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Nebraska Supreme Court Advance Sheets

312 Nebraska Reports

REO ENTERS. V. VILLAGE OF DORCHESTER

Cite as 312 Neb. 792

REO Enterprises, LLC, a Nebraska limited 

liability company, appellant, v. Village 

of Dorchester, a Nebraska political 

subdivision, appellee.

___ N.W.2d ___

Filed November 4, 2022. No. S-21-752.

1. Summary Judgment: Appeal and Error. An appellate court will 

affirm a lower court’s grant 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.

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. Administrative Law: Statutes: Appeal and Error. The meaning 

and interpretation of statutes and regulations are questions of law for 

which an appellate court has an obligation to reach an independent 

conclusion irrespective of the decision made by the court below.

5. Appeal and Error. Plain error is error plainly evident from the record 

and of such a nature that to leave it uncorrected would result in damage 

to the integrity, reputation, or fairness of the judicial process.

6. Special Legislation. A legislative act constitutes special legislation if 

(1) it creates an arbitrary and unreasonable method of classification or 

(2) it creates a permanently closed class.

7. Special Legislation: Public Policy. To be valid, a legislative classification must be based upon some reason of public policy, some 

substantial difference in circumstances that would naturally suggest 

the justice or expediency of diverse legislation regarding the objects to 

be classified.

Nebraska Supreme Court Online Library

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

11/04/2022 09:04 AM CDT
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REO ENTERS. V. VILLAGE OF DORCHESTER

Cite as 312 Neb. 792

8. Special Legislation. Legislative classifications must be real and not 

illusive; they cannot be based on distinctions without a substantial 

difference.

9. ____. A legislative body’s distinctive treatment of a class is proper if 

the class has some reasonable distinction from other subjects of a like 

general character. And that distinction must bear some reasonable relation to the legitimate objectives and purposes of the legislative act.

Appeal from the District Court for Saline County: Vicky L. 

Johnson, Judge. Affirmed.

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

Kelly R. Hoffschneider and Timothy J. Kubert, of 

Hoffschneider Law, P.C., L.L.O., for appellee.

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

Papik, and Freudenberg, JJ.

Per Curiam.

The Village of Dorchester, Nebraska, enacted an ordinance 

providing that renters of property could receive utility services 

from the village only if their landlord guaranteed that the landlord would pay any unpaid utility charges. REO Enterprises, 

LLC (REO), an owner of rental property within the village, 

filed an action seeking a declaration that the ordinance was 

unenforceable for various reasons. The district court initially 

granted the relief REO sought, declaring that the ordinance 

violated the Equal Protection Clauses of the U.S. and Nebraska 

Constitutions. In an appeal filed by the village, however, we 

reversed the district court’s judgment on that question and 

remanded the cause for the district court to consider REO’s 

other claims. See REO Enters. v. Village of Dorchester, 306 

Neb. 683, 947 N.W.2d 480 (2020) (REO I). On remand, the 

district court found that the village was entitled to summary 

judgment on each of REO’s other claims. The case now returns 

to us, this time at the behest of REO. We find no error on the 

part of the district court and therefore affirm.
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Nebraska Supreme Court Advance Sheets

312 Nebraska Reports

REO ENTERS. V. VILLAGE OF DORCHESTER

Cite as 312 Neb. 792

BACKGROUND

The Ordinance.

The village enacted the ordinance at issue in this appeal in 

2017. The ordinance addresses the village’s provision of utility 

services, including water, sewer, and electricity. The ordinance 

requires that all residents of the village “subscribe to [the] 

[v]illage utility services” and provides terms for billing, collection of bills, and discontinuance of service.

The ordinance also sets forth the process by which persons 

may apply to receive utility services. Under the ordinance, 

an application for utility services must be submitted to the 

village clerk, who is to require payment of “a service deposit 

and tap fees for water and sewer service.” Of particular relevance to this appeal, the ordinance provides the following 

with respect to applications for utility services filed by renters of property: “Before a tenant’s utility application will be 

accepted, the landlord shall be required to sign an owner’s 

consent form and agree to pay all unpaid utility charges for 

his or her property.”

EO’s Complaint.

Several months after the ordinance was enacted, REO filed 

a lawsuit against the village in which it asked the district 

court to declare the ordinance unenforceable. In its complaint, 

REO alleged that when one of its tenants, Ange Lara, applied 

to receive utility services and paid the requested deposit, the 

village clerk told her that she would not be provided with 

such services until REO signed a guarantee as required by the 

ordinance. According to the complaint, when REO informed 

the village that it would not sign the guarantee, the village provided utility services to the property, but through an account 

held by a member of REO rather than through an account 

in Lara’s name. Although REO’s complaint named Lara as a 

third-party defendant, nothing in our record indicates that Lara 

has participated in the proceedings as a party.
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REO ENTERS. V. VILLAGE OF DORCHESTER

Cite as 312 Neb. 792

REO’s complaint alleged that the ordinance was unconstitutional and in violation of state and federal statutes. REO 

alleged that the ordinance violated the Equal Protection Clauses 

of the U.S and Nebraska Constitutions, as well as article III, 

§ 18, of the Nebraska Constitution. It also alleged that the 

ordinance violated the federal Equal Credit Opportunity Act, 

see 15 U.S.C. § 1691 et seq. (2018), and Nebraska’s Uniform 

Residential Landlord and Tenant Act, see Neb. Rev. Stat. 

