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Date: 10-05-2017

Case Style:

Tri-County Metropolitan Transportation District of Oregon v. Joseph Y. Aizawa, et al.

Case Number: CC 1108-10129; CA A155714; SC S064112

Judge: Kistler

Court: Supreme Court of Oregon

Plaintiff's Attorney: Ketih M. Garza and Erik Van Hagen

Defendant's Attorney: Joshua D. Stadtler and Brian R. Talcott

Description: Ordinarily, a party entitled to recover attorney fees
incurred in litigating the merits of a fee-generating claim
also may receive attorney fees incurred in determining the
amount of the resulting fee award. See Strawn v. Farmers
Ins. Co., 353 Or 210, 234, 297 P3d 439 (2013) (awarding
so-called “fees on fees” to which no objection was raised);
Crandon Capital Partners v. Shelk, 219 Or App 16, 42, 181
P3d 773 (2008) (describing that rule as reflecting “longstanding
precedent in Oregon”). The question that this case
presents is whether the legislature intended to depart from
that accepted practice when it authorized property owners
to recover their attorney fees in condemnation actions. The
trial court ruled that it did not and awarded the property
owner in this case the fees that she had incurred both in
litigating the merits of the underlying condemnation action
and in determining the amount of the fee award. The Court
of Appeals affirmed. TriMet v. Aizawa, 277 Or App 504, 371
P3d 1250 (2016). We now affirm the Court of Appeals decision
and the trial court’s judgment.
In the course of constructing the Portland-Milwaukie
light-rail line, Tri-County Metropolitan Transportation
District of Oregon (TriMet) sought to acquire part of the
American Plaza Condominium. Defendant Noble owned a
fractional share of that property, for which TriMet initially
offered her $1,040. When Noble declined that offer, TriMet
filed a condemnation action against her on August 4, 2011,
and ultimately increased its offer to $22,000. Approximately
a year and a half after TriMet filed this condemnation
action, it made a formal “offer of compromise” to Noble, which
stated:
“Pursuant to ORS 35.300, plaintiff [TriMet] offers defendant
[Noble] the amount of $22,000 for just compensation
for the property described in the Complaint and any
compensable damages to the remaining property of defendant.
This offer does not include any amount for costs and
disbursements, attorney fees, and expenses. If the offer
is accepted, recoverable costs and disbursements, attorney
fees and expenses shall be awarded pursuant to ORS
35.300(2).”
4 TriMet v. Aizawa
Noble accepted TriMet’s offer, and the parties executed
a stipulated judgment, which awarded Noble $22,000
for her property and provided that she could petition for her
attorney “fees and costs pursuant to ORCP 68 and ORS
35.300.” In petitioning for her fees, Noble sought to recover
two related but separate types of fees. First, she sought the
pre-offer fees that she had incurred in litigating the fair
market value of her property. TriMet agreed that Noble was
entitled to those fees pursuant to ORS 35.300(2). Second,
Noble sought to recover the post-offer fees that she had
incurred in determining the amount of the fee award that
she was entitled to receive under ORS 35.300(2). TriMet
did not agree that Noble could recover those fees. As noted,
the trial court disagreed with TriMet and ruled that Noble
could recover both types of fees, as did the Court of Appeals.
On review, TriMet relies primarily on what it views
as the “plain text” of ORS 35.300(2) to argue that Noble may
not recover any fees that she incurred after TriMet served
her with the offer of compromise. Noble, by contrast, relies
primarily on the context of that statute and its legislative
history. She contends that the text is not as plain as TriMet
perceives and that the text, considered in light of the statute’s
context and legislative history, fits comfortably with
established Oregon law, which permits a party to recover
not only the attorney fees that it incurred in litigating the
merits of a fee-generating claim but also the attorney fees
that the party incurred in determining the amount of a reasonable
fee award.
In considering the parties’ arguments, we first
describe the condemnation statutes briefly and then turn
to the text, context, and legislative history of the statute
at issue here, ORS 35.300. ORS chapter 35 sets out a process
for public bodies to follow in condemning private property.
