                         IN THE NEBRASKA COURT OF APPEALS

               MEMORANDUM OPINION AND JUDGMENT ON APPEAL
                        (Memorandum Web Opinion)

                                    MOGENSEN V. MOGENSEN


  NOTICE: THIS OPINION IS NOT DESIGNATED FOR PERMANENT PUBLICATION
 AND MAY NOT BE CITED EXCEPT AS PROVIDED BY NEB. CT. R. APP. P. § 2-102(E).


                                 STEVEN MOGENSEN, APPELLEE,
                                                V.

                                 KEITH MOGENSEN, APPELLANT.


                            Filed January 17, 2017.    No. A-15-848.


       Appeal from the District Court for Boone County: RACHEL A. DAUGHERTY, Judge.
Affirmed.
       George H. Moyer, of Moyer & Moyer, for appellant.
       David S. Houghton and Keith A. Harvat, of Houghton, Bradford & Whitted, P.C., L.L.O.,
and Jeffrey C. Jarecki, of Jarecki Law, P.C., L.L.O., for appellee.



       MOORE, Chief Judge, and INBODY and PIRTLE, Judges.
       PIRTLE, Judge.
                                       INTRODUCTION
       Keith Mogensen appeals from an order of the district court for Boone County which
granted a receiver the authority to sell the personal property of Mogensen Brothers Land and Cattle
Company, a partnership between Keith and his two brothers, Steven Mogensen and Brian
Mogensen. Based on the reasons that follow, we affirm.
                                        BACKGROUND
       Keith, Steven, and Brian formed Mogensen Brothers Land and Cattle Company, a farming
partnership, in 1982 by a written agreement, which was amended in 1987.




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         In June 2013, Steven filed a complaint against Keith and Brian, alleging they had breached
the partnership agreement, violated the Uniform Partnership Act, and breached their fiduciary
duties as partners. Steven filed an amended complaint in July. Steven sought a full accounting of
partnership assets and profits, disgorgement of partnership profits, the imposition of a constructive
trust for property and assets of the partnership, and disassociation of Brian and Keith from the
partnership. In November, Brian was dismissed as a party to the case without prejudice.
         In December 2013, Keith filed an application for appointment of a receiver for the
partnership. The court granted Keith’s application and appointed a receiver. Among the
instructions set forth by the court for the receiver was an instruction which provided that “the
Receiver shall submit periodic reports to the parties not less frequently than quarterly and may
report them to the Court and file Motions requesting Instructions, seeking clarification or
authorizing other actions, or permitting the Receiver to take other steps as the Receiver deems
reasonably prudent and necessary.”
         The receiver filed an acceptance of appointment in February 2014. Since the time of his
appointment, the receiver has filed numerous motions seeking authorization to take various actions
and has filed reports as ordered by the court.
         On July 24, 2015, the receiver filed a “Motion for Approval to Marshal Mogensen Brothers
Personal Property and Authority to Sell,” asking the court to authorize him “to expend the financial
resources necessary to physically assemble and relocate (‘Marshal’) all of the personal property of
the Mogensen Brothers Land and Cattle partnership . . . into one central location,” and for authority
“to hire an auction company to sell all of the personal property owned by [the partnership].” The
receiver also asked the court for authority to sell all of the livestock owned by the partnership.
         A hearing on the receiver’s motion was heard on August 4, 2015. Steven had no objection
to the motion. Keith objected to the motion, and the court asked the receiver if he had any evidence
in support of the motion. The receiver offered a copy of his affidavit he had attached to the motion,
and it was received into evidence. In the affidavit, the receiver stated that he was appointed as the
receiver over Mogensen Brothers Land and Cattle Partnership on January 30, 2014, and since that
time, he had become familiar with all aspects of the farming and ranching operations of the
partnership. It stated that starting in late winter 2014, and since then, he had been conducting
several business matters, including the renting out of all the partnership’s real estate. The affidavit
further stated that the receiver was principally interested in selling all the farm equipment and
machinery previously needed by the partnership when it was the active farm and ranch operator
for the real estate. It stated that the last time the partnership actively farmed the partnership’s real
estate was in 2013. After the receiver’s appointment in January 2014, the receiver leased out all of
the real estate to third parties. The equipment and machinery were not needed for conducting
farming and ranching operations in 2014. In 2015, the receiver again entered into lease
arrangements for the partnership’s real estate and the farming and ranch equipment went unused
for the 2015 growing season. The receiver stated in the affidavit that he does not know when the
equipment and machinery will be used again and he is concerned that it will depreciate in value if
the litigation continues and the equipment goes unused. The receiver believed that the sale and
disposition of the personal property was in the best interests of the receivership.




