Lindsay International Sales & Service, LLC v. Wegener

Summary

The Nebraska Supreme Court affirmed a judgment for Lindsay International Sales & Service, LLC, against personal guarantors of an irrigation-equipment debt. The court held that the impairment-of-collateral defense was unavailable because the debt was unsecured, and that any error in directing a verdict on failure of consideration was harmless because the jury rejected the underlying factual argument. The court also upheld rulings concerning the Nebraska Uniform Deceptive Trade Practices Act, admission of financial evidence, and denial of a new trial.

Holdings

1. A guarantor cannot assert an impairment-of-collateral defense when the underlying debt is not secured by collateral, because there is no collateral to impair and no related subrogation right to protect.
2. Any error in directing a verdict on the failure-of-consideration defense was harmless when the jury necessarily rejected the factual theory underlying that defense by finding that IJS owed the full amount claimed.
3. When it follows logically from a jury's findings that a theory on which a directed verdict was granted could not have succeeded, the directed verdict did not affect the outcome and is, at most, harmless error.
4. Nebraska Revised Statutes § 87-303.07 does not provide a defense to guarantors who claim that they were induced to sign guaranties by deceptive trade practices, because the statute protects a buyer or lessee induced to enter a sale or lease.
5. The district court did not abuse its discretion by admitting the defendants' financial statements because the evidence had some probative value on whether the defendants were susceptible to alleged misrepresentations, even though it may have had limited probative value and potential prejudice.

Questions Presented

1. Whether the district court properly directed a verdict against the defendants on the impairment-of-collateral and subrogation-related defenses.
2. Whether the district court properly directed a verdict on the defendants' failure-of-consideration defense.
3. Whether the defendants, as guarantors, could assert Nebraska Revised Statutes § 87-303.07 as a defense based on alleged deceptive trade practices.
4. Whether the district court erred by refusing the defendants' proposed Uniform Deceptive Trade Practices Act jury instruction.
5. Whether the district court abused its discretion by admitting the defendants' personal financial statements over relevance objections.
6. Whether the district court abused its discretion by denying the defendants' motion for new trial.

Disposition

affirmed