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NORTHEAST NEB. PUB. POWER DIST. v. NEBRASKA PUB. POWER DIST.

Cite as 24 Neb. App. 837

Northeast Nebraska Public Power Distr

appellee and cross-appellant, 

Nebraska Public Power Distr

appellant and cross-appell

___ N.W.2d ___

Filed June 27, 2017. No. A-16-309.

1. Contracts: Appeal and Error. The construction of a contract is a question of law, and is reviewed de novo.

2. Summary Judgment: Appeal and Error. An appellate court will affirm 

a lower court’s granting of summary judgment if the pleadings and 

admitted evidence show that there is no genuine issue as to any material 

facts or as to the ultimate inferences that may be drawn from the facts 

and that the moving party is entitled to judgment as a matter of law.

3. ____: ____. In reviewing a summary judgment, an appellate court views 

the evidence in the light most favorable to the party against whom the 

judgment was granted, and gives that party the benefit of all reasonable 

inferences deducible from the evidence.

4. Declaratory Judgments. A declaratory judgment action is ripe for judicial determination if the issue presented is fit for judicial determination 

and would result in significant harm if review were delayed.

5. Courts: Judgments: Damages. A court may proceed to the merits of 

a case where the issues presented are largely legal in nature, the issue 

may be resolved without further factual development, or judicial resolution will largely settle the parties’ dispute; and significant harm applies 

to both actual damages, pecuniary or otherwise, and also the heightened 

uncertainty and resulting behavior modification that may result from 

delayed resolution.

6. Pretrial Procedure: Appeal and Error. On a discovery issue, the district court’s ruling is reviewed for an abuse of discretion.

7. Contracts. The meaning of a contract and whether a contract is ambiguous are questions of law.

Nebraska Supreme Court Online Library

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

07/03/2017 09:10 AM CDT
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8. Contracts: Words and Phrases. A contract is ambiguous when a word, 

phrase, or provision in the contract has, or is susceptible of, at least two 

reasonable but conflicting interpretations or meanings.

9. Contracts. If the terms of a contract are clear, a court may not resort 

to rules of construction and must accord clear terms their plain and 

ordinary meaning as an ordinary or reasonable person would understand them.

10. ____. The fact that the parties suggest opposing meanings of a disputed instrument does not compel the conclusion that the instrument 

is ambiguous.

11. 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.

Appeal from the District Court for Wayne County: James G. 

Kube, Judge. Affirmed

Kile W. Johnson and Corey J. Wasserburger, of Johnson, 

Flodman, Guenzel & Widger, and John C. McClure, of 

Nebraska Public Power District, for appellant.

Steven D. Davidson and David C. Levy, of Baird Holm, 

L.L.P., for appellee.

Inbody, Riedmann, and Arterburn, 

Arterburn, Judg

INTRODUCTION

Nebraska Public Power District (NPPD) appeals and 

Northeast Nebraska Public Power District (Northeast) crossappeals from an order entered by the district court for Wayne 

County granting summary judgment in favor of Northeast and 

denying NPPD’s motion for summary judgment. On appeal, 

NPPD argues the district court erred in overruling NPPD’s 

motion to dismiss for lack of subject matter jurisdiction, overruling NPPD’s motion to compel, interpreting the relevant 

contract provisions, failing to find that equitable estoppel 

did not give rise to a cause of action, and granting summary 

judgment in favor of Northeast. On cross-appeal, Northeast 
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preserved its right to relief on its alternative claim alleging 

promissory estoppel as a matter of law. For the reasons set 

forth below, we affirm.

BACKGROUND

Northeast is a political subdivision of the State of Nebraska 

and a public power district engaged in the distribution of 

electricity to approximately 8,500 metered accounts in parts 

of Pierce, Thurston, Wayne, Dixon, and Dakota Counties. 

Northeast operates approximately 3,000 miles of electric 

lines and over 100 miles of high-voltage transmission lines 

in its service area. Northeast is governed by an elected board 

of directors.

