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306 Nebraska Reports

REO ENTERS. v. VILLAGE OF DORCHESTER

Cite as 306 Neb. 683

REO Enterprises, LLC, a Nebraska limited 

liability company, appellee, v. Village of 

Dorchester, a Nebraska political 

subdivision, appellant, and 

Ange Lara, appellee.

___ N.W.2d ___

Filed August 7, 2020. No. S-18-970.

1. Ordinances. Interpretation of a municipal ordinance is a question 

of law.

2. Constitutional Law: Ordinances. The constitutionality of an ordinance 

presents a question of law.

3. Judgments: Appeal and Error. An appellate court independently 

reviews questions of law decided by a lower court.

4. Equal Protection. Equal protection requires the government to treat 

similarly situated people alike.

5. ____. Equal protection does not forbid classifications; it simply keeps 

governmental decisionmakers from treating differently persons who are 

in all relevant respects alike.

6. ____. When a classification created by governmental action does not 

jeopardize the exercise of a fundamental right or categorize because of 

an inherently suspect characteristic, equal protection requires only that 

the classification rationally further a legitimate state interest.

7. Constitutional Law: Ordinances: Presumptions. Courts begin with 

a presumption of validity when passing upon the constitutionality of 

an ordinance.

8. Equal Protection: Proof. Under the rational basis test, whether an equal 

protection claim challenges a statute or some other government act or 

decision, the burden is upon the challenging party to eliminate any reasonably conceivable state of facts that could provide a rational basis for 

the classification.

9. Equal Protection. The rational basis test, which is the most relaxed and 

tolerant form of judicial scrutiny of equal protection claims, is satisfied 

Nebraska Supreme Court Online Library

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

09/04/2020 09:09 AM CDT
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as long as (1) there is a plausible policy reason for the classification, 

(2) the legislative facts on which the classification is based may rationally have been considered to be true by the governmental decisionmaker, and (3) the relationship of the classification to its goal is not so 

attenuated as to render the distinction arbitrary or irrational.

10. Equal Protection: Records. In equal protection claims, where the 

record does not contain information regarding the adoption of an ordinance, statute, or other governmental action, courts analyze the underlying legislative facts the governmental entity alleged to have considered 

when such basis is clearly apparent.

11. Equal Protection: Ordinances: Proof. The burden is upon a party challenging an ordinance under an equal protection claim to eliminate any 

reasonably conceivable state of facts that could provide a rational basis 

for the classification.

12. Equal Protection: Legislature: Intent. Social and economic measures 

violate equal protection only when the varying treatment of different 

groups or persons is so unrelated to the achievement of any legitimate 

purposes that a court can only conclude that the Legislature’s actions 

were irrational.

13. Equal Protection. The rational basis test does not require a governmental entity to choose a specific course of action to address its legitimate interest.

14. Appeal and Error. An appellate court will not consider an issue on 

appeal that was not passed upon by the trial court.

15. Constitutional Law: Appeal and Error. A constitutional issue not 

presented to or passed upon by the trial court is not appropriate for consideration on appeal.

Appeal from the District Court for Saline County: Vicky 

L. Johnson, Judge. Reversed and remanded for further 

proceedings.

Kelly R. Hoffschneider, of Hoffschneider Law, P.C., L.L.O., 

for appellant.

Gregory C. Damman, of Blevens & Damman, for appellee 

REO Enterprises, LLC.

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

Papik, and Freudenberg, JJ.
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Nebraska Supreme Court Advance Sheets

306 Nebraska Reports

REO ENTERS. v. VILLAGE OF DORCHESTER

Cite as 306 Neb. 683

Funke, J.

