Boxum v. Munce

marital estate and, in addition, awarded Karen 7 years’ worth of
alimony at the rate of $1,200 per month.
The overriding concern is whether the division is fair and rea-
sonable, recognizing the substantial factual difference between
the instant case and Grace, supra; Medlock, supra; and Walker,
supra, because the parties here have a substantial marital estate.
Therefore, the instant case is distinguishable from Grace,
supra, as well as the cases we have mentioned that followed it
and where a Grace award was made. Additionally, the division
of the marital estate was equal and thus was clearly fair and
reasonable. Hence, we cannot say that the trial court abused its
discretion in declining to make a Grace award to Karen.
CONCLUSION
Finding no merit to the assignments of error raised by either
Karen or Joe, we affirm the decision of the district court in
all respects, except for the minor correction to Joe’s child
support obligation.
affIrMeD.
rICharD h. B oxuM, appellant , v . sherry l. M unCe
anD harry J. M unCe , appellees .
751 N.W.2d 657
Filed June 3, 2008. 	No. A-07-552.
1. Judgments: Statutes: Appeal and Error. To the extent an appeal calls for statu-
tory interpretation, it represents a question of law, and an appellate court must reach
an independent conclusion irrespective of the determination of the lower court.
2. Secured Transactions: Trusts: Deeds: Limitations of Actions. At any time
within 3 months after any sale of property under a trust deed, as provided in Neb.
Rev. Stat. § 76-1013 (Reissue 2003), an action may be commenced to recover the
balance due upon the obligation for which the trust deed was given as security.
3. Secured Transactions: Trusts: Deeds. The Nebraska Trust Deeds Act provides a
specific statutory plan to obtain performance of an obligation, prescribes a distinct
procedure to dispose of security for performance of an obligation, and, generally,
authorizes a form of financing quite apart from other methods recognized under
Nebraska law.
4. Limitations of Actions: Legislature: Intent. A special statute of limitations con-
trols and takes precedence over a general statute of limitations because the special
statute is a specific expression of legislative will concerning a particular subject.
BOxUM v. MUNCe 	731
Cite as 16 Neb. App. 731
Nebraska Supreme Court Online Library
www.nebraska.gov/apps-courts-epub/
11/01/2026 04:16 AM CST

5. Secured Transactions: Trusts: Deeds: Limitations of Actions: Foreclosure.
The 3-month statute of limitations under Neb. Rev. Stat. § 76-1013 (Reissue
2003) is applicable to a suit which seeks a deficiency judgment on a particular
obligation that was secured by the particular trust deed that was foreclosed.
6. ____: ____: ____: ____: ____. The 3-month statute of limitations under Neb.
Rev. Stat. § 76-1013 (Reissue 2003) applies only when the suit for deficiency is on
the obligation for which the foreclosed trust deed was given as security.
7. Secured Transactions: Trusts: Deeds: Limitations of Actions. The obligation
secured by a deed of trust, not the title to the security, determines applicability or
availability of the 3-month statute of limitations under Neb. Rev. Stat. § 76-1013
(Reissue 2003).
8. Contracts: Guaranty: Debtors and Creditors. The debtor is not a party to a
guaranty, and the guarantor is not a party to the principal obligation; the under-
taking of the debtor is independent of the promise of the guarantor and the respon-
sibilities which are imposed by the contract of guaranty differ from those created
by the contract to which the guaranty is collateral.
Appeal 	from 	the 	District 	Court 	for 	Lincoln 	County:
J ohn p. M urphy, Judge. Reversed and remanded for further
proceedings.
Wayne e. Griffin for appellant.
Tim W. Thompson and Angela R. Shute, of Kelley, Scritsmier
& Byrne, P.C., for appellees.
sIevers , M oore, and C assel, Judges.
sIevers, Judge.
The district court for Lincoln County, Nebraska, granted
summary judgment to the defendants, Sherry L. Munce and
Harry J. Munce, husband and wife, who had been sued by
Richard H. Boxum upon a guaranty of payment executed by
the Munces on February 6, 2002. The district court found that
the 3-month statute of limitations in which to collect a defi-
ciency after foreclosure of a trust deed, found in Neb. Rev. Stat.
§ 76-1013 (Reissue 2003), barred Boxum’s lawsuit. This mat-
ter is a case of first impression, and we address the scope and
reach of the statute of limitations provision in § 76-1013.
FACTUAL AND PROCeDURAL BACKGROUND
The Munces are the mother and stepfather of David S. Carl.
In the fall of 1997, David and his wife, Teena R. Carl, were
732 	16 NeBRASKA APPeLLATe RePORTS