§§ 76-1401 to 76-1449 (Reissue 2018 & Supp. 2021). REO 

asked the district court to declare that the ordinance was void 

and unenforceable on each of these grounds.

Summary Judgment Evidence.

REO and the village eventually filed cross-motions for summary judgment. At the summary judgment hearing, the district 

court received an affidavit from the village clerk, Gloria Riley. 

In her affidavit, Riley asserted that she was responsible for 

managing utility accounts for the village. Riley stated that a 

previous renter of the property REO rented to Lara failed to 

pay a utility bill of over $500 and that the residency of that 

former tenant was unknown. She also stated that the village 

“has spent substantial resources in trying to locate former 

residential tenant utilities customers that have left town with 

unpaid utility account obligations” and that the village had 

previously used collection agencies to assist in pursuing a 

recovery for these unpaid bills, but that such agencies would 

charge 50 percent of the amount collected. According to Riley, 

the ordinance was adopted to “further the goal of collection 

by reducing the possibility that [the village] will be faced 

with the administrative expenses associated with repeatedly 

resorting to cumbersome and expensive foreclosure or collection proceedings.”

The district court also received an affidavit of Lara. Lara’s 

affidavit was consistent with the allegations in REO’s complaint regarding the village’s response to Lara’s application 

for utility services.
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REO ENTERS. V. VILLAGE OF DORCHESTER

Cite as 312 Neb. 792

Initial District Court Order 

and First Appeal.

After the hearing on the motions for summary judgment, 

the district court entered an order granting summary judgment 

in favor of REO. In its order, the district court found that the 

ordinance violated the Equal Protection Clauses of the U.S. 

and Nebraska Constitutions. It reasoned that the ordinance 

treated residential owners of property and residential tenants 

differently and that there was no rational relationship between 

the difference in treatment and the village’s interest in collecting unpaid utility bills. The district court did not address the 

other grounds REO offered in support of its request that the 

ordinance be declared invalid.

The village appealed the district court’s decision, and we 

reversed. We held that although the ordinance classified residential tenants and residential owners separately, the classification was subject to and satisfied rational basis scrutiny and thus 

did not violate the Equal Protection Clauses of the U.S. and 

Nebraska Constitutions. We found that ensuring the collection 

of utility bills was a plausible policy reason for the requirement 

that renters obtain a landlord guarantee and that the differential 

treatment of renters and owners was sufficiently related to the 

goal of ensuring payment of utility bills so as not to render 

the treatment arbitrary or irrational.

Proceedings on Remand.

After receiving and spreading our mandate in REO I, the 

district court entered an order addressing REO’s other claims. 

It found that the village was entitled to summary judgment 

on each of those claims and thus granted the village’s motion 

for summary judgment, overruled REO’s motion for summary 

judgment, and dismissed the case.

REO timely appealed. We moved the case to our docket 

on our own motion pursuant to Neb. Rev. Stat. § 24-1106(3) 

(Cum. Supp. 2020).
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REO ENTERS. V. VILLAGE OF DORCHESTER

Cite as 312 Neb. 792

ASSIGNMENTS OF ERROR

REO assigns that the district court erred by finding that 

the ordinance (1) did not violate article III, § 18, of the 

Nebraska Constitution, (2) did not violate the federal Equal 

Credit Opportunity Act, and (3) was not void as against the 

public policy of Nebraska. REO also assigns that the district 

court committed plain error by finding that the village had 

statutory authority to enact the ordinance.

STANDARD OF REVIEW

[1] An appellate court will affirm a lower court’s grant 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. D-CO, Inc. v. City of La Vista, 285 Neb. 676, 829 N.W.2d 

105 (2013).

[2,3] The constitutionality of an ordinance presents a question of law. Dowd Grain Co. v. County of Sarpy, 291 Neb. 

620, 867 N.W.2d 599 (2015). An appellate court independently 

reviews questions of law decided by a lower court. Id.

[4] The meaning and interpretation of statutes and regulations are questions of law for which an appellate court has 

an obligation to reach an independent conclusion irrespective of the decision made by the court below. In re App. No. 

P-12.32 of Black Hills Neb. Gas, 311 Neb. 813, 976 N.W.2d 

152 (2022).