The Village of Dorchester, Nebraska (Dorchester), appeals 

the district court’s order granting summary judgment for REO 

Enterprises, LLC (REO). In its order, the district court declared 

Dorchester’s ordinance No. 684 unconstitutional because it 

treated tenants and owners of property differently when applying for utility services by requiring tenants to obtain a landlord’s written guarantee that the landlord would pay any unpaid 

utility charges for the rented property. Dorchester claims that 

the district court erred in this declaration and that ordinance 

No. 684 does not violate the Equal Protection Clauses of the 

U.S. and Nebraska Constitutions. For the reasons set forth 

herein, we reverse the judgment and remand the cause to the 

district court for further proceedings.

BACKGROUND

REO is a Nebraska limited liability company which owns 

residential rental property in Dorchester. Prior to May 1, 2017, 

tenants who leased REO’s property applied for utility services 

with Dorchester, paid a deposit, and received water, sewer, and 

electrical services.

On May 1, 2017, Dorchester’s village board passed ordinance No. 684 mandating the use of village utility services and 

setting forth terms for billing, collection of bills, and discontinuance of service. As relevant to the instant case, “Section 

3-002: Consumer’s Application; Service Deposit” provides:

A. Every person or persons desiring utility services 

must make application therefor to the Village clerk, who 

shall require the applicant to make a service deposit and 

tap fees for water and sewer service in such amounts as 

set by resolution by the Village Board and placed on file 

at the Village office. . . . Utility services shall not be supplied to any house or private service pipe except upon the 

order of the utilities superintendent.

B. Before a tenant’s utility application will be accepted, 

the landlord shall be required to sign an owner’s consent 
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Cite as 306 Neb. 683

form and agree to pay all unpaid utility charges for his 

or her property.

In July 2017, Ange Lara entered into a lease agreement with 

REO for the rental of REO’s Dorchester property. Pursuant 

to this agreement, Lara contacted Dorchester’s village clerk 

to apply for utility services and paid a $250 deposit with this 

application. At that time, Lara was informed that there was a 

prior, unpaid utility bill associated with a prior renter of the 

property and that she would not receive the services until this 

bill was paid and REO signed a form titled “Owner’s Consent 

and Guaranty of Payment for Unpaid Utility Charges for 

Rental Property.”

Lara told a representative of REO about her interaction 

with the village clerk. An REO representative then contacted 

representatives of Dorchester and was informed of ordinance 

No. 684 and its requirement that REO sign the “Guaranty” 

before Lara could receive utility services for the property. The 

village clerk also reiterated the requirement that the prior tenant’s past-due bill be paid. REO responded to these requirements by asserting that ordinance No. 684 is invalid and that it 

would not sign the “Guaranty.”

Due to this noncompliance, Dorchester refused to provide 

Lara utility services at the property in Lara’s name. However, 

Dorchester did begin to provide services to the property 

through an account set up in an REO representative’s name. At 

the time of this action, Dorchester had retained Lara’s deposit 

and was continuing to provide utility services for the property, 

still occupied and leased by Lara, through the REO representative’s account.

In October 2017, REO filed a complaint seeking that the 

district court declare ordinance No. 684 void and unenforceable and order Dorchester to pay REO’s attorney fees and court 

costs. REO alleged four claims as follows: (1) Ordinance No. 

684 violated the Equal Protection Clauses of article 1, § 3, 

of the Nebraska Constitution and the 14th Amendment to the 

U.S. Constitution; (2) ordinance No. 684 violated the Equal 
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Cite as 306 Neb. 683

Credit Opportunity Act 1; (3) ordinance No. 684 violated the 

special legislation provision of article 3, § 18, of the Nebraska 

Constitution; and (4) ordinance No. 684 violated Nebraska’s 

Uniform Residential Landlord and Tenant Act. 2

Dorchester filed an answer which claimed, in part, that 

REO’s complaint failed to state a claim upon which relief 

could be granted and that REO’s claims were barred in whole 

or in part by the doctrine of unclean hands, laches, waiver, 

and estoppel.