attempting to buy certain real estate located on West 4th Street
in North Platte, Nebraska, which they intended to modify for a
daycare business. The sellers of that real estate were Kelly B.
Smith and Jo F. Smith, who agreed to “carry back” most of the
purchase price. As a result, the Carls executed and delivered
their “Promissory Note with Balloon” to the Smiths with the
original principal amount of $55,031.88 secured by a deed of
trust on the West 4th Street property. Boxum loaned the Carls
$14,000 in order that the Carls could complete the purchase
from the Smiths, plus another $9,000 with which the Carls
were going to modify the property. Such loans were ultimately
evidenced by the Carls’ promissory note to Boxum in the
amount of $28,500 executed and delivered on October 1, 1999.
The difference between the amounts loaned and the amount
of the promissory note was apparently accrued interest. Such
promissory note was secured by a deed of trust on the West
4th Street property. For convenience and clarity, we will refer
to the first-described promissory note as the “Carl-Smith note”
and the second as the “Carl-Boxum note.”
By early 2002, the Carls were delinquent on their payments
to the Smiths, who had elected to declare a default and fore-
close on the deed of trust given by the Carls to the Smiths.
In order to avoid such foreclosure, the Munces apparently
sought the assistance of Boxum. As a result, Boxum agreed to
pay off the obligation due the Smiths in return for an assign-
ment of the Carl-Smith note to him. As further inducement for
Boxum to pay off the Carls’ debt to the Smiths, the Munces
agreed that they would guarantee payment of the obligations
represented by the Carl-Smith note as well as the Carl-Boxum
note. We note that we do not have before us, nor did the dis-
trict court, the deed of trust from the Carls to Boxum. But
from other undisputed evidence such as Boxum’s affidavit, we
know that the only obligation secured by such deed was the
Carl-Boxum note.
Accordingly, on January 29, 2002, Boxum paid off the
obligation due the Smiths in the amount of $40,623.65. In
return, Boxum received an assignment of the Carl-Smith note
of October 1, 1997, as well as an assignment of the correspond-
ing deed of trust. On February 6, 2002, the Munces signed and
BOxUM v. MUNCe 	733
Cite as 16 Neb. App. 731

delivered to Boxum their guaranty of payment with respect to
the Carl-Smith note and the Carl-Boxum note.
After receiving the guaranty, Boxum received irregular pay-
ments from the Carls, and by mid-December 2003, the Carls
had filed a chapter 7 bankruptcy case in the U.S. Bankruptcy
Court for the Northern District of Oklahoma. That proceed-
ing ultimately resulted in a discharge of the Carls on April 2,
2004—which included discharge of both the Carl-Smith and
the Carl-Boxum notes.
The successor trustee, under the Carl-Boxum deed of trust,
gave notice of default on such note on May 12, 2004, indi-
cating that the amount of the indebtedness as of May 10 was
$44,258.87. It is noteworthy that the notice of default, after
reciting such amount, states that it “does not include any obliga-
tions secured by the subject property senior or junior to the said
indebtedness secured by said Deed of Trust.” The term “said
deed of trust” clearly refers to the trust deed given by the Carls
to Boxum. The trustee sold the property, and according to the
trustee’s deed dated November 15, 2004, the highest bid at the
trustee’s sale was Boxum’s $10,000 bid. The evidence shows
that this was the only bid. The trustee conveyed the West 4th
Street property to Boxum “pursuant to the powers conferred
by a Trust Deed with power of sale recorded on December 2,
1999, in Book 621, Pages 485-488, Records of Lincoln County,
Nebraska.” We note that in neither the notice of default nor the
trustee’s deed, exhibits 8 and 9 respectively, is there any specific
mention whatsoever of the Carl-Smith note. And the notice of
default of May 12, 2004, provides that the amount specified
therein as owing “does not include any obligations secured by
the subject property senior or junior to the said indebtedness
secured by said Deed of Trust.” Again, the reference to “said
deed of trust” is clearly to the Carl-Boxum note. In short, the
notice of default excludes the obligations represented by the
Carl-Smith note.
On January 24, 2006, Boxum sued the Munces on their guar-
anty, seeking judgment against them in the amount of $97,116.21,
which sum included interest calculated to December 31, 2005,
and thereafter accruing at the rate of $25.40 per day. Attached
to such complaint is the Munces’ guaranty of payment and a
734 	16 NeBRASKA APPeLLATe RePORTS