1 At least 40 days before filing an action to condemn
private property, a public body must make a written offer
to the property owner, which the owner must accept or
1 Statutorily, the power to condemn private property is not limited to public
bodies. See ORS 35.215(4) (recognizing that a private corporation may have the
power to exercise the right of eminent domain). For the purposes of this opinion,
we refer only to public bodies (public bodies generally or TriMet specifically) as
exercising the right to condemn private property for public use.
Cite as 362 Or 1 (2017) 5
reject within a specified period of time. ORS 35.346(1), (4).
If the owner rejects the pretrial offer, proceeds to trial, and
recovers more than the public body offered, then the owner
shall receive, in addition to compensation for the property,
the owner’s “costs and disbursements including reasonable
attorney fees and reasonable expenses.” ORS 35.346(7).
Conversely, if the owner rejects the public body’s pretrial
offer and recovers less than that offer, the owner may not
recover its costs and fees. Id.2
ORS 35.300 strikes a middle ground between those
two extremes. Subsection (1) of that statute provides that,
in addition to making a written offer to a property owner
before filing a condemnation action, a public body also may
make an “offer of compromise” up to 10 days before trial. ORS
35.300(1). An offer of compromise must identify the amount
offered as just compensation for the property3 and also may
include an amount offered for the reasonable costs and
fees that the property owner has incurred. Id. Subsections
(2) through (4) then set out three options for awarding costs
and fees, which vary depending on what the public body
offered, what the property owner accepted, and how the
property owner fared if it rejected the offer and the case
went to trial.
The option set out in subsection (2) applies in this
case. That subsection provides that, if an owner accepts an
offer of compromise that identifies an amount as just compensation
but does not include an amount for costs and
attorney fees, then:
“the court shall give judgment to the [property owner] for
the amount offered as just compensation for the property
* * * and, in addition, for costs and disbursements, attorney
2 ORS 35.346(7) does not state that proposition directly. However, it provides
that an owner may recover its costs and fees “in the following cases, and no
other.” It then identifies two instances in which an owner can recover costs and
fees: (1) when the owner recovers more than the pretrial offer and (2) when the
pretrial written offer was not made in good faith. ORS 35.346(7)(a), (b).
3 ORS 35.300(1) refers to “the amount offered as just compensation for the
property and as compensable damages to the remaining property of the defendant.”
For ease of reference, we use the phrase “just compensation” to refer to
both just compensation and compensable damages to the owner’s remaining
property.
6 TriMet v. Aizawa
fees and expenses that are determined by the court to have
been incurred before service of the offer on the [owner].”
ORS 35.300(2). In TriMet’s view, the text of that subsection
is unambiguous. By authorizing recovery of fees “incurred
before service of the offer,” ORS 35.300(2) precludes an
award of any and all fees incurred after that date. Noble
takes a different view of the matter. In her view, the fact
that ORS 35.300(2) authorizes a limited recovery of one
type of fees (pre-offer fees incurred in litigating the merits
of a condemnation action) does not mean that the legislature
intended to preclude a litigant from recovering a different
type of fees (fees incurred in determining the amount of the
pre-offer fee award to which the owner is entitled).
The parties’ dispute presents an issue of statutory
interpretation, which we resolve by considering the text,
context, and legislative history of ORS 35.300(2). State v.
Gaines, 346 Or 160, 171-72, 206 P3d 1042 (2009) (setting out
our methodology for determining the legislature’s intent).
We begin with the text of ORS 35.300(2).
ORS 35.300(2) is directed at recovering one type
of attorney fees—the fees that a property owner incurred
in litigating the merits of a condemnation action before the
public body served an offer of compromise. By definition, no
other type of attorney fees will have been incurred before
service of an offer of compromise. It follows that, in specifying
that a court shall give judgment for the fees that a property
owner incurred before the public body served an offer
of compromise, ORS 35.300(2) implies that a court shall not
give judgment for post-offer fees incurred in litigating the
merits of a condemnation action.