In May 2016, REO filed a motion for summary judgment 

claiming there were no genuine issues of material fact and it 

was entitled to judgment as a matter of law. Dorchester, in turn, 

also filed a motion for summary judgment, agreeing there were 

no genuine issues of material fact and claiming it was entitled 

to judgment as a matter of law.

Following a hearing, the district court entered summary 

judgment for REO and overruled Dorchester’s motion. In its 

order, the court analyzed REO’s claim that ordinance No. 684 

violated the Equal Protection Clauses. First, the court found 

that residential tenants and owners of Dorchester property were 

similarly situated under ordinance No. 684 for equal protection 

purposes. The court noted that by requiring a landlord to be a 

cosigner to a tenant’s utility obligations, but not requiring a 

residential owner to obtain a third-party cosigner, ordinance 

No. 684 treated tenants and owners differently. The court then 

found there was not a rational relationship between the difference in treatment and Dorchester’s interest in collecting 

unpaid bills from tenants. Specifically, the court reasoned that 

Dorchester’s policy was applied to tenants irrespective of their 

creditworthiness and ability to pay without taking into account 

the tenants’ security deposits and the ability of Dorchester 

to impose liens on the rented property or provide other remedies to meet Dorchester’s offered goal. Thus, the court 

determined ordinance No. 684 unconstitutionally violated the 

1 15 U.S.C. § 1691 et seq. (2012).

2 Neb. Rev. Stat. §§ 76-1401 to 76-1449 (Reissue 2018).
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Equal Protection Clauses and, because it found this claim dispositive, did not discuss REO’s remaining claims.

ASSIGNMENT OF ERROR

Dorchester assigns, consolidated and restated, that the 

district court erred by finding that ordinance No. 684 violated the Equal Protection Clauses of the U.S. and Nebraska 

Constitutions.

STANDARD OF REVIEW

[1-3] Interpretation of a municipal ordinance is a question of 

law. 3 Similarly, the constitutionality of an ordinance presents 

a question of law. 4 An appellate court independently reviews 

questions of law decided by a lower court. 5

ANALYSIS

Equal Protection

[4-6] The Nebraska Constitution and the U.S. Constitution 

have identical requirements for equal protection challenges. 6

Equal protection requires the government to treat similarly situated people alike. 7 It does not forbid classifications; it simply 

keeps governmental decisionmakers from treating differently 

persons who are in all relevant respects alike. 8 When a classification created by governmental action does not jeopardize 

the exercise of a fundamental right or categorize because of 

an inherently suspect characteristic, equal protection requires 

only that the classification rationally further a legitimate 

state interest. 9

3 Wilkison v. City of Arapahoe, 302 Neb. 968, 926 N.W.2d 441 (2019).

4 Dowd Grain Co. v. County of Sarpy, 291 Neb. 620, 867 N.W.2d 599 

(2015).

5 Wilkison, supra note 3; Dowd Grain Co., supra note 4.

6 Lingenfelter v. Lower Elkhorn NRD, 294 Neb. 46, 881 N.W.2d 892 (2016).

7 Id.

8 Id.

9 Id.
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REO ENTERS. v. VILLAGE OF DORCHESTER

Cite as 306 Neb. 683

Ordinance No. 684 creates two classifications relevant to the 

instant action: (1) residential tenants and (2) residential owners. 

REO does not claim, and the district court did not find, that 

tenants are a suspect class or that ordinance No. 684’s difference in treatment affected a fundamental right. Additionally, we 

have not held that a specific application and collection structure 

for payment of utility services by tenants and landowners is a 

fundamental right. As such, and because the interests at issue 

are economic, we apply the rational basis test. 10

[7-9] This court begins with a presumption of validity 

when passing upon the constitutionality of an ordinance. 11

Accordingly, under the rational basis test, whether an equal 

protection claim challenges a statute or some other government 

act or decision, the burden is upon the challenging party to 

eliminate any reasonably conceivable state of facts that could 

provide a rational basis for the classification. 12 The rational 

basis test, which is the most relaxed and tolerant form of judicial scrutiny of equal protection claims, is satisfied as long 