[5] Plain error is error plainly evident from the record and 

of such a nature that to leave it uncorrected would result in 

damage to the integrity, reputation, or fairness of the judicial 

process. North Star Mut. Ins. Co. v. Miller, 311 Neb. 941, 977 

N.W.2d 195 (2022).

ANALYSIS

Special Legislation.

REO first claims that the district court should have declared 

the ordinance unenforceable on the grounds that it violates 
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REO ENTERS. V. VILLAGE OF DORCHESTER

Cite as 312 Neb. 792

article III, § 18, of the Nebraska Constitution. The text of 

article III, § 18, prohibits “[t]he Legislature” from “pass[ing] 

local or special laws” in a set of enumerated circumstances. 

The section concludes, “In all other cases where a general law 

can be made applicable, no special law shall be enacted.” Id. 

We have described article III, § 18, as generally prohibiting 

“special legislation.” Big John’s Billiards v. State, 288 Neb. 

938, 944, 852 N.W.2d 727, 734 (2014). We have said that the 

special legislation prohibition applies to municipal ordinances. 

See, e.g., D-CO, Inc., supra.

[6] So what exactly is it that article III, § 18, prohibits? Our 

precedent holds that a legislative act constitutes special legislation if (1) it creates an arbitrary and unreasonable method 

of classification or (2) it creates a permanently closed class. 

D-CO, Inc., supra. REO’s sole argument is that the ordinance 

creates an arbitrary and unreasonable classification, so we next 

turn our attention to the tests we have developed to identify 

such classifications.

[7-9] In order to withstand a special legislation challenge, 

i.e., to be valid, a legislative classification must be based 

upon some reason of public policy, some substantial difference 

in circumstances that would naturally suggest the justice or 

expediency of diverse legislation regarding the objects to be 

classified. Id. Legislative classifications must be real and not 

illusive; they cannot be based on distinctions without a substantial difference. Id. A legislative body’s distinctive treatment 

of a class is proper if the class has some reasonable distinction 

from other subjects of a like general character. Id. And that 

distinction must bear some reasonable relation to the legitimate 

objectives and purposes of the legislative act. Id.

REO argues that by requiring only renters’ applications for 

utility services to be supported by the guarantee of a third 

party, the ordinance treats renters differently than it treats 

owners. And it argues that there is no substantial difference in 

circumstances between renters applying for utility services and 

owners doing the same that justifies the differential treatment. 
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REO ENTERS. V. VILLAGE OF DORCHESTER

Cite as 312 Neb. 792

REO observes that some renters may be very creditworthy 

while some owners may have very poor credit, and thus argues 

that requiring only renters’ applications to be supported by a 

guarantee is arbitrary.

If the village was attempting to defend the ordinance based 

on a claim about the relative creditworthiness of renters and 

owners of property, REO’s argument might have some force. 

But, in fact, the village does not claim that the ordinance 

is justified based solely on a difference in creditworthiness 

between those two groups. Instead, the village’s argument 

and Riley’s affidavit focus on the time and expense associated with collecting unpaid utility bills from renters. As noted 

above, Riley’s affidavit stated that the village had spent substantial resources trying to locate former renters of property 

with unpaid utility bills and had resorted to using collection 

agencies that would take half of any amount collected. The 

ordinance’s requirement of a landlord guarantee, according to 

Riley, was intended to minimize the time and expense associated with those efforts.

We agree with the village that there is a substantial difference 

in circumstances between renters and owners as to the time and 

expense that are likely necessary to collect unpaid utility bills. 

On this point, we find our opinion in REO I instructive. In the 

course of our equal protection analysis in that case, we found 

compelling the village’s assertion 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.” REO I, 306 Neb. 683, 693, 

947 N.W.2d 480, 488 (2020). We observed that tenants are 

connected to the property through only a lease agreement and 

that their connection to the property thus ceases when they 

are no longer acting under the agreement, while owners are 

more “tied” to the serviced property and thus provide a “static 

source” that can be more easily contacted and from which 

collection can be more easily pursued. Id. at 693, 694, 947 

N.W.2d at 488. We also noted that a landlord guarantee could 
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REO ENTERS. V. VILLAGE OF DORCHESTER

Cite as 312 Neb. 792

help the village minimize collection costs, because the guarantee provides another party to account for amounts due, but 

concluded that “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 propert y.” Id. 

at 694, 947 N.W.2d at 488.

Although the foregoing analysis was conducted in the context of an equal protection challenge in REO I, we find it also 

supports the conclusion that there is a substantial difference 

in circumstances between renters and owners that justifies the 

ordinance’s differential treatment of the two groups. We have 

previously acknowledged that special legislation analysis is 

similar to an equal protection analysis and that, in some cases, 

both issues can be decided on the same facts. See Hug v. City 

of Omaha, 275 Neb. 820, 749 N.W.2d 884 (2008). As a result, 

language normally applied to an equal protection analysis is 

sometimes used to help explain the reasoning employed under 

a special legislation analysis. Id. That is the case here.

