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EADIE v. LEISE PROPERTIES

Cite as 300 Neb. 141

Rachel Eadie and Jeffrey Blount, indiv

and as parents and natural guardians of 

minor children, Jaden and Zarah, appell

v. Leise Properties, LLC, and Cert

Properties Management, Inc., app

___ N.W.2d ___

Filed June 1, 2018. No. S-17-646.

1. Motions to Dismiss: 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. Negligence. The question whether a legal duty exists for actionable 

negligence is a question of law dependent on the facts in a particular 

situation.

3. Judgments: Appeal and Error. When reviewing questions of law, an 

appellate court has an obligation to resolve the questions independently 

of the conclusion reached by the trial court.

4. Pleadings: Appeal and Error. An appellate court reviews a district 

court’s denial of a motion for leave to amend a complaint for an abuse 

of discretion. However, an appellate court reviews de novo an underlying legal conclusion that the proposed amendments would be futile.

5. Actions: Pleadings: Notice. Civil actions are controlled by a liberal 

pleading regime; a party is only required to set forth a short and plain 

statement of the claim showing that the pleader is entitled to relief and 

is not required to plead legal theories or cite appropriate statutes so long 

as the pleading gives fair notice of the claims asserted.

6. Motions to Dismiss: Pleadings. To prevail against a motion to dismiss for failure to state a claim, a plaintiff must allege sufficient facts, 

accepted as true, to state a claim to relief that is plausible on its face. 

In cases in which a 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 

Nebraska Supreme Court Online Library

www.nebraska.gov/apps-courts-epub/

08/03/2018 09:09 AM CDT
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raise a reasonable expectation that discovery will reveal evidence of the 

element or claim.

7. Negligence: Damages: Proximate Cause. In order to prevail in a negligence action, a plaintiff must establish the defendant’s duty to protect 

the plaintiff from injury, a failure to discharge that duty, and damages 

proximately caused by the failure to discharge that duty.

8. Negligence. The threshold issue in any negligence action is whether the 

defendant owes a legal duty to the plaintiff.

9. Pleadings. A district court’s denial of leave to amend pleadings is 

appropriate only in those limited circumstances in which undue delay, 

bad faith on the part of the moving party, futility of the amendment, or 

unfair prejudice to the nonmoving party can be demonstrated.

10. Motions to Dismiss: Limitations of Actions. A dismissal without 

prejudice means that another petition may be filed against the same parties upon the same facts as long as it is filed within the applicable statute 

of limitations.

11. Motions to Dismiss: Claim Preclusion. A dismissal with prejudice 

operates as a rejection of the plaintiff’s claims on the merits and claim 

preclusion bars further litigation.

12. Motions to Dismiss: Pleadings. As a general rule, when a court grants 

a motion to dismiss for failure to state a claim, a party should be 

given leave to amend absent undue delay, bad faith, unfair prejudice, 

or futility.

13. Appeal and Error. An appellate court is not obligated to engage in an 

analysis which is not needed to adjudicate the controversy before it.

Appeal from the District Court for Douglas County: Thoma

A. Otepka, Judge. Reversed and remanded with directio

James Martin Davis, of Davis Law Office, for appellants.

Stephen G. Olson II, Robert S. Keith, and Kristina J. Kamler, 

of Engles, Ketcham, Olson & Keith, P.C., for appellee Leise 

Properties, LLC.

Patrick S. Cooper, David J. Stubstad, and Brandon J. Crainer, 

of Fraser Stryker, P.C., L.L.O., for appellee Certified Property 

Management, Inc.

Heavican, C.J., Miller-Lerman, Cassel, and Stacy, 

Luther and O’Gorman, District Jud
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EADIE v. LEISE PROPERTIES

Cite as 300 Neb. 141

Per Curiam

INTRODUCTION

A natural gas explosion at a rental house injured the nextdoor neighbors and destroyed the neighbors’ house, and they 

sued based upon a negligence theory. Less than 5 months 

after the action commenced, without providing a postresponse 

opportunity to amend and based upon a no-duty-owed conclusion, the district court dismissed the neighbors’ amended 

complaint with prejudice. Because amendment to state a claim 

was plausible, the district court abused its discretion in dismissing the complaint with prejudice. We reverse, and remand 

with direction.

