Bridgestar Capital Corp. v. Nguyen
Bridgestar Capital Corp. v. Nguyen
Opinion of the Court
EGAN, C. J.
*205In this judicial foreclosure action, plaintiff appeals a supplemental judgment awarding attorney fees to defendant Nguyen.
The relevant facts are procedural. In its complaint, plaintiff sought to foreclose its mortgage and alleged that, under the mortgage note and deed of trust, it was entitled to recover "its attorney fees and costs of foreclosure." It expressly sought attorney fees under a provision in the note. In her answer, Nguyen denied all of plaintiff's allegations and asserted 12 affirmative defenses. Neither that part of Nguyen's pleading nor the associated prayers, which assert that plaintiff is not entitled to the relief it seeks and that Nguyen is entitled to dismissal of the action, mentions attorney fees. In the same pleading, Nguyen alleged three counterclaims, based on the Fair Debt Collection Practices Act,
Plaintiff moved to dismiss Nguyen's counterclaims under ORCP 21 A(8), contending, among other things, that Nguyen had failed to allege facts sufficient to state a *206claim on any of her counterclaims. The trial court granted the motion and dismissed the counterclaims with leave for Nguyen to refile. Nguyen did so, again without mentioning attorney fees with respect to plaintiff's claims and again seeking attorney fees on the three counterclaims. Plaintiff again moved to dismiss on the same ground, and the trial court granted the motion, again granting Nguyen leave to refile. Nguyen filed a second amended answer that, again, did not mention attorney fees with respect to plaintiff's claims but sought attorney fees on the three counterclaims.
Plaintiff moved for summary judgment on its claims and Nguyen's counterclaims, and Nguyen filed a cross-motion for summary *1097judgment on plaintiff's claims. Nguyen did not respond to plaintiff's arguments in favor of summary judgment on the counterclaims. The trial court denied plaintiff's motion for summary judgment, granted summary judgment for Nguyen on plaintiff's claims, and entered a general judgment dismissing the action without prejudice.
On appeal, as it did before the trial court, plaintiff asserts that Nguyen failed to allege any entitlement to attorney fees on plaintiff's claims. Consequently, in plaintiff's view, Nguyen failed to comply with ORCP 68 C(2)(a), which requires a party to "allege the facts, statute, or rule that provides a basis for the award of fees in a pleading filed by that party" and provides that "[n]o attorney fees shall *207be awarded unless a right to recover fees is alleged as provided in this paragraph or [another paragraph not applicable here]."
In Mulier v. Johnson ,
Based on that rule and our previous case law, we held that the failure to seek fees in the motion was not fatal to the defendant's request because "any reasonable person, upon reading the memorandum, would have understood that [the defendant was] asserting an entitlement to fees and what the basis for that entitlement was" and because, by seeking fees in the memorandum, the defendant had asserted the entitlement to fees "at the 'first appropriate opportunity.' " Mulier I ,
The Supreme Court rejected our reasoning and reversed our decision. Mulier v. Johnson ,
The Supreme Court's holding in Mulier II demonstrates that the question in this case is whether Nguyen alleged, or at least attempted to allege, the right to recover attorney fees in her pleadings in one of the ways required by ORCP 68 C(2)(a). If she did not, ORCP 12 B cannot excuse the omission. To review, ORCP 68 C(2)(a) requires a party seeking fees to "allege the facts, statute, or rule that provides a basis for the award of fees in a pleading filed by that party." "No attorney fees shall be awarded unless a right to recover fees is alleged as provided in this paragraph * * *."
In her counterclaims, Nguyen alleged the right to recover fees under the law governing those counterclaims. Under these circumstances, however, those allegations do not satisfy ORCP 68 C(2)(a) because those sources of law *209do not "provide[ ] a basis for the award of fees" that she sought and that the trial court awarded. ORCP 68 C(2)(a) (emphasis added). Here, Nguyen sought, and was awarded, fees because she prevailed on plaintiff's claims based on the note and trust deed. Thus, "the award of fees" was based on the note and ORS 20.096. The counterclaims were distinct from plaintiff's claims; litigation of plaintiff's claims would not have implicated the sources of law on which Nguyen's counterclaims (and attorney fee allegations) were based. Consequently, Nguyen's allegations of the right to fees on the counterclaims could have provided a basis for a different award of fees-fees that would have been awarded if Nguyen had prevailed on her counterclaims and sought fees on that ground-but they did not "provide[ ] a basis for the award of fees" that the trial court did make.