NPPD is a political subdivision of the State of Nebraska and 

a public power district engaged in the generation and transmission of electricity at wholesale to numerous towns, public 

power districts, and cooperatives across Nebraska. NPPD is 

Nebraska’s largest wholesale electric utility.

Prior to January 1, 2015, Northeast was a member of the 

Nebraska Electric Generation and Transmission Cooperative, 

Inc. (NEG&T). NEG&T is a nonprofit cooperative of more 

than 25 Nebraska public power districts and nonprofit electric membership corporations, all of whom are wholesale 

customers of NPPD. NEG&T was formed, in part, to provide a single point of negotiation with NPPD on behalf of 

its members in order to obtain energy through a single contract between NEG&T and NPPD. As a member of NEG&T, 

Northeast satisfied all of its demand and energy requirements 

under a wholesale power agreement with NEG&T, which, in 

turn, purchased electricity at wholesale from NPPD. Under 

Northeast’s contract with NEG&T, Northeast did not have the 

right to limit or reduce the amounts of demand and energy 

it was obligated to purchase under the contract. Northeast 

had to withdraw from NEG&T if Northeast desired to limit 

and reduce its purchases of demand and energy requirements 

in order to purchase demand and energy requirements from 
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another wholesale provider. Upon withdrawing from NEG&T, 

Northeast was obligated under the wholesale power contract 

(WPC) to contract with NPPD for the remainder of the term 

of the WPC. Once contracted with NPPD under the WPC, 

Northeast could avail itself of the limit and reduction provisions contained in the WPC.

Northeast engaged an outside consultant to assist with issues 

regarding its potential transition from NPPD to a new wholesale electricity provider in 2013. There were 77 wholesale 

customers bound by the same WPC, either through individual 

contracts with NPPD or through the NEG&T cooperative contract. The WPC was originally implemented with most of those 

customers on January 1, 2002, for a term of 20 years. The 

NEG&T member agreement contract stated:

Beginning January l, 2008, and thereafter, pursuant 

to the terms of the Member Agreement, a Member may 

elect to limit or reduce its purchase of demand and 

energy from NEG&T; provided, a Member electing to 

limit or reduce its purchase of demand and energy from 

NEG&T may only do so upon notice of termination of its 

Member Agreement. Upon the effective termination date 

of the Member Agreement, the Member shall enter into an 

Individual Wholesale Power Contract with NPPD, a copy 

of which is attached hereto as Exhibit E, for the remainder of the 20-year term of this Contract, which Individual 

Wholesale Power Contract shall set forth the terms and 

conditions governing such limitation or reduction and 

which Individual Wholesale Power Contract shall be the 

same contract as is offered to other NPPD wholesale customers under similar conditions of service.

The WPC, in turn, provided that until January 1, 2008, the customer must purchase from NPPD the entire amount of demand 

and energy needed to service its customers. After January 

1, 2008, the WPC gave the customer the ability to limit and 

reduce its purchase of demand and energy from NPPD upon 

advanced written notice under a specified formula.
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Northeast withdrew from NEG&T at the end of 2014 and 

entered into the WPC with NPPD effective January 1, 2015. 

Northeast provided notice to NPPD of its intent to limit 

and reduce its purchases of demand and energy requirements 

under the WPC when it executed the WPC in January 2015. 

The WPC limit and reduction provision, which is the provision upon which Northeast requested declaratory relief in this 

action, stated:

Effective on and after the calendar year commencing January l, 20ll, Customer shall have the right, for 

any reason and with proper written notice, to reduce the 

amount of Demand and Energy it purchases from NPPD 

in any calendar year to levels below the Base Demand 

and Energy Obligation; provided, such notice(s) of reduction shall be given no earlier than January 1, 2008. 

