Opinion ID: 1359551
Heading Depth: 2
Heading Rank: 1

Heading: Lien Foreclosure Jurisdiction

Text: Nebraska jurisdiction over the lien dispute is unique only in the sense that the Nebraska statute, here the NCLA, governs the nature and amount of damages the lien claimant may recover in its construction lien dispute, nothing more. Of course, federal courts routinely interpret and apply state law. Frequently, as in this appeal, statutes from more than one state are in play in a single piece of litigation. The NCLA does not specify the forum or procedure that must be used to determine rights and remedies under the legislation. Neb.Rev.Stat. § 52-155. A court may use any procedure applicable to a realization on judgments to satisfy a NCLA-based claim. Tilt-Up Concrete, Inc. v. Star City/Fed., Inc., 261 Neb. 64, 621 N.W.2d 502, 509 (2001). And, any action is grounded in equity. Tilt-Up Concrete, Inc. v. Star City/Fed., Inc., 255 Neb. 138, 582 N.W.2d 604, 610 (1998). It is reviewed on appeal de novo on the record. Id. Nothing in the statute limits an NCLA action to Nebraska courts and it has already been correctly determined by the federal judge that the United States District Court for the Eastern District of Missouri would have subject matter jurisdiction over the lien dispute as well as personal jurisdiction over the parties and proper venue. See n. 4. Under the NCLA, [a]ny person having an interest in real estate may release the real estate from liens ... by [d]epositing in the office of the clerk of the [appropriate Nebraska] district court ... a surety bond. Neb.Rev.Stat. § 52-142(1)(a). Upon the deposit of a bond, the claimant's rights are transferred from the real estate to [that] bond and the claimant may establish his or her claim under the [Act]. [6] Id. § 52-142(3). Upon determination of the validity and amount of a lien claim, the court shall render judgment against the surety company. Id. Thus, whether Controlled Air files a foreclosure suit in Nebraska or Missouri, only the amount of a claim against the bonding company is dictated by the NCLA. Recovery under the bond first requires proof that a real estate improvement contract has actually been entered into. Id. § 52-131(1). In this case, the question of whether such a contract exists between the Joint Venture and Controlled Air is answered by Missouri lawthe law selected under their agreement. And even if the applicable law is governed by Nebraska statute, the federal court can make that determination. So, once it is established that a valid real estate improvement contract exists and that the Joint Venture breached that contract by receiving and failing to pay for labor and materials provided by Controlled Air, recovery under the bond is had through a judgment against the surety company. Id. § 52-142(3). In the event that such a judgment is rendered by the federal district court for the Eastern District of Missouri, it may be transferred, if necessary, to the District Court of Buffalo County, Nebraska, through the Uniform Enforcement of Foreign Judgments Act long ago enacted in Nebraska. See id. §§ 25-1587.01 to 1587.09. It is likely, however, that any bonding company authorized to do business in Nebraska is also directly subject to service of process in the federal courts of Missouri.