Court Opinion

ID: 9560448
Source: CourtListenerOpinion
Date Created: 2023-08-21 17:49:15.687521+00
Date Added: 2024-06-11T09:12:55.712933
License: Public Domain

De MUNIZ, J.,
dissenting.
On reconsideration, I would conclude that the trial court did not err in awarding defendant attorney fees as consequential damages. Accordingly, I dissent.
Defendant alleged the release agreement as both an affirmative defense to plaintiffs action and as a counterclaim. After finding that the agreement was valid, the trial court *550awarded, as consequential damages for breach of the release agreement, the amount of defendant’s attorney fees for preparing and defending the personal injury action.1 Plaintiff does not contest the trial court’s finding that she breached her agreement by suing defendant for her injuries. She argues that in any breach of contract there is a possibility that the dispute will require resolution by litigation. Therefore, she contends, if that fact alone allows for recovery of attorney fees as consequential damages, then attorney fees would be recoverable in every breach of contract action. She argues that that result is clearly not the rule in Oregon, as is evidenced by the long standing rule against recovery of attorney fees in contract actions.
However, the award here is not for resolving the contract dispute. Rather, it is for the litigation expenses that defendant incurred to defend against plaintiffs personal injury claim. In Braught v. Granas, 73 Or App 488, 698 P2d 1012 (1985), the defendants defaulted on a land sale contract with the plaintiffs that caused the plaintiffs, in turn, to default on the contract with their vendor and to defend a foreclosure action. We allowed the plaintiffs defense expenses in defending the foreclosure as consequential damages in their subsequent action against the defendants for breach of the land sale contract. We stated:
“An award of consequential damages is proper, in addition to an award of lost bargain damages, if the consequential damages were contemplated by the parties and were ‘a natural and proximate result of the [purchasers’] breach.’ Senior Estates v. Bauman Homes, 272 Or 577, 584, 539 P2d 142 (1975); see also Blagen v. Thompson, 23 Or 239, 248, 31 P 647 (1892). Here the trial court found that the parties were aware of the underlying contract. It could also have found that it was within the parties’ contemplation that, if plaintiffs defaulted on that contract, plaintiffs’ interest in it would be foreclosed and that they would be liable for costs and attorney fees as a result of the foreclosure. The court could have also found that the parties contemplated that a default by defendants on the contract with plaintiffs would cause plaintiffs to default on the underlying contract * * * and would result in damage to plaintiffs.” Braught v. Granas, supra, 73 Or App at 493. (Brackets in original.)
*551As defendant points out, unlike in Braught, here there is no need to speculate if the parties contemplated that plaintiffs breach of the contract not to sue would cause defendant to incur litigation costs beyond the costs incident to enforcing the contract itself. That is so, because the contract here was plaintiffs agreement to fully and finally settle any personal injury claim against defendant and to release him from any further injury claims. See Raymond v. Feldmann, 120 Or App 452, 454 n 1, 853 P2d 297 (1993). It was a contract not to sue; the natural and necessary result of its breach was the incurring of litigation expense. I would affirm the trial court’s award of attorney fees as a measure of the damages that defendant incurred in defending against plaintiffs claims for personal injury.
Richardson, C. J., andWarren, J., join in this dissent.

 The parties stipulated to the amount of those expenses.