Customer can reduce its monthly Demand and Energy 

obligations from NPPD in any such calendar year by an 

amount no greater than the product of (a) ten percent 

(10%) of the Customer’s Base Monthly Demand and 

Energy Obligation, multiplied by (b) the number of years 

between the effective date of the reduction and either (i) 

January 1, 2010, or (ii) one year prior to the ending date 

of a previous reduction, whichever is later; provided, 

however, in no event shall Customer be allowed to reduce 

to a level below ten percent (10%) of the Customer’s 

Base Monthly Demand and Energy Obligation prior to 

completion of the term of this Contract. Notification(s) 

to reduce purchases of Demand and Energy by thirty 

percent (30%) or less must be given by Customer to 

NPPD not less than three (3) calendar years prior to the 

effective date of such reduction. Notification(s) to reduce 

purchases of Demand and Energy by more than thirty 

percent (30%) must be given by Customer to NPPD not 

less than five (5) calendar years prior to the effective date 

of such reduction.
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In early 2013, Northeast retained its outside consultant to 

explore alternatives with respect to wholesale power suppliers. 

He began communicating with NPPD in order to determine 

the maximum reduction available in the shortest amount of 

time. In May 2013, NPPD’s vice president of customer services communicated to Northeast’s outside consultant that he 

understood the reduction paragraph to allow Northeast, with 

proper notice, to reduce its demand and energy purchases from 

NPPD at the rate of 30 percent per year for 3 consecutive 

years (30/30/30 method).

In June 2013, Northeast’s board of directors issued a request 

for proposals, soliciting proposals from potential suppliers 

of wholesale power. Northeast sent NPPD a copy of the 

request for proposals as a prospective bidder. In August 2013, 

Northeast’s general manager was authorized by the board of 

directors to issue notice to NEG&T of its intent to withdraw 

from the membership agreement. He issued this notice to 

NEG&T on October 28.

On November 1, 2013, NPPD communicated to Northeast’s 

outside consultant that after further review, NPPD no longer 

understood the reduction paragraph to permit the 30/30/30 

method of reduction. In late 2013, Northeast executed a purchase agreement with Big Rivers Electric Corporation (BREC) 

to purchase power at the maximum schedule of reduction 

from NPPD.

On June 23, 2014, Northeast filed an action for declaratory judgment in the district court. Northeast also filed an 

action for equitable estoppel to prevent NPPD from prohibiting Northeast from reducing in any manner other than the 

30/30/30 method. On July 24, NPPD filed a motion to dismiss 

on the basis of lack of subject matter jurisdiction. The district 

court overruled NPPD’s motion to dismiss on December 2.

On December 30, 2014, during the pendency of litigation, 

Northeast and NPPD executed the WPC, which had an effective date of January 1, 2015. Northeast sent formal notice 

that it intended to limit and reduce its purchase under the 
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contract and that its preferred means of reduction was the 

30/30/30 method.

During discovery, the district court entered a protective 

order that was stipulated to by both parties. The protective 

order provided that any material exchanged in the course of 

discovery and marked “‘Confidential’” would be limited in 

use to the purposes of litigation. Northeast provided NPPD 

with a redacted copy of its contract with BREC, and removed 

13 sections of the agreement. On June 9, 2015, NPPD filed 

a motion to compel the disclosure of the unredacted document. On August 14, the district court overruled the motion 

to compel.

Each party filed a motion for summary judgment in June 

2015. On January 19, 2016, the district court entered an order 

granting Northeast’s motion for summary judgment, in part, and 

overruling NPPD’s motion for summary judgment. The district 

court found that the reduction provision in the contract was 

unambiguous. The court concluded that the 30/30/30 method 

was the appropriate reduction method. The court declined to 

reach the promissory estoppel issue, finding it moot because 

Northeast obtained all the relief it requested on the contract 

claim. NPPD filed a notice of appeal on March 23.

ASSIGNMENTS OF ERROR

NPPD argues the district court erred in (1) overruling 

NPPD’s motion to dismiss for lack of subject matter jurisdiction, (2) overruling NPPD’s motion to compel, (3) interpreting 

the relevant contract provisions, (4) failing to find that equitable estoppel did not give rise to a cause of action, and (5) 

granting summary judgment in favor of Northeast. On crossappeal, Northeast preserved its right to relief on its alternative 

claim alleging promissory estoppel as a matter of law.

