§ 46.1 Costs and Disbursements
Library | Oregon Civil Pleading and Litigation (OSBar) (2020 Ed.) |
§ 46.1-1 Basis for Recovery of Costs
ORCP 68 is generally the starting point for issues relating to costs and disbursements. For purposes of ORCP 68, there is no distinction between costs and disbursements. Nw. Acceptance Corp. v. Bles Studs, Inc., 74 Or App 248, 251 n 4, 702 P2d 1128 (1985). This chapter uses the term costs to refer to both costs and disbursements.
Costs are "reasonable and necessary expenses incurred in the prosecution or defense of an action, other than for legal services." ORCP 68 A(2). Costs "shall be allowed to the prevailing party unless these rules or any other rule or statute direct that in the particular case costs and disbursements shall not be allowed to the prevailing party or shall be allowed to some other party, or unless the court otherwise directs." ORCP 68 B. See § 46.2-2 for a discussion of ORS 20.077 and how a court identifies the prevailing party.
ORCP 68 B gives a court "authority in all civil cases to deny costs and disbursements to both sides in its discretion." Rogerson v. Baker, 56 Or App 748, 750, 642 P2d 1216 (1982); see also Vill. at N. Pointe Condos. Ass'n v. Bloedel Constr. Co., 278 Or App 354, 376-79, 374 P3d 978, adh'd to as modified on recons, 281 Or App 322, 383 P3d 409 (2016) (explaining ORCP 68 B gives a court "significant discretion" over costs). A court may only award costs to a prevailing party. Selective Servs. v. AAA Liquidating & Auction Serv., Inc., 126 Or App 74, 78-79, 867 P2d 545 (1994).
PRACTICE TIP: For cases in a court's mandatory arbitration program, UTCR 13.210(4)(e) requires the arbitrator's award to include a provision for costs "where allowed under applicable law." The arbitrator must also "establish procedures for determining attorney fees and costs." UTCR 13.210(5).
Certain statutes provide for or limit the right to costs. These include
(1) ORS 20.120 (decision brought before a court for review);
(2) ORS 20.130 (natural person joined as plaintiff with state is liable in the first instance for costs awarded against plaintiffs);
(3) ORS 20.140 (certain public corporations not required to pay fees taxable as costs in advance);
(4) ORS 20.150 (when party represented by another, including by an executor, administrator, trustee or in which party appears by a general guardian, conservator, or guardian ad litem);
(5) ORS 30.643-30.647 (procedure for waiver or deferral of court costs in an action by an adult in custody against a public body);
Other statutes provide for or limit the right to attorney fees as well as costs. For a partial list of those statutes, see § 46.2-3(e)(1) to § 46.2-3(e)(2) (statutory right to attorney fees).
PRACTICE TIP: Always review contracts and other agreements between the parties that may affect recovery of costs. Agreements relating to the amount or right to recover costs are often but not always included with contract language about the right to recover attorney fees. Also look for indemnity and advancement clauses that may affect the right to costs.
§ 46.1-2 Who May Recover or Be Liable for Costs
In most cases, only a party has the right to recover or is potentially liable for costs. The general rule is that a nonparty cannot recover or be liable for costs. See ORCP 68 B; State v. Keelen, 103 Or 172, 195, 204 P 162 (1922) (finding "it is well settled that, in the absence of statutory authority thereof, a judgment for costs and disbursements cannot be given against one not a party to an action."). There are several exceptions to this general rule.
§ 46.1-2(a) Class Actions
If a defendant has a right to costs in a class action, "only representative parties and those members of the class who have appeared individually are liable for those amounts." ORCP 32 M(1)(b). However, if a plaintiff is entitled to costs, "the court may apportion" the costs recovered "among the members of the class." ORCP 32 M(1)(b).
PRACTICE TIP: A lawyer representing a plaintiff in a class action should advise the plaintiff of the potential risk that the court might assess attorney fees and costs against the named plaintiff.
While the risk is low that a court would award attorney fees and costs against the named plaintiff in a class action brought in good faith, this risk sometimes has a chilling effect on the willingness of a class member to serve as a named plaintiff. Defendants often use the threat of fees to discourage a person or entity from serving as a named plaintiff. The authors of this chapter are unaware of any Oregon court awarding attorney fees and costs against plaintiffs in a class action.
§ 46.1-2(b) Declaratory Judgments
Oregon's Uniform Declaratory Judgments Act (ORS 28.010-28.160) potentially provides an exception to the general rule limiting recovery and liability for costs to a party. ORS 28.100 states that in any proceeding pursuant to the Act, the court may award "costs as may seem equitable and just."
§ 46.1-2(c) Lawyer
If a lawyer's deliberate misconduct causes a mistrial, the court on its own or on motion by the opposing party must assess against the lawyer costs "and reasonable attorney fees incurred by the opposing party as a result of the misconduct." ORS 20.125.
PRACTICE TIP: In a malpractice action in which the plaintiff seeks attorney fees and costs incurred to repair the harm caused by the negligent former lawyer, costs and attorney fees may be recoverable against the former lawyer. Rowlett v. Fagan, 283 Or App 1, 10-12, 388 P3d 407 (2016), rev den, 361 Or 311 (2017) (explaining attorney fees that plaintiff would have recovered in the underlying case could be recoverable in the malpractice action, but attorney fees incurred in the malpractice action were not recoverable without a statutory or contractual basis); Rivera-Martinez v. Vu, 245 Or App 422, 429, 263 P3d 1078, rev den, 351 Or 318 (2011) (denying attorney fees on malpractice claim and explaining that legal malpractice is a form of negligence in which attorney fees are not ordinarily recoverable in tort).
§ 46.1-2(d) Representative Party
Costs awarded against a person serving as a representative of a trust, estate, or other party are recoverable only from the estate, trust, or party represented unless the court orders otherwise for mismanagement or bad faith in the action on the part of the representative. ORS 20.150; see also Pederson v. Barnes, 185 Or App 35, 37-38, 58 P3d 240 (2002), rev den, 335 Or 402 (2003) (explaining that where trial court did not make a determination as required in ORS 20.150 that the trustee engaged in "mismanagement or bad faith" in defending the case, an award of enhanced prevailing party fees against the trustee was in error).
§ 46.1-2(e) Assignee
An assignee occupies the same legal position under a contract as the original contracting party. Autolend, IAP, Inc. v. Auto Depot, Inc., 170 Or App 135, 142, 11 P3d 693 (2000), rev den, 332 Or 240 (2001). Because of that, rules governing costs apply to an assignee to the same extent as a party to the contract. Autolend, IAP, Inc. , 170 Or App at 142.
§ 46.1-2(f) No Multiple Collection
When a court enters multiple judgments in an action, the court should not make multiple assessments of the same costs or attorney fees. The same approach applies to paying a cost award. If the court enters separate limited judgments covering the same claim against several parties pursuant to ORCP 67 B, the court may include the same items of costs in each judgment, but satisfaction of one judgment bars recovery on another judgment for the same costs. ORCP 68...
To continue reading
Request your trial