We are not dissuaded from our conclusion that the ordinance 

did not violate article III, § 18, by an alternative argument 

raised by REO challenging the adequacy of Riley’s affidavit. 

In support of this argument, REO compares Riley’s affidavit to 

a commissioned study a municipality offered in defending an 

ordinance regulating rental properties against a special legislation challenge in D-CO, Inc. v. City of La Vista, 285 Neb. 676, 

829 N.W.2d 105 (2013). REO also contends that Riley’s affidavit failed to compare the resources the village had expended 

pursuing unpaid utility bills of renters to unpaid utility bills 

of property owners and failed to consider the effectiveness of 

other means the village could have used to recover renters’ 

unpaid utility bills, such as requiring deposits or pursuing liens 

imposed on the property.

We disagree with REO’s contention that Riley’s affidavit 

was inadequate. Although the municipality in D-CO, Inc., 

supra, relied on a commissioned study, our opinion in that 

case did not require that type of evidence in every special 
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REO ENTERS. V. VILLAGE OF DORCHESTER

Cite as 312 Neb. 792

legislation challenge. Moreover, in that case, we relied on 

more than just the commissioned study to determine that there 

were substantial differences in circumstances between rental 

properties and owner-occupied properties that justified the 

municipality’s rental property regulations. The study did not 

specifically show that rental properties within the municipality were dilapidated, but we relied on evidence of complaints 

the municipality received about the condition of some rental 

properties and of code violations it had found in some rental 

properties. This anecdotal evidence is not unlike the evidence 

set forth in Riley’s affidavit.

We also disagree with REO that the village was required 

to offer evidence comparing the resources it had expended 

attempting to collect unpaid utility bills from renters as opposed 

to owners or show that it had considered the effectiveness of 

other potential means of pursuing renters’ unpaid utility bills. 

REO’s argument that this information was required overlooks 

aspects of our special legislation doctrine. Even assuming the 

village had also invested significant time and money in pursuing unpaid utility bills associated with owner-occupied properties, our special legislation jurisprudence would not preclude it 

from attempting to minimize the resources it must expend to 

pursue renters’ unpaid utility bills. As we said in D-CO, Inc., 

in response to an argument that there were also maintenance 

problems associated with owner-occupied properties in the 

relevant municipality, government entities are “not required to 

solve every problem at once.” 285 Neb. at 685, 829 N.W.2d 

at 112.

In addition, even if the village may have had other means 

at its disposal to pursue renters’ unpaid utility bills, it does 

not follow that the ordinance is prohibited special legislation. As we have explained, the special legislation inquiry 

is focused on whether the distinctive treatment of classes is 

based on a substantial difference in circumstances between 

the classes that justifies the distinctive treatment. Because 

we find that there was such a substantial difference here, we 
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REO ENTERS. V. VILLAGE OF DORCHESTER

Cite as 312 Neb. 792

conclude that REO’s special legislation challenge to the ordinance fails.

Equal Credit Opportunity Act.

We next consider REO’s contention that the ordinance is 

unenforceable because it violates the federal Equal Credit 

Opportunity Act (ECOA). The ECOA prohibits creditors from 

discriminating against applicants for credit on various bases. 

See 15 U.S.C. § 1691(a). REO’s argument that the ordinance 

violates the ECOA is based on a regulation promulgated to 

enforce that statute. The regulation REO relies upon provides 

that creditors may not generally require “the signature of an 

applicant’s spouse or other person” on a credit instrument “if 

the applicant qualifies under the creditor’s standards of creditworthiness for the amount and terms of the credit requested.” 

12 C.F.R. § 1002.7(d)(1) (2021). REO contends that when a 

renter applies to receive utility services from the village, he or 

she is applying for credit. And because the ordinance requires 

that the renter’s application be supported by the guarantee of 

his or her landlord without any consideration of the renter’s 

creditworthiness, REO argues that the ordinance violates the 

ECOA. As we will explain, however, it is not necessary for 

us to determine whether the ordinance is inconsistent with 

the ECOA, because REO was not entitled to seek relief under 

that act.

REO claims that a provision of the ECOA, 15 U.S.C. 

