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Nebraska Court of Appeals Advance Sheets

28 Nebraska Appellate Reports

MOSS v. ASSOCIATED UNDERWRITERS

Cite as 28 Neb. App. 739

Marjorie Moss, appellee, v. Associated 

Underwriters, Inc., et al., appellants.

___ N.W.2d ___

Filed August 18, 2020. No. A-19-380.

1. Corporations: Equity: Liability. Proceedings seeking disregard of a 

corporate entity, that is, piercing the corporate veil to impose liability 

on a shareholder for a corporation’s debt or other obligation, are equitable actions.

2. Equity: Appeal and Error. In an appeal of an equity action, an appellate court tries factual questions de novo on the record, reaching a conclusion independent of the findings of the trial court.

3. Evidence: Appeal and Error. Where credible evidence is in conflict 

on a material issue of fact, the appellate court considers and may give 

weight to the circumstances that the trial judge heard and observed the 

witnesses and accepted one version of the facts rather than another.

4. Damages. As a general rule, a party may not have double recovery for 

a single injury, or be made more than whole by compensation which 

exceeds the actual damages sustained.

5. Actions. Where several claims are asserted against several parties for 

redress of the same injury, only one satisfaction can be had.

6. Corporations: Liability: Appeal and Error. Generally, a corporation 

is viewed as a complete and separate entity from its shareholders and 

officers, who are not, as a rule, liable for the debts and obligations of 

the corporation.

7. Corporations: Fraud. A court will disregard a corporation’s identity 

only where the corporation has been used to commit fraud, violate a 

legal duty, or perpetrate a dishonest or unjust act in contravention of the 

rights of another.

8. Corporations. A corporation’s identity as a separate legal entity will 

be preserved, as a general rule, until sufficient reason to the contrary appears.

Nebraska Supreme Court Online Library

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

08/25/2020 01:08 AM CDT
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9. Corporations: Proof: Fraud. A plaintiff seeking to pierce the corporate veil must allege and prove that the corporation was under the 

actual control of the shareholder and that the shareholder exercised such 

control to commit a fraud or other wrong in contravention of the plaintiff’s rights.

10. Corporations: Liability: Proof: Fraud: Debtors and Creditors. A 

plaintiff seeking to impose liability for a corporate debt on a shareholder 

has the burden to show by a preponderance of the evidence that the 

corporate identity must be disregarded to prevent fraud or injustice to 

the plaintiff.

11. Trial: Evidence: Witnesses: Appeal and Error. All conflicts in the 

evidence, expert or lay, and the credibility of the witnesses are for the 

fact finder and not for the appellate court.

12. Corporations: Words and Phrases. Horizontal veil piercing occurs 

when a limited liability entity is considered to be the alter ego of another 

limited liability entity with the same owner.

13. Corporations: Debtors and Creditors. Under the concept of horizontal 

veil piercing, a creditor with a claim against one of the limited liability 

entities seeks to disregard corporate separateness between the entities to 

reach assets belonging to both.

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

analysis that is not necessary to adjudicate the case and controversy 

before it.

15. Costs: Appeal and Error. The decision of a trial court regarding taxing 

of costs is reviewed for an abuse of discretion.

16. Costs. Costs of litigation and expenses incident to litigation may not 

be recovered unless provided for by statute or a uniform course of 

procedure.

Appeal from the District Court for Sarpy County: Michael 

A. Smith, Judge. Affirmed in part, and in part reversed.

Kathryn J. Derr, of Berkshire & Burmeister, for appellants.

John P. Weis and Andrew Wurdeman, Senior Certified Law 

Student, of Wolfe, Snowden, Hurd, Ahl, Sitzmann, Tannehill & 

Hahn, L.L.P., for appellee.

Pirtle, Riedmann, and Bishop, Judges.
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MOSS v. ASSOCIATED UNDERWRITERS

Cite as 28 Neb. App. 739

Riedmann, Judge.

INTRODUCTION

The appellants appeal the judgment of the district court in 

favor of Marjorie Moss on her claims of piercing the corporate 

veil and successor liability. We reverse the award of $22,000 

of taxable costs awarded to Moss. However, finding no error 

in the court’s decision to pierce the corporate veil and hold the 

appellants jointly and severally liable, we otherwise affirm the 

district court’s judgment.

BACKGROUND

Moss was an employee of Associated Underwriters, Inc. 