as (1) there is a plausible policy reason for the classification, 

(2) the legislative facts on which the classification is based 

may rationally have been considered to be true by the governmental decisionmaker, and (3) the relationship of the classification to its goal is not so attenuated as to render the distinction 

arbitrary or irrational. 13

In this three-part analysis, we first consider the policy reason 

for the classification. 14 Under ordinance No. 684, Dorchester 

requires residential tenants to provide written guarantees 

from their landlords but does not require similar third-party 

guarantees for residential owners. In requiring the written 

10 See id.

11 DeCoste v. City of Wahoo, 255 Neb. 266, 583 N.W.2d 595 (1998).

12 State v. Montoya, 304 Neb. 96, 933 N.W.2d 558 (2019); Lingenfelter, 

supra note 6.

13 See Lingenfelter, supra note 6.

14 Id.
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guarantee, Dorchester claims it has a legitimate interest in 

maintaining a financially stable municipal utility by collecting from tenants who abscond without paying their bills 

when those bills are in excess of the tenant’s security deposit. 

Dorchester argues that requiring a landlord’s guarantee 

“‘remind[s] each landlord owner of its obligations and liability to . . . Dorchester and will further the goal of collection 

by reducing the possibility that . . . Dorchester will be faced 

with the administrative expenses associated with repeatedly 

resorting to cumbersome and expensive foreclosure or collection proceedings.’” 15

A village has the statutory authority to make and enforce 

all necessary rules and regulations in the use of its system of 

waterworks or water supply and the use of the water from such 

system. 16 Along with charges for the use of a village’s sewer 

system, 17 a village has the power to assess and collect from 

its inhabitants rates for the use and benefit of water used or 

supplied to them which includes the authority to enforce liens 

upon the real estate where the water and sewer system are used 

or supplied. 18 A village also has the authority to contract to 

furnish electricity to any person or corporation. 19

Pursuant to its authority to provide and charge for utility 

services, Dorchester has a legitimate interest in ensuring collection of accounts for these services. By requiring a landlord 

to guarantee any unpaid utility charges not paid by the tenant, 

Dorchester increases the likelihood that it will be able to collect payment for services with minimal additional collection 

costs even if the tenants move away and collection efforts 

from the tenants are unsuccessful. Such guarantee involves a 

third party who is tied to real estate located within Dorchester 

15 Brief for appellant at 13.

16 See Neb. Rev. Stat. § 17-537 (Cum. Supp. 2016).

17 See Neb. Rev. Stat. § 17-925.02 (Cum. Supp. 2016).

18 See Neb. Rev. Stat. § 17-538 (Cum. Supp. 2016).

19 See Neb. Rev. Stat. § 17-901 (Reissue 2012).
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and against whom collection may be more easily pursued. 

This consideration does not equally apply when determining 

whether to require a third-party guarantee from a residential 

landowner where the utility customer owns the land at issue 

and cannot as easily avoid his or her obligations without abandoning the property to its creditors. We find ensuring payment 

for utility services is a plausible policy reason for the classifications requiring landlords’ guarantees for tenants but not for 

residential owners.

[10] We next consider whether the legislative facts on which 

the classification is based may rationally have been considered 

to be true. 20 Where, as here, the record does not contain information regarding the adoption of an ordinance, statute, or other 

governmental action, we have analyzed the underlying legislative facts the governmental entity alleged to have considered 

when such basis is clearly apparent. 21

Dorchester claims by requiring a landlord guarantee for tenants and not requiring a third-party guarantee for residential 

owners, it was recognizing that tenants are less likely to be 

creditworthy than owners and that collection from tenants who 

moved away is more difficult than from owners who are tied 

to the property within the village. In support of these alleged 

facts, Dorchester provided an affidavit from Dorchester’s village clerk and treasurer. She explained that “[i]n the past, 

[Dorchester] spent substantial resources in trying to locate 

former residential tenant utilities customers that . . . left town 

with unpaid utility account obligations” and “collections agencies would be used to collect these unpaid utilities accounts 

[and] charge 50% of the amount collected.” She also described 

that there remains an unpaid utility bill on REO’s property in 

the previous tenant’s name and that the location of the previous 

tenant is unknown.

