Chapter 542 Oregon Laws 2001

AN ACT

HB 2381

Relating to attorney fees; creating new provisions; amending ORS 20.080, 20.096, 20.097, 46.405, 55.011, 83.100 and 646.498; and repealing section 4, chapter 417, Oregon Laws 2001 (Enrolled House Bill 2374).

Be It Enacted by the People of the State of Oregon:

SECTION 1. (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.

(3) Attorney fees may not be awarded to a plaintiff under the provisions of this section unless written demand for payment of the claim was made on the defendant not less than 10 days before the commencement of the action or the filing of a formal complaint under ORS 46.465, or not more than 10 days after the transfer of the action under ORS 46.461. The failure of a plaintiff to give notice under the provisions of this subsection does not affect the ability of a defendant to claim attorney fees under the provisions of this section.

(4) Attorney fees may not be awarded to a plaintiff under the provisions of this section if the court finds that the defendant tendered to the plaintiff, prior to the commencement of the action or the filing of a formal complaint under ORS 46.465, or not more than 10 days after the transfer of the action under ORS 46.461, an amount not less than the amount awarded to the plaintiff.

(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;

(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.

SECTION 2. ORS 20.080 is amended to read:

20.080. (1) In any action for damages for an injury or wrong to the person or property, or both, of another where the amount pleaded is $5,500 or less, and the plaintiff prevails in the action, there shall be taxed and allowed to the plaintiff, at trial and on appeal, a reasonable amount to be fixed by the court as attorney fees for the prosecution of the action, if the court finds that written demand for the payment of such claim was made on the defendant not less than 10 days before the commencement of the action or the filing of a formal complaint under ORS 46.465, or not more than 10 days after the transfer of the action under ORS 46.461. However, no attorney fees shall be allowed to the plaintiff if the court finds that the defendant tendered to the plaintiff, prior to the commencement of the action or the filing of a formal complaint under ORS 46.465, or not more than 10 days after the transfer of the action under ORS 46.461, an amount not less than the damages awarded to the plaintiff.

(2) If the defendant pleads a counterclaim, not to exceed $5,500, and the defendant prevails in the action, there shall be taxed and allowed to the defendant, at trial and on appeal, a reasonable amount to be fixed by the court as attorney fees for the prosecution of the counterclaim.

(3) The provisions of this section do not apply to any action based on contract.

SECTION 3. ORS 20.096 is amended to read:

20.096. (1) In any action or suit on a contract, where such contract specifically provides that attorney fees and costs incurred to enforce the provisions of the contract shall be awarded to one of the parties, the prevailing party, whether that party is the party specified in the contract or not, at trial or on appeal, shall be entitled to reasonable attorney fees in addition to costs and disbursements.

(2) Attorney fees provided for in a contract described in subsection (1) of this section shall not be subject to waiver by the parties to any such contract which is entered into after September 9, 1971. Any provision in such a contract which provides for a waiver of attorney fees is void.

[(3) If the plaintiff prevails in any action or suit on a contract which expressly provides for the award of attorney fees where the amount of principal together with interest due on such contract at the time of commencement of the proceedings does not exceed $200, there shall be taxed and allowed to the plaintiff a reasonable amount to be fixed by the court as attorney fees, if the court finds that written demand for the payment of plaintiff’s claim was made on the defendant not less than 10 days before the commencement of the action. However, no attorney fees shall be allowed to the plaintiff if the court finds that the defendant tendered to the plaintiff, subsequent to such demand but prior to the commencement of the action or suit, an amount not less than the damages awarded to the plaintiff.]

[(4) In the event that a default judgment is taken against the defendant in an action or suit described in subsection (3) of this section, the amount of attorney fees awarded shall be 25 percent of the amount of the principal together with interest due, exclusive of any other fees or costs authorized by law.]

[(5)] (3) Except as provided in ORS 20.015, as used in this section, [and ORS 20.097] “prevailing party” means the party in whose favor final judgment or decree is rendered.

[(6)] (4) As used in this section and ORS 20.097,”contract” includes any instrument or document evidencing a debt.

