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Nebraska Court of Appeals Advance Sheets

29 Nebraska Appellate Reports

SCHMUNK v. AQUATIC SOLUTIONS

Cite as 29 Neb. App. 940

Tosha Schmunk and Jason Schmunk, appellees, 

v. Aquatic Solutions, appellant.

___ N.W.2d ___

Filed June 8, 2021. No. A-20-642.

1. Small Claims Court: Appeal and Error. The district court and higher 

appellate courts generally review judgments from a small claims court 

for error appearing on the record.

2. Judgments: Appeal and Error. When reviewing a judgment for errors 

appearing on the record, the inquiry is whether the decision conforms 

to the law, is supported by competent evidence, and is neither arbitrary, 

capricious, nor unreasonable.

3. ____: ____. In instances when an appellate court is required to review 

cases for error appearing on the record, questions of law are nonetheless 

reviewed de novo on the record.

4. Attorney and Client: Actions. A legal proceeding in which a party is 

represented by a person not admitted to practice law is a nullity and is 

subject to dismissal.

5. Attorneys at Law: Attorney and Client. A licensed member of the 

Nebraska bar must represent a limited liability company in the courts of 

this state.

6. Attorney and Client: Parties: Appeal and Error. When a layperson 

appeals both in his or her own behalf and on behalf of a business entity, 

an appellate court dismisses the appeal as to the entity but considers the 

merits of the appeal as to the errors assigned by the layperson in his or 

her own behalf.

7. Actions: Pleadings: Parties. The character in which one is a party to 

a suit, and the capacity in which a party sues, is determined from the 

allegations of the pleadings and not from the caption alone.

8. Courts: Actions: Parties: Complaints: Pleadings: Records. If the 

capacity in which a party sues is doubtful, a court may examine the 

complaint, the pleadings as a whole, and even the entire record.

Nebraska Supreme Court Online Library

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

06/15/2021 08:08 AM CDT
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SCHMUNK v. AQUATIC SOLUTIONS

Cite as 29 Neb. App. 940

9. Actions: Pleadings: Parties. When the pleadings show a cause of 

action by a person in his individual capacity, a court may reject words 

indicating representative capacity.

10. Names. Doing business under another name or several names does 

not create an entity separate and distinct from the person operating the 

business.

11. Attorney and Client: Parties. The prohibition on representation by a 

layperson does not apply to a sole proprietorship where the owner of 

that entity is representing his or her own interests.

Appeal from the District Court for Cheyenne County, Derek 

C. Weimer, Judge, on appeal thereto from the County Court 

for Cheyenne County, Randin R. Roland, Judge. Judgment 

of District Court reversed and cause remanded for further 

proceedings.

Drew Lefler, pro se.

No appearance for appellees.

Pirtle, Chief Judge, and Moore and Bishop, Judges.

Moore, Judge.

INTRODUCTION

Tosha Schmunk and Jason Schmunk filed an action in 

the county court for Cheyenne County, sitting as a small 

claims court, against “Drew Lefler, Aquatic Solutions.” We 

have referred to the party sued in this case as “Lefler,” except 

when otherwise necessary to our discussion of the issues on 

appeal. The small claims court entered judgment in favor of 

the Schmunks. Lefler appealed, pro se, to the district court, 

which dismissed his appeal. Lefler then appealed to this court. 

For the reasons set forth herein, we reverse the district court’s 

dismissal of Lefler’s appeal and remand the cause for further proceedings.

STATEMENT OF FACTS

On November 21, 2019, the Schmunks filed an action in 

the small claims court, alleging that “the Defendents [sic] 
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Cite as 29 Neb. App. 940

company” used deceptive trade practices in the marketing 

of a vacuum cleaner. Service was accomplished on “Aquatic 

Solutions % Drew Le[f]ler.”