REO argues the affidavit should be viewed with skepticism 

in that it was conclusory and self-serving and failed to include 

20 Lingenfelter, supra note 6.

21 See id.
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specific information supporting its conclusion. REO contends 

that there is no evidence that Dorchester ever conducted a 

study or analysis of utility bill payment tendencies in order to 

establish that tenants were any more likely than property owners to fail to pay utility bills and, if so, at what level. REO’s 

argument is based upon the proposition that Dorchester had a 

burden to offer evidence in support of its alleged policy reason 

for the classification.

We first note the court granted summary judgment in favor 

of REO, and as such, Dorchester is entitled to have the evidence viewed in its most favorable light and have all reasonable inferences deducible from the evidence. 22

[11] Additionally, as stated above, the burden is upon REO 

as a party challenging the ordinance to eliminate any reasonably conceivable state of facts that could provide a rational 

basis for the classification. 23 The U.S. Supreme Court has 

explained, “A State . . . has no obligation to produce evidence 

to sustain the rationality of a statutory classification.” 24 The 

Court further explained, “‘[A] legislative choice is not subject to courtroom factfinding and may be based on rational 

speculation unsupported by evidence or empirical data.’” 25

Contrary to REO’s argument, Dorchester was not required 

to present evidence to support the classification under ordinance No. 684, and instead, REO had the duty to disprove 

Dorchester’s alleged factual basis or establish the facts were 

not reasonably conceivable.

As the district court correctly noted, individual residential tenants and owners are not intrinsically with or without 

creditworthiness. However, other jurisdictions have recognized 

22 See JB & Assocs. v. Nebraska Cancer Coalition, 303 Neb. 855, 932 

N.W.2d 71 (2019).

23 See, Montoya, supra note 12; Lingenfelter, supra note 6.

24 Heller v. Doe, 509 U.S. 312, 320, 113 S. Ct. 2637, 125 L. Ed. 2d 257 

(1993).

25 Id.
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an increased likelihood that an individual who rents a property may have less available reachable assets and resources 

than an owner who may have applied for and acquired debt to 

buy the property or had enough resources to buy the property 

outright. 26 When analyzing the underlying facts Dorchester 

relied on in enacting ordinance No. 684, the question is not 

whether such assertion is correct but whether it may rationally 

have been considered to be true. 27 Accordingly, the inherent 

increased likelihood of a tenant’s lack of creditworthiness compared to a residential owners’ creditworthiness is an appropriate consideration.

Even more compelling is Dorchester’s allegation that administrative and collection costs associated with unpaid utility bills 

are more likely to increase when seeking payment for services 

provided to tenants versus residential owners. Tenants are connected to the property through a lease agreement which means 

their connection with that property ceases when they are no 

longer acting under the agreement. Dorchester noted in the village clerk’s affidavit that, in the past, this lack of continuing 

connection with the property can result in Dorchester’s spending “substantial resources” in trying to locate the tenant to collect on unpaid services.

REO argues that Dorchester does not define “substantial 

resources” expended to locate and collect from tenants in contrast to residential owners. However, evidence of a study and 

a precise comparison is unnecessary to support Dorchester’s 

conclusion. 28 Residential owners own the property until they 

sell, abandon, or are removed. Dorchester, therefore, has a 

static source to contact and pursue collection from residential 

owners. It is rational to conclude that the costs associated 

26 See, Midkiff v. Adams County Reg. Water District, 409 F.3d 758 (6th Cir. 

2005); DiMassimo v. City of Clearwater, 805 F.2d 1536 (11th Cir. 1986); 

Chatham v. Jackson, 613 F.2d 73 (5th Cir. 1980).