§ 1691e(c), authorized it to ask the district court to declare the 

ordinance invalid. Section 1691e(c) of the ECOA provides that 

“[u]pon application by an aggrieved applicant, the appropriate 

United States district court or any other court of competent 

jurisdiction may grant such equitable and declaratory relief as 

is necessary to enforce the requirements imposed under this 

subchapter.” REO focuses on the language authorizing courts 

of competent jurisdiction to grant equitable and declaratory 

relief, but it glosses over the fact that § 1691e(c) authorizes 

only an “aggrieved applicant” to seek such relief.
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REO ENTERS. V. VILLAGE OF DORCHESTER

Cite as 312 Neb. 792

The ECOA defines an “applicant” as “any person who 

applies to a creditor directly for an extension, renewal, or continuation of credit, or applies to a creditor indirectly by use of 

an existing credit plan for an amount exceeding a previously 

established credit limit.” 15 U.S.C. § 1691a(b). For present 

purposes, we will assume for the sake of argument that when 

a person applies to the village to receive utility services, he 

or she is requesting an extension of credit for purposes of the 

ECOA. Having made this assumption, we would have no difficulty in finding that a renter seeking utility services is an 

“applicant” under the ECOA. But, even with that assumption, 

it is not so clear that REO is an “applicant” for purposes of 

the statute.

REO asserts that the ordinance violates the ECOA by 

requiring REO to serve as a guarantor. At least two federal 

courts of appeal have expressly held that, notwithstanding a 

regulation of the Federal Reserve Bank providing that “the 

term [applicant] includes guarantors,” see 12 C.F.R. § 202.2(e) 

(2021), a guarantor is not an “applicant” under the ECOA. 

The U.S. Court of Appeals for the Eighth Circuit reached that 

conclusion in Hawkins v. Community Bank of Raymore, 761 

F.3d 937 (8th Cir. 2014), affirmed by an equally divided court, 

577 U.S. 495, 136 S. Ct. 1072, 194 L. Ed. 2d 163 (2016). It 

observed that to qualify as an “applicant” under the definition 

provided in the ECOA, a person must “apply” for, that is, 

request, credit. It reasoned that a guarantor is not an “applicant,” because a guarantor agrees to pay the debt of another in 

the event of default, but does not itself request credit. As the 

Eighth Circuit put it, “[a] guarantor engages in different conduct, receives different benefits, and exposes herself to different legal consequences than does a credit applicant.” Hawkins, 

761 F.3d at 942.

More recently, the U.S. Court of Appeals for the Eleventh 

Circuit also concluded that a guarantor was not an “applicant” 

under the ECOA. See Regions Bank v. Legal Outsource PA, 

936 F.3d 1184 (11th Cir. 2019). Relying on a number of legal 
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Cite as 312 Neb. 792

and other dictionaries, that court concluded that the ordinary 

meaning of the term “applicant” under the ECOA is “one who 

requests credit to benefit himself.” Regions Bank, 936 F.3d at 

1191. The Eleventh Circuit concluded that a guarantor did not 

fit within this definition, explaining that “[a]lthough a guarantor makes a promise related to an applicant’s request for credit, 

the guaranty is not itself a request for credit, and certainly not 

a request for credit for the guarantor.” Id.

The U.S. Court of Appeals for the Seventh Circuit has also 

expressed doubt about whether a guarantor qualifies as an 

“applicant” under the ECOA in Moran Foods v. Mid-Atlantic 

Market Development, 476 F.3d 436 (7th Cir. 2007). The court 

ultimately decided that case on other grounds, but not before 

observing that “there is nothing ambiguous about ‘applicant’ 

and no way to confuse an applicant with a guarantor.” Id.

at 441.

Although one other federal court of appeals has concluded 

that for purposes of the ECOA, “applicant” could reasonably 

be construed to include a guarantor, see RL BB Acquisition v. 

Bridgemill Commons Dev. Group, 754 F.3d 380 (6th Cir. 2014), 

we find the reasoning of the Seventh, Eighth, and Eleventh 

Circuits persuasive. A guarantor may support an application 

for credit, but, in our view, a guarantor does not itself apply 

for credit and is thus not an “applicant” under the plain terms 

of the ECOA.

Because REO did not qualify as an “applicant” under the 

ECOA, it could not seek declaratory or equitable relief under 

15 U.S.C. § 1691e(c). And, contrary to REO’s suggestion 

otherwise, it could not obtain relief under the ECOA by naming Lara as a third-party defendant. As we have discussed, 

§ 1691e(c) authorizes courts to grant relief to enforce the 

ECOA “[u]pon application by an aggrieved applicant . . . .” 

Even if Lara qualified as an “applicant” for credit under the 

ECOA, she did not make an “application” to the district court 

for relief. REO alone asked the district court to declare the 

ordinance invalid.
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Cite as 312 Neb. 792

Because we find that REO was not entitled to seek relief 

under the ECOA, we find no error in the district court’s entry 

of summary judgment on REO’s claim that the ECOA rendered 

the ordinance invalid.

Public Policy.

