Court Opinion

ID: 9948965
Source: CourtListenerOpinion
Date Created: 2024-03-08 15:15:56.639842+00
Date Added: 2024-06-11T14:26:25.298438
License: Public Domain

Nebraska Supreme Court Online Library
www.nebraska.gov/apps-courts-epub/
03/08/2024 09:15 AM CST

                                                      - 143 -
                               Nebraska Supreme Court Advance Sheets
                                        316 Nebraska Reports
                             INLAND INS. CO. V. LANCASTER CTY. BD. OF EQUAL.
                                             Cite as 316 Neb. 143

                          Inland Insurance Company, appellant and
                         cross-appellee, v. Lancaster County Board of
                          Equalization, appellee and cross-appellant.
                                                  ___ N.W.3d ___

                                        Filed March 8, 2024.    No. S-23-289.

                 1. Taxation: Judgments: Appeal and Error. Appellate review of a deci-
                    sion from the Tax Equalization and Review Commission shall be con-
                    ducted for error appearing on the record.
                 2. Judgments: Appeal and Error. When reviewing a judgment for errors
                    appearing on the record, an appellate court’s inquiry is whether the deci-
                    sion conforms to the law, is supported by competent evidence, and is
                    neither arbitrary, capricious, nor unreasonable.
                 3. ____: ____. In instances when an appellate court is required to review
                    cases for error appearing on the record, questions of law are nonetheless
                    reviewed de novo on the record.
                 4. Statutes. Statutory language is to be given its plain and ordinary
                    meaning.
                 5. Statutes: Legislature: Intent: Appeal and Error. An appellate court
                    will not look beyond a statute to determine the legislative intent when
                    the words are plain, direct, or unambiguous.
                 6. Statutes: Intent: Appeal and Error. When interpreting a statute,
                    effect must be given, if possible, to all the several parts of a statute; no
                    sentence, clause, or word should be rejected as meaningless or super-
                    fluous if it can be avoided. An appellate court must look to the stat-
                    ute’s purpose and give to the statute a reasonable construction which
                    best achieves that purpose, rather than a construction which would
                    defeat it.

                 Appeal from the Tax Equalization and Review Commission.
               Reversed and remanded for further proceedings.
                    Shannon L. Doering and Luke F. Vavricek for appellant.
                                  - 144 -
            Nebraska Supreme Court Advance Sheets
                     316 Nebraska Reports
          INLAND INS. CO. V. LANCASTER CTY. BD. OF EQUAL.
                          Cite as 316 Neb. 143

  Daniel J. Zieg, Chief Deputy Lancaster County Attorney, for
appellee.

  Heavican, C.J., Miller-Lerman, Cassel, Stacy, Funke,
Papik, and Freudenberg, JJ.

    Heavican, C.J.
                      INTRODUCTION
   Inland Insurance Company (Inland) appeals from the deci-
sion of the Tax Equalization and Review Commission (TERC)
upholding the decision of the Lancaster County Board of
Equalization (Board of Equalization) declining to lower the
assessed value of real property owned by Inland. At issue
on appeal is whether a fire caused by arson is a calamity for
purposes of Neb. Rev. Stat. § 77-1307(2)(a) (Cum. Supp.
2022). We conclude that it is and reverse TERC’s decision and
remand the cause for further proceedings.

                        BACKGROUND
   Inland owned real property located at 610 S. 12th Street
in Lincoln, Nebraska. As of January 1, 2020, the Lancaster
County assessor had valued this real property at $793,800.
On or about May 30 or 31, the property was damaged by fire
caused by arson. Inland then filed a report of destroyed real
property with the county assessor’s and county clerk’s offices
in Lancaster County. The Board of Equalization considered
the report but left the value of the property as assigned as of
January 1. Inland appealed to TERC.
   TERC held a hearing in Inland’s case, after which TERC
concluded that the property was not “destroyed real property” 1
because the fire that had destroyed the property was not a
“calamity” as defined by § 77-1307(2)(a). Inland appeals, and
the Board of Equalization cross-appeals.
1
    Neb. Rev. Stat. § 77-1308 (Cum. Supp. 2022).
                                  - 145 -
            Nebraska Supreme Court Advance Sheets
                     316 Nebraska Reports
          INLAND INS. CO. V. LANCASTER CTY. BD. OF EQUAL.
                          Cite as 316 Neb. 143