recitation of the details of the Carl-Boxum note as well as the
Carl-Smith note. The guaranty includes the recitation that the
Munces “absolutely guarantee payment” to Boxum. Moreover,
in the guaranty, the Munces acknowledged that both promissory
notes were then in default and that each obligation was secured
by a deed of trust on the West 4th Street property.
On October 31, 2006, the Munces filed their answer, in
which they asserted that Boxum’s action was filed out of time,
given the 3-month limitation period in the Nebraska Trust
Deeds Act. See Neb. Rev. Stat. §§ 76-1001 to 76-1018 (Reissue
2003). While other defenses such as lack of consideration for
the guaranty of payment were alleged, the Munces’ motion
for summary judgment was premised solely upon the 3-month
limitation found in § 76-1013, and such was the sole basis of
the trial court’s grant of summary judgment to the Munces.
The motion for summary judgment was filed January 23,
2007, heard on April 16, and decided on April 24. The district
court found that the matter was controlled by Sports Courts of
Omaha v. Meginnis, 242 Neb. 768, 497 N.W.2d 38 (1993); that
it was “clear that the action was filed outside of the three-month
limitation period”; and that as a result, the motion for summary
judgment was sustained and the complaint dismissed. Boxum
timely appeals.
ASSIGNMeNT OF eRROR
Restated and summarized, Boxum’s assignment of error is
simply that the district court erred in granting summary judg-
ment to the Munces on the basis of the 3-month statute of limi-
tations in the Nebraska Trust Deeds Act.
STANDARD OF ReVIeW
[1] Our examination of the record reveals no material issue
of disputed fact, but, rather, an issue of law involving statutory
interpretation. The rule is well-established that to the extent an
appeal calls for statutory interpretation, it represents a ques-
tion of law, and an appellate court must reach an independent
conclusion irrespective of the determination of the lower court.
See Hawkins v. City of Omaha, 261 Neb. 943, 627 N.W.2d
118 (2001).
BOxUM v. MUNCe 	735
Cite as 16 Neb. App. 731

ANALYSIS
[2] Although we have previously referred to the 3-month
statute of limitations a number of times, we now set forth the
relevant statute, § 76-1013, which provides:
At any time within three months after any sale of
property under a trust deed, as hereinabove provided,
an action may be commenced to recover the balance due
upon the obligation for which the trust deed was given as
security, and in such action the complaint shall set forth
the entire amount of the indebtedness which was secured
by such trust deed and the amount for which such prop-
erty was sold and the fair market value thereof at the date
of sale, together with interest on such indebtedness from
the date of sale, the costs and expenses of exercising the
power of sale and of the sale. Before rendering judgment,
the court shall find the fair market value at the date of sale
of the property sold. The court shall not render judgment
for more than the amount by which the amount of the
indebtedness with interest and the costs and expenses of
sale, including trustee’s fees, exceeds the fair market value
of the property or interest therein sold as of the date of the
sale, and in no event shall the amount of said judgment,
exclusive of interest from the date of sale, exceed the dif-
ference between the amount for which the property was
sold and the entire amount of the indebtedness secured
thereby, including said costs and expenses of sale.
(emphasis supplied.)
We have emphasized that portion of the statute which is
crucial in this appeal. However, we first turn to Sports Courts
of Omaha v. Meginnis, 242 Neb. 768, 497 N.W.2d 38 (1993),
relied upon by the trial court. While there are several other
appellate decisions involving § 76-1013, they all generally
involve the question of determining the fair market value of
the property sold under a trust deed. Meginnis is the only case
discussing the statute of limitations found in § 76-1013.
[3] Meginnis was tried on stipulated facts which revealed
that Harry Meginnis and Tom Schuessler were shareholders in
Tom-Har, Inc., and that Sports Courts of Omaha, Ltd. (Sports
Courts), sold an Omaha sports fitness facility, including real
736 	16 NeBRASKA APPeLLATe RePORTS