Nevertheless, Nguyen asserts that the pleadings justify the fee award because, considered as a whole, they adequately allege facts that provide a basis for the award of fees. That is so because, in her view, ORCP 68 C(2)(a), read in conjunction with ORCP 12 B, requires only that the other party needs to be "fairly alerted to the fact that attorney fees would be sought." Lumbermen's ,
Before the Supreme Court's decision in Mulier , we had established an analysis under ORCP 68 C(2) that, consistently with Nguyen's argument, largely ignored the textual requirements of ORCP 68 C(2) and focused instead on notice and prejudice to the opposing party. See, e.g. , Mulier I ,
Accordingly, we take this opportunity to clarify that, after Mulier II , a party's complete failure to comply with the textual requirements of ORCP 68 C(2) cannot be excused by the fact that the opposing party's pleadings, or the circumstances as a whole, would have alerted the opposing party of the prevailing party's intention to seek attorney fees. Nor can complete failure to comply be excused by the fact that the opposing party was not prejudiced by the failure. "A complete failure to allege the right to attorney fees [as required by ORCP 68 C(2) ] does not demonstrate an *211attempt to comply with the requirements of that rule" and, consequently, cannot be excused by ORCP 12 B. Mulier II ,
Here, in her own pleadings, Nguyen did not allege, or attempt to allege, "facts * * * that provide[ ] a basis for the award of fees." ORCP 68 C(2)(a). She did not allege, or even admit, the existence of a contract or any contractual fee provision, and she did not assert any right at all to fees on plaintiff's claims. ORCP 12 B does not allow us to rely on plaintiff's pleadings or what plaintiff knew or may have known to excuse Nguyen's lack of attempt to comply with ORCP 68 C(2)(a).
Reversed and remanded.
Nguyen was the only defendant who appeared below and, likewise, is the only defendant who appears on appeal.
Neither party objected to the court's dismissal of Nguyen's counterclaims despite the trial court's denial of plaintiff's unopposed motion for summary judgment on those claims.
ORS 20.096(1) provides:
"In any action or suit in which a claim is made based on a contract that specifically provides that attorney fees and costs incurred to enforce the provisions of the contract shall be awarded to one of the parties, the party that prevails on the claim shall be entitled to reasonable attorney fees in addition to costs and disbursements, without regard to whether the prevailing party is the party specified in the contract and without regard to whether the prevailing party is a party to the contract."
ORCP 68 C(2)(a) provides:
"A party seeking attorney fees shall allege the facts, statute, or rule that provides a basis for the award of fees in a pleading filed by that party. Attorney fees may be sought before the substantive right to recover fees accrues. No attorney fees shall be awarded unless a right to recover fees is alleged as provided in this paragraph or in paragraph C(2)(b) of this rule."
Although the particular circumstances at issue in Mulier involved a motion, rather than a pleading, and thus were addressed by ORCP 68 C(2)(b) rather than ORCP 68 C(2)(a), the court noted that the two provisions are phrased the same way, and it is clear that the court's holding applies equally to ORCP 68 C(2)(a).
It is undisputed that Nguyen did not allege, or attempt to allege, a right to fees under a rule.
We express no opinion on whether an allegation of a right to fees on one claim might constitute an allegation of or attempt to allege a right to fees on another claim if the claims were more closely related than those at issue here.
Because Nguyen neither alleged nor admitted any facts regarding a contract or fees under a contract, we need not consider precisely what suffices to allege or attempt to allege "the facts * * * that provide[ ] a basis for the award of fees," ORCP 68 C(2)(a), and, consequently, whether any of our pre-Mulier II case law on that question is consistent with the Supreme Court's holding in Mulier II .
Case-law data current through December 31, 2025. Source: CourtListener bulk data.