(AU), and her employment was terminated in 2009. She filed 

a complaint in the U.S. District Court for the District of 

Nebraska alleging employment discrimination. In June 2015, 

a jury awarded her a judgment in the amount of $257,361.56 

plus interest, attorney fees, and costs of $138,720.92 for a total 

of $396,082.48.

After Moss was unable to recover from AU on the federal court judgment, she commenced the instant action in 

October 2016 in the district court for Sarpy County against 

AU; Relinco, Inc.; C-Tek Insurance Agency, Inc. (C-Tek); Roll 

the Bones, LLC; C-Notes, LLC; and Gregory Gurbacki, individually (collectively the appellants). In the causes of action 

relevant to the issues presented on appeal, Moss sought to hold 

the appellants liable for the federal court judgment against AU 

under the theories of piercing the corporate veil and successor liability.

A bench trial was held in November 2018. At the outset of trial, C-Notes was dismissed as a defendant, and trial 

proceeded against the remaining defendants. The evidence 

presented revealed that AU was incorporated in 1979 and 

operated as an independent insurance broker with contracts to 

sell property and liability insurance through several insurance 

companies. In 2007, Gurbacki and another individual became 

shareholders, officers, and directors of AU. Gurbacki became 

the sole shareholder in 2011.
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To fund the original stock purchase of AU, Gurbacki and his 

co-owner obtained a loan for $5.9 million. Security State Bank, 

along with several other banks, took over the loan in 2008. The 

loan was refinanced in 2010 and was personally guaranteed by 

Gurbacki. In December 2015, AU sold substantially all of its 

assets to Farmers National Company for $400,000 and ceased 

all business activity.

Roll the Bones was formed as a Nebraska limited liability 

company in 2008. Gurbacki was one of two original members, and he became the sole member in 2010. Roll the Bones 

obtained a loan of approximately $440,000 in 2008 to purchase 

a piece of real property. The note was guaranteed by AU and 

Gurbacki, individually. Roll the Bones initially made interestonly payments, using funds from the initial investments. Once 

that money was depleted, AU made the $500 per month payments, because it had guaranteed the note, and C-Tek made 

some payments on the note as well. The real property was 

sold in a foreclosure sale in 2015, leaving a deficiency balance owed to the bank. C-Tek paid the deficiency to the bank. 

Thereafter, Roll the Bones had no further business operations 

or assets.

Relinco was the largest producing asset of AU, operating 

under a managing general agent agreement with Travelers 

Indemnity Company. In 2011, Relinco was spun off into its 

own corporation for the sum of $300,000 plus the assumption of approximately $862,000 in debt directly related to 

the Relinco business. Gurbacki is the sole shareholder of 

Relinco. In 2012, Relinco was added as a co-borrower on AU’s 

Security State Bank loan. Relinco began paying management 

fees to AU of $33,000 per month in order to provide cash 

for AU to make the loan payments. Relinco also loaned additional money to AU beyond the management fees. Travelers 

Indemnity Company ended its contract with Relinco, causing 

Relinco to close in October 2014. As of December 2014, AU 

owed Relinco $529,000.

Gurbacki Insurance Services, Inc., was incorporated in 2004 

and changed its name to C-Tek in 2013. Gurbacki and his wife 
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each originally owned 33 percent of the shares of C-Tek stock, 

with the remaining shares divided between their two adult 

sons. As of January 2016, however, Gurbacki relinquished his 

shares of C-Tek, leaving his wife as the majority shareholder. 

Prior to December 1, 2015, C-Tek brokered insurance through 

AU for which it paid AU a commission.

In June 2014, AU and Relinco began to have difficulty making the loan payments to Security State Bank. Thereafter, as 

part of a restructuring settlement, C-Tek agreed to guarantee 

the loan to help AU. According to Gurbacki’s wife, adding 

C-Tek as a guarantor was the best option, because Gurbacki 

was personally obligated on the loan and because they wanted 

to get the loan paid in order to protect Gurbacki’s assets in the 

event of foreclosure. In January 2015, AU and Relinco began 

making interest-only payments, and as of June, the balance 

of the loan remained more than $4.2 million. In November, 

AU, Relinco, and C-Tek entered into a forbearance agreement with Security State Bank, wherein the bank agreed to 

accept $800,000 in satisfaction of the debt, and in exchange, 

Gurbacki, his wife, and C-Tek were released from the note. 