estate, to Tom-Har for $600,000 reflected by a promissory note
signed by Tom-Har, Schuessler, and Meginnis as comakers. The
note was secured by a trust deed on the real estate involved in
the sale. In August 1985, after Tom-Har failed to pay the note
and had received Sports Courts’ notice of default, the trustee,
acting under the power of sale expressed in the trust deed,
sold the real estate, but the proceeds were insufficient to pay
the indebtedness on the underlying promissory note. While the
Meginnis opinion traces a twisted path of litigation to attempt
to collect the deficiency after the trust deed sale, we will not
recite that history. It is sufficient for our purposes that the
action to collect the deficiency in Meginnis was clearly filed
more than 3 months after the trust deed sale. The Meginnis
court initially recalled its decision in Blair Co. v. American
Savings Co., 184 Neb. 557, 169 N.W.2d 292 (1969), which
upheld the constitutionality of the Nebraska Trust Deeds Act.
The Meginnis court reiterated its observation from Blair that
the Nebraska Trust Deeds Act provides “a specific statutory
plan to obtain performance of an obligation, prescribes a dis-
tinct procedure to dispose of security for performance of an
obligation, and, generally, authorizes a form of financing quite
apart from other methods recognized under Nebraska law.” 242
Neb. at 774, 497 N.W.2d at 42. The Meginnis court framed
the issue of first impression it was deciding as, “Which statute
of limitations, § 25-205 or § 76-1013, controls the time for
commencement of an action to recover the balance due on the
obligation secured by a deed of trust?” 242 Neb. at 774-75, 497
N.W.2d at 42-43.
[4] In answering this question, the Meginnis court set forth
the well-known rule that when statutory language is plain and
unambiguous, no judicial interpretation is needed to ascertain
the statute’s meaning, so that, in the absence of a statutory
indication to the contrary, words in a statute will be given their
ordinary meaning. Additionally, the court found that “‘[a] spe-
cial statute of limitations controls and takes precedence over
a general statute of limitations because the special statute is a
specific expression of legislative will concerning a particular
subject.’” Id. at 775, 497 N.W.2d at 43, quoting Murphy v.
Spelts-Schultz Lumber Co., 240 Neb. 275, 481 N.W.2d 422
BOxUM v. MUNCe 	737
Cite as 16 Neb. App. 731

(1992). After referencing the key statutory language which we
emphasized when we quoted the statute at the beginning of our
analysis, the Meginnis court said that such language “unambig-
uously expresses that the 3-month statute of limitations applies
to an action to recover a deficiency on any obligation, such as
a promissory note or other contract, after sale of the real estate
which secured the obligation pursuant to the Nebraska Trust
Deeds Act.” 242 Neb. at 775, 497 N.W.2d at 43. To us, the plain
and unambiguous language from the statute which we have
emphasized, as well as the foregoing quoted holding, requires
that we reverse the district court’s decision.
[5,6] The key to the issue before us is recognition that the
3-month limitation is applicable to a suit which seeks a defi-
ciency judgment on a particular obligation that was secured
by the particular trust deed that was foreclosed. The 3-month
statute of limitations applies only when the suit for defi-
ciency is on the obligation for which the foreclosed trust deed
was given as security. This is not the factual situation in the
present case.
Here, the evidence is undisputed that the trust deed which
was used to foreclose on the West 4th Street property was a trust
deed “filed for record on December 2, 1999, as Instrument No.
1599 108415, in Book 621, Page 485-488, Records of Lincoln
County, Nebraska.” This trust deed secures the Carl-Boxum
note in the amount of $28,500 plus accrued interest. Therefore,
under the plain language of § 76-1013, Boxum had 3 months
from the date of the trustee sale, November 15, 2004, in
which to seek a deficiency judgment on that obligation, the
Carl-Boxum note. But, this lawsuit is obviously not a suit on
the Carls’ obligation to Boxum, which was secured by the trust
deed that was foreclosed upon. Rather, this suit is upon a com-
pletely different and separate obligation of the Munces, entitled
“Guaranty of Payment” and dated February 6, 2002, which
“absolutely guarantee[s]” their payment of two obligations, the
Carl-Boxum note and the Carl-Smith note, each of which was
secured by a separate trust deed given by the Carls.
[7] Sports Courts of Omaha v. Meginnis, 242 Neb. 768, 775,
497 N.W.2d 38, 43 (1993), states that the 3-month statute of
limitations “applies to actions to recover an amount owed ‘upon
738 	16 NeBRASKA APPeLLATe RePORTS