STANDARD OF REVIEW

[1-3] The construction of a contract is a question of law, 

and is reviewed de novo. Labenz v. Labenz, 291 Neb. 455, 
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866 N.W.2d 88 (2015). An appellate court will affirm a lower 

court’s granting of summary judgment if the pleadings and 

admitted evidence show that there is no genuine issue as to 

any material facts or as to the ultimate inferences that may be 

drawn from the facts and that the moving party is entitled to 

judgment as a matter of law. Pittman v. Western Engineering 

Co., 283 Neb. 913, 813 N.W.2d 487 (2012). In reviewing a 

summary judgment, an appellate court views the evidence in 

the light most favorable to the party against whom the judgment was granted, and gives that party the benefit of all reasonable inferences deducible from the evidence. Id.

ANALYSIS

Motion to Dism

NPPD argues that the district court erred in overruling its 

motion to dismiss for lack of subject matter jurisdiction. NPPD 

asserts that the district court should have dismissed the case 

because Northeast “sought an advisory opinion to determine 

whether its future actions would constitute a breach under a 

contract that had yet to be executed at the time the declaratory 

judgment action was filed.” Brief for appellant at 15. NPPD 

argues the case was not, and is not, ripe for judicial review. We 

find these assertions lack merit.

The Nebraska Supreme Court in City of Omaha v. City of 

Elkhorn, 276 Neb. 70, 752 N.W.2d 137 (2008), adopted a twostep analysis from the U.S. Court of Appeals for the Eighth 

Circuit to determine whether a declaratory judgment action 

was ripe. In Nebraska Public Power Dist. v. MidAmerican 

Energy, 234 F.3d 1032 (8th Cir. 2000), NPPD sought declaratory relief regarding the meaning of a contract provision 

addressing decommissioning payments for a MidAmerican 

Energy Company (MidAmerican) nuclear power facility. 

Certain payments were allegedly due only after MidAmerican 

made a contractual election to extend the time to decommission the facility, the deadline for which had not yet occurred. 

NPPD asked the court to interpret contractual duties that 
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would arise only if the election were made. As a result, 

MidAmerican contended that NPPD’s declaratory judgment 

claim was not ripe, and could not be ripe for adjudication until 

after the contractual election occurred. Id.

[4,5] The Eighth Circuit held that a declaratory judgment 

action is ripe for judicial determination if the issue presented 

is fit for judicial determination and would result in significant 

harm if review were delayed. The first prong of the test, fitness 

for judicial determination, goes to a court’s ability to visit an 

issue. Id. A court may proceed to the merits of a case where the 

issues presented are largely legal in nature, the issue may be 

resolved without further factual development, or judicial resolution will largely settle the parties’ dispute; and significant 

harm applies to both actual damages, pecuniary or otherwise, 

and also the heightened uncertainty and resulting behavior 

modification that may result from delayed resolution. Id. A 

party need not wait for actual harm to occur; however, both the 

immediacy and the size of the threatened harm must be significant. Id. A party seeking judicial relief must necessarily satisfy 

both prongs to at least a minimal degree. Id.

The court in MidAmerican Energy found the case ripe 

despite the fact that the triggering event for MidAmerican’s 

payment or nonpayment remained in the future. The court 

noted that the case presented primarily a legal question of 

contract interpretation about which the facts were already 

established, the resolution of which would largely resolve the 

dispute. Id. Moreover, delay would cause harmful uncertainty 

that would require NPPD to gamble millions of dollars on 

an uncertain legal foundation. Id. The insecurity caused by 

the parties’ contending interpretations of the contract worked 

a definite, tangible, and significant future harm, and even 

worked as a present harm on their ability to plan and conduct 

business operations. Id. Finally, the court found it significant 

that the case would not change if the court waited for the 

future contractual deadline to pass. The parties were 3 years 

from the decommissioning decision. If the court were to 
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withhold adjudication, the parties would have returned shortly, 

making precisely the same arguments, with nary a scintilla of 

additional relevant evidence. Id.

The present case presents an issue of contract interpretation where all relevant facts and contingencies have already 

occurred and the resolution of which will end the dispute. 