The $800,000 that AU paid was comprised of $400,000 from 

the sale of AU’s assets to Farmers National Company and 

$400,000 from C-Tek.

Chris Best, a certified public accountant, testified at trial, 

and his report was received into evidence. He testified that AU 

“was grossly inadequately capitalized” as of June 2015. As of 

June 30, AU had assets of approximately $279,000 and liabilities greater than $5 million.

Best opined that from a general accounting principle and 

best business practices point of view, AU, Relinco, and C-Tek 

were under the control of Gurbacki and did not treat each other 

as separate entities. According to Best, there were an inordinate number of intercompany transactions with companies 

making payments for other companies, assets being recorded 

in the books of one account and being transferred to another 

account, and the booking of intercompany receivables and 

payables. Then, when AU ultimately sold its assets to Farmers 
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National Company, there were significant remaining balances 

in those intercompany accounts, so the companies were never 

made whole in terms of what they should have received from 

AU or AU should have received from the other companies. In 

Best’s 40 years of experience, he has never seen commingling 

of accounts, interdependency of one entity on the operations of 

another entity, and interrelationship of companies in the manner and to the extent he saw here.

Specifically, with respect to C-Tek, Best opined that although 

it was a separate entity, the parties did not treat it as such. He 

explained that typically a corporation that is a separate entity 

does not pay the expenses of another entity and certainly does 

not make loan payments for that entity. He stated that the general ledger of C-Tek for the year ending December 31, 2018, 

shows more than 60 transactions in which AU paid expenses or 

made payments on notes for C-Tek. He testified he has never 

seen that done in any other company he has worked on; thus, 

in his opinion, that was very unusual and not in the ordinary 

course of business.

With regard to the Security State Bank loan, Best explained 

that the bank continued to add entities and take security 

interests in order to prevent AU from defaulting on the loan. 

Relinco’s assets, which were previously unencumbered, were 

pledged to the bank, and then C-Tek was brought in. Those 

actions were done so that AU did not default, which would 

result in the obligation falling to Gurbacki, personally. Best 

agreed that the forbearance agreement was a benefit to AU and 

Gurbacki, who was a personal guarantor on the loan, noting 

that the agreement itself indicates the parties’ acknowledgment 

that it was a personal benefit to Gurbacki.

Certified public accountant William Kenedy works for the 

accounting firm who prepared the tax returns for the corporations for years other than 2012 and 2013. He testified that in 

his experience, it is not uncommon to see companies owned 

by related parties making intercompany loans back and forth 

between entities. He opined that it is extremely common to see 
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intercompany transactions such as loans from one business to 

the other or one company buying goods or services from the 

other and having payables back and forth. In his opinion, if 

the companies have kept track of the intercompany loans, their 

actions do not constitute commingling of assets. He explained 

that commingling occurs where there are “two businesses 

operating out of one set of books,” which is not the case here. 

He did not believe that the level of intercompany transactions 

between AU, Relinco, and C-Tek was unusually high.

Subsequent to trial, the district court entered a written order. 

The court found that AU was grossly undercapitalized and 

insolvent at all relevant times. Even more evident to the court 

was the disregard of the corporate entities of AU, Relinco, 

C-Tek, and Roll the Bones. The court concluded that there 

were repeated instances of shifting of corporate assets and 

liabilities, with no real discernible benefit to any of the corporations. Further, it determined that there was evidence of 

corporate assets being made available for the use of Gurbacki 

or for the other entities he owned, as well as business dealings 

done in disregard of the business entities.

The court held that Gurbacki exercised control over all of 

the corporations; therefore, the corporate entities should be 

disregarded in order to avoid injustice. Accordingly, the court 

found in Moss’ favor as to the seventh cause of action (count 7) 

and the eighth cause of action (count 8) of the complaint, alleging piercing the corporate veil claims, as well as the successor 

liability claim alleged in the fifth cause of action (count 5). 

Judgment was entered against Gurbacki, AU, Relinco, C-Tek, 

and Roll the Bones, jointly and severally, in the amount of 

$396,082.48.

The appellants filed a motion to set a supersedeas bond, 

requesting that the district court set bond in the amount of 

$3,000. After holding a hearing on the motion, the court found 

that Gurbacki failed to prove that he was insolvent but that 

Moss met her burden of showing that Gurbacki was dissipating 

or diverting assets outside of the ordinary course of business 
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to avoid payment of a judgment. The court therefore determined that bond should be set at an amount sufficient to pay 

the judgment of $396,082.48, estimated interest of $27,000, 

and taxable court costs of approximately $22,000. Thus, 

the appellants were ordered to pay a total supersedeas bond 

of $445,000.