                 ASSIGNMENTS OF ERROR
   On appeal, Inland assigns that TERC erred in (1) “sanction-
ing” the Board of Equalization’s “unlawful error of requiring
Inland to rebut a presumption that the [Board of Equalization]
faithfully performed its duties and then to meet a heightened
burden of proof after the Report was filed and imposing this
heightened standard upon Inland in derogation of the statuto-
rily prescribed process due to Inland,” (2) determining that the
word “calamity” did not include a “‘fire’” caused by arson,
(3) finding there was not competent evidence to rebut the pre-
sumption that the Board of Equalization faithfully performed
its duties and had sufficient competent evidence to make its
determination, (4) finding that there was not clear and convinc-
ing evidence to make its determination, and (5) interpreting
§ 77-1307 in such a manner as to create unconstitutional sub-
classifications of taxpayers that violate the Equal Protection
Clauses of the U.S. and Nebraska Constitutions.
   On cross-appeal, the Board of Equalization asserts in a
separate cross-appeal (although it does not assign) that portions
of Neb. Rev. Stat. § 77-1301 (Cum. Supp. 2022), as well as
§§ 77-1307 and 77-1308 and Neb. Rev. Stat. § 77-1309 (Cum.
Supp. 2022), were unconstitutional.

                   STANDARD OF REVIEW
   [1-3] Appellate review of a decision from TERC shall be
conducted for error appearing on the record. 2 When reviewing
a judgment for errors appearing on the record, an appellate
court’s inquiry is whether the decision conforms to the law,
is supported by competent evidence, and is neither arbitrary,
capricious, nor unreasonable. 3 However, in instances when an
appellate court is required to review cases for error appearing
2
    See Neb. Rev. Stat. § 77-5019(5) (Reissue 2018).
3
    Wheatland Indus. v. Perkins Cty. Bd. of Equal., 304 Neb. 638, 644, 935
    N.W.2d 764 (2019).
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         Nebraska Supreme Court Advance Sheets
                  316 Nebraska Reports
        INLAND INS. CO. V. LANCASTER CTY. BD. OF EQUAL.
                        Cite as 316 Neb. 143

on the record, questions of law are nonetheless reviewed de
novo on the record. 4

                           ANALYSIS
   On appeal, Inland argues that TERC erred in various ways
when it upheld the Board of Equalization’s refusal to lower
the assessed value of its real property. Inland first argues that
the Board of Equalization failed to utilize the procedures set
forth by statutes for lowering the assessed value on such prop-
erty—in that Inland need only submit the appropriate request
to the Board of Equalization, which was then obligated to
lower its assessment. According to Inland, if the Board of
Equalization believed that lower assessment to be incorrect, it
was then the responsibility of the Lancaster County assessor
to protest the valuation. Inland also argues that the property in
question was “destroyed property,” which decreased valuation
was caused by a “‘calamity’”—in this case, a fire caused by
arson—and that TERC erred in various ways when finding to
the contrary. 5
   Meanwhile, the Board of Equalization has cross-appealed
and alleges that a portion of § 77-1301 and all of §§ 77-1307
to 77-1309 were unconstitutional as violative of the uniformity
clause of Neb. Const. art. VIII, § 1.
Board of Equalization’s Procedure.
   We turn first to Inland’s contention that the Board of
Equalization followed an incorrect procedure when denying
its request for a reduced valuation in its report of destroyed
real property. Inland suggests that its due process rights were
violated and that the procedure set forth by the statutes was
not followed when the Board of Equalization considered and
then denied Inland’s request for a downward valuation of
4
  Centurion Stone of Neb. v. Whelan, 286 Neb. 150, 152, 835 N.W.2d 62
  (2013).
5
  See brief for appellant at 25.
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         Nebraska Supreme Court Advance Sheets
                  316 Nebraska Reports
        INLAND INS. CO. V. LANCASTER CTY. BD. OF EQUAL.
                        Cite as 316 Neb. 143