SECTION 3a. If House Bill 2374 becomes law, section 4, chapter 417, Oregon Laws 2001 (Enrolled House Bill 2374) (amending ORS 20.096), is repealed and ORS 20.096, as amended by section 3 of this 2001 Act, is amended to read:

20.096. (1) In any action or suit in which a claim is made based on a contract, where such contract specifically provides that attorney fees and costs incurred to enforce the provisions of the contract shall be awarded to one of the parties, the [prevailing] party that prevails on the claim, whether that party is the party specified in the contract or not, [at trial or on appeal,] shall be entitled to reasonable attorney fees in addition to costs and disbursements.

(2) Attorney fees provided for in a contract described in subsection (1) of this section shall not be subject to waiver by the parties to any such contract [which] that is entered into after September 9, 1971. Any provision in such a contract [which] that provides for a waiver of attorney fees is void.

[(3) Except as provided in ORS 20.015, as used in this section, “prevailing party” means the party in whose favor final judgment or decree is rendered.]

[(4)] (3) As used in this section and ORS 20.097, “contract” includes any instrument or document evidencing a debt.

SECTION 4. ORS 20.097 is amended to read:

20.097. (1) In any action or suit on a contract by an assignee of any right under that contract, [when that contract specifically provides that attorney fees and costs incurred to enforce the provisions of the contract shall be awarded to one of the parties, if the defendant is the prevailing party,] the maker of that contract and the plaintiff in the action or suit on that contract shall be severally liable for [reasonable] any attorney fees and costs [provided by ORS 20.096] that may be awarded to the defendant in the action.

(2) As used in this section, “maker” means the original party to the contract which is the subject of the action or suit who is the predecessor in interest of the plaintiff under the contract.

(3) A maker shall be liable under this section only if the defense successfully asserted by the defendant existed at the time of the assignment of the contract.

SECTION 5. ORS 46.405 is amended to read:

46.405. (1) Except as provided in subsection [(3)] (6) of this section, each circuit court shall have a small claims department.

[(2) All actions for the recovery of money, damages, specific personal property, or any penalty or forfeiture, excepting class actions and actions providing for statutory attorney fees, where the amount or value claimed does not exceed $750, shall be commenced and prosecuted only in the small claims department. Where the amount or value claimed does not exceed $5,000, such actions may be commenced and prosecuted in the small claims department.]

(2) Except as provided in this section, all actions for the recovery of money, damages, specific personal property, or any penalty or forfeiture must be commenced and prosecuted in the small claims department if the amount or value claimed in the action does not exceed $750.

(3) Except as provided in this section and ORS 46.455 (2)(c), an action for the recovery of money, damages, specific personal property, or any penalty or forfeiture may be commenced and prosecuted in the small claims department if the amount or value claimed in the action does not exceed $5,000.

(4) Class actions may not be commenced and prosecuted in the small claims department.

(5) Actions providing for statutory attorney fees in which the amount or value claimed does not exceed $750 may be commenced and prosecuted in the small claims department or may be commenced and prosecuted in the regular department of the circuit court. This subsection does not apply to an action based on contract for which attorney fees are authorized under section 1 of this 2001 Act.

[(3)] (6) If a circuit court is located in the same city as a justice court, the circuit court need not have a small claims department if the circuit court and the justice court enter into an intergovernmental agreement that provides that only the justice court will operate a small claims department. If an intergovernmental agreement is entered into under this subsection, the agreement must establish appropriate procedures for referring small claims cases to the justice court.

SECTION 6. ORS 55.011 is amended to read:

55.011. (1) Except as provided in subsection [(5)] (8) of this section, in each justice court created under any law of this state there shall be a [department to be known as the Small Claims Department of the Justice Court] small claims department.

[(2) All actions in the justice court for the recovery of money or damages only, excepting class actions and actions providing for statutory attorney fees, where the amount claimed does not exceed $750, shall be commenced and prosecuted only in the small claims department. Where the amount claimed does not exceed $5,000, such actions may be commenced and prosecuted in the small claims department subject to the provisions of ORS 55.065 (2)(c).]