The appellants filed their notice of appeal, and as part of 

their appeal, they filed a motion to reduce the amount of the 

supersedeas bond. This court deducted the $22,000 the district 

court had included as taxable court costs and reduced the total 

bond amount to $423,000.

ASSIGNMENTS OF ERROR

The appellants assign, restated and renumbered, that the district court erred in (1) awarding a monetary judgment in favor 

of Moss against AU; (2) finding Gurbacki is the alter ego of 

AU on count 7; (3) finding Relinco, C-Tek, and Roll the Bones 

are the alter egos of Gurbacki on count 7; (4) finding Relinco, 

C-Tek, and Roll the Bones are the alter egos of AU on count 8; 

(5) finding Relinco, C-Tek, Roll the Bones, and Gurbacki are 

successors of AU on count 5; (6) setting a supersedeas bond for 

Gurbacki in the amount of $423,000; and (7) awarding Moss 

costs in the amount of $22,000.

STANDARD OF REVIEW

[1-3] Proceedings seeking disregard of a corporate entity, 

that is, piercing the corporate veil to impose liability on 

a shareholder for a corporation’s debt or other obligation, 

are equitable actions. Christian v. Smith, 276 Neb. 867, 759 

N.W.2d 447 (2008). In an appeal of an equity action, an appellate court tries factual questions de novo on the record, reaching a conclusion independent of the findings of the trial court. 

Id. Where credible evidence is in conflict on a material issue of 

fact, the appellate court considers and may give weight to the 

circumstances that the trial judge heard and observed the witnesses and accepted one version of the facts rather than another. 

Torres v. Morales, 287 Neb. 587, 843 N.W.2d 805 (2014).
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Cite as 28 Neb. App. 739

ANALYSIS

Monetary Judgment Against AU.

The appellants first argue that the district court erred in 

imposing a monetary judgment against AU. They claim that 

when considering the federal court judgment in Moss’ favor 

and the judgment in the instant case, AU is now liable to Moss 

on two separate judgments. We disagree.

[4,5] As a general rule, a party may not have double recovery 

for a single injury, or be made more than whole by compensation which exceeds the actual damages sustained. Vowers & 

Sons, Inc. v. Strasheim, 254 Neb. 506, 576 N.W.2d 817 (1998). 

Where several claims are asserted against several parties for 

redress of the same injury, only one satisfaction can be had. 

Id. However, since a party does not receive a double recovery 

until he or she has been made more than whole by damage 

payments, there can be no double recovery when a party has 

not fully recovered his or her losses. See Blue Cross and Blue 

Shield v. Dailey, 268 Neb. 733, 687 N.W.2d 689 (2004).

The rule against double recovery does not prevent entry of 

a second judgment, only double collection of the judgment. 

And in the present case, Moss has not recovered any damages 

from AU pursuant to the federal court judgment. The district 

court here held the appellants jointly and severally liable 

for the total judgment amount; thus, any or all of the appellants may be held liable for the entire damage. See Shipler v. 

General Motors Corp., 271 Neb. 194, 710 N.W.2d 807 (2006) 

(under joint and several liability, either tort-feasor may be held 

liable for entire damage). But Moss would not be permitted to 

recover more than the total amount of the judgment. Because 

Moss has not fully recovered her losses, there is no danger of 

double recovery at issue here, and there was nothing preventing the district court from entering judgment in her favor. We 

therefore reject this assigned error.

Alter Ego and Piercing Corporate Veil.

With regard to the corporate veil claims, the appellants 

assign that the district court erred in finding that Gurbacki 
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is the alter ego of AU on count 7; finding that Relinco, C-Tek, 

and Roll the Bones are the alter egos of Gurbacki on count 7; 

and finding that Relinco, C-Tek, and Roll the Bones are the 

alter egos of AU on count 8. The district court, however, did 

not make a finding that Relinco, C-Tek, and Roll the Bones are 

the alter egos of Gurbacki. Rather, the district court generally 

found in Moss’ favor on count 7 and count 8 of the complaint. 

