Court Opinion

ID: 9900436
Source: CourtListenerOpinion
Date Created: 2023-11-18 22:12:54.591288+00
Date Added: 2024-06-11T09:21:05.462970
License: Public Domain

No. 298               June 14, 2023                    363

          IN THE COURT OF APPEALS OF THE
                  STATE OF OREGON

                     Molly SMITH,
                  Plaintiff-Respondent,
                            v.
                Tina Pauline JOHNSON,
                  Defendant-Appellant.
               Baker County Circuit Court
                  21LT02316; A176787

  Matthew B. Shirtcliff, Judge.
  Argued and submitted September 15, 2022.
   Rachael A. Federico argued the cause for appellant. Also
on the brief was Sara T. Montrone.
  No appearance for respondent.
  Before Ortega, Presiding Judge, and Powers, Judge, and
Hellman, Judge.
  POWERS, J.
  Vacated and remanded.
364                                         Smith v. Johnson

        POWERS, J.
         In this residential forcible entry and detainer (FED)
action, tenant challenges the attorney-fee award, arguing
that the trial court erred in its application of ORS 20.075,
which outlines factors for awarding of attorney fees, and in
setting the post-judgment interest rate at zero percent per
annum. Tenant further argues that the court abused its dis-
cretion by focusing on impermissible criteria to determine
the amount of attorney fees. Landlord did not file a respon-
dent’s brief and thereby waived appearance on appeal under
ORAP 5.60, which provides that, “[i]f the respondent files no
brief, the cause will be submitted on the appellant’s open-
ing brief and appellant’s oral argument, and the respondent
shall not be allowed to argue the case.” As explained below,
we conclude that the trial court erred in its determination
of the fee amount and its imposition of a zero percent inter-
est rate. Accordingly, we vacate and remand for further pro-
ceedings without reaching whether the trial court made a
choice outside the permissible range of discretion when it
weighed the factors to determine the amount of attorney
fees.
         We review a trial court’s decision to award or deny
legal fees in landlord-tenant disputes for abuse of discretion,
ORS 20.075(3), which asks whether the amount was in the
range of legally permissible outcomes. See, e.g., Stonecrest
Properties, LLC v. City of Eugene, 280 Or App 550, 562-
63, 382 P3d 539 (2016) (reviewing fee award to determine
whether it was “within the range of permissible choices
available to the trial court”). Although the court’s decision
is reviewed for abuse of discretion, we review the terms on
which the trial court exercised its discretion for legal error.
Barbara Parmenter Living Trust v. Lemon, 345 Or 334, 342,
194 P3d 796 (2008). That is, even where a trial court has
discretion to reach a certain outcome, it may not rely on a
mistaken legal premise to reach that outcome. Anderson v.
Sullivan, 311 Or App 406, 413, 492 P3d 118, rev den, 368 Or
702 (2021).
        The facts are undisputed and primarily procedural.
Tenant rented a house owned by landlord. Landlord filed an
FED action for possession in Baker County Justice Court
Cite as 326 Or App 363 (2023)                            365

after serving tenant with two separate notices for non-
payment of rent and termination of the tenancy for cause.
Tenant, represented by counsel, filed defenses and counter-
claims based in part on House Bill (HB) 4401 (2020), which
provided renters with certain protections from eviction
during the COVID-19 pandemic. The justice court awarded
damages on tenant’s counterclaims and awarded possession
of the home to landlord. Tenant appealed that decision to
the circuit court. See ORS 53.010 (authorizing any party to
appeal “a judgment in a civil action in a justice court * * *
when the action is for the recovery of the possession of real
property”); ORS 53.020 (providing that an appeal from a
justice court “is taken to the circuit court for the county
wherein the judgment is given”).
         After a hearing, the circuit court entered a judg-
ment in favor of tenant; it dismissed landlord’s claim for
possession, found that landlord had violated HB 4401, and
awarded damages to tenant on her counterclaims. The
damages included three months of periodic rent and a $640
prevailing party fee, totaling $3,340. Following entry of the
judgment, tenant sought attorney fees in accordance with
ORS 90.255 (authorizing reasonable attorney fees for any
action on a rental agreement or arising under ORS chapter
90). Tenant’s counsel submitted a fee petition representing
21.8 hours of work at a rate of $200 per hour for a total
of $4,360. That amount included time spent in both jus-
tice court and the circuit court. Landlord filed a motion to
reduce or eliminate the fees, and the court held a hearing to
determine the fee award.
         At that hearing, landlord, who was not represented
by counsel in any of the proceedings, sought to reduce or
eliminate the fees by arguing that she filed the FED action
for possession in good faith and that she did not understand
that HB 4401 prevented her from seeking to evict tenant.
Tenant contended that the fees were reasonable, authorized
by statute, and that landlord had refused to dismiss the
case when given the opportunity before trial.
         In announcing its fee decision, the trial court made
findings related to some of the factors enumerated in ORS
20.075, including that: landlord had not acted in bad faith in
366                                                       Smith v. Johnson