An evidentiary hearing was held, and the small claims court 

heard testimony from the Schmunks and Lefler and received 

several documentary exhibits. In his testimony, Lefler asserted 

that the Schmunks failed to properly and timely cancel their 

order for the vacuum and were bound by the parties’ contract 

to pay for it. On June 11, 2020, the small claims court entered 

judgment in favor of the Schmunks in the amount of $2,883.65 

plus costs. The order specified that judgment was entered 

against “Aquatic Solutions.”

Lefler appealed to the district court. The notice of appeal 

identifies the appellant as “Drew Lefler.” Lefler appeared pro 

se at the district court hearing, during which the bill of exceptions from the small claims court hearing was received as 

an exhibit.

On August 20, 2020, the district court entered an order 

dismissing Lefler’s appeal. In its order, the court first considered Lefler’s capacity to appeal. The court deemed that the 

Schmunks’ small claims complaint had identified both Aquatic 

Solutions and Lefler as defendants, but that the small claims 

court had entered judgment only as to Aquatic Solutions 

with no monetary judgment against Lefler. The district court 

observed that “Aquatic Solutions is some type of business 

entity and Drew Lefler is somehow affiliated with the leadership of that business entity.” The court further observed that 

there was no evidence that Lefler was an attorney licensed in 

Nebraska. The court did not then analyze its jurisdiction under 

Neb. Rev. Stat. § 25-1315(1) (Reissue 2016), but, instead, 

it determined that Lefler had engaged in the unauthorized 

practice of law in representing Aquatic Solutions. The court 

cited Steinhausen v. HomeServices of Neb., 289 Neb. 927, 857 

N.W.2d 816 (2015), for the proposition that an individual can 

represent himself or herself in legal proceedings in his or her 

own behalf, but one who is not an attorney cannot represent 
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Cite as 29 Neb. App. 940

others. The court further cited Steinhausen for the proposition 

that a legal proceeding in which a party is represented by a 

person not admitted to practice law is a nullity and is subject 

to dismissal. The court found that while Aquatic Solutions had 

the right to pursue an appeal of the judgment entered against 

it, it did not do so with the assistance of a licensed attorney, 

and that the filings on its behalf by Lefler were not proper as 

he was not a licensed attorney. Accordingly, the court concluded that Lefler’s appeal was a nullity and dismissed it on 

that basis.

Lefler appealed to this court. The notice of appeal identifies the party appealing as “Drew Lefler.” Lefler also filed 

a motion for summary reversal and vacatur of the district 

court’s August 2020 order dismissing his appeal and the small 

claims court’s June 2020 order entering judgment “on grounds 

that they contain two errors, one foundational and the other 

a misunderstanding of fact,” which “when corrected will end 

this long-term dispute.” This court ordered the “appellant” to 

show cause why it should not dismiss the appeal because the 

appellant had not appeared by an attorney licensed to practice law in Nebraska. In his affidavit in response to the show 

cause order, Lefler asserted that he operates Aquatic Solutions 

as a sole proprietorship, that there is no legal entity separate 

from himself for Aquatic Solutions, and that it is therefore 

permissible for him to represent himself. He attached a copy 

of his dealer application for Equity Sales Finance, Inc., which 

indicates that Aquatic Solutions is operating as a sole proprietorship. This court determined that the appeal could proceed, 

but we overruled Lefler’s motion for summary reversal. The 

caption on the cover of Lefler’s subsequently filed appellate 

brief identified the appellant as “AQUATIC SOLUTIONS 

c/o DREW LEFLER.” He also identified the appellant on the 

cover page and in the signature blocks following the conclusion and certificate of service pages of his brief as “Drew 

Lef[l]er d/b/a Aquatic Solutions.”
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SCHMUNK v. AQUATIC SOLUTIONS

Cite as 29 Neb. App. 940

ASSIGNMENT OF ERROR

Lefler asserts, consolidated and restated, that the district 

court erred in dismissing his appeal from the small claims court.