In count 7, she sought to pierce the corporate veil of AU 

and hold Gurbacki personally liable for the judgment against 

AU. In count 8, Moss alleged that the corporate defendants, 

either through Gurbacki or on their own, exercised control 

over the financial and business practices of one another and 

that in order “[t]o prevent the misuse of the corporate forms 

of the Corporate Defendants to commit fraud and promote 

injustice, the Corporate Defendants’ corporate and LLC veils 

must be pierced to hold each Corporate Defendant individually 

liable for the debts and/or liabilities of the other Corporate 

Defendants to [Moss].” Based upon the evidence and theory 

presented at trial, we interpret this as a request to pierce the 

corporate veil of AU to hold the other corporate defendants 

liable. Thus, the question before us is whether the district court 

erred in finding that the corporate veil of AU should be pierced 

to hold Gurbacki personally liable and the other corporate 

defendants jointly and severally liable. We find no error in the 

court’s decision.

[6-8] Generally, a corporation is viewed as a complete and 

separate entity from its shareholders and officers, who are not, 

as a rule, liable for the debts and obligations of the corporation. Christian v. Smith, 276 Neb. 867, 759 N.W.2d 447 (2008). 

A court will disregard a corporation’s identity only where the 

corporation has been used to commit fraud, violate a legal 

duty, or perpetrate a dishonest or unjust act in contravention of 

the rights of another. Id. A corporation’s identity as a separate 

legal entity will be preserved, as a general rule, until sufficient 

reason to the contrary appears. Id.

[9,10] A plaintiff seeking to pierce the corporate veil must 

allege and prove that the corporation was under the actual 
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control of the shareholder and that the shareholder exercised 

such control to commit a fraud or other wrong in contravention of the plaintiff’s rights. Id. A plaintiff seeking to impose 

liability for a corporate debt on a shareholder has the burden 

to show by a preponderance of the evidence that the corporate 

identity must be disregarded to prevent fraud or injustice to the 

plaintiff. Id.

Some of the relevant factors in determining whether to disregard the corporate entity on the basis of fraud are (1) grossly 

inadequate capitalization, (2) insolvency of the debtor corporation at the time the debt is incurred, (3) diversion by the shareholder or shareholders of corporate funds or assets to their own 

or other improper uses, and (4) the fact that the corporation 

is a mere facade for the personal dealings of the shareholder 

and that the operations of the corporation are carried on by the 

shareholder in disregard of the corporate entity. Id.

The first element of the test, inadequate capitalization, 

means capitalization very small in relation to the nature of 

the business of the corporation and the risks entailed. Id. 

Inadequate capitalization is measured at the time of incorporation. Id. A corporation which was adequately capitalized 

when formed but which has suffered losses is not necessarily 

undercapitalized Id. Undercapitalization presents a question of 

fact that turns on the nature of the business of the particular 

corporation. Id.

In the case at hand, the record does not establish any 

evidence regarding undercapitalization at the time AU was 

incorporated in 1979. However, in United States Nat. Bank 

of Omaha v. Rupe, 207 Neb. 131, 296 N.W.2d 474 (1980), 

the Nebraska Supreme Court noted that the corporation was 

grossly undercapitalized when the sole shareholder acquired it. 

Here, Gurbacki acquired AU in 2007. Best testified that as of 

June 15, 2015, when Moss obtained her judgment, AU “was 

grossly inadequately capitalized.” He admitted, however, that 

he did not have an opinion as to the corporation’s status as of 

2007. There was no evidence as to AU’s capitalization at the 

time it was formed, and other than requiring unconventional 
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financing when purchased and being refinanced shortly thereafter, there was no evidence as to the corporation’s capitalization status as of 2007. Therefore, while we agree AU was 

undercapitalized as of 2015, we conclude that the district 

court’s finding that AU was undercapitalized “at all relevant 

times” was in error.

The second factor used to determine whether a corporation’s 

identity should be disregarded is whether the corporation was 

insolvent at the time the debt was incurred. Christian v. Smith, 

276 Neb. 867, 759 N.W.2d 447 (2008). A corporation is insolvent if it is unable to pay its debts as they become due in the 

usual course of its business, or if it has an excess of liabilities 

of the corporation over its assets at a fair valuation. Id. Whether 

a corporation is insolvent is usually a question of fact. Id. Here, 

it is undisputed that AU was insolvent in June 2015 when Moss 

obtained judgment against it. At trial, Gurbacki admitted that 

AU was insolvent at that time and that its debts exceeded its 

assets because of the Security State Bank loan. According to 

Best, at that time, AU’s liabilities exceeded its assets by more 

than $4 million.