BACKGROUND

The rental house next door to the house where Rachel Eadie 

and Jeffrey Blount and their children (collectively the neighbors) resided blew up on July 25, 2016. The neighbors sued 

the rental house’s landowner, Leise Properties, LLC, and its 

property manager, Certified Property Management, Inc. The 

suit was filed on December 15, 2016. On January 27, 2017, 

before any response was filed, the neighbors filed an amended 

complaint, which we summarize.

Amended Compla

The amended complaint was not a model of clarity, particularly regarding the allegations of negligence. But some of the 

basic allegations were clear. The rental house that blew up was 

located at 3858 North 68th Street in Omaha, Nebraska. The 

neighbors’ address was 3862 North 65th Street, contiguous to 

the rental house property. The neighbors’ house was destroyed, 

and they suffered personal injuries in the explosion.

Sometime prior to the date of the explosion, the landowner 

and its property manager had evicted tenants from the rental 

house. The evicted tenants removed items from the rental 

house, including a gas clothes dryer that did not belong to the 

tenants. The tenants allegedly removed the dryer without properly terminating and blocking the gas connection, and natural 
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gas was allowed to seep into and fill the rental house. On July 

25, 2016, when an agent of the property manager entered the 

rental house, the gas ignited and the rental house exploded. 

The force of the explosion destroyed the neighbors’ house and 

caused personal injuries to the neighbors.

Regarding duty, the amended complaint alleged that the 

landowner delegated to the property manager “duties . . . 

of reasonable care.” The amended complaint stated that the 

evicted tenants were “permitted to remove property and to 

disconnect the gas dryer without permission to do so without 

proper supervision and due diligence and care by failing to 

monitor, observe, and to prevent the gas leakage.” Later, the 

complaint stated that the landowner and its property manager 

“acted in reckless disregard for the safety of neighbors . . . 

by failing to properly monitor the actions of the tenants who 

were permitted to re-enter the . . . rental home after eviction 

and to cause gas to escape.” It also stated that the “seepage 

of gas is one duty that the [landowner and property manager] 

evaded and permitted to occur.” The complaint next alleged 

a duty to “properly maintain and pursue safe habitation of 

the home that exploded.” Finally, it alleged negligence in 

“permitt[ing] the ingredients of a dangerous and explosive gas 

to accumulate within the property.”

Motions to Dism

The property manager filed a motion to dismiss the amended 

complaint for failure to state a claim.1 Three days later, on 

February 13, 2017, the landowner filed a similar motion. The 

motions were heard on May 5.

District Court’s Or

On May 11, 2017, the district court dismissed the amended 

complaint with prejudice. The court first disposed of the complaint’s allusion to res ipsa loqitur, which is not contested 

on appeal.

1 See Neb. Ct. R. Pldg. § 6-1112(b)(6).
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The district court then examined the “proper standard of 

care regarding negligent supervision and monitoring” and summarized the duty as “whether the defendant acted as a reasonably prudent person would in a similar circumstance.” The 

court concluded that the amended complaint failed to allege 

a “recognized legal duty.” The court opined that there was 

“no recognized legal duty of a landlord to supervise a tenant’s 

move-out in order to ensure that a third party is not harmed 

by the actions of the tenant.” The court also found no duty to 

control the conduct of a third person as to prevent him or her 

from causing physical harm to another in the absence of a special relationship.

The court analyzed two cases cited by the neighbors, one 

involving the use of dynamite by a construction company to 

remove a tree a few feet away from the plaintiff’s property2

and one against a gas distribution company regarding an 

employee who filled an underground tank to supply a restaurant without first inspecting the condition of the equipment 

receiving the gas.3 Contrasting the defendants’ respective 

activities in those cases with the landowner’s and property 

manager’s engagement in the “real estate and property management business,” the court found no duty to “supervise 

a tenant’s move-out to ensure the safety of third parties.” 

Without discussing whether amendment to state a plausible 

claim was possible or likely, the court dismissed the amended 

complaint with prejudice.

Postorder Attempt to A

The neighbors filed a motion to vacate the order of dismissal 

with prejudice. They also filed a motion for leave to amend, 

together with the proposed second amended complaint. On 

May 30, 2017, both motions were overruled.

2 See Wendt v. Yant Construction Co., 125 Neb. 277, 249 N.W. 599 (1933).

3 See Clay v. Butane Gas Corporation, 151 Neb. 876, 39 N.W.2d 813 

(1949).
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Represented by new counsel, the neighbors brought this 

timely appeal.