Next, we address REO’s argument that the district court 

erred by rejecting REO’s claim that the ordinance violated 

Nebraska public policy. REO alleged in its complaint and now 

argues on appeal that the ordinance “violates public policy as 

established by the Nebraska Uniform Residential Landlord 

[and] Tenant Act.” Brief for appellant at 12. REO focuses on 

a particular provision of the Uniform Residential Landlord and 

Tenant Act, § 76-1416, which generally prohibits landlords 

from demanding a security deposit exceeding 1 month’s rent. 

REO argues that because state law caps the amount landlords 

may demand as a security deposit, the ordinance cannot create 

the potential for additional liability by requiring a landlord to 

provide a guarantee in support of a tenant’s application for utility services.

While REO clearly takes the position that the district court 

should have declared the ordinance invalid given the statutory 

limit on the amount landlords may require as a security deposit, 

the precise legal theory it is relying on is less obvious. REO 

claims that the ordinance is “void as against public policy.” 

Brief for appellant at 26. The only case it relies on in support 

of this argument is a New Jersey case that used that language 

in finding a municipal ordinance unenforceable. See Economy 

Enterprises, Inc. v. Township Committee, 104 N.J. Super. 373, 

250 A.2d 139 (1969). REO does not, however, direct us to any 

Nebraska authority holding that a municipal ordinance can be 

“void as against public policy,” and we are not aware of any 

such doctrine under Nebraska law.

Municipal ordinances can of course be preempted by state 

law. See State ex rel. City of Alma v. Furnas Cty. Farms, 266 

Neb. 558, 667 N.W.2d 512 (2003). This can occur in three 
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different circumstances: (1) where the Legislature expressly 

declares in explicit statutory language its intent to preempt 

municipal ordinances, (2) where the Legislature’s intent to 

preempt municipal ordinances may be inferred from a comprehensive scheme of legislation, and (3) where a municipal ordinance actually conflicts with state law. See id. REO, however, 

has not made a preemption argument of any kind, let alone 

shown that the ordinance is preempted under the recognized 

categories discussed above.

We find no error in the district court’s rejection of REO’s 

claim that the ordinance violated Nebraska public policy.

Plain Error.

Finally, we come to REO’s argument that the district court 

committed plain error. Here, REO contends that the village 

lacked the statutory authority to enact the ordinance. And while 

REO concedes that it did not raise this issue before the district 

court, it asserts that the district court nonetheless plainly erred 

by finding that the village had the statutory authority to enact 

the ordinance. We disagree.

Plain error is error plainly evident from the record and 

of such a nature that to leave it uncorrected would result in 

damage to the integrity, reputation, or fairness of the judicial 

process. North Star Mut. Ins. Co. v. Miller, 311 Neb. 941, 977 

N.W.2d 195 (2022). While REO assigns that the district court 

erred by finding that the village had the statutory authority to 

enact the ordinance, the district court did not expressly consider that issue. That is not surprising given REO’s concession 

that it did not raise the issue of the village’s statutory authority 

to enact the ordinance in the district court.

To the extent REO claims the district court committed plain 

error by not finding that the village lacked statutory authority, we would still disagree. As noted above, the district court 

resolved the case on the parties’ cross-motions for summary 

judgment. We have held, however, that a court may not enter a 

summary judgment on an issue not presented by the pleadings. 
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See, e.g., Green v. Box Butte General Hosp., 284 Neb. 243, 

818 N.W.2d 589 (2012). Because the district court could not 

properly enter summary judgment on an issue REO concedes 

it did not raise in the district court, the district court obviously 

did not commit plain error by not doing so.

CONCLUSION

We find no error in the district court’s entry of summary 

judgment in favor of the village and against REO. Accordingly, 

we affirm.

Affirmed.

Papik, J., concurring.

I agree with the majority opinion in all respects, including 

its conclusion that under our current precedent, the ordinance 

at issue does not qualify as special legislation prohibited by 

article III, § 18, of the Nebraska Constitution. I write separately, however, to suggest that certain aspects of our precedent 

in this area may not be consistent with the text and original 

meaning of that constitutional provision.

Application to Municipal Ordinances.

I have more than one concern with our current special legislation precedent. The first is whether the limits on special 

legislation expressed in article III, § 18, properly apply to 

municipal ordinances like the one challenged in this case. This 

court held that a municipal ordinance violated article III, § 18, 

as early as 1964. See Midwest Employers Council, Inc. v. City 

of Omaha, 177 Neb. 877, 131 N.W.2d 609 (1964). We have 

since said on numerous occasions that article III, § 18, applies 

to municipal ordinances. See, e.g., Dowd Grain Co. v. County 

of Sarpy, 291 Neb. 620, 867 N.W.2d 599 (2015); D-CO, Inc. v. 

