Horton v. Nelson

288 P.3d 967, 252 Or. App. 611, 2012 Ore. App. LEXIS 1211
CourtCourt of Appeals of Oregon
DecidedOctober 3, 2012
Docket090527; A146817
StatusPublished
Cited by10 cases

This text of 288 P.3d 967 (Horton v. Nelson) is published on Counsel Stack Legal Research, covering Court of Appeals of Oregon primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Horton v. Nelson, 288 P.3d 967, 252 Or. App. 611, 2012 Ore. App. LEXIS 1211 (Or. Ct. App. 2012).

Opinion

NAKAMOTO, J.

Plaintiff appeals a limited judgment dismissing plaintiff’s claims against defendants John and Linda Nelson.1 Plaintiff brought a claim for common-law fraud and violation of Oregon’s Unlawful Trade Practices Act (UTPA) against Nelson Equipment Corporation (the company); defendants, as the owners of the company; and Kennedy, an employee of the company. Defendants moved under ORCP 21 A to dismiss and under ORCP 21 E to strike plaintiff’s claims against defendants and moved for attorney fees as sanctions under ORCP 17 or ORS 20.105. The trial court dismissed plaintiff’s claims and granted the motion for sanctions under ORS 20.105. Because the trial court erred by dismissing plaintiff’s claims and awarding attorney fees to defendants, we reverse and remand.

When reviewing the trial court’s granting of a motion to dismiss, we assume the truth of plaintiff’s allegations and any facts that might be adduced to prove them. Gambaro v. Dept. of Justice, 247 Or App 609, 612, 270 P3d 377 (2012). We liberally construe the allegations and view all reasonable inferences in the light most favorable to plaintiff, the nonmoving party. Id.

The following facts are taken from the fourth amended complaint. Defendants were officers of the company, which operated under its own name, as well as the names “The Tractor House” or “The Tractor Connection.” Kennedy was an employee of the company. Defendants and Kennedy set up the company to induce buyers to send money to the company in exchange for tractors that the company advertised on an Internet website. The website portraying The Tractor Connection showed the company “as a major tractor supply business with large grounds, a large warehouse, [and] multiple new tractors of various kinds in stock” and gave “the false impression that it was a large successful tractor dealer.” When a buyer sent money to the company for a tractor, defendants and Kennedy would withdraw the money from the company for their own [614]*614personal use. Defendants, Kennedy, and the company never ordered the tractors from the manufacturer when a buyer placed an order.

Plaintiff is a Texas resident. After seeing the company’s Internet advertisement, plaintiff called the company to inquire about purchasing a tractor. He spoke to Kennedy, who told him that the company required a $200 deposit to order the tractor. Plaintiff paid $200 to the company. A few days later, Kennedy called plaintiff to tell him that the company needed $4,745.45 “right away as part of the delivery process.” Despite receiving plaintiff’s money, the company did not order the tractor. Almost two months later, Kennedy called plaintiff again, requesting that plaintiff pay $5,044.55 to “release” the tractor to plaintiff. The company still had not ordered the tractor. Plaintiff called the company several times and spoke to Kennedy, who in a variety of different stories blamed the tractor manufacturer for the delivery delay. Kennedy made the statements “with the knowledge and consent of the other Defendants” and as part of the common intent to deceive plaintiff. Plaintiff then called the manufacturer directly and discovered that defendants had not ordered his tractor and that Kennedy’s excuses about the delay were untrue. Defendant John Nelson contacted plaintiff in his capacity as president of the company; admitted that the company had no tractors, despite the website indicating that the tractor was “in stock,” and that there were others who were owed money; and told plaintiff that the company was dissolving and had adopted a plan of liquidation. It is unclear whether the company filed for bankruptcy. Plaintiff neither received the tractor nor a refund.

Plaintiff filed an action against defendants, Kennedy, and the company. Kennedy and the company were not served, and only defendants appeared in court. Following plaintiff’s third amended complaint, the court ordered plaintiff to strike his request for punitive damages. Shortly thereafter, plaintiff filed a fourth amended complaint, alleging two claims, one for common-law fraud and the other for violations of the UTPA. The fourth amended complaint included a demand for punitive damages, in violation of the court’s order. Defendants filed motions to make more definite and certain [615]*615under ORCP 21 D, a motion to strike the punitive damages request, and motions to dismiss or to strike the fraud and UTPA violation claims under ORCP 21 A(8), for failure to allege facts sufficient to state a claim, or ORCP 21 E, for alleging claims against defendants that “are not separately stated.” In addition, defendants filed motions for sanctions and an award of attorney fees under ORCP 17 or ORS 20.105.

In a letter opinion, the court granted defendants’ motions to dismiss or to strike plaintiff’s claims. The court noted that, in each of plaintiff’s three previous complaints, “ [p] laintiff made claims against the several defendants which were not separately stated and which did [not] reasonably provide notice as to which defendants were alleged to have done what.” The court also stated that it had previously ruled that the complaints be made more definite and certain and that plaintiff correct those and other defects, but “[p] laintiff again failed to comply with the previous Court Orders in that respect.” The court discussed which orders plaintiff did not follow. Specifically, the court stated that it “unequivocally ruled that Plaintiff was not permitted to plead entitlement to punitive damages without first following the protocol set forth in ORS 31.725. Plaintiff apparently disagrees with that ruling and has again included a claim for punitive damages.” After granting defendants’ motions to dismiss or to strike the claims, the court explained its ruling granting defendants’ motion for sanctions under ORS 20.105. The court found that plaintiff “willfully disobeyed the previous Order(s) of the Court, and, with respect [to] the claim for punitive damages, that there was no objectively reasonable basis for asserting that claim without having first obtained leave of the court pursuant to ORS 31.725.”

Defendants submitted a proposed order, proposed judgment, and statement of fees and costs. Plaintiff filed an objection to the proposed order and judgment. Ultimately, the trial court entered an order and a limited judgment dismissing plaintiff’s claims against defendants and awarding defendants $2,500 in attorney fees and $733 in costs.

On appeal, plaintiff raises three assignments of error. In his first and second assignments of error, plaintiff contends that the trial court erred by dismissing his fraud claim and his UTPA violation claim. In his third assignment [616]*616of error, plaintiff argues that the court erred in awarding attorney fees as sanctions. In response, defendants argue that plaintiff’s fraud claim fails because defendants did not make any false statements and plaintiff did not allege that he relied on those statements.

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Cite This Page — Counsel Stack

Bluebook (online)
288 P.3d 967, 252 Or. App. 611, 2012 Ore. App. LEXIS 1211, Counsel Stack Legal Research, https://law.counselstack.com/opinion/horton-v-nelson-orctapp-2012.