The third factor of the test to determine whether the corporate veil should be pierced is evidence of a diversion by the 

shareholder or shareholders of corporate funds or assets to their 

own or other improper uses. Id. When a principal shareholder 

appropriates and uses corporate funds and property for his 

personal purposes and thereby defrauds and causes damages 

to creditors, the shareholder can be held individually liable for 

corporate debt. Id.

In Carpenter Paper Co. v. Lakin Meat Processors, 231 Neb. 

93, 435 N.W.2d 179 (1989), the Supreme Court held that Lakin 

Meat Processors, Inc., was a mere corporate shell, an alter 

ego of Charles E. Lakin, the majority shareholder, and that it 

must therefore disregard the corporate entity. In reaching this 

conclusion, the court noted that Lakin controlled the corporation’s every move and ran it as he saw fit and that the claimed 

separate identity was simply a series of complicated and innovative books and accounts. The Supreme Court found that 
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there was a unity of interest as far as Lakin and Lakin Meat 

Processors were concerned and reiterated that the separate 

entity concept of the corporation may be disregarded where 

the corporation is a mere shell, serving no legitimate business 

purpose, and is used as an intermediary to perpetuate fraud 

on the creditors. The Supreme Court concluded that Lakin’s 

manipulations of the business permitted him to, and he did, 

terminate the corporation for his own financial well-being to 

the prejudice of the corporation’s creditors.

Likewise, in the instant case, Gurbacki was in control of the 

corporations and there are multiple instances where Gurbacki 

used AU’s assets for his personal benefit. The evidence establishes that Roll the Bones secured a loan in 2008 in order to 

purchase a parcel of land. AU and Gurbacki, individually, 

guaranteed the note. The loan was refinanced in 2013. AU 

made payments on the note for Roll the Bones, and AU paid 

the deficiency after the land was sold in a foreclosure sale, 

without receiving any benefit from Roll the Bones. Gurbacki 

admitted that AU made the $500 per month payments for a 

while because it had guaranteed the note. Using AU’s assets to 

pay Roll the Bones’ obligation resulted in a personal benefit to 

Gurbacki, because he could have been held personally liable on 

the guarantee if Roll the Bones defaulted on its note.

In addition, Best testified that the general ledger of C-Tek 

for the year ending December 31, 2018, showed more than 

60 transactions in which AU was paying the expenses of or 

making payments on notes for C-Tek without receiving any 

benefit in return. Best testified that typically a corporation 

that is considered a separate entity does not pay the expenses 

of another entity and certainly does not make loan payments 

for that entity. Best further explained that the forbearance 

agreement, through which the Security State Bank loan was 

satisfied by using assets of C-Tek to the benefit of AU, was 

also a personal benefit to Gurbacki because he was a personal 

guarantor on that loan, and after the $800,000 was paid using 

funds from AU and C-Tek, Gurbacki was released from any 

obligation on the note.
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Finally, if the corporation is a facade for the personal dealings of the shareholder and the operations of the corporation 

are carried on by the shareholder in disregard of the corporate 

entity, the shareholder may be individually liable for corporate debt. Christian v. Smith, 276 Neb. 867, 759 N.W.2d 447 

(2008). The separate entity concept of the corporation may be 

disregarded where the corporation is a mere shell, serving no 

legitimate business purpose, and is used as an intermediary to 

perpetuate fraud on the creditors. Id.

Here, it is clear that Gurbacki was in control of AU, Relinco, 

C-Tek, and Roll the Bones. With regard to control, the appellants argue only that Gurbacki did not exercise control over 

C-Tek after January 2016. Thus, we need not discuss Gurbacki’s 

control over C-Tek prior to that date or his control over the 

other corporations. And despite the fact that Gurbacki was no 

longer a shareholder of C-Tek after January 2016, we conclude 

that he continued to exercise control over the financial decisions of the company.

Gurbacki’s wife testified multiple times that Gurbacki handled all of the financial aspects of C-Tek. Further, at the time 

of trial, Gurbacki was driving a luxury vehicle provided by 

C-Tek, despite the fact that he no longer had any ownership in 

the corporation, and his wife was unsure of the details of the 

transaction, other than that he had had the vehicle for less than 

3 years. At trial, Gurbacki was asked whether he was the one 

who made the financial decisions for C-Tek, and he responded 

that he worked with accountants and professional services for 

C-Tek, but that he and his wife would discuss the decisions and 

would talk about it “to this day.”