STANDARD OF REVIEW

[1-3] The district court and higher appellate courts generally 

review judgments from a small claims court for error appearing on the record. Flodman v. Robinson, 22 Neb. App. 943, 

864 N.W.2d 716 (2015). See, also, Neb. Rev. Stat. §§ 25-2733 

and 25-2807 (Reissue 2016); Hara v. Reichert, 287 Neb. 577, 

843 N.W.2d 812 (2014). When reviewing a judgment for errors 

appearing on the record, the inquiry is whether the decision 

conforms to the law, is supported by competent evidence, and 

is neither arbitrary, capricious, nor unreasonable. Schaefer 

Shapiro v. Ball, 305 Neb. 669, 941 N.W.2d 755 (2020). 

However, in instances when an appellate court is required to 

review cases for error appearing on the record, questions of 

law are nonetheless reviewed de novo on the record. Millard 

Gutter Co. v. Farm Bureau Prop. & Cas. Ins. Co., 295 Neb. 

419, 889 N.W.2d 596 (2016).

ANALYSIS

Lefler asserts that the district court erred in dismissing 

his appeal from the small claims court. In addressing the 

issues raised in Lefler’s appeal, we first review Steinhausen v. 

HomeServices of Neb., 289 Neb. 927, 857 N.W.2d 816 (2015), 

the case relied on by the district court in dismissing Lefler’s 

appeal from the judgment entered by the small claims court 

against Aquatic Solutions. Then, we consider generally whether 

a layperson can represent a sole proprietorship. Finally, assuming for the sake of our analysis that Aquatic Solutions is a sole 

proprietorship, we turn to the issues of Lefler’s capacity to represent Aquatic Solutions and the parties to this appeal.

In Steinhausen, the Nebraska Supreme Court considered 

a pro se appeal brought by a layperson who was the sole 

member and registered agent of a limited liability company (LLC). The layperson, Matthew M. Steinhausen, filed 
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Cite as 29 Neb. App. 940

a civil complaint stating claims of libel, false light invasion of privacy, and tortious interference with a business 

relationship against certain named defendants. The caption 

identified the plaintiff as “‘MATTHEW M. STEINHAUSEN 

D/B/A STEINHAUSEN HOME INSPECTIONS, LLC,’” and 

the complaint appeared to allege wrongs committed against 

both Steinhausen and the LLC. Steinhausen, 289 Neb. at 932, 

857 N.W.2d at 823. The trial court granted summary judgment in favor of the defendants, and Steinhausen appealed. 

The caption on the cover of Steinhausen’s appellate brief 

identified the appellant as “‘MATTHEW M. STEINHAUSEN; 

D/B/A Steinhausen Home Inspections, LLC,’” and the notice 

of appeal stated that the party appealing was “‘Plaintiff, 

Matthew M. Steinhausen.’” Steinhausen, 289 Neb. at 933, 

857 N.W.2d at 824. This court entered an order to show cause 

why the appeal should not be dismissed because the LLC had 

not appeared by an attorney licensed in Nebraska. Based on 

the parties’ responsive briefs, we determined that cause had 

been shown for the appeal to proceed, but we cautioned that 

Steinhausen could only proceed pro se on behalf of his own 

individual claims and not on behalf of the LLC. Subsequently, 

the Nebraska Supreme Court moved the appeal to its own 

docket under its statutory authority to regulate the caseloads 

of this state’s appellate courts.

[4] In addressing Steinhausen’s capacity to appeal, the 

Nebraska Supreme Court first addressed the representation 

of a business entity, specifically an LLC, by a layperson. The 

Supreme Court noted Neb. Rev. Stat. § 7-101 (Reissue 2012), 

which prohibits the practice of law by those not “previously 

admitted to the bar by order of the Supreme Court of this 

state.” The court also noted Neb. Rev. Stat. § 7-110 (Reissue 

2012), which provides that “[p]laintiffs shall have the liberty of prosecuting, and defendants shall have the liberty of 

defending, in their proper persons.” The court stated, “The 

prohibition of the unauthorized practice of law is not for the 

benefit of lawyers. Prohibiting the unauthorized practice of law 

protects citizens and litigants in the administration of justice 
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from the mistakes of the ignorant on the one hand and the 

machinations of the unscrupulous on the other.” Steinhausen 

v. HomeServices of Neb., 289 Neb. 927, 935, 857 N.W.2d 816, 

825 (2015). It stated further that a legal proceeding in which a 

party is represented by a person not admitted to practice law is 

a nullity and is subject to dismissal. Id.