Whether ORS 35.300(2) also precludes recovery of
other types of post-offer fees is a question that the text of
subsection (2) does not definitively answer. It is possible to
read the text of subsection (2) as TriMet does and say that
the legislature intended to foreclose the recovery of all categories
of post-offer fees. The text of subsection (2), however,
lacks words like “only,” “all,” or “any,” which would have
made clear that the legislature intended to preclude any
and all fees that a property owner incurred after service of
Cite as 362 Or 1 (2017) 7
an offer of compromise.4 It is also possible to read the text
of subsection (2) as Noble does and say that authorizing a
limited recovery of one type of fees (pre-offer fees incurred
in litigating the merits of a condemnation claim) does not
preclude recovery of other types of post-offer fees. The text
permits either interpretation.
In seeking to determine the legislature’s intent,
we consider a statute’s context as well as its text. Stevens
v. Czerniak, 336 Or 392, 401, 84 P3d 140 (2004). Context
includes the preexisting common law, case law, and statutory
framework in which the law was enacted. Id. In this
case, two contextual sources bear on the meaning of ORS
35.300(2): prior cases interpreting ORCP 68 and the other
subsections in ORS 35.300.
ORCP 68 sets out a procedure for recovering attorney
fees. ORCP 68 C(4). The rule does not specify when a
party may recover fees; however, it defines the term “attorney
fees” for the purposes of the rule. ORCP 68 A(1). It provides
that “ ‘[a]ttorney fees’ are the reasonable value of legal
services related to the prosecution or defense of an action.”
Id. The Court of Appeals explained in Crandon Capital
Partners that “there is longstanding precedent in Oregon
[interpreting ORCP 68] that [in addition to recovering fees
incurred in litigating the merits of a fee-generating claim,]
a party may recover its attorney fees incurred as part of
the fee application and litigation process.” 219 Or App at
42; accord Strawn, 353 Or at 234 (awarding such fees). The
basis for those decisions is that the process of recovering
“attorney fees to which a * * * party is entitled by statute
is ‘related to the prosecution or defense of the action’ ” and
thus recoverable under ORCP 68. 219 Or App at 43 (quoting
ORCP 68 A(1)). TriMet does not contend otherwise. As
it acknowledged in its opening brief, “TriMet did not below
and does not here challenge the way in which the Court of
4 TriMet’s argument that ORS 35.300(2) is unambiguous depends on reading
that statute as providing that, if a property owner accepts an offer of compromise,
then “the court shall give judgment to the defendant for the amount
offered as just compensation * * * and, in addition, for [only those] costs and disbursements,
attorney fees and expenses that are determined by the court to have
been incurred before service of the offer on the defendant.” The text lacks the
bracketed words that TriMet’s interpretation presumes.
8 TriMet v. Aizawa
Appeals historically has treated the rule: ORCP 68 permits
the recovery of fees-on-fees.”
In 2009, the legislature enacted ORS 35.300 against
the backdrop of that longstanding Oregon precedent. See Or
Laws 2009, ch 530, § 5 (enacting what is now codified as
ORS 35.300); Crandon Capital Partners, 219 Or App at 43
(reaffirming that longstanding precedent). Given that context,
we think that the question in this case is more properly
framed as follows: Does ORS 35.300(2) reflect a legislative
intent to preclude a property owner who is entitled to
pre-offer fees incurred in defending a condemnation action
from recovering post-offer fees incurred in determining the
amount of the resulting fee award?
At this stage of the inquiry, our answer to that question
is “no.” As explained above, the text of ORS 35.300(2)
identifies one type of fees that shall be included in a judgment
(pre-offer fees incurred in litigating the merits of a
condemnation action). It does not provide that only those
fees may be included in the judgment, nor does it preclude a
property owner from seeking other, related fees that derive
from another source, such as ORCP 68. Authorizing an
award of pre-offer fees incurred in litigating the merits of
a claim does not preclude an award of a different type of
post-offer fees that derive from some other source. Viewing
the text of ORS 35.300(2) in the context of the attorney-fee
cases that preceded it, we think that Noble has the better of
the argument.
