law Firm, for appellees.

Riedmann, Arterburn, and Welch, Judges.

Riedmann, Judge.

INTRODUCTION

Steve A. Oltman and Diane Oltman appeal the Gage County District Court's order dismissing their complaint with prejudice. We conclude that the statute of limitations bars their claims; thus, we affirm.

BACKGROUND

On October 5, 2022, the Oltmans sued Doug Parde and Cindy Parde for conversion, fraudulent concealment, breach of contract and spoilation, and they sought common-law indemnification, punitive damages, and attorney fees. In their complaint, the Oltmans alleged that in 2003, they began renting 320 acres of land to the Pardes. In 2007, the Oltmans sold a 40-acre tract to the Pardes, and the Pardes began renting a 250-acre tract. The Pardes rented the 250-acre tract until the 2017 crop year, after which they bought the tract from the Oltmans. The Oltmans alleged that "[t]he farm ground was originally leased by [the Oltmans] to [the Pardes] on a cash rent basis at the rate of $150.00 an acre, which was increased to $175.00 an acre in 2007, for the 2008 crop year." During the 2008-17 crop years, the Pardes paid rent on 227 acres, with the remaining 23 acres consisting of pasture and grass waterways.

While the Pardes rented the land, they made various improvements to the property. The Oltmans estimate that they received construction invoices totaling $36,000 during the Pardes' rental period. The complaint does not describe what improvements these construction invoices addressed. The Oltmans claim that they never approved any improvements on the land. Furthermore, the Oltmans claim that the Pardes never informed them or the U.S. Department of Agriculture (USDA) that they put additional acres into production beyond the 227 acres.

The basis of the Oltmans' claims is their allegation that "as early as 2004" the Pardes "converted some of the land that had previously been pasture and waterways, into tillable acres" and failed to pay rent on those additional acres. The Oltmans confronted Doug in October 2021 with information that the Pardes had not paid the correct amount of rent, because the Pardes were able to produce crops on the additional acres of pasture and grass waterways by tilling them. The Oltmans alleged in their complaint that Doug admitted to not paying the full amount of rent based on the acreage he tilled. The Oltmans estimate that the Pardes did not pay rent on a total of 423 acres-totaling $74,025 in back rent, but do not show how they calculated the 423 acres.

The Oltmans claimed they sold the land to the Pardes in April 2018 because they were not making enough money from the rental agreement with the Pardes to pay the maintenance and taxes on the property. They claim that if the Pardes had paid the accurate rental price, then they would not have needed to sell the land. Additionally, the Oltmans claim the Pardes knew this, so they fraudulently concealed the fact that they converted additional acres. The Oltmans alleged that they could not have discovered the additional converted acreage with reasonable diligence, in part because they trusted the Pardes.

The Oltmans requested that the district court vacate, set aside, and declare null and void the contract of sale from April 2018, in which the Oltmans sold the subject land to the Pardes. They also asked, in the alternative, that the Pardes pay unpaid rent and other damages to be proved at trial, as well as punitive damages, attorney fees, and costs.

On November 7, 2022, the Pardes filed a motion to dismiss. They cited various reasons for why the suit should be dismissed, including that the Oltmans failed to state a claim upon which relief could be granted, the statute of limitations barred the Oltmans' claims, and the Oltmans' claims were not stated with particularity.

The district court granted the Pardes' motion to dismiss and dismissed the Oltmans' complaint with prejudice. The district court held that the Oltmans' "allegations deal with a lease contract for real property," so "any theory of 'conversion' is inapplicable and should be dismissed with prejudice." Alternatively, it held that even if the conversion claim applied to the Oltmans' allegations, the claim would be barred by the statute of limitations. It explained that the face of the complaint shows that more than 4 years elapsed between the last alleged "conversion," which had to have occurred prior to the sale of the land in April 2018. Because the Oltmans filed suit in October 2022, the statute of limitations barred the claim.

The district court found that the Oltmans had failed to allege facts to support a finding that there was a valid contract to establish a breach of contract claim. The Oltmans had alleged only the amount of rent due on a per acre basis; they did not allege whether the 250-acre lease was to be completed within 1 year and renewed yearly or whether it was a long-term lease. There were no allegations in the Oltmans' complaint to indicate whether the lease was written or oral. The district court concluded that the Oltmans merely raised conclusory allegations without supporting lease contract terms.

The district court also concluded that any breach of contract claim was barred by the statute of limitations. Because the pleadings did not allege any facts to indicate the contract was written, the district court applied the statute of limitations for oral contracts, which is 4 years. The latest the breach of contract could have occurred was prior to the sale of the land in April 2018. The Oltmans filed suit in October 2022, which is outside the statute of limitations period.

Lastly the district court concluded that the Oltmans failed to allege sufficiently particular facts to establish a claim for fraudulent concealment. It explained that the Oltmans failed to allege any facts that the Pardes owed a duty to notify them of changes to the land. The Oltmans also alleged that the Pardes owed them $74,025, which they calculated to be 423 acres times $175. But the Oltmans failed to...