Opinion ID: 1183666
Heading Depth: 1
Heading Rank: 3

Heading: The trial court erred in dismissing plaintiff's complaint.

Text: Defendant contends that plaintiff's complaint fails to state a cause of action under ORS ch. 646. More specifically, defendant contends that ORS 646.060 was not intended to apply to payments made to third parties; that the complaint alleges no facts which show that defendant was not entitled to pay such a discount to a third party or that plaintiff was entitled to the alleged discount, and that ORS 646.060 applies only to transactions in which such payments fall within the terms of ORS 646.060 relating to payments    or any allowance or discount in lieu thereof    to any agent, representative or other intermediary,    in the transaction    where such agent, representative or other intermediary is acting for or in behalf of or is subject to the direct or indirect control of the other party to the transaction. [14] Plaintiff contends, on the contrary, that despite such terms in the second sentence of ORS 646.060, the first sentence of that section contains no such limitation. As originally enacted, the section was composed of one, rather than two sentences. [15] It must be conceded that the intent of the legislature in adding what is now the second sentence of that section is not entirely clear and little legislative history is available on this question. [16] It appears from the letter to counsel in which the trial judge informed them of his decision to overrule defendant's demurrer that he entertained doubts whether plaintiff's complaint was sufficient, saying, however, that I believe that the fairest way to handle this question is to overrule the demurrer and let the case proceed to trial.    As matters developed, we believe that this was a wise decision. Evidence was received on the trial of plaintiff's plea in abatement, without objection, to the effect that defendant's Oregon manager was at least originally under the belief that this was a sale of restaurant equipment by defendant to Crazy Eric's of Oregon; that its principal stockholder also operated a chain of restaurants in Washington and planned to develop a similar chain in Oregon; that when Crazy Eric's of Oregon was incorporated defendant's Oregon manager and his wife were among its stockholders. That evidence was not controlling upon the issues raised by plaintiff's plea in abatement to defendant's affirmative defense. We believe, however, if that upon trial on the merits of this case, plaintiff again offered this same evidence as developed on trial of the plea in abatement, and also offered evidence that defendant paid to Crazy Eric's 10% of the purchase price received by it from plaintiff, the trier of the fact could reasonably infer from such evidence that defendant did not sell the equipment to plaintiff at the same price that it would have sold it to Crazy Eric's; that in the event that this restaurant equipment had been sold directly by defendant to Crazy Eric's of Oregon, rather than to plaintiff, a discount of 10% would have been allowed by defendant to Crazy Eric's, and that, as a result, there was a discrimination in the price charged by defendant to plaintiff. The purpose of ORS ch. 646, as stated in ORS 646.010, is to protect the public from:    any scheme of special concessions or rebates, any collateral contracts or agreements or any device of any nature whereby discrimination is, in substance or fact, effected in violation of the spirit and intent of ORS 646.010 to 646.180. As previously stated, we believe that in the enactment of this statute the legislature intended that it should be liberally construed to afford the greatest possible protection to the public. After considering ORS 646.060 in its application to the facts of this case, and in the light of the purpose of this statute, as stated in ORS 646.010, we hold that the provisions of the first part of ORS 646.060 prohibit payments, allowances and discounts of the nature involved in this case regardless of whether the person who was allegedly paid such a discount was an agent, representative or other intermediary. In other words, we hold that the first part of ORS 646.060, as applied to a scheme or device    whereby discrimination is    effected, within the meaning of ORS 646.010, is not modified by the second part of that section so as to limit its application to persons who are agent[s], representative[s] or other intermediar[ies]    acting for or in behalf of or    subject to the direct or indirect control of the other party to the transaction. Plaintiff's complaint alleges that defendant paid 10% of the purchase price to Crazy Eric's of Oregon, but alleges no facts which show that such a payment was pursuant to any discriminatory scheme or device. We therefore hold that the allegations of plaintiff's second amended complaint were not sufficient to allege a cause of action under ORS 646.060. It appears from the foregoing evidence, however, that it may have been possible for plaintiff to allege sufficient facts to constitute such a cause of action. Accordingly, plaintiff is entitled to an opportunity to do so and it was error to dismiss plaintiff's complaint. Because of the basis on which we decide this case it is not necessary to consider plaintiff's further contention that its complaint stated sufficient facts to constitute a cause of action at common law and defendant's contention to the contrary. For all of these reasons this case is remanded to the trial court for further proceedings not inconsistent with this opinion. Reversed and remanded.