Another contextual clue points in the same direction:
the other subsections in ORS 35.300. As discussed
above, subsection (1) of ORS 35.300 provides that an offer of
compromise must include an offer of just compensation and
may include an offer of costs and attorney fees. Subsections
(2) through (4) then set out three options for awarding costs
and fees. Subsection (3) adds little to the understanding
of subsection (2); the two subsections effectively duplicate
each other.5 Subsection (4), however, sheds more light on the
5 As discussed above, ORS 35.300(2) specifies the costs and fees that a property
owner can recover if the owner accepts an offer that includes an amount for
just compensation but no amount for costs and fees. Subsection (3) is effectively
identical. It specifies the costs and fees that an owner can recover if the offer of
compromise contains an amount for just compensation and an amount for costs
Cite as 362 Or 1 (2017) 9
issue. That subsection specifies the costs and fees that may
be recovered if a property owner does not accept an offer of
compromise and fails to obtain a more favorable judgment
at trial.
Subsection (4) provides that, if an owner fails to
obtain a more favorable judgment than the offer of compromise:
(a) the property owner “may not recover prevailing
party fees or costs and disbursements, attorney fees
and expenses that were incurred on or after the service
of the offer”; (b) “[u]nless the parties agree otherwise, the
court shall give judgment to the [property owner] for costs
and disbursements, attorney fees and expenses that were
incurred by the [property owner] before service of the offer”;
and (c) the court shall give judgment to the public body for
its “costs and disbursements, other than prevailing party
fees, incurred by the [public body] on and after the service of
the offer.” ORS 35.300(4)(a)-(c) (emphasis added).
Subsection (4) expressly provides that, if an owner
rejects an offer of compromise and fails to obtain a more
favorable verdict at trial, the court shall award the owner
its pre-offer costs and fees, but it shall not award the owner
its post-offer costs and fees. If TriMet were correct—if the
direction in paragraph (4)(b) to award an owner the fees it
incurred in litigating the merits of a condemnation claim
before service of an offer of compromise precluded an award
of all post-offer fees—then a substantial part of subsection
(4) would be surplusage. If TriMet were correct, there
would have been no need for the legislature to prohibit,
as ORS 35.300(4)(a) does, awarding post-offer costs and
fees.6
and fees, but the owner accepts only the amount offered for just compensation.
In both instances, there will be an agreement only as to just compensation, and,
in both instances, subsections (2) and (3) provide that the owner shall recover
the agreed just compensation and “costs and disbursements, attorney fees and
expenses incurred by the [property owner] before service of the offer.” ORS
35.300(2), (3).
6 TriMet argues that ORS 35.300(4)(a) is not completely redundant because
it also prohibits awarding the property owner a prevailing party fee. However,
most of ORS 35.300(4)(a) is focused on prohibiting post-offer costs and fees, and
TriMet never explains how we can agree with its interpretation of ORS 35.300(2)
(and by extension 35.300(4)(b)) without rendering large parts of ORS 35.300
(4)(a) redundant.
10 TriMet v. Aizawa
Given ORS 35.300(4)(a), we cannot read ORS
35.300(4)(b) as broadly as TriMet does. Moreover, ORS
35.300(4)(b) is materially indistinguishable from ORS
35.300(2),7 and we assume that the legislature intended
that both provisions would have the same meaning. See
Figueroa v. BNSF Railway Co., 361 Or 142, 159, 390 P3d
1019 (2017) (“Ordinarily, we assume that, when the legislature
uses the same terms throughout a statute, those terms
have the same meaning.”). Put differently, if the other paragraphs
of ORS 35.300(4) lead us to conclude, as we do, that
ORS 35.300(4)(b) authorizes the recovery of one category of
pre-offer costs and fees and does not limit the recovery of all
categories of post-offer costs and fees, then it follows that
ORS 35.300(2) has the same meaning.