City of La Vista, 285 Neb. 676, 829 N.W.2d 105 (2013). But, 

as far as I can tell, we have never explored whether there is a 

principled basis for interpreting the text of article III, § 18, to 

do so. I am skeptical such a basis exists.
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Article III, § 18, provides that “[t]he Legislature shall not 

pass local or special laws” in several enumerated circumstances. (Emphasis supplied.) After that list of enumerated 

circumstances, article III, § 18, states as follows:

Provided, that notwithstanding any other provisions of 

this Constitution, the Legislature shall have authority 

to separately define and classify loans and installment 

sales, to establish maximum rates within classifications 

of loans or installment sales which it establishes, and to 

regulate with respect thereto. In all other cases where a 

general law can be made applicable, no special law shall 

be enacted.

(Second emphasis supplied.)

Article III, § 18, thus contains three rules for three categories 

of cases: (1) an absolute prohibition on local or special laws 

in the specifically enumerated circumstances, (2) an explicit 

authorization of certain special legislation regarding loans and 

installment sales, and (3) for all other cases, a prohibition on 

special laws if “a general law can be made applicable.” For 

ease of reference, I will refer to these provisions respectively 

as “the absolute prohibition,” “the loans and installment sales 

exception,” and “the catchall prohibition.”

I can discern no textual basis for concluding that the absolute prohibition applies to municipal ordinances. The text provides that only “the Legislature” shall not pass local or special 

laws in the enumerated circumstances. No mention is made of 

acts of other branches or levels of government.

As for the catchall prohibition, perhaps one could muster an 

argument that it applies to municipal ordinances by emphasizing that the sentence in which it appears does not expressly 

refer to the Legislature. But while the catchall prohibition 

does not refer to any enacting authority, it immediately follows the absolute prohibition and the loans and installments 

sales exception, both of which expressly refer only to the 

Legislature. This context suggests to me that all of article 

III, § 18, is aimed at laws passed by the Legislature. If that 
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context were not enough, the placement of this constitutional 

provision in article III, the article of the Nebraska Constitution 

discussing the enactment of statewide legislation, provides 

yet more evidence that article III, § 18, does not apply to 

municipal ordinances. See, also, Robert D. Miewald et al., The 

Nebraska State Constitution: A Reference Guide 156 (2d ed. 

2009) (observing that text of article III, § 18, appears to limit 

its application to Legislature).

I recognize that this court has held that another provision of the state Constitution that refers expressly only to the 

Legislature—article III, § 19—nonetheless applies to political 

subdivisions of the State. See Retired City Civ. Emp. Club of 

Omaha v. City of Omaha Emp. Ret. Sys., 199 Neb. 507, 260 

N.W.2d 472 (1977). In that case, we reasoned that to hold 

otherwise would permit the State to evade this constitutional 

restriction by creating a political subdivision and authorizing it to do what the Nebraska Constitution prohibited the 

Legislature from doing.

Whatever the merits of that reasoning with respect to article 

III, § 19, it seems a stretch to apply it to article III, § 18. In 

addition to restricting the enactment of “special laws,” the 

absolute prohibition of article III, § 18, forbids the enactment 

of “local” laws on subjects including “[r]egulating [c]ounty 

and [t]ownship offices”; “changing or amending the charter of 

any [t]own, [c]ity, or [v]illage”; “[p]roviding for the bonding 

of cities, towns, precincts, school districts or other municipalities”; and “[p]roviding for the management of [p]ublic 

[s]chools.” If article III, § 18, applies to political subdivisions, 

its terms would appear to prevent those political subdivisions 

from governing themselves in several key areas. No such 

problems arise if article III, § 18, is interpreted to apply only 

to the Legislature.

Special Legislation Test.

I also have a more general concern about our special legislation jurisprudence: I question whether the test we use to 
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identify “special laws” is consistent with the original meaning 

of that term.

Nebraska’s article III, § 18, is far from unique. Similar 

provisions are found in the legislative articles of approximately 30 other state constitutions. See Anthony Schutz, 

State Constitutional Restrictions on Special Legislation as 

Structural Restraints, 40 J. Legis. 39 (2013). A number of 

jurists who have examined the history of such provisions have 

concluded that the restrictions on “special laws” would have 

been originally understood as restricting a then-common legislative practice of passing legislation that, by its terms, applied 

only to an individual person, corporation, or other entity. 

See, Laurance B. VanMeter, Reconsideration of Kentucky’s 

Prohibition of Special and Local Legislation, 109 Ky. L.J. 523, 

524 (2021) (contending that original understanding of special 

legislation prohibited by Kentucky constitution was legislation that “refer[red] only to a particular individual or entity”); 

Schutz, 40 J. Legis. at 58 (contending that “the primary focus 

of these provisions was on laws that identified an object and 

singled it out for special treatment”); Robert M. Ireland, The 

Problem of Local, Private, and Special Legislation in the 

Nineteenth-Century United States, 46 Am. J. Legal Hist. 271 

(2004). Under this conception, examples of special legislation 

would be acts granting a legal remedy or benefit to a specifically identified party. See, also, Calloway Cty. Sheriff’s Dep’t 

v. Woodall, 607 S.W.3d 557, 572 (Ky. 2020) (concluding that 

original understanding of local or special legislation is legislation that “applies exclusively to particular places or particular persons”).