Inland’s property. Inland contends that the governing statutes
require the Board of Equalization to lower the value of the
property as requested by the landowner and that if the County
or the Board of Equalization disagreed with the new valua-
tion, the county assessor could protest that valuation. We find
this contention regarding the procedure to be followed with-
out merit.
   Section 77-1308 provides:
         (1) If real property becomes destroyed real property
      during the current assessment year, the property owner
      shall file a report of the destroyed real property with
      the county assessor and county clerk of the county in
      which the property is located on or before July 15 of
      the current assessment year. The report of destroyed real
      property shall be made on a form prescribed by the Tax
      Commissioner.
         ....
         (3) The county board of equalization shall consider
      any report of destroyed real property received pursuant to
      this section, and the assessment of such property shall be
      made by the county board of equalization in accordance
      with section 77-1309. After county board of equalization
      action pursuant to section 77-1309, the county assessor
      shall correct the current year’s assessment roll as pro-
      vided in section 77-1613.02.
And § 77-1309(1) states that “[i]f the county board of equal-
ization receives a report of destroyed real property pursuant
to section 77-1308, the county board of equalization shall
adjust the assessed value of the destroyed real property to
its assessed value on the date it suffers significant property
damage.”
   When read together, Inland argues that the requirement
in § 77-1309 that upon receipt of a report of destroyed real
property pursuant to § 77-1308, a board of equalization has no
discretion but shall adjust the assessed value of the destroyed
real property.
                                   - 148 -
            Nebraska Supreme Court Advance Sheets
                     316 Nebraska Reports
           INLAND INS. CO. V. LANCASTER CTY. BD. OF EQUAL.
                           Cite as 316 Neb. 143

    But Inland’s argument overlooks a separate subpart of
§ 77-1308. Section 77-1308(3) requires that a board of equal-
ization “shall consider any report of destroyed real property
. . . and the assessment of such property shall be made by the
county board of equalization.” That a board of equalization
would be required to accept, without consideration, the posi-
tion of a property owner that its property had been destroyed
by a calamity, and further accept a revised value of the prop-
erty as binding, is contrary to those statutory provisions gov-
erning the assessment of real property, which provide that the
county board of equalization sets the value of real property. 6
We find no merit to Inland’s contention on appeal.
Destroyed Real Property Damaged by Calamity.
  We turn next to Inland’s assertion on appeal that its property
was destroyed real property damaged by a calamity within the
meaning of the statute. We find merit to this argument.
  The relevant statutes are found at §§ 77-1307 to 77-1309.
Section 77-1307 states in part:
        (1) The Legislature finds and declares that fires, earth-
     quakes, floods, and tornadoes occur with enough fre-
     quency in this state that provision should be made to grant
     property tax relief to owners of real property adversely
     affected by such events.
        (2) For purposes of sections 77-1307 to 77-1309:
        (a) Calamity means a disastrous event, including, but
     not limited to, a fire, an earthquake, a flood, a tornado,
     or other natural event which significantly affects the
     assessed value of real property;
        (b) Destroyed real property means real property that
     suffers significant property damage as a result of a calam-
     ity occurring on or after January 1, 2019, and before July
     1 of the current assessment year. Destroyed real property
     does not include property suffering significant property
     damage that is caused by the owner of the property[.]
6
    See, e.g., Neb. Rev. Stat. § 77-1502 (Cum. Supp. 2022).
                                 - 149 -
           Nebraska Supreme Court Advance Sheets
                    316 Nebraska Reports
         INLAND INS. CO. V. LANCASTER CTY. BD. OF EQUAL.
                         Cite as 316 Neb. 143