The current record confirms that Northeast has terminated the 

WPC with NEG&T, has entered into the required direct WPC 

with NPPD, and has provided the required advance contractual notice of its intention to limit and reduce its purchases. 

Northeast’s first reduction will occur on January l, 2018. All 

triggering events that define the legal issues and give context 

to the interpretation of the contract have already taken place. 

The contract is in force, requisite notices to limit and reduce 

have been given, and there is a clear and defined dispute about 

the parties’ rights in light of that notice. There is no remaining 

factual uncertainty and no future event yet to take place other 

than implementation of decisions already made. As a result, the 

legal issues of contract interpretation raised in this case are fit 

for determination now.

There is both a present significant potential harm, a nearly 

$1 million difference between the proposed reduction methods, and future uncertainty from an operational standpoint for 

Northeast. Absent resolution, Northeast will not know from 

whom, or in what amount, it will be purchasing demand and 

energy for its customers over a multiyear period. Logistical 

and business planning regarding Northeast’s operations would 

be significantly impacted. If this case were dismissed, the 

parties would return with the same contract provision dispute 

and nearly the same evidence. This case is ripe for review, 

and the district court did not err in denying NPPD’s motion 

to dismiss.

Motion to Comp

NPPD argues the district court erred in denying its motion 

to compel an unredacted version of the wholesale power 
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contract between Northeast and BREC. NPPD asserts that 

without an opportunity to verify or contradict Northeast’s 

claims with respect to the cost difference between the BREC 

and NPPD contracts, the district court deprived NPPD of 

important evidence which could have been dispositive in this 

case. We find these assertions lack merit.

[6] On a discovery issue, the district court’s ruling is 

reviewed for an abuse of discretion. See Roskop Dairy v. GEA 

Farm Tech., 292 Neb. 148, 871 N.W.2d 776 (2015). It is difficult to show that a party has been prejudiced by a discovery 

order, or that the question is not moot; and the harmless error 

doctrine, together with the broad discretion the discovery rules 

vest in the trial court, will bar reversal save under very unusual 

circumstances. Id.

The district court determined that whatever reduction 

method utilized involves a calculation of a percentage of 

energy purchase reduction under the contract between NPPD 

and Northeast. The court noted that there was some relevance 

in reviewing the contract between Northeast and BREC for 

establishing the materiality of contractual aspects which would 

help determine the ultimate costs to Northeast. However, the 

court determined that the potential harm of disclosing BREC’s 

contract to NPPD, one of its business competitors, outweighed 

the purpose for which NPPD sought the unredacted contract. 

The court determined that the redacted contract disclosed sufficient information in order for NPPD to defend its position 

in this case. After a review of the record, we find the district 

court did not abuse its discretion in denying NPPD’s motion 

to compel.

Contract Interpret

NPPD argues the district court erred in its contract interpretation finding that the 30/30/30 method was consistent 

with the plain language of the WPC. NPPD asserts that the 

unambiguous language of the WPC only allows successive 

reductions after the first year at a maximum of 10 percent per 
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year (30/10/10 method). Upon our review, we find this assertion lacks merit.

[7-11] The meaning of a contract and whether a contract is 

ambiguous are questions of law. Facilities Cost Mgmt. Group 

v. Otoe Cty. Sch. Dist., 291 Neb. 642, 868 N.W.2d 67 (2015). A 

contract is ambiguous when a word, phrase, or provision in the 

contract has, or is susceptible of, at least two reasonable but 

conflicting interpretations or meanings. Kasel v. Union Pacific 

R.R. Co., 291 Neb. 226, 865 N.W.2d 734 (2015). If the terms 

of a contract are clear, a court may not resort to rules of construction and must accord clear terms their plain and ordinary 

meaning as an ordinary or reasonable person would understand 

them. See id. The fact that the parties suggest opposing meanings of a disputed instrument does not compel the conclusion 

that the instrument is ambiguous. Id. When reviewing questions of law, an appellate court has an obligation to resolve the 

questions independently of the conclusion reached by the trial 

court. Facilities Cost Mgmt. Group, supra.