[5] The Nebraska Supreme Court noted that the prohibition on representation by a layperson applies to entities, and 

it reviewed Nebraska case law previously applying that rule 

to find that a corporation, a partnership, and a trust must be 

represented by a member of the bar. The Supreme Court also 

observed that other courts have held that LLC’s, including 

those with a single member, must be represented in court by 

a licensed attorney. It then concluded that a licensed member 

of the Nebraska bar must represent a limited liability company 

in the courts of this state. Steinhausen, supra. In doing so, the 

court observed that LLC’s are entities distinct from their members, have the capacity to sue and be sued in their own name, 

are abstractions like corporations, and are a form of business 

entity conferring the significant privilege of limited liability on 

their members. The court declined to recognize an exception 

for LLC’s with a single member, stating that “having called 

into being a new juridical person, Steinhausen cannot ignore 

[the LLC’s] separate existence when it suits him.” Id. at 937, 

857 N.W.2d at 826.

[6-9] The Nebraska Supreme Court determined that any 

appeal by Steinhausen on behalf of the LLC was a nullity, 

but that he could prosecute an appeal in his own behalf. It 

noted that when a layperson appeals both in his or her own 

behalf and on behalf of a business entity, an appellate court 

dismisses the appeal as to the entity but considers the merits 

of the appeal as to the errors assigned by the layperson in his 

or her own behalf. Steinhausen, supra. Accordingly, the court 

also considered whether Steinhausen’s appeal was solely for 

the LLC, and in doing so, it noted the confusion as to the 

identity of the plaintiff or plaintiffs apparent on the face of the 

pleadings and other filings in the case. The court stated that 
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Cite as 29 Neb. App. 940

the character in which one is a party to a suit, and the capacity 

in which a party sues, is determined from the allegations of 

the pleadings and not from the caption alone. Id. If the capacity in which a party sues is doubtful, a court may examine 

the complaint, the pleadings as a whole, and even the entire 

record. Id. When the pleadings show a cause of action by a 

person in his individual capacity, a court may reject words 

indicating representative capacity. Id. The Supreme Court considered the parties’ arguments and examined the record as a 

whole before concluding that Steinhausen had brought the 

action and attempted to appeal on behalf of both himself and 

the LLC. The court dismissed his appeal on behalf of the LLC 

as a nullity and proceeded to consider the merits only of those 

assigned errors relating to claims Steinhausen could make in 

his own behalf.

The instant case also presents a situation where the pleadings and other filings reveal confusion as to the identity 

of a party below (here, the defendant or defendants). The 

district court determined that the complaint identified both 

“Aquatic Solutions” and “Drew Lefler” as defendants but that 

the small claims court entered judgment only against “Aquatic 

Solutions,” which was “some type of business entity,” and 

there was no monetary judgment against “Drew Lefler.” The 

district court concluded that while “Aquatic Solutions” had the 

right to appeal the judgment against it, the filings made on its 

behalf by “Mr. Lefler” were not proper as he was not a licensed 

attorney and thus its appeal was a nullity.

In response to this court’s order to show cause, Lefler filed 

an affidavit, in which he swore under oath that he operates 

Aquatic Solutions as a sole proprietorship and that Aquatic 

Solutions is not a separate legal entity. Lefler identified a 

Nebraska sales tax permit number and a federal “EIN.” Lefler 

asserted that he and Aquatic Solutions are the same party. He 

also attached a copy of a dealer finance application which identified Aquatic Solutions as a sole proprietorship.