ASSIGNMENTS OF ERROR

The neighbors make two assignments of error, which we 

have restated into three components. They assign error to (1) 

the district court’s ruling that the amended complaint failed to 

identify a legal duty, (2) the dismissal with prejudice, and (3) 

the failure to grant the postdismissal motion to file a second 

amended complaint.

STANDARD OF REVIEW

[1] 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.4

[2,3] The question whether a legal duty exists for actionable negligence is a question of law dependent on the facts 

in a particular situation.5 When reviewing questions of law, 

an appellate court has an obligation to resolve the questions independently of the conclusion reached by the trial 

court.6

[4] An appellate court reviews a district court’s denial of a 

motion for leave to amend a complaint for an abuse of discretion. However, an appellate court reviews de novo an underlying legal conclusion that the proposed amendments would 

be futile.7

4 See Nimmer v. Giga Entertainment Media, 298 Neb. 630, 905 N.W.2d 523 

(2018).

5 Bell v. Grow With Me Childcare & Preschool, 299 Neb. 136, 907 N.W.2d 

705 (2018).

6 Id.

7 Estermann v. Bose, 296 Neb. 228, 892 N.W.2d 857 (2017).
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ANALYSIS

Basic Civil Pleading Pri

[5] Nebraska is a notice pleading jurisdiction. Civil actions 

are controlled by a liberal pleading regime; a party is only 

required to set forth a short and plain statement of the claim 

showing that the pleader is entitled to relief and is not required 

to plead legal theories or cite appropriate statutes so long as 

the pleading gives fair notice of the claims asserted.8 The 

rationale for this liberal notice pleading standard in civil 

actions is that when a party has a valid claim, he or she should 

recover on it regardless of a failure to perceive the true basis 

of the claim at the pleading stage.9

[6] To prevail against a motion to dismiss for failure to 

state a claim, a plaintiff must allege sufficient facts, accepted 

as true, to state a claim to relief that is plausible on its face.10

Here, we accept the allegations of the amended complaint 

as true and draw all reasonable inferences in favor of the 

neighbors. In cases in which a 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.11

[7,8] In order to prevail in a negligence action, a plaintiff 

must establish the defendant’s duty to protect the plaintiff 

from injury, a failure to discharge that duty, and damages 

proximately caused by the failure to discharge that duty.12

8 Rodriguez v. Catholic Health Initiatives, 297 Neb. 1, 899 N.W.2d 227 

(2017).

9 Id.

10 Id.

11 Id.

12 Bell v. Grow With Me Childcare & Preschool, supra note 5.
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The threshold issue in any negligence action is whether the 

defendant owes a legal duty to the plaintiff.13

Landowner’s Duty to P

Outside the L

Unaided by the parties, the district court overlooked our 

jurisprudence regarding liability imposed upon possessors of 

land for physical harm to others outside the land under certain 

circumstances. Prior to our adoption of the duty analysis in § 7 

of the Restatement (Third) of Torts in 2010,14 we had recognized such liability of landowners.

For example, in Brown v. Nebraska P.P. Dist.,

15 we adopted 

§ 371 of the Restatement (Second) of Torts.16 In Brown, smoke 

obstruction from burning weeds was alleged to have caused 

driving hazards on a nearby public highway. We assumed duty 

and concluded that issues of fact remained as to whether the 

defendant failed to exercise reasonable care to prevent injury 

to travelers on the highway and whether the negligence was a 

proximate cause of the injury.17

We have not yet adopted § 54(a) of the Restatement (Third) 

of Torts,18 which would impose upon a possessor of land a duty 

of reasonable care for artificial conditions or conduct on the 

land that poses a risk of physical harm to persons or property 

not on the land.

It is not necessary to do so here. We are not presented with a 

developed record. The pleadings here were not well articulated. 

13 Id.

14 See, A.W. v. Lancaster Cty. Sch. Dist. 0001, 280 Neb. 205, 784 N.W.2d 

907 (2010); 1 Restatement (Third) of Torts: Liability for Physical and 

Emotional Harm § 7 (2010).

15 Brown v. Nebraska P.P. Dist., 209 Neb. 61, 306 N.W.2d 167 (1981).

16 Restatement (Second) of Torts § 371 (1965).

17 Id.

18 2 Restatement (Third) of Torts: Liability for Physical and Emotional Harm 

§ 54(a) (2012).
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The critical question is whether the district court should have 

dismissed the complaint with prejudice, thereby effectively 

denying leave to amend. Because the answer to that question 

is sufficient to resolve the appeal, we need not delineate with 

precision the duties owed by possessors of land.