In sum, the definition of “destroyed real property” requires
that the property be destroyed or diminished in value due to a
calamity. And a “calamity” includes a fire, earthquake, flood,
tornado, or other natural disaster.
   [4-6] Statutory language is to be given its plain and ordinary
meaning. 7 An appellate court will not look beyond a statute
to determine the legislative intent when the words are plain,
direct, or unambiguous. 8 When interpreting a statute, effect
must be given, if possible, to all the several parts of a statute;
no sentence, clause, or word should be rejected as meaningless
or superfluous if it can be avoided. 9 An appellate court must
look to the statute’s purpose and give to the statute a reason-
able construction which best achieves that purpose, rather than
a construction which would defeat it. 10
   The central dispute decided by TERC was whether a fire
started by arson was a “calamity” under § 77-1307(2)(a).
TERC concluded that it was not. On appeal, Inland argues that
this was error, and based upon our reading of the statute, and
in considering the entirety of the relevant statutes, we agree.
   In defining “calamity,” § 77-1307(2)(a) explains by its plain
terms that a “calamity” is, first and foremost, a “disastrous
event.” The definition of “disastrous event” includes some
natural events, but by the plain language of § 77-1307(2)(a),
it is “not limited” to natural events. Although § 77-1307(1)
notes that the Legislature “finds and declares” that fires,
earthquakes, floods, and tornadoes occur with frequency in
Nebraska, this recognition does not limit disastrous events to
only these “events.”
   TERC interpreted the listed events provided in § 77-1307(2)
(a) and concluded that the phrase “other natural event[s]”
must mean that all listed preceding events were also natural.
7
   State v. Clemens, 300 Neb. 601, 915 N.W.2d 550 (2018).
8
   Id.
 9
   Id.
10
   Id.
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         Nebraska Supreme Court Advance Sheets
                  316 Nebraska Reports
        INLAND INS. CO. V. LANCASTER CTY. BD. OF EQUAL.
                        Cite as 316 Neb. 143

But in doing so, TERC reads out the language “including, but
not limited to,” and ignores the text that provides a calamity
is simply a “disastrous event.” In so doing, TERC effectively
redefined a “calamity” as “a fire, an earthquake, a flood, a
tornado, or other natural event.” But this definition does not
conform to the law.
   This conclusion is further reinforced by the last sentence
of § 77-1307(2)(b), which excepts from the definition of
“[d]estroyed real property” any “property suffering signifi-
cant property damage that is caused by the owner of the prop-
erty.” If a “calamity” did not include all disastrous events, as
we explain above, it would be unnecessary to provide a statu-
tory exception for damage caused by the property’s owner.
   We conclude that TERC erred in limiting a “calamity” to
only “natural events.” We reverse TERC’s decision and remand
the cause for further proceedings. Accordingly, we need not
address Inland’s remaining assignments of error.

Cross-Appeal.
  Neb. Ct. R. App. P. § 2-109(E) (rev. 2023) provides:
     Cases Involving Constitutional Questions. A party who
     asserts that a Nebraska statute is unconstitutional under
     the Nebraska Constitution or the U.S. Constitution must
     file and serve notice thereof with the Clerk by a separate
     notice or by notice in a Petition to Bypass at the time of
     filing such party’s brief. . . . If the Attorney General is
     not already a party to an action where the constitution-
     ality of the statute is in issue, a copy of the notice and
     brief asserting unconstitutionality must be served on the
     Attorney General within 5 days of the filing of the brief
     with the Clerk . . . . Proof of such service shall be filed
     with the Clerk.
  The record in this case does not show that the Attorney
General was served notice of the Board of Equalization’s brief,
nor is the Attorney General a party to this action. TERC was
noticed, but we have emphasized the requirement of “strict
                                    - 151 -
             Nebraska Supreme Court Advance Sheets
                      316 Nebraska Reports
            INLAND INS. CO. V. LANCASTER CTY. BD. OF EQUAL.
                            Cite as 316 Neb. 143

compliance” with § 2-109(E) and have been clear that the
Attorney General must be notified of such constitutional ques-
tions in order for this court to consider them on appeal. 11
   Given this failure, we need not reach the Board of
Equalization’s cross-appeal.
                     CONCLUSION
   We reverse TERC’s decision and remand the cause for fur-
ther proceedings.
                            Reversed and remanded for
                            further proceedings.
11
     See State v. Catlin, 308 Neb 294, 953 N.W.2d 563 (2021).