[10] Black’s Law Dictionary defines “sole proprietorship” 

as “[a] business in which one person owns all the assets, owes 
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all the liabilities, and operates in his or her personal capacity.” Black’s Law Dictionary 1607 (10th ed. 2014). “A sole 

proprietorship has no separate legal existence or identity apart 

from the sole proprietor.” 18 C.J.S. Corporations § 4 at 353 

(2018). While we have found no Nebraska cases specifically 

defining “sole proprietorship,” both the Nebraska Supreme 

Court and this court have previously recognized that doing 

business under another name or several names does not create an entity separate and distinct from the person operating 

the business. Hall v. Auto-Owners Ins. Co., 265 Neb. 716, 658 

N.W.2d 711 (2003); Toulousaine de Distrib. v. Tri-State Seed 

& Grain, 2 Neb. App. 937, 520 N.W.2d 210 (1994). See, also, 

Duval v. Midwest Auto City, Inc., 425 F. Supp. 1381 (D. Neb. 

1977) (individual who does business as sole proprietor under 

one or several names remains one person, personally liable for 

all his or her obligations). Other courts have held that sole proprietorships may litigate pro se under the reasoning that a sole 

proprietorship has no legal existence separate from its owner. 

See, e.g., U.S. v. Hagerman, 545 F.3d 579 (7th Cir. 2008); 

RZS Holdings AVV v. PDVSA Petroleo S.A., 506 F.3d 350 (4th 

Cir. 2007); Lattanzio v. COMTA, 481 F.3d 137 (2d Cir. 2007); 

National Ind. Theatre v. Buena Vista Distribution, 748 F.2d 

602 (11th Cir. 1984); Dutch Village Mall v. Pelletti, 162 Wash. 

App. 531, 256 P.3d 1251 (2011); Lowery v. Hoffman, 188 

F.R.D. 651 (M.D. Ala. 1999).

[11] We find the foregoing authority persuasive. Because 

doing business under another name does not create an entity 

separate and distinct from the person operating the business, we conclude that the prohibition on representation by a 

layperson does not apply to a sole proprietorship where the 

owner of that entity is representing his or her own interests. 

We agree with the district court’s conclusions in this case that 

the only judgment in this case was entered against Aquatic 

Solutions and that Aquatic Solutions had the right to pursue the appeal of the judgment entered against it. The court 

read the complaint in this case as identifying two defendants, both “Aquatic Solutions” and “Drew Lefler.” A better 
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interpretation, when the record (including the filings on appeal 

to this court) is examined as a whole, might be to identify 

a single defendant, “Drew Lefler, doing business as Aquatic 

Solutions.” Regardless, it is clear that service was asked for 

and accomplished as to a single defendant, “Aquatic Solutions 

% Drew Le[f]ler,” and judgment was entered against a single 

defendant, “Aquatic Solutions.”

We have determined that the owner of a sole proprietorship 

may represent his or her interests pro se. If Aquatic Solutions 

is operated by Lefler as a sole proprietorship, the district court 

erred in dismissing the appeal from the small claims court 

as a nullity. While we have assumed that Aquatic Solutions 

was a sole proprietorship for purposes of the above analysis, based on Lefler’s affidavit filed in this court, the district 

court has not addressed that question. We reverse the district 

court’s dismissal of Lefler’s appeal and remand the cause for 

consideration of the question of whether Aquatic Solutions is 

operated by Lefler as a sole proprietorship. In addressing that 

question, the court may receive evidence limited to that issue. 

In the event that the evidence considered by the court shows 

that Aquatic Solutions is operated by Lefler as a sole proprietorship, the court is directed to consider the merits of Lefler’s 

appeal based on the record made in the small claims court.

CONCLUSION

We conclude that the district court erred in dismissing 

Lefler’s appeal from the small claims court judgment without considering Aquatic Solution’s form of business entity. 

Accordingly, we reverse the district court’s order and remand 

the cause for further proceedings consistent with this opinion.

Reversed and remanded for 

further proceedings.