the obligation for which the trust deed was given as security.’”
The fundamental difficulty with applying § 76-1013 to the
instant lawsuit is that it is not an action to collect a deficiency
on the obligation for which the foreclosed trust deed was given.
The Carl-Boxum note is the obligation that the foreclosed trust
deed secured—and suit for collection of a deficiency on that
obligation must be instituted within 3 months. But, this suit
is on the Munces’ guaranty of payment, a completely separate
and distinct obligation from the promissory note obligation
given by the Carls to Boxum. As a security device, Boxum
took a trust deed from the Carls, and it is this trust deed which
was foreclosed. The fact that Boxum claims that there is still
money owing on the Carl-Boxum note, which could be called a
deficiency, is a “verbal happenstance in language” that is of no
consequence because this action seeks to enforce the contract
that the Munces made when they guaranteed payment of both
the Carl-Boxum note and the Carl-Smith note. It is not a suit to
collect a deficiency on the obligation secured by the foreclosed
trust deed, but, rather, it is a suit to collect on a separate and dif-
ferent contract—the Munces’ guaranty. Therefore, the applicable
statute of limitations is that found in Neb. Rev. Stat. § 25-205
(Cum. Supp. 2006), providing for a 5-year statute of limitations
on an action on any agreement, contract, or promise in writing.
In this regard, we point out that the Nebraska Supreme Court in
Meginnis stated that it was “the obligation secured by a deed of
trust, not the title to the security, [that] determines applicabil-
ity or availability of the 3-month statute of limitations under
§ 76-1013.” 242 Neb. at 775, 497 N.W.2d at 43. In this case,
the “obligation” upon which a deficiency collection suit must be
brought within 3 months of the foreclosure is the Carl-Boxum
note—not the Munces’ guaranty of payment of the Carls’ obliga-
tion to Boxum.
The Meginnis court discussed how Meginnis assumed the
obligation to pay the promissory note and, to ensure perform-
ance of that obligation, Sports Courts used the Nebraska Trust
Deeds Act. But, importantly, Meginnis was a comaker and orig-
inal obligor on the note. In the case before us, the Munces were
not comakers of the note, as was Meginnis, and Boxum did not
use the Nebraska Trust Deeds Act to secure the performance
BOxUM v. MUNCe 	739
Cite as 16 Neb. App. 731

of the Munces’ guaranty—because the Munces had no title and
thus no trust deed to give.
[8] The essential nature of a guaranty as well as the obliga-
tion of a guarantor help clarify that the Munces stand in an
entirely different position than do the Carls vis-a-vis Boxum,
and, thus, the Munces are not entitled to the protection of the
short statute of limitations under the Nebraska Trust Deeds
Act, as were the Carls. The law is that the debtor is not a party
to a guaranty, and the guarantor is not a party to the principal
obligation; the undertaking of the debtor is independent of the
promise of the guarantor and the responsibilities which are
imposed by the contract of guaranty differ from those created
by the contract to which the guaranty is collateral. National
Bank of Commerce Trust & Sav. Assn. v. Katleman, 201 Neb.
165, 266 N.W.2d 736 (1978). See In re Estate of Williams, 148
Neb. 208, 26 N.W.2d 847 (1947).
Finally, we take note of the Munces’ argument designated
as “III,” which asserts that because trust deeds are subject to
the same rules and restrictions as mortgages, citing Blair Co. v.
American Savings Co., 184 Neb. 557, 169 N.W.2d 292 (1969),
the foreclosure of the junior deed of trust, from the Carls to
Boxum, extinguishes the debt on the senior deed of trust and
note, from the Carls to the Smiths, when the same person or
entity holds both the junior and the senior debt—as was true
here. See Tri-County Bank & Trust Co. v. Watts, 234 Neb. 124,
449 N.W.2d 537 (1989). This claim was not presented to, or
decided by, the district court, and hence we neither decide nor
express any opinion thereupon.
CONCLUSION
For the foregoing reasons, we reverse the decision of the dis-
trict court for Lincoln County and find that the 3-month statute
of limitations contained in § 76-1013 does not bar this lawsuit
against the Munces on the guaranty they gave Boxum. This
lawsuit was timely brought.
reverseD anD reManDeD for
further proCeeDIngs .
740 	16 NeBRASKA APPeLLATe RePORTS