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         The receiver also offered an inventory of personal property that he had prepared in the
spring of 2014. The exhibit was received into evidence.
         After the receiver presented his evidence, Keith called the receiver to testify. The receiver
testified that the partnership owns approximately 3,600 acres of land located in various parts of
Boone County, with the exception of 480 acres located in Greeley County. He testified that the
various tracts of land each have various personal property located on them, particularly equipment
used for farming and ranching.
         The receiver testified that prior to his involvement as receiver, the partnership had farmed
its land through the 2013 growing season. He testified that he did not know and could not predict
whether or not the partnership would continue farming after the dissociation action was resolved.
         The receiver testified that he and the farm manager had been discussing whether to
physically marshal all of the property to one site and prepare it for auction or whether to leave the
property where it is at do a “virtual marshalling” by taking pictures of the property, identifying the
values and selling the property online. He stated that no decision had been made on which option
would be the best way to handle selling the property. He testified that he estimated the cost to
marshal the property into one location would be between $50,000 and $75,000, due to the “vastness
of assets” that are involved. He explained that there is a lot of personal property in a lot of different
locations, at various stages of operation.
         The receiver also testified that he had talked to the partnership’s accountant about the tax
ramifications of an auction. He stated that based on information from the accountant, depreciation
had been claimed on the property for tax purposes, but the receiver did not know the specifics. He
was asked if he was aware of the tax consequences of recapturing depreciation on equipment that
has previously been claimed as depreciated property. The receiver said he had a general familiarity,
but not to the extent of a tax expert.
         Keith’s counsel, in his closing comments, stated that his main objection to the receiver’s
motion was the proposal to marshal the assets into one location. He stated that consolidating all
the property from the various tracts of land is an inefficient way to handle the property. He stated
that a more efficient way to handle the sale of the property would be to have an auction company
go to the various tracts of land and appraise the personal property to be sold. Keith’s counsel also
stated that there would be significant tax issues with recapturing the depreciation on the personal
property. He further stated that it was premature to sell the personal property when it was unknown
whether or not the partnership would use the property going forward as it did before the receiver
was appointed.
         Following the hearing, the trial court entered an order granting the motion and granting the
receiver the authority to marshal the assets in a way he deemed most practical, and to sell the
property.
                                    ASSIGNMENTS OF ERROR
        Keith assigns that the trial court erred in (1) failing to recognize that the partnership is an
entity which will continue after the disassociation matter is resolved, (2) concluding that a sale is
necessary to prevent depreciation of the farm machinery, (3) failing to find that the evidence was




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insufficient to show that depreciation and depletion are occurring at a rate which will outweigh the
tax consequences of a sale or the cost of assembling the property for sale, and (4) ordering a sale.
                                     STANDARD OF REVIEW
        On appeal from an equity action, an appellate court tries factual questions de novo on the
record and, as to questions of both fact and law, is obligated to reach a conclusion independent of
the conclusion reached by the trial court. Sutton v. Killham, 22 Neb. App. 257, 854 N.W.2d 320
(2014).
                                             ANALYSIS
        Keith’s four assignments of error can be consolidated into one: The trial court erred in
finding there was sufficient evidence to grant the receiver’s “Motion for Approval to Marshal
Mogensen Brothers Personal Property and Authority to Sell,” authorizing him to sell the
partnership’s farming equipment and machinery. The record shows that the receiver was appointed
in January 2014 and since that time has been very involved with the partnership’s operations. The
Supplemental Transcript provides documentation of all the actions requested and undertaken by
the receiver since his appointment. The receiver’s affidavit states that he has become very familiar
with the farming and ranching operations of the partnership.
        The evidence showed that the receiver had leased out the real estate owned by the
partnership to third parties since January 2014. The last time the partnership actively farmed the
real estate was in 2013 and since then the equipment and machinery had not been used for
conducting farming and ranching operations. The receiver indicated that he had no way of knowing
how long the pending litigation would last and whether the equipment would be used after it ended.
However, he was concerned that if the litigation continues and the equipment continues to go
unused it will depreciate in value.
        Although the receiver presented no specific evidence regarding the cost and the tax liability
that will come with marshalling and selling the property, the receiver had become intimately
familiar with the farming and ranching operations. Based on his experience and involvement with
the partnership and it operations, he testified that in his opinion the sale and disposition of the
personal property was in the best interests of the receivership.
        Although Keith objected to the motion, he presented no evidence to show that selling the
property was not in the partnership’s best interests.
        A receiver is generally obliged to preserve and protect property for the benefit of all parties.
Such a duty requires that the receiver proceed with the same care and diligence that an ordinary
prudent person would use in caring for and handling property under like circumstances. See Dickie
v. Flamme Bros., 251 Neb. 910, 560 N.W.2d 762 (1997). Based on the record before us, we
determine that the receiver was fulfilling his duty to preserve and protect the property by filing a
motion to marshal and sell the personal property. By asking the court for permission to sell the
property, he was doing what was in the best interests of the partnership, rather than letting the
property continue to depreciate in value. Upon our de novo review, we determine that the trial
court did not err in granting the receiver’s motion and granting him the authority to marshal the
assets in a way he deemed most practical, and to sell the property.




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                                         CONCLUSION
        We conclude that the trial court did not err in granting the receiver’s “Motion for Approval
to Marshal Mogensen Brothers Personal Property and Authority to Sell,” authorizing him to sell
the partnership’s personal property. Accordingly, the order of the trial court is affirmed.
                                                                                          AFFIRMED.




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