Opinion ID: 2136924
Heading Depth: 1
Heading Rank: 8

Heading: albees' cross-appeal

Text: Albees contend that the district court erred in finding that paragraph 4.1(p) of the purchase agreement was unambiguous, in awarding Maverick a setoff without any evidence that Maverick attempted to collect the accounts in the ordinary course of business, and in failing to award Albees prejudgment interest from the date of the sale. Ambiguity of Paragraph 4.1(p). Albees contend that the warranty in paragraph 4.1(p) of the agreement is ambiguous and, therefore, requires interpretation. Whether a document is ambiguous is a question of law initially determined by a trial court. Luschen Bldg. Assn. v. Fleming Cos., 226 Neb. 840, 415 N.W.2d 453 (1987). Regarding a question of law, an appellate court has an obligation to reach a conclusion independent from a trial court's conclusion in a judgment under review. Huffman v. Huffman, 232 Neb. 742, 748, 441 N.W.2d 899, 904 (1989). See, also, Boisen v. Petersen Flying Serv., 222 Neb. 239, 383 N.W.2d 29 (1986). Ambiguity exists in an instrument when a word, phrase, or provision in the instrument has, or is susceptible of, at least two reasonable but conflicting interpretations or meanings. In re Estate of Walker, 224 Neb. 812, 402 N.W.2d 251 (1987). See, also, National Farmers Union Serv. Corp. v. Edwards, 220 Neb. 231, 369 N.W.2d 76 (1985) (a document is ambiguous if, after application of the pertinent rules for construction, there is uncertainty concerning which of two or more reasonable meanings represents the intention of the parties). The fact that parties to a document have or suggest opposing interpretations of the document does not necessarily, or by itself, compel the conclusion that the document is ambiguous. Lueder Constr. Co. v. Lincoln Electric Sys., 228 Neb. 707, 424 N.W.2d 126 (1988). If the contents of a document are unambiguous, the document is not subject to interpretation and construction, and the intention of the parties to the document must be determined from the contents of the document. Fisbeck v. Scherbarth, Inc., 229 Neb. 453, 428 N.W.2d 141 (1988). Knox v. Cook, 233 Neb. 387, 391-92, 446 N.W.2d 1, 4 (1989). Under paragraph 4.1(p) of the agreement, Albees warranted collectibility of accounts receivable, that is, accounts receivable of Albee which are collectible in the ordinary course of business with the exceptions noted therein [are] attached hereto as Schedule 6 and Sellers agree to update any changes in the accounts receivable up to the date of closing. Although one of the Albees testified that, in her belief, paragraph 4.1(p) was only a promise to present Maverick with a list of all accounts receivable and not a warranty that the accounts were collectible, the express and unambiguous language of the agreement is: Sellers [Albees] warrant [that] all of the accounts receivable ... are collectible in the ordinary course of business.... In light of the language in paragraph 4.1(p), the only reasonable interpretation is Albees' warranty that all accounts receivable were collectible in the ordinary course of business except those accounts specifically excluded. Consequently, a court must look solely to the contents of the contract to ascertain the parties' intention and not to a party's understanding or belief regarding the meaning of unambiguous language in a contract. The district court correctly determined that paragraph 4.1(p) was unambiguous. Insufficiency of the Evidence. Albees next contend that the district court erred in awarding Maverick a setoff in the absence of evidence that Maverick attempted to collect the accounts in the ordinary course of business. However, often with the help of Albees, Maverick mailed bills and telephoned account debtors in efforts to obtain payment. Also, Maverick hired I.C. Systems, a collection agency, and several law firms to assist in Maverick's collection efforts. In some instances, Maverick even resorted to litigation to collect accounts receivable. Thus, Maverick presented prima facie evidence that Maverick attempted to collect the accounts receivable in the ordinary course of business. See State v. Jasper, 237 Neb. 754, 758, 467 N.W.2d 855, 858 (1991): Prima facie evidence means that proof presented on an issue is sufficient to submit the issue to the fact finder for disposition and precludes a directed verdict against the party with the burden of proof on the issue in a jury trial or exclusion of a particular issue from consideration in a nonjury trial. See, also, Bituminous Casualty Corp. v. Deyle, 234 Neb. 537, 546, 451 N.W.2d 910, 916 (1990): [A]s the result of prima facie proof on an issue, an adversary has the burden of producing evidence to the contrary or risks an adverse finding on the issue for which there is prima facie proof. Consequently, evidence supports the district court's determination that Maverick attempted to collect accounts receivable in the ordinary course of business. Prejudgment Interest. Finally, Albees claim that the district court erred in denying Albees prejudgment interest from the date of the sale. However, after the correct setoff and indemnification for collection cost, that is, $46,532.22, and after credit for Maverick's tender of $2,419.97, or a total of $48,952.19, there remained $1,047.81 on the purchase price under the Albee-Maverick agreement. Nevertheless, since the unpaid balance of the purchase price was uncertain on account of the disputed setoff and indemnified loss, prejudgment interest was inappropriate under the circumstances. For that reason, the district court correctly held that Albees were not entitled to prejudgment interest, because Maverick did not breach any of its contractual obligations imposed by the Albee-Maverick agreement.