Those contextual sources shed light on the meaning
of ORS 35.300(2). Read together, the text and context of
ORS 35.300(2) direct a court to award a property owner who
accepts an offer of just compensation the reasonable costs
and fees that the owner incurred in litigating the merits of
the condemnation action before service of the offer. They do
not require a court to depart from the customary rule that a
party entitled to recover the costs and fees incurred in litigating
the merits of a fee-generating claim also may recover
the costs and fees reasonably incurred in determining the
amount of the resulting fee award.
In addition to considering the text and context,
we look to the statute’s legislative history for guidance.
See Gaines, 346 Or at 171-72. What is now codified as ORS
35.300 was enacted in 2009 as part of Senate Bill (SB) 794.
Or Laws 2009, ch 530, § 5. As initially proposed, SB 794
was relatively rudimentary. See Bill File, SB 794, Jan 26,
2009 (initial draft). It provided for a generic offer of compromise
that, if accepted, would result in a judgment. Id.
§ 5(1).8 It also provided that, if the property owner rejected
7 ORS 35.300(2) differs from ORS 35.300(4)(b) in that, in addition to directing
the trial court to include an award of pre-offer costs and fees in the judgment,
it directs the trial court to include the amount offered and accepted for just compensation.
It also differs in minor details from ORS 35.300(4)(b). However, the
two provisions are virtually identical for the purposes of the issue that this case
presents.
8 As initially drafted, the bill referred to an “offer of compromise” without
distinguishing, as the legislature later did, between amounts offered for just
Cite as 362 Or 1 (2017) 11
the offer and did not “obtain a more favorable judgment
than the offer, the [property owner] may not recover prevailing
party fees or costs and disbursements, attorney fees
or expenses * * * that were incurred after the date of the
offer.” Id. § 5(2).
Beyond that, the bill was silent regarding offers
of compromise and a property owner’s right to recover
costs and fees. The bill, as initially drafted, did not specify
whether an offer of compromise could include an offer of just
compensation without also including an offer of costs and
fees. It did not specify what would occur if a property owner
accepted an offer of compromise that included only an offer
of just compensation. Finally, although the bill specified that
a property owner who rejected an offer of compromise and
failed to obtain a more favorable verdict could not recover
post-offer costs and fees, the bill did not specify whether the
property owner could recover pre-offer costs and fees.
Oregonians in Action, a citizens group that advocates
for private property rights, raised those concerns about
the bill, even before the Senate Judiciary Committee held
its first hearing on it. Audio Recording, Senate Judiciary
Committee, SB 794, Apr 16, 2009, at 8:10:23 a.m. (testimony
of Harry Auerbach), https://olis.leg.state.or.us (accessed
Aug 28, 2017). In response, representatives from various
public bodies met with representatives from Oregonians in
Action and jointly proposed an amendment to the bill. Id.
The proposed amendment made two changes that are relevant
here. See Bill File, SB 794 (Apr 30, 2009 amendment).
First, it added a subsection to address what would occur
if an owner accepted an offer of compromise that included
an amount for just compensation but not an amount for the
owner’s costs and fees. Id. Second, it added a subsection to
address what would occur if the owner rejected an offer of
compromise and failed to obtain a more favorable judgment
at trial. Id. Both subsections were virtually identical. Each
provided, with only minor variation, that whether a property
owner accepted or rejected the offer of compromise, the
court shall give judgment to the property owner for costs
compensation and amounts offered for costs and fees. See Bill File, SB 794, Jan
26, 2009, § 5(1) (initial draft).
12 TriMet v. Aizawa
and disbursements, attorney fees, and expenses that were
incurred before the date of the offer. Bill File, SB 794 (Apr 30,
2009 amendment).
Harry Auerbach, a representative from the City of
Portland, explained the reason for the proposed amendment.