filing her action for possession; the objective reasonableness
of the claims and defenses “cut more in favor” of tenant; and
tenant’s attorney was fair in her assessment of her time and
likely charged a lower rate than what her abilities would
support. Ultimately, the trial court entered an amended
judgment awarding tenant $600 of the $4,360 requested
attorney fees. The court specified at the hearing that the
fee award was for three hours of counsel’s work in preparing
for and representing tenant in circuit court, and specifically
noted that it did not award any fees for the justice court pro-
ceedings. In the written amended judgment, the court set
the post-judgment per annum interest rate at zero percent.
         On appeal, tenant argues that the trial court erred
in barring fees for the justice court proceedings, setting the
interest rate at zero percent, and by improperly weighing
the statutory factors enumerated in ORS 20.075 to reduce
the attorney fee award. As noted earlier, landlord does not
appear on appeal.
         We begin our analysis with tenant’s contention
that the trial court erred in barring attorney fees for the
justice court proceedings. In any action arising under ORS
chapter 90, a trial court “may” award attorney fees to the
prevailing party. ORS 90.255. To guide that determination,
ORS 20.075(1) and (2), respectively, provide factors that the
court must consider in determining whether to make a fee
award and, if so, the amount of the award.1 ORS 20.075 does

   1
     ORS 20.075 provides, in part:
       “(1) A court shall consider the following factors in determining whether
   to award attorney fees in any case in which an award of attorney fees is
   authorized by statute and in which the court has discretion to decide whether
   to award attorney fees:
       “(a) The conduct of the parties in the transactions or occurrences that
   gave rise to the litigation, including any conduct of a party that was reckless,
   willful, malicious, in bad faith or illegal.
       “(b) The objective reasonableness of the claims and defenses asserted by
   the parties.
       “(c) The extent to which an award of an attorney fee in the case would
   deter others from asserting good faith claims or defenses in similar cases.
       “(d) The extent to which an award of an attorney fee in the case would
   deter others from asserting meritless claims and defenses.
       “(e) The objective reasonableness of the parties and the diligence of the
   parties and their attorneys during the proceedings.
Cite as 326 Or App 363 (2023)                                                 367

not address which types of judicial proceedings are eligi-
ble for attorney fee awards; however, we have previously
held that attorney fees incurred at judicial proceedings
beyond the circuit court “are just as recoverable as those
incurred in the circuit court.” Morat v. Sunset Village, LLC,
294 Or App 427, 444, 432 P3d 327 (2018) (explaining that
attorney fees incurred during court-annexed arbitration are
recoverable).
        In this case, after discussing some of the factors
within ORS 20.075(1) and (2), the trial court concluded:
   “I am going to—I’m not going to award for justice court
   time, I’m going to award a fee of $600 for the circuit court
   time for three hours of some prep time, but court time for
   sure, plus a prevailing party fee, which I believe puts the
   total around $1,200.”

        “(f) The objective reasonableness of the parties and the diligence of the
   parties in pursuing settlement of the dispute.
        “(g) The amount that the court has awarded as a prevailing party fee
   under ORS 20.190.
        “(h) Such other factors as the court may consider appropriate under the
   circumstances of the case.
        “(2) A court shall consider the factors specified in subsection (1) of this
   section in determining the amount of an award of attorney fees in any case
   in which an award of attorney fees is authorized or required by statute. In
   addition, the court shall consider the following factors in determining the
   amount of an award of attorney fees in those cases:
        “(a) The time and labor required in the proceeding, the novelty and dif-
   ficulty of the questions involved in the proceeding and the skill needed to
   properly perform the legal services.
        “(b) The likelihood, if apparent to the client, that the acceptance of the
   particular employment by the attorney would preclude the attorney from
   taking other cases.
        “(c) The fee customarily charged in the locality for similar legal services.
        “(d) The amount involved in the controversy and the results obtained.
        “(e) The time limitations imposed by the client or the circumstances of
   the case.
        “(f) The nature and length of the attorney’s professional relationship
   with the client.
        “(g) The experience, reputation and ability of the attorney performing
   the services.
        “(h) Whether the fee of the attorney is fixed or contingent.
        “(i) Whether the attorney performed the services on a pro bono basis or
   the award of attorney fees otherwise promotes access to justice.”
368                                                      Smith v. Johnson

