Court Opinion

ID: 6930478
Source: CourtListenerOpinion
Date Created: 2022-07-23 23:56:54.613051+00
Date Added: 2024-06-11T16:07:09.337525
License: Public Domain

GILLETTE, J.,
dissenting.
Apparently motivated by its irritation at the state’s use of a particular form of incorporation by reference in its contracts, the majority has promulgated a new rule of law which translates roughly as “contracts of adhesion, even when they are clear, can be unenforceable if they are too long.” I know of no principled basis for the adoption of such a rule and therefore decline to join in it.
*347The problem is what to do with a paragraph which appears on the back of a single-page application filed by defendant with the state seeking permission to construct, operate and maintain an irrigation canal across state property. That paragraph appears at page 2 of the proposed opinion, but I repeat it here for convenience:
“The appropriate General Provisions contained in ‘Oregon State Highway Commission, General Provisions for Pole Line, Buried Cable, Pipe Line, Non-commercial Signs and Miscellaneous Operations and/or Facility Permits, December, 1966’ * * * shall apply to this permit, and by this reference are made a part hereof. It shall he the obligation of the applicant to obtain said General Provisions from the Commission and to determine which of the various provisions are applicable before the commencement of work under said permit.” (Emphasis supplied.)
Reading the provision in question on its face, it seems to be self-evident that it means the following:
1. Anyone such as defendant who files an application must obtain a copy of the “General Provisions.”
2. Upon obtaining the book of General Provisions, the applicant must read them.
3. Whether he reads them or not, the applicant is bound by each of the General Provisions which by its terms is clearly applicable to the kind of project for which permission is sought.
To take a slightly different approach, the paragraph appearing on the back of the application form is, so far as I am concerned, a clear cross-reference to and incorporation of the General Provision booklet. If any ambiguity exists at all with respect to the incorporation, it exists with respect to whether or not any particular provision within the booklet is “appropriate;” however, there has been a sufficient incorporation by reference. The answer to the question of which terms are “appropriate” may be a purely legal one, i.e., it may clear from the context of the application and permit that a particular section is applicable, or it may be a factual one, i.e., there may arise a question as to whether reasonable men would have understood that a particular provision was applicable.
*348In this case, where the defendant was applying for permission to construct a canal, there can be no question that the indemnification provision which is in question here is “appropriate,” i.e., applicable. The provision obviously applies to any construction project for which an applicant has received a permit. No person reading the booklet could reasonably determine otherwise.
Of course, the requirement that the booklet be read may be a red herring (pun intended). It is enough, I think, that the provisions be incorporated by reference without any suggestion that a party to an application must go ahead and read them. The fact is, however, that reading the provisions is a benefit to the applicant because the applicant knows (or can learn) what his obligations and liabilities are so that he has an opportunity to obtain insurance to cover them. However, because I think the incorporation by reference is so clear, there certainly is no requirement that, in order for the permit to be valid, the applicant have read the General Provisions. Rather, any applicant can choose to read them or not at his peril.
Having made the above observations, I turn now to the specific language at pages 5-6 of the proposed opinion.
1. “However, we cannot say that there was a clear incorporation by reference here.” This is, of course, the pivotal holding. It is dependent upon the sentences that follow it, which sentences, I believe, are analytically flawed.
2. “The permit does not incorporate the General Provisions in their entirety; if it had done so, there would be no question whether the indemnity provision was part of the agreement.” No, it does not incorporate all of the provisions because, obviously, certain of them will be totally inapplicable and unrelated to a particular project. The use of the term “appropriate,” seen in this context, is nothing more than a state agency recognizing the obvious.
3. “Instead, it incorporates only the ‘appropriate’ provisions and leaves to the applicant to obtain the ‘General Provisions’ and to determine which of the various provisions are applicable * * *.” This is where I believe the opinion makes an analytically incorrect left turn. What is *349left to the applicant to determine by a reading of the General Provisions is which of the General Provisions he wishes to seek insurance for or to otherwise guard against. In no sense is it left to the applicant to settle on what the contract provides. Rather, because there has been (contrary to the majority’s conclusion) incorporation by reference, that which is applicable is to be determined by standard rules of contract law, not by the individual perception (or lack thereof) of a particular applicant.
4. “There is no mention in the printed form of an indemnity provision.” That’s not the point.
5. “Assuming that there was a valid incorporation in the agreement of some of the General Provisions, the turbid language used by the state in the printed form is ambiguous and, to the extent that its meaning depends on extrinsic evidence, the question was for the trier of fact.” (Emphasis in original.) This is where the opinion gets lame. I am not at all sure what the pronoun “its” purports to refer to. Contrary to the way the sentence is written, and assuming there was a valid incorporation by reference, it seems to me self-evident that anyone examining the General Provisions would conclude that, whatever other provisions might be “appropriate,” there could not be any doubt at all as to the applicability of the indemnity provision. The proposed opinion does not begin to take on this claim, much less answer it.
I submit that this case is wrongly decided and that, in fact, the plaintiff was entitled to a directed verdict.
I respecfully dissent.
Joseph, C. J., Richardson and Van Hoomissen, JJ, join in this dissent.