Audio Recording, Senate Judiciary Committee, SB 794, Apr 16,
2009, at 8:10:23 a.m., https://olis.leg.state.or.us (accessed
Aug 28, 2017). He told the Senate Judiciary Committee that
Oregonians in Action had been concerned that SB 794, as
initially drafted, “would have prevented [a] property owner
from recovering costs and fees incurred up to the date of
[the] offer of compromise.” Id. He said that that had not been
the drafters’ understanding or intent. Id. He then explained
that the amendment was
“designed to clarify that when the government makes an
offer of compromise during the course of the litigation, the
owner is entitled to recover costs, expenses, and attorney’s
fees incurred as of the date of the offer whether the owner
accepts the offer or whether the owner rejects the offer.”
Id. The Committee voted to adopt the proposed amendment
to SB 794 and to send the bill, as amended, to the Senate
with a do-pass recommendation.
Before the House Judiciary Committee, Auerbach
explained that all the participants had recognized that SB
794, as it emerged from the Senate, was a work in progress.
Audio Recording, House Judiciary Committee, SB 794,
May 19, 2009, at 2:38:02 p.m., https://olis.leg.state.or.us
(accessed Aug 28, 2017). Given that recognition, Auerbach
and Oregonians in Action proposed yet another amendment
to SB 794, which made primarily three changes to the bill,
none of which is relevant to the issue presented here.9 Not
surprisingly, most of Auerbach’s testimony before the House
Judiciary Committee did not touch on matters that bear
on this case. See id. However, both Auerbach and David
9 The House amendments: (1) provided a means for determining when
an offer of compromise that includes an amount for just compensation and an
amount for costs and fees would be more favorable than the result obtained at
trial; (2) added what is now codified as ORS 35.300(3); and (3) made minor wording
changes to the A-Engrossed version of SB 794. See Bill File, SB 794 (June 2,
2009 amendments).
Cite as 362 Or 1 (2017) 13
Hunnicutt, speaking on behalf of Oregonians in Action,
emphasized one point that is relevant here.
In concluding his testimony, Auerbach told the House
Judiciary Committee:
“The only other thing that I want to make sure that
I don’t forget to say is that we’re not asking through this
bill to do anything that’s unusual in civil litigation. All
we’re really trying to do is incorporate a version of what’s
already in existence generally in civil cases through the
rules of civil procedure for offers of compromise into the
specific context of eminent domain litigation. So, it’s a process
that already exists in other contexts. We’re just trying
to tailor something that’s applicable to this special kind of
proceeding.”
Id. Hunnicutt made the same point. Id. at 2:51:43 p.m. He
told the committee:
“Once the court determines that fees are entitled preand
post-offer, the amount of the fees will be determined in
the normal course. We’re not trying to change the method
for determining attorney’s fees as they are in any other
civil case. This bill doesn’t try and change that.”
Id. Having heard that testimony, the House Judiciary
Committee adopted the proposed amendment and sent
SB 794, as amended, to the House. After the House approved
the bill, the Senate acceded to the House amendments,
and the Governor signed the bill. Senate Journal, Regular
Session, 2009, S-141.
We draw two conclusions from that history. First,
ORS 35.300(2) was added to SB 794 for one reason: to make
clear that a property owner who accepts an offer of compromise
will receive the pre-offer costs and fees that the owner
incurred in litigating the merits of the condemnation action.
It was intended to authorize that category of pre-offer costs
and fees. It was not intended to limit all categories of postoffer
costs and fees. Second, both Auerbach and Hunnicutt
emphasized that SB 794 would not change the normal rules
for awarding attorney fees in civil actions. In this context,
their testimony means that SB 794 was not intended to
14 TriMet v. Aizawa
displace customary rules, such as ORCP 68, which had been
construed as permitting a party to recover both the costs
and fees incurred in litigating a fee-generating claim and
the costs and fees incurred in determining the amount of
the resulting fee award.
We also note that Auerbach’s statement—that the
bill’s drafters were “trying to * * * incorporate what’s already
in existence generally in civil cases through the rules of civil
procedure for offers of compromise”—points in the same
direction.10 While Auerbach’s reference to ORCP 54 E was
oblique, it was consistent with his and Hunnicutt’s express
point