Although the court had discretion to determine the amount
of the fee award, it may not categorically deny fees because
they were incurred during the justice court proceedings.
We discussed that same principle for a different issue in
Anderson. In that case, the plaintiff objected to the defen-
dant’s attorney fee request, and the defendant’s counsel
filed a response defending his request for fees. 311 Or App
at 407-08. The defendant then requested additional fees
for the time his counsel spent defending the initial request
(so-called “fees on fees”). Id. at 408. The trial court denied
that request, concluding that the plaintiff did not contest
the fees in bad faith and explaining that “the defendant
cannot receive attorney’s fees for contesting the objection.”
Id. at 409. We disagreed with the trial court and remanded,
explaining that, although the court had discretion to deny
the fees, it was legally incorrect to say that defendant could
not recover the requested fees. Id. at 414.
         The Anderson principle applies with equal force in
this case. As in that case, the trial court here had discre-
tion to award or deny tenant’s attorney fees based upon the
application of the factors in ORS 20.075 to make a reason-
able award. It may not, however, categorically deny fees sim-
ply because they were based on work in the justice court, as
opposed to the circuit court. Because the attorney fee award
in this case appears to do so, we conclude that the trial court
erred and vacate the attorney fee award and remand.
         We further conclude that the trial court erred in
setting the post-judgment per annum interest rate at zero
percent. Generally, the interest rate for judgments that
include the payment of money is nine percent per annum
under ORS 82.010(2).2 Post-judgment interest is imposed on

   2
     ORS 82.010 provides, in part:
        “(2) Except as provided in this subsection, the rate of interest on judg-
   ments for the payment of money is nine percent per annum. The following
   apply as described:
        “(a) Interest on a judgment under this subsection accrues from the date
   of the entry of the judgment unless the judgment specifies another date.
        “(b) Interest on a judgment under this subsection is simple interest,
   unless otherwise provided by contract.
        “(c) Interest accruing from the date of the entry of a judgment shall also
   accrue on interest that accrued before the date of entry of a judgment.
Cite as 326 Or App 363 (2023)                                               369

all judgments and does not require that a prevailing party
plead a claim for the interest. Young v. State of Oregon, 346
Or 507, 515, 212 P3d 1258 (2009); see also Chase and Chase,
354 Or 776, 782, 323 P3d 266 (2014) (explaining that interest
under ORS 82.010(2)(b) “applies (in the absence of a different
contractual arrangement) to all judgments”). Post-judgment
interest accrues on attorney fees and costs that are entered
as part of the judgment. ORS 82.010(2)(d). Here, the trial
court gave no explanation as to why it set the interest rate at
zero percent, and there was no alternative rate discussed by
the parties at the FED trial or the motion hearing. Indeed,
the first time that the zero percent interest rate appeared
in this proceeding was in the written amended judgment.
Because there is no explanation why the trial court devi-
ated from the nine percent interest rate dictated by ORS
82.010(2), we conclude that the trial court erred by imposing
a zero percent post-judgment interest rate. See Warrington
v. Nichols, 57 Or App 828, 829, 646 P2d 638 (1982) (vacating
judgment and remanding for entry of a new judgment “pro-
viding for interest on the amount of the judgment at the rate
of 9 percent”).
         Finally, tenant advances additional arguments
challenging the trial court’s analysis of the factors in ORS
20.075. She contends that the court abused its discretion
by applying factors not permitted under ORS 20.075, and
that it erred by finding that ORS 20.075(1)(g) (amount of
the prevailing party fee) and ORS 20.075(2)(a) (difficulty of
the legal questions involved) weighed against awarding fees.
See Barbara Parmenter Living Trust, 345 Or at 347 (explain-
ing that “the decision not to award enhanced prevailing
party fees either is neutral or leaves open the possibility of
       “(d) Interest under this subsection shall also accrue on attorney fees and
   costs entered as part of the judgment.
       “(e) A judgment on a contract bearing more than nine percent interest
   shall bear interest at the same rate provided in the contract as of the date of
   entry of the judgment.
       “(f) The rate of interest on a judgment rendered in favor of a plaintiff
   in a civil action to recover damages for injuries resulting from the profes-
   sional negligence of a person licensed by the Oregon Medical Board under
   ORS chapter 677 or the Oregon State Board of Nursing under ORS 678.010
   to 678.410 is the lesser of five percent per annum or three percent in excess
   of the discount rate in effect at the Federal Reserve Bank in the Federal
   Reserve district where the injuries occurred.”
370                                      Smith v. Johnson

an award of attorney fees under ORS 20.075(1)”). Given our
disposition that vacates the attorney fee award and because
the record is less developed on those issues, we need not
reach tenant’s arguments. The parties and the trial court
will have an opportunity to revisit the application of the
factors in ORS 20.075 to determine the proper attorney fee
award on remand.
        Vacated and remanded.