    Papik, J., concurring.
    The majority opinion concludes that a fire caused by some-
one other than the property owner is a “calamity” for purposes
of Neb. Rev. Stat. § 77-1307(2)(a) (Cum. Supp. 2022), even if
it is not a “natural event.” I agree that a fire caused by someone
other than the property owner is a “calamity,” but for somewhat
different reasons. I write separately to explain my thinking.
    I begin with the fact that § 77-1307(2)(a) expressly defines
“calamity” to include “a fire.” Because the statute expressly
provides that a fire qualifies as a “calamity,” one might assume
that this is a very straightforward case, there is nothing more
to discuss, and all fires, including the one at issue in this
case, qualify as a calamity. TERC found, however, that a fire
caused by arson is not a “calamity,” because of the reference
in § 77-1307(2)(a) to “other natural event[s].” TERC took
the position that in order to give the phrase “other natural
event” meaning, “calamity” must include only events caused
by nature.
    I find no fault in TERC’s attempt to avoid rendering the
phrase “or other natural event” superfluous; indeed, a canon
of statutory interpretation we often cite counsels as much,
see, e.g., Dean v. State, 288 Neb. 530, 849 N.W.2d 138
                               - 152 -
          Nebraska Supreme Court Advance Sheets
                   316 Nebraska Reports
        INLAND INS. CO. V. LANCASTER CTY. BD. OF EQUAL.
                        Cite as 316 Neb. 143

(2014). I disagree, however, that TERC identified the only
reasonable way to interpret and give meaning to the “other
natural event” language of § 77-1307(2)(a). In my view, “nat-
ural event” could be understood as referring not to the cause
of the particular event at issue, but to the type of event, i.e.,
was the property destroyed as a result of a naturally occur-
ring phenomenon like a fire, earthquake, et cetera? Under this
alternative interpretation, the “other natural event” language
serves the purpose of clarifying that naturally occurring phe-
nomena that are not expressly listed nonetheless qualify as
“calamit[ies].”
   Not only do I find the alternative interpretation of “natural
event” textually permissible, I find it to be the superior reading.
For one thing, by referring to “a fire, an earthquake, a flood,
a tornado, or other natural event,” the statute seems to presup-
pose that each of the specifically mentioned phenomena is,
for purposes of the statute, a “natural event.” § 77-1307(2)(a)
(emphasis supplied). If someone refers to “works of William
Shakespeare, Edgar Allan Poe, Emily Dickinson, or other
great poets,” one could reasonably presume that the speaker
considered Shakespeare, Poe, and Dickinson great poets. So
too, it seems to me, could one presume that fires and the like
are, for purposes of the statute, natural events.
   In addition, reading “natural event” to refer to the type of
event rather than the cause of the event avoids a major dif-
ficulty with the interpretation adopted by TERC alluded to
above: Under that reading, “calamity” is specifically defined to
include “a fire,” and yet, somehow, some fires are not calami-
ties. It is difficult to square such a reading with a court’s “‘role
to make sense rather than nonsense out of the corpus juris.’”
Maslenjak v. United States, 582 U.S. 335, 345, 137 S. Ct.
1918, 198 L. Ed. 2d 460 (2017) (emphasis omitted) (quoting
West Virginia Univ. Hospitals, Inc. v. Casey, 499 U.S. 83, 111
S. Ct. 1138, 113 L. Ed. 2d. 68 (1991)).
   Even assuming that both readings of “natural event” are
reasonable and the statute is thus ambiguous, I would find in
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         Nebraska Supreme Court Advance Sheets
                  316 Nebraska Reports
        INLAND INS. CO. V. LANCASTER CTY. BD. OF EQUAL.
                        Cite as 316 Neb. 143

favor of Inland based on the legislative statement of purpose
codified in subsection (1) of § 77-1307. Although statutory
policy statements and preambles cannot be used to override
a statute’s operative language, see, e.g., In re Guardianship
of Eliza W., 304 Neb. 995, 938 N.W.2d 307 (2020), such
statements can be considered in “determining which of vari-
ous permissible meanings the dispositive text bears.” Antonin
Scalia & Bryan A. Garner, Reading Law: The Interpretation
of Legal Texts 218 (2012). In § 77-1307(1), the Legislature
declared that “fires, earthquakes, floods, and tornadoes occur
with enough frequency in this state that provision should be
made to grant property tax relief to owners of real property
adversely affected by such events.” The statement specifi-
cally mentions granting property tax relief to owners of real
property adversely affected by fires, earthquakes, floods, and
tornadoes. No mention is made of providing property tax relief
only when those phenomena occur because of forces of nature.
This statement of purpose, in my view, removes any lingering
doubt as to whether a fire caused by someone other than the
property owner is a “calamity” under the statute.
   For these reasons, I concur in the majority’s decision find-
ing that a fire caused by someone other than the property
owner is a “calamity” for purposes of § 77-1307(2)(a).