There is no question that the contract language in dispute is 

unnecessarily complicated. However, we find that there is only 

one reasonable interpretation of the contract. We, therefore, 

find that the contract is not ambiguous. According clear terms 

their plain and ordinary meaning, we find that the reduction 

provision at issue allows for the 30/30/30 method, commencing 

on January 1, 2018.

First, the parties agree that the maximum potential reduction 

under the WPC is 90 percent of the base obligation. The parties also agree that 3 years’ advance notice must be given to 

implement a reduction of 30 percent or less and that 5 years’ 

advance notice must be given to implement a reduction of 

more than 30 percent. Finally, the parties agree that Northeast 

can reduce its demand by 30 percent in its first year of reduction. The parties disagree on whether subsection (i) or subsection (ii) applies to the reductions proposed for 2019 and 2020. 

NPPD argues that subsection (i) is inapplicable after the initial 

reduction, so subsection (ii) must apply.
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NPPD argues that the phrase “(ii) one year prior to the ending date of a previous reduction, whichever is later,” should be 

fairly read to mean “‘ending date of a previous reduction level’ 

within the context of the reduction paragraph as a whole,” 

brief for appellant at 28. Therefore, after Northeast’s initial 

reduction of 30 percent of its demand, the subsequent reductions would be limited to 10 percent multiplied by the ending 

date of the previous reduction, which was 1 year for each 

subsequent reduction that Northeast had given advance notice. 

This is how NPPD arrived at its 30/10/10 method. In contrast, 

Northeast argues, and the district court found, that there was 

not an “ending date of a previous reduction,” therefore the limiting provision of subsection (ii) is inapplicable and subsection 

(i) applies.

Affording the plain and ordinary meaning as an ordinary 

or reasonable person would understand it, the phrase “(ii) 

one year prior to the ending date of a previous reduction, 

whichever is later,” we find that there is no “ending date of a 

previous reduction.” Northeast provided notice of continuous, 

cumulative, and maximum reductions of 30 percent annually 

to the maximum reduction level of 90 percent of its monthly 

base demand and obligation under the WPC. The district court 

found: “The ending of previous reduction cannot mean that 

the reduction continues to exist. To ‘end’ means to terminate; 

a cessation; a point beyond which something does not continue, or which ceases to exist.” We agree with the district 

court’s conclusion given the context of this contract that the 

ordinary meaning of the term “ending date” is the date on 

which a previous reduction ends. Here, the proposed reductions will not end. They will each remain in place through the 

duration of the contract’s term, which expires on January 1, 

2022. The original 30-percent reduction that begins in 2018 

will remain in place during 2019. Each additional reduction 

will be capped at 30 percent, and the total will be capped at 

90 percent per the reduction provision. Since there was no 

“ending date of a previous reduction,” subsection (ii) does not 
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come into effect, and thus subsection (i) was applicable for 

every notice. However, the notice requirement of the contract 

capped each years’ subsequent reduction to a 30-percent total, 

and at 90 percent from January 1, 2020, until the expiration 

of the WPC. Upon our review, we find that the district court 

did not err in its interpretation of the contract provisions and, 

therefore, did not err in granting summary judgment in favor 

of Northeast.

Remaining Assigne

On cross-appeal, Northeast preserved its right to relief on 

its alternative claim alleging promissory estoppel as a matter 

of law. NPPD argues that the district court should have found 

that equitable estoppel did not give rise to a cause of action, 

but can serve only as a defense.

The district court found that the equitable estoppel issue 

was moot, since it granted summary judgment on the contract 

claim to Northeast. We agree. Our findings above render this 

issue contained in the remaining assigned errors moot.

CONCLUSION

Upon our review, we find the district court did not err in 

overruling NPPD’s motion to dismiss for lack of subject matter 

jurisdiction. The district court did not err in overruling NPPD’s 

motion to compel. Additionally, the district court did not err in 

its interpretation of the relevant contract provisions. The district court did not err in granting summary judgment in favor of 

Northeast. Finally, our opinion regarding the contract’s meaning renders moot the remaining causes of action.

Affirmed