If these scholars are correct about the original understanding of the term “special laws,” our special legislation test 

may be due for reconsideration. We have held that a legislative act will be found to constitute special legislation if it 

creates an arbitrary and unreasonable method of classification. See D-CO, Inc. v. City of La Vista, 285 Neb. 676, 829 

N.W.2d 105 (2013). But a statute could create an unreasonable 
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classification and be nothing like the type of individualized 

statutes the scholars cited above contend were the original target of special legislation prohibitions. Taking this case as the 

basis for an example, if a statute unreasonably or arbitrarily 

treats property owners and property renters differently and 

without sufficient justification, it would be special legislation 

under our current precedent, but it is difficult to see how such 

a statute looks anything like a law that singles out a specifically identified party for special treatment.

Instead of policing individualized legislation, it seems to 

me that our current special legislation precedent’s focus on 

the reasonableness of classifications provides an avenue for 

parties to obtain something akin to heightened equal protection review. Our precedent says that to withstand a special 

legislation challenge, a legislative classification “must rest 

upon some reason of public policy, some substantial difference 

in circumstances, which would naturally suggest the justice or 

expediency of diverse legislation regarding the objects to be 

classified.” Dowd Grain Co. v. County of Sarpy, 291 Neb. 620, 

628, 867 N.W.2d 599, 606 (2015). To my ears, that sounds a 

lot like the intermediate scrutiny test developed by the U.S. 

Supreme Court under which certain types of classifications 

“must serve important governmental objectives and must be 

substantially related to achievement of those objectives.” See, 

e.g., Friehe v. Schaad, 249 Neb. 825, 832, 545 N.W.2d 740, 

746 (1996).

We have, I acknowledge, asserted that the focus of our special legislation test is different from the tests used to evaluate 

equal protection challenges. Specifically, we have said the 

following:

The analysis under a special legislation inquiry focuses 

on the Legislature’s purpose in creating the class and 

asks if there is a substantial difference of circumstances 

to suggest the expediency of diverse legislation. This 

is different from an equal protection analysis under 

which the state interest in legislation is compared to the 
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statutory means selected by the Legislature to accomplish 

that purpose.

Gourley v. Nebraska Methodist Health Sys., 265 Neb. 918, 939, 

663 N.W.2d 43, 66 (2003).

With all due respect, I am not sure I grasp the difference the 

foregoing quote purports to identify. Instead, I am sympathetic 

to the view of a group of commentators who have called the 

distinction identified above “somewhat fleeting.” Miewald et 

al., supra at 159.

To the extent our special legislation jurisprudence allows 

parties to obtain something like intermediate scrutiny equal 

protection review by alleging that a classification is special legislation, it is effectively a more expansive Equal 

Protection Clause. Unless a legislative classification jeopardizes the exercise of a fundamental right or categorizes 

on the basis of an inherently suspect characteristic, an equal 

protection challenge to that classification is analyzed using 

the deferential rational basis standard. See REO Enters. v. 

Village of Dorchester, 306 Neb. 683, 947 N.W.2d 480 (2020). 

But this limitation does not apply to challenges brought to 

legislation under article III, § 18: One need not allege the 

jeopardization of a fundamental right or the use of a suspect classification to trigger the arguably heightened review 

required by our article III, § 18, precedent. It is not clear 

to me, however, that the text or history of article III, § 18, 

suggests that this provision should be policing the reasonableness of legislative classifications at all, let alone under a 

heightened standard of scrutiny. See Schutz, 40 J. Legis. at 

55 (“[t]he text of special-legislation provisions reveals little 

in terms of a concern for substantive equality, whether it is 

the minoritarian concerns of the mid- to late-1800s or some 

broader notion of equality”).

Conclusion.

No party in this case asked us to reconsider whether article 

III, § 18, properly applies to municipal ordinances. Neither 
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were we asked to reconsider the tests we have developed to 

identify special legislation under that constitutional provision. 

In the absence of such arguments, the majority’s decision 

to analyze this case under our current precedent makes perfect sense.

That said, this court has emphasized that the “main inquiry” 

in interpreting the Nebraska Constitution is the original 

meaning of its provisions. See State ex rel. State Railway 

Commission v. Ramsey, 151 Neb. 333, 340, 37 N.W.2d 502, 

507 (1949). We have also stressed the importance of adhering 

to the text of constitutional provisions. See id. For the reasons 

discussed in this concurrence, I believe our precedent under 

article III, § 18, may not be entirely consistent with that provision’s original meaning and text. In an appropriate case, I 

would be open to reconsidering that precedent.