Significantly, according to Best, from a general accounting 

principle and best business practices point of view, the corporations did not treat each other as separate entities. He 

testified that there was an inordinate number of intercompany 

transactions and that in his 40 years of work, he had never 

seen commingling of accounts, interdependency of one entity 

on the operations of another entity, and interrelationship of 

companies the way he saw here. He said there were companies 
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making payments for other companies, assets being recorded 

in the books of one account and being transferred to another 

account, and the booking of intercompany receivables and 

payables. Then, when AU ultimately sold its assets to Farmers 

National Company, there were significant remaining balances 

in those intercompany accounts, so those companies were 

never made whole in respect to what they should have received 

from AU or what AU should have received from the other 

companies.

Specifically, AU paid off a note payable for C-Tek, made 

loan payments and credit card payments for C-Tek, and paid 

accounting and advertising expenses for C-Tek. Similarly, AU 

made note payments for Roll the Bones and paid certain 

expenses for Roll the Bones, including commissions and legal 

and accounting fees. Best explained that the corporations could 

claim to be separate entities, but they did not treat themselves 

that way. He pointed to the Security State Bank loan, where the 

assets of Relinco were pledged and then C-Tek was added as 

a guarantor on the note, to prevent AU from defaulting on the 

note and leaving the obligation to Gurbacki personally.

[11] We recognize that Best’s testimony was contradicted by 

the testimony of Kenedy. According to Kenedy, it is common 

to see intercompany transactions and the evidence here did not 

prove the commingling of assets. However, all conflicts in the 

evidence, expert or lay, and the credibility of the witnesses are 

for the fact finder and not for the appellate court. See Pierce 

v. Landmark Mgmt. Group, 293 Neb. 890, 880 N.W.2d 885 

(2016). Although the district court’s order did not mention Best 

by name in its findings, the court’s findings were more consistent with Best’s opinions than Kenedy’s; we therefore give 

weight to the district court’s assessment of the witnesses and 

give weight to Best’s opinions. Accordingly, when considering the evidence presented at trial, we conclude that three of 

the four factors set forth in Christian v. Smith, 276 Neb. 867, 

759 N.W.2d 447 (2008), are met here. As a result, the district 

court did not err in piercing the corporate veil of AU to hold 

Gurbacki liable for the judgment against AU.
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[12,13] The appellants also challenge the district court’s 

decision to hold Relinco, C-Tek, and Roll the Bones liable for 

AU’s judgment. They argue that they were unable to locate 

a case in which the Nebraska courts have imposed liability 

between sister corporations, a concept known as horizontal 

veil piercing. One court has defined horizontal veil piercing 

as occurring when a limited liability entity is considered to be 

the alter ego of another limited liability entity with the same 

owner. See In re Petters Company, Inc., 561 B.R. 738 (D. 

Minn. 2016). In this situation, a creditor with a claim against 

one of the limited liability entities seeks to disregard corporate 

separateness between the entities to reach assets belonging to 

both. Id.

Although not referring to this concept by name, the Supreme 

Court referenced such a situation in Hayes v. Sanitary & 

Improvement Dist. No. 194, 196 Neb. 653, 664, 244 N.W.2d 

505, 511-12 (1976), stating that

“the notion of separate corporate existence of parent and 

subsidiary or affiliated corporations will not be recognized where one corporation is so organized and controlled and its business conducted in such a manner as to 

make it merely an agency, instrumentality, adjunct, or alter 

ego of another corporation. The fiction of separate corporate identity of two corporations will not be extended to 

permit one of the corporations to evade its just obligations 

or to promote fraud or illegality or injustice.”

(Emphasis supplied.)

In Graham Graphics v. Baer Mktg. Internat., 10 Neb. App. 

382, 631 N.W.2d 550 (2001), this court relied on the abovequoted language to hold a corporation liable for the debt of a 

related corporation. The debtor was a subsidiary of the defendant Baer Marketing International, Inc. According to Baer Baer 

Marketing International, the proper defendant was actually an 

affiliated corporation, Baer Imports, Inc.; thus, the focus of our 

inquiry was which sister corporation was the proper defendant. In affirming the trial court’s decision, we highlighted that 
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the same company and same nucleus of individuals controlled 

Baer Marketing International and Baer Imports and concluded 

that the corporations were so closely tied and the management 

and financing so commingled that following the corporate 

form as Baer Marketing International suggested would lead to 

injustice. Id.

