Chapter § 64.6 REMEDIES FOR WASTE

• Jurisdiction: Oregon

§ 64.6 REMEDIES FOR WASTE

§ 64.6-1 Injunction

The most common remedy for waste is an injunction. Most plaintiffs would prefer to restrain the waste rather than wait until it is completed and sue for damages. Threatened or existing conduct that will cause "substantial injury or destruction of the estate or . . . irreparable damage to the plaintiff" is the primary requirement for an injunction to restrain waste. Roots v. Boring Junction Lumber Co., 50 Or 298, 312-13, 92 P 811 (1907).

The mere apprehension of waste is generally insufficient to support a claim for an injunction. Generally it is necessary to show a single, clear instance of intentional waste or a small degree of waste that shows intent to do more. See Sheridan v. McMullen, 12 Or 150, 151, 6 P 497 (1885).

In some situations an injunction is the only remedy available. For example, generally, contingent remaindermen can only obtain injunctive relief. Pedro v. January, 261 Or 582, 596, 494 P2d 868 (1972) (assessment of damages—as opposed to injunctive relief—is made only if the court impounds the damages to await outcome of the contingencies); see generally Oregon Civil Pleading and Practice ch 34 (OSB Legal Pubs 2012).

Once equity takes jurisdiction for the purpose of an injunction, it may decree an account and satisfaction for waste already committed. Sheridan, 12 Or at 152-53. See Form 64-1.

§ 64.6-2 Receivership

Receivers may be appointed under particular circumstances to preserve and protect property (ORCP 80), or by a court of equity independent of rule (Grayson v. Grayson, 222 Or 507, 513, 352 P2d 738 (1960) (trial court appointed a receiver at wife's request to take charge of a dairy farm operation during the pendency of a divorce suit; although wife's affidavit supporting the motion for the appointment was inadequate under the general statutory grounds, the power to appoint a receiver is "necessarily inherent in a court of equity independent of statute")). Receivership is an ancillary remedy and usually cannot be obtained when the appointment is the sole primary object of the suit. Cook v. Leona Mills Lumber Co., 106 Or 520, 530, 212 P 785 (1923).

NOTE: Receivership is not really a true remedy against waste, but as a practical matter it is an effective remedy between injunction and damages.

The appointment of a receiver in a proper case is an effective tool whenever income-producing property is involved. When income-producing property is in danger of being foreclosed by the county for nonpayment of real-property taxes, the appointment of a receiver of the rents and income of the property is proper in order to pay the arrearage. Abernathy v. Orton, 42 Or 437, 444, 71 P 327 (1903). If the contract permits activities that would otherwise be waste, such as removing timber, a receiver can be appointed to continue the activities so as to preserve the security or the revenues while the seller and the purchaser litigate contract disputes. Spies v. Butts, 59 W Va 385, 53 SE 897, 902 (1906). When a purchaser remains in possession (removing timber, minerals, and the like), while at the same time withholding contract payments because of a dispute with the seller, the situation is ripe for a receiver. Spies, 53 SE at 905. In Spies, the contract of sale provided that defendants had the right to cut timber, mine coal, and operate the railroad. Defendants did so, but at the same time withheld contract payments because of some title disputes with plaintiff seller. During the ensuing litigation to resolve the contract disputes, plaintiff sought, and the court appointed, a receiver to manage the operations pending litigation and retain the proceeds until further order of the court. The Supreme Court of Appeals of West Virginia affirmed. A purchaser cannot resist payment of the purchase money on the ground of a defective title in the seller while at the same time remaining in possession and depreciating the seller's security. A receiver is proper in equity to protect the seller's security until the litigation is resolved. Spies, 53 SE at 903.

§ 64.6-3 Damages

Except in cases in which injunction is the sole remedy, the injured party may recover damages in addition to the injunction. See Form 64-1. The measure of damages will be the repair costs or the lost market value. "Whether repair costs or lost market value is the more appropriate measure of...