McGarry v. Hansen

120 P.3d 525, 201 Or. App. 695, 2005 Ore. App. LEXIS 1247
CourtCourt of Appeals of Oregon
DecidedSeptember 28, 2005
Docket0204-03846; A123266
StatusPublished
Cited by1 cases

This text of 120 P.3d 525 (McGarry v. Hansen) 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
McGarry v. Hansen, 120 P.3d 525, 201 Or. App. 695, 2005 Ore. App. LEXIS 1247 (Or. Ct. App. 2005).

Opinion

SCHUMAN, P. J.

Plaintiff purchased a motorcycle manufactured by defendant. Mechanical problems developed. After defendant did not resolve them to plaintiffs satisfaction, he brought this action alleging breach of contract and breach of express and implied warranties, claiming $5,500 in damages.1 A jury returned a verdict in plaintiffs favor for that amount. In a supplemental judgment, the court awarded plaintiff $46,909 in attorney fees, an enhanced prevailing party fee of $2,000, and $777 in costs and disbursements. On appeal, defendant contests only the allowance of attorney fees, arguing that the statute under which they were allowed, ORS 20.082, does not apply to actions on contracts unless the contract was one “evidencing a debt.” We review for error of law, Chaffee v. Shaffer Trucking, Inc., 151 Or App 323, 325, 948 P2d 760 (1997), and affirm.

In relevant part, ORS 20.082 provides:

“(1) As used in this section, ‘contract’ includes all express or implied contracts and instruments or documents evidencing a debt.
“(2) Except as provided in this section, a court shall allow reasonable attorney fees to the prevailing party on any claim based on contract if:
“(a) The amount of the principal together with interest due on the contract at the time the claim is filed is $5,500 or less; and
“(b) The contract does not contain a clause that authorizes or requires the award of attorney fees.
"*****
“(5) The provisions of this section do not apply to:
“(a) Contracts for insurance;
“(b) Contracts for which another statute authorizes or requires an award of attorney fees;
[698]*698“(c) Any action for damages for breach of an express or implied warranty in a sale of consumer goods or services that is subject to ORS 20.098; or
“(d) Any action against the maker of a dishonored check that is subject to ORS 30.701.”

Plaintiff argues that his action falls within the terms of the statute. Defendant contends that it does not. Each side musters cogent arguments but, as we explain below, plaintiffs is ultimately better.

In essence, defendant’s position is that the statute applies only to actions for the recovery of small debts. In support of that position, it argues that the participial phrase “evidencing a debt” in subsection (1) modifies all of the noun phrases that precede it: express contracts, implied contracts, and “instruments or documents.” Thus, the first criterion that an action must meet in order to qualify for attorney fees under the statute is that it be an action to collect on a debt; because plaintiff does not claim a “debt,” that is, he does not claim that defendant has failed to pay back a sum of loaned money, his action does not qualify. Further, according to defendant, that interpretation is confirmed in paragraph (2)(a), which limits application of the statute to contracts for amounts not larger than $5,500 in “principal together with interest due”; only contracts “evidencing a debt” consist of principal and interest. More specifically, because all of plaintiffs claims are for breach of warranty in one form or another (including breach of the contract implied in a warranty) and none is for a debt consisting of principal and interest, plaintiffs claim is, again, not within the reach of the statute. Moreover, defendant argues that use of the phrase “due on the contract” in paragraph (2)(a) contemplates a liquidated claim for a sum owed and for which a demand may be readily declared under subscetion (3), rather than for an unliquidated damages claim the amount of which would be fixed only after a completed factfinding process.

Defendant also argues that plaintiffs action is excluded because the statute applies only to actions in which the amount of the contract is $5,500 or less, and, although plaintiff claims only that amount in damages, his real damages, as found by the trial court, were considerably more. [699]*699This argument, in other words, is that ORS 20.082 does not encompass actions in which a plaintiff meets the damages limit only by “pleading down” as plaintiff did here.

Several of those arguments do not withstand scrutiny. Although defendant’s reading of subsection (1) so as to apply the qualifier “evidencing a debt” to all of the antecedent items including express and implied contracts is plausible, it is not the better reading. Under the so-called “Doctrine of the Last Antecedent,” a grammar-based rule that limits the reach of a modifying phrase in cases such as this,

“Referential and qualifying words and phrases, where no contrary intention appears, refer solely to the last antecedent. The last antecedent is ‘the last word, phrase, or clause that can be made an antecedent without impairing the meaning of the sentence.’ Thus a proviso usually is construed to apply to the provision or clause immediately preceding it. * * * Evidence that a qualifying phrase is supposed to apply to all antecedents instead of only to the immediately preceding one may be found in the fact that it is separated from the antecedents by a comma.”

State v. Webb, 324 Or 380, 386, 927 P2d 79 (1996) (quoting Norman J. Singer, 2A Sutherland Statutory Construction § 47.33, at 270 (5th ed 1992)) (footnotes omitted). In subsection (1), the phrase “evidencing a debt” is not separated from the antecedents by a comma. Thus, according to the last antecedent doctrine, the phrase “evidencing a debt” modifies only the immediately prior phrase “instruments or documents.” Understood in that way, subsection (1) defines “contract” as a category that includes two broad and overlapping subcategories: “all express or implied contracts” and “instruments or documents evidencing a debt.” Thus, at least insofar as subsection (1) is concerned, the statute covers implied and express contracts even if they do not “evidenc[e] a debt.”

In addition to violating a “rule” of grammar that has been officially approved by the Supreme Court, defendant’s interpretation of subsection (1) also strains logic. Under defendant’s proposed construction, the statute would apply specifically to “implied contracts * * * evidencing a debt.” The statute would therefore address a category of debt agreements implied from the conduct of relevant parties. Although [700]*700such a category might exist, construing the sentence as defendant urges produces a more forced result than reading it with the phrase “implied contracts” unmodified by the phrase “evidencing a debt.”

Likewise, defendant’s contention that the statute excludes claims that have been pleaded down is not convincing.

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Cite This Page — Counsel Stack

Bluebook (online)
120 P.3d 525, 201 Or. App. 695, 2005 Ore. App. LEXIS 1247, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mcgarry-v-hansen-orctapp-2005.