Similarly, in the present case, Gurbacki controlled AU, 

Relinco, C-Tek, and Roll the Bones. As discussed above, he 

intermixed and commingled the assets of the corporations, and 

their assets were used to benefit Gurbacki, personally, and each 

other. Gurbacki disregarded the corporate entities; thus, following the corporate form now to the detriment of Moss would 

lead to injustice. Accordingly, the district court did not err in 

holding Relinco, C-Tek, and Roll the Bones liable for the judgment against AU.

[14] Having concluded that the district court did not err 

in its findings regarding piercing the corporate veil, we need 

not consider whether the court’s decision regarding successor 

liability was erroneous. An appellate court is not obligated to 

engage in an analysis that is not necessary to adjudicate the 

case and controversy before it. Mays v. Midnite Dreams, 300 

Neb. 485, 915 N.W.2d 71 (2018).

Supersedeas Bond and Costs.

In their final assignments of error, the appellants assert 

that the district court erred in setting a supersedeas bond for 

Gurbacki in the amount of $423,000 and awarding Moss costs 

in the amount of $22,000. With respect to the amount of the 

supersedeas bond, the appellants challenge the district court’s 

factual finding under Neb. Rev. Stat. § 25-1916(1) (Reissue 

2016) that Gurbacki was dissipating or diverting assets outside the ordinary course of business to avoid the payment 

of a judgment. Given that we have now resolved the appeal, 

however, the issue of the proper amount of a supersedeas bond 

has become moot. See McCullough v. McCullough, 299 Neb. 

719, 736, 910 N.W.2d 515, 528 (2018) (“[b]ecause we have 

resolved the appeal the order sought to be stayed, the setting 
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of the supersedeas bond is a moot issue . . . , and we need 

not review the district court’s finding of fact”).

The appellants also seek a final ruling regarding the amount 

of taxable court costs the district court required them to pay. As 

indicated above, as part of their appeal, the appellants filed a 

motion to reduce the amount of the supersedeas bond, and this 

court deducted the $22,000 the district court had included as 

taxable court costs.

[15] When the district court sets the amount of a supersedeas 

bond, the court may include in its calculations “the taxable 

court costs in the district court” and “estimated amount of the 

costs of appeal.” § 25-1916(1)(a). The decision of a trial court 

regarding taxing of costs is reviewed for an abuse of discretion. 

City of Falls City v. Nebraska Mun. Power Pool, 281 Neb. 230, 

795 N.W.2d 256 (2011).

[16] The Supreme Court has held that costs of litigation and 

expenses incident to litigation may not be recovered unless 

provided for by statute or a uniform course of procedure. Id. 

Applying this principle, the Supreme Court has held that expert 

witness fees and expenses of making copies of depositions and 

enlargements of exhibits are not taxable court costs. See id. 

Similarly, this court has applied this principle in holding that 

photocopy, fax, and postage expenses are not taxable costs. 

See In re Estate of Snover, 4 Neb. App. 533, 546 N.W.2d 

341 (1996).

In the instant case, at the hearing, counsel for Moss entered 

into evidence his own affidavit. In that affidavit, counsel 

asserted that Moss “has incurred approximately $22,500.00 in 

fees and expenses.” Attached to the affidavit as an exhibit is 

a list of fees and costs incurred by Moss from October 2016, 

when her complaint was filed, to December 2018, just after 

the trial. These costs include expert witness fees, photocopy 

and postage expenses, and deposition costs. The district court 

included $22,000 in taxable court costs in its calculation of 

Gurbacki’s supersedeas bond. Because expert witness fees and 

photocopy, fax, and postage expenses are not taxable costs, 

the record does not support an inclusion of these costs in the 
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amount awarded. Accordingly, the district court abused its 

discretion in awarding Moss $22,000 in taxable costs, and we 

reverse the judgment in that regard.

CONCLUSION

We conclude that the district court abused its discretion in 

awarding $22,000 in taxable costs to Moss. The court did not 

err in piercing the corporate veil to hold the appellants liable 

for the judgment against AU, so the district court’s judgment is 

otherwise affirmed.

Affirmed in part, and in part reversed.