(4) Class actions may not be commenced and prosecuted in the small claims department.

(5) Actions providing for statutory attorney fees in which the amount or value claimed does not exceed $750 may be commenced and prosecuted in the small claims department or may be commenced and prosecuted in the regular department of the justice court. This subsection does not apply to an action based on contract for which attorney fees are authorized under section 1 of this 2001 Act.

[(3)] (6) Jurisdiction of the person of the defendant in an action commenced in the small claims department shall be deemed acquired as of the time of service of the notice and claim.

[(4)] (7) Except as provided in ORS 55.065 (2)(c), the provisions of ORS 55.020 to 55.140 shall apply with regard to proceedings in the small claims department of any justice court.

[(5)] (8) If a justice court is located in the same city as a circuit court, the justice court need not have a small claims department if the justice court and the circuit court enter into an intergovernmental agreement that provides that only the circuit court will operate a small claims department. If an intergovernmental agreement is entered into under this subsection, the agreement must establish appropriate procedures for referring small claims cases to the circuit court.

SECTION 7. ORS 83.100 is amended to read:

83.100. (1) Except as provided in section 1 of this 2001 Act, the holder of any retail installment contract or retail charge agreement may not collect any delinquency or collection charges, including any attorney’s fee and court costs and disbursements, unless the contract or charge agreement so provides. In such cases, the charges shall be reasonable, and no attorney’s fee may be recovered unless the contract or charge agreement is referred for collection to an attorney not a salaried employee of the holder.

(2) The contract or charge agreement may contain other provisions not inconsistent with the purposes of ORS 83.010 to 83.190, including but not limited to provisions relating to refinancing, transfer of the buyer’s equity, construction permits and title reports.

SECTION 8. ORS 646.498 is amended to read:

646.498. (1) In addition to pursuing any other remedy, a consumer may bring a private cause of action to recover damages caused by a violation of any provision of ORS 646.482 to 646.498. The court shall award a consumer who prevails in such an action pecuniary loss and noneconomic damages, together with costs, disbursements, reasonable attorney fees and any equitable relief that the court determines is appropriate. Pecuniary loss caused by a violation of ORS 646.482 to 646.498 shall include collateral costs, beginning at the time of the violation, whether or not the consumer acquired the rights provided by ORS 646.488. If a consumer has submitted a dispute arising under ORS 646.482 to 646.498 to a dispute resolution procedure as described in ORS 646.494, the consumer may not bring a private cause of action under this section relating to that dispute until a decision resulting from the dispute resolution procedure has been issued or until the consumer has withdrawn the dispute from the dispute resolution procedure.

(2) If a consumer appeals to a court from a decision resulting from the dispute resolution procedure described in ORS 646.494 because the consumer was not granted one of the remedies by ORS 646.482 to 646.498, and the consumer is granted one of the remedies by the court, the consumer who prevails under this subsection shall be awarded:

(a) Up to three times the amount of any damages awarded if the court finds that the party opposing the consumer did not act in good faith in the dispute resolution procedure;

(b) Reasonable attorney fees; and

(3) If the party opposing the consumer is the prevailing party in an action brought under subsection (1) or (2) of this section, the party opposing the consumer shall be entitled to reasonable attorney fees[, in accordance with ORS 20.098, and costs and disbursements] if the court finds the action to have been frivolous.

(4) Any action brought under this section shall be commenced during the period beginning one year after the date the assistive device was originally delivered to the consumer and ending two years later.

SECTION 9. Section 1 of this 2001 Act and the amendments to ORS 20.080, 20.096, 20.097, 46.405, 55.011, 83.100 and 646.498 by sections 2 to 8 of this 2001 Act apply only to actions commenced on or after the effective date of this 2001 Act. Any action commenced before the effective date of this 2001 Act shall continue to be governed by the provisions of law in effect immediately before the effective date of this 2001 Act, as though this 2001 Act had never become law.

Approved by the Governor June 22, 2001

Filed in the office of Secretary of State June 25, 2001

Effective date January 1, 2002

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