Dismissal With Prej

[9] The neighbors argue that because they should have been 

permitted to amend their complaint, the district court erred in 

dismissing the action with prejudice. We agree. The district 

court did not explain why it was dismissing the complaint 

with prejudice. A district court’s denial of leave to amend 

pleadings is appropriate only in those limited circumstances in 

which undue delay, bad faith on the part of the moving party, 

futility of the amendment, or unfair prejudice to the nonmoving party can be demonstrated.19 The record would not support 

a finding of undue delay, bad faith, or unfair prejudice. As 

we read the judge’s order, it appears that the court thought 

amendment would be futile.

[10,11] In this case, the district court dismissed the neighbors’ amended complaint with prejudice. A dismissal without 

prejudice means that another petition may be filed against 

the same parties upon the same facts as long as it is filed 

within the applicable statute of limitations.20 In comparison, 

“‘a dismissal with prejudice operates as a rejection of the 

plaintiff’s claims on the merits and [claim preclusion bars] 

further litigation.’”21 Here, the dismissal with prejudice would 

preclude the neighbors from filing a second suit with the same 

claims in a Nebraska court.

[12] If a plaintiff has moved for leave to amend before the 

court rules on a motion to dismiss, the court must first consider 

19 Estermann v. Bose, supra note 7.

20 See Dworak v. Farmers Ins. Exch., 269 Neb. 386, 693 N.W.2d 522 (2005).

21 RFD-TV v. WildOpenWest Finance, 288 Neb. 318, 329, 849 N.W.2d 107, 

116 (2014) (quoting Jaramillo v. Burkhart, 59 F.3d 78 (8th Cir. 1995)).
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and rule upon the pending motion to amend.22 We have hinted 

that the same rule should apply where the plaintiff did not 

move for leave.23 As a general rule, when a court grants a 

motion to dismiss for failure to state a claim, a party should 

be given leave to amend absent undue delay, bad faith, unfair 

prejudice, or futility. Granting leave to amend is consistent 

with the rationale for the liberal pleading standard in civil 

cases discussed above.24 And it is consistent with the practice 

in Nebraska prior to the adoption of the Nebraska Court Rules 

of Pleading in Civil Cases.25 But leave should not be granted 

when it is clear that the defect cannot be cured by amendment.26 Here, that would only be the case if amendment would 

be futile.

As we have already explained, the district court (and the 

parties, apparently) did not consider whether a duty to the 

neighbors could be found in the pertinent law governing the 

liability imposed upon possessors of land for physical harm to 

others outside the land under certain circumstances. Upon our 

de novo review of that question, we cannot say that amendment would be futile. Thus, we conclude that the district court 

abused its discretion in dismissing the amended complaint 

with prejudice.

Other Assignm

[13] We do not reach the neighbors’ other assignments 

of error. An appellate court is not obligated to engage in an 

22 See Gonzalez v. Union Pacific RR. Co., 282 Neb. 47, 803 N.W.2d 424 

(2011).

23 See Spear T Ranch v. Knaub, 269 Neb. 177, 691 N.W.2d 116 (2005).

24 See, John P. Lenich, Nebraska Civil Procedure § 15:5 (2018); 5B Charles 

Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 1357 

(3d ed. 2004 & Supp. 2017).

25 See Lenich, supra note 24.

26 See Kocontes v. McQuaid, 279 Neb. 335, 778 N.W.2d 410 (2010).
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analysis which is not needed to adjudicate the controversy 

before it.27

CONCLUSION

The district court did not consider the pertinent law governing liability imposed upon possessors of land for physical harm 

to others outside the land under certain circumstances. Thus, 

when the court apparently determined that amendment of the 

complaint would be futile, it overlooked a potential source of 

duty to the neighbors. Upon de novo review, we cannot say 

that amendment would have been futile. Thus, we conclude the 

district court abused its discretion in dismissing the neighbors’ 

complaint with prejudice. We reverse the dismissal with prejudice, and remand the cause with direction to grant the neighbors leave to amend their complaint.

Reversed and remanded with direc

Funke, J., participating on brief

Wright, J., not participating

27 Thompson v. Johnson, 299 Neb. 819, 910 N.W.2d 800 (2018).