27 See, Montoya, supra note 12; Lingenfelter, supra note 6.

28 See id. See, also, Heller, supra note 24.
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with locating a residential landowner is likely to be less than 

locating a previous tenant.

Finally, we must consider whether the relationship of the 

classification to its goal is so attenuated as to render the distinction arbitrary or irrational. 29

[12] The village clerk’s affidavit claims Dorchester has 

expended substantial resources in pursuing collection of unpaid 

utility accounts from tenants who have moved away, including 

costs associated with locating the tenants and collection agencies. Landlord guarantees help to ensure that Dorchester can 

minimize these costs because the landlords are more directly 

tied to property within Dorchester and the guarantees provide 

another party to account for the amounts due. Such a third-party 

guarantee does not equally apply to residential owners who do 

not have a landlord third-party relationship and are already tied 

to the serviced property. Social and economic measures violate 

equal protection only when the varying treatment of different 

groups or persons is so unrelated to the achievement of any 

legitimate purposes that a court can only conclude that the 

Legislature’s actions were irrational. 30 Here, we find ordinance 

No. 684’s treatment of tenants and residential owners was sufficiently related to Dorchester’s stated purpose so as not to 

render the distinction arbitrary or irrational.

In DeCoste v. City of Wahoo,

 31 the city enacted an ordinance which authorized collection of landfill management 

fees from city residents by adding the fees to the electrical bills of “‘all appropriate electrical customers.’” Because 

some city residents such as those within units of multiple-unit 

apartment complexes did not have individual electrical meters 

and electrical bills, a number of these residents did not have 

to pay the landfill management fees. 32 We determined this 

29 See Lingenfelter, supra note 6.

30 Citizens for Eq. Ed. v. Lyons-Decatur Sch. Dist., 274 Neb. 278, 739 

N.W.2d 742 (2007).

31 DeCoste, supra note 11, 255 Neb. at 271, 583 N.W.2d at 599.

32 Id.
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difference in treatment violated equal protection because the 

classifications did not rationally relate to the city’s objective of funding its landfill management. 33 We reasoned that 

whether or not a residence had an electrical meter did not 

relate to landfill management and was wholly irrelevant to the 

city’s stated objective. 34

The ordinance at issue in DeCoste is different than the landlord guarantee requirement under ordinance No. 684, which 

directly relates to Dorchester’s objective. Dorchester provides 

utility services to properties and charges for the services. 

Ordinance No. 684 requires that the property owners of the 

residences who are provided the services, including landlords 

and residential owners, agree to the responsibility for payment 

of these utility charges. Having a landlord guarantee increases 

the likelihood that these bills are paid.

REO argues the landlord guarantee requires a landlord to 

agree to cover unpaid bills for services the landlord will not 

receive. REO also claims allowing Dorchester to require a 

landlord guarantee would have far-reaching negative implications and allow municipalities and power districts to require 

similar guarantees for rented farmland, industrial land, and 

commercial land which could greatly increase the potential 

liability of those landlords.

This argument ignores the fact that a landlord receives a 

benefit from the property’s having access to and use of utility 

services in that a property which has access to utilities and in 

which this access is reliable and consistent has an increased 

property value. 35 The statutory scheme also assumes a property 

owner is a relevant party to the availability and use of utilities 

at a property in permitting the imposition of a lien against the 

owner’s property when a tenant fails to pay. 36 Finally, whether 

33 See id.

34 Id.

35 See Chatham, supra note 26.

36 See, § 17-925.02; § 17-538.
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ordinance No. 684 may influence other municipalities and 

power districts to require landlord guarantees which may have 

their own expanded implications is immaterial to the question 

of whether Dorchester’s landlord guarantee requirement furthers the legitimate interest of ensuring collection of accounts 

for the provision of utility services to Dorchester residents.

REO also argues Dorchester “is already adequately protected 

by its ability to require the tenant to make a deposit . . . to cover 

the last month’s bill and to place a lien on the property for any 

amounts that remain unpaid for water and sewer services after 

application of the deposit.” 37 REO contends Dorchester can 

further limit its potential risk of nonpayment over the deposit 

amount by promptly shutting off utility services when a tenant 

fails to pay.

[13] While Dorchester may have had alternate avenues to 

address its goal of ensuring payment of utility bills through 

higher security deposits and collecting from liens imposed on 

properties, the rational basis test does not require a governmental entity to choose a specific course of action to address 

its legitimate interest. REO has pointed to no authority under 

a rational basis review that would require a municipality to 

choose an individual means of pursuing its legitimate interest. 

Instead, the question remains whether the classification rationally furthers a legitimate state interest. 38

We find DiMassimo v. City of Clearwater 39 instructive. 

There, the 11th Circuit evaluated a requirement that a landlord 

join in a tenant’s application for utilities and found the requirement was obviously related to the city’s legitimate purpose of 

maintaining a financially stable municipal utility. The court 

explained that “a landowner, whose property is readily subject 

to liens and foreclosure may be rationally presumed to be more 

readily held to account as the ultimate guarantor of the bills 

37 Brief for appellee at 18.

38 See Lingenfelter, supra note 6.

39 DiMassimo, supra note 26.
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than a tenant who may freely abandon the lease, leaving behind 

only his outstanding debts.” 40 In addressing the plaintiff’s 

argument that the city already had adequate protection through 

liens and the ability to require greater security deposits, the 

court stated:

Requiring a landlord’s joinder in the application for utilities serves to remind each owner of his obligations and 

liability to the City and therefore, furthers the goal of 

collection by reducing the possibility that the City will 

be faced with the administrative expenses of repeatedly 

resorting to cumbersome and expensive foreclosure proceedings. A financial deposit sufficient to provide the City 

with the same degree of security would indeed be burdensome to any potential tenant. 41

REO cites Golden v. City of Columbus 42 and O’Neal v. City 

of Seattle 43 for the proposition that classifications and dispar

ate treatment of tenants and owners is not rationally related 

to a municipality’s interest in collecting unpaid utility debts. 

However, these cases are distinguishable because they involve 

whether a municipality could require a tenant to pay a previous, unpaid utility bill for the initiation and continuation of 

service even though the tenant had not received the previous 

service and had no previous relationship with the property. 44

In Golden, the Sixth Circuit analyzed a city policy where, 

after a tenant moved into a property which was already receiving water services, the city would terminate the services if 

the landlord owed for a prior tenant’s water usage. 45 The city 

would inform the tenant that water services would only recommence once the landlord satisfied that debt. The Golden court 

40 Id. at 1541.

41 Id. at 1542.

42 Golden v. City of Columbus, 404 F.3d 950 (6th Cir. 2005).

43 O’Neal v. City of Seattle, 66 F.3d 1064 (9th Cir. 1995).

44 Golden, supra note 42; O’Neal, supra note 43.

45 Golden, supra note 42.
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analyzed the equal protection claim solely with regard to the 

city policy’s irrationally differential treatment of tenants whose 

landlords owed the city for water service and other tenants 

whose landlords did not have such debt. The court found the 

policy violated equal protection because it treated tenants who 

moved into properties and whose owners were encumbered 

with preexisting utility debts differently from properties that 

were not. 46 The court expressed no opinion regarding the pol

icy’s differential treatment of landlords and tenants. 47 It is noteworthy that the court left undisturbed the city’s requirements 

that a tenant obtain a landlord’s consent prior to receiving 

utility services and that a property owner is liable for unpaid 

utility bills of a tenant. 48

Similarly, in O’Neal, the Ninth Circuit analyzed a city policy of refusing to provide water service to new tenants when 

there is a balance due for prior water service to the premises. 49

The O’Neal court also found the policy treated tenants differently based upon whether the properties were encumbered with 

preexisting utility debts. The court determined that this scheme 

was divorced from the reality of legal accountability for the 

debt because the person directly penalized by the scheme 

was not the debtor but an innocent third party with whom the 

debtor contracted.

Requiring a tenant to pay previous, unpaid utility bills to 

initiate or continue service where the tenant was not a party to 

those services nor connected to the property is different from 

Dorchester’s requirement that a tenant obtain the landlord’s 

guarantee prior to the initiation of service. Unlike the tenants 

in Golden and O’Neal, landlords are connected to the property 

for which the utilities are being provided and, as discussed, 

receive a benefit from the availability and use of utilities at 

46 Id. See, also, O’Neal, supra note 43.

47 Golden, supra note 42. See, also, Midkiff, supra note 26.

48 Golden, supra note 42.

49 O’Neal, supra note 43.
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Nebraska Supreme Court Advance Sheets

306 Nebraska Reports

REO ENTERS. v. VILLAGE OF DORCHESTER

Cite as 306 Neb. 683

their property. Landlords have agency in minimizing their risk 

by choosing a creditworthy tenant, mandating in the lease that 

the tenant promptly pay all utility bills, and terminating the 

lease should the tenant fail in that duty.

On this third consideration, we find Dorchester’s goal of 

ensuring the collection of utility accounts through a costeffective means is sufficiently related to, and not too attenuated 

from, ordinance No. 684’s requirement that a residential tenant 

obtain a landlord’s guarantee of payment while not requiring a 

residential owner to obtain a third-party guarantee.

In consideration of all of the above, we find that ensuring 

collection of utility bills was a plausible policy reason for 

requiring tenants to obtain landlord guarantees but not requiring residential owners to obtain third-party guarantees. We 

further find that this classification was based on facts which 

Dorchester could rationally have considered to be true and 

that the classification was sufficiently related to the goal of 

ensuring payment of utility bills so as not to render the treatment arbitrary or irrational. Accordingly, ordinance No. 684’s 

requirement that a residential tenant obtain a landlord’s guarantee for initiating utility services does not violate the Equal 

Protection Clauses of the U.S. and Nebraska Constitutions and 

the district court erred.

Additional Claims

Even though the district court declined to address REO’s 

remaining claims, REO asks that we address them on appeal, 

which claims include whether ordinance No. 684 violated 

the Equal Credit Opportunity Act; violated article 3, § 18, of 

the Nebraska Constitution; and violated Nebraska’s Uniform 

Residential Landlord and Tenant Act.

[14,15] An appellate court will not consider an issue on 

appeal that was not passed upon by the trial court. 50 As to 

constitutional claims specifically, we have held that a constitutional issue not presented to or passed upon by the trial 

50 Siedlik v. Nissen, 303 Neb. 784, 931 N.W.2d 439 (2019).
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Nebraska Supreme Court Advance Sheets

306 Nebraska Reports

REO ENTERS. v. VILLAGE OF DORCHESTER

Cite as 306 Neb. 683

court is not appropriate for consideration on appeal. 51 Based 

upon these established rules and REO’s failure to cross-appeal, 

we decline to address REO’s remaining claims on appeal and 

remand this cause to the district court for further consideration 

of the remaining claims.

CONCLUSION

Because the requirement under ordinance No. 684 that tenants must obtain a landlord guarantee in order to initiate utility 

services did not violate the Equal Protection Clauses of the 

U.S. and Nebraska Constitutions, we reverse the judgment of 

the district court and remand the cause for further proceedings 

to consider the remaining claims.

Reversed and remanded for 

further proceedings.

51 Capitol City Telephone v. Nebraska Dept. of Rev., 264 Neb. 515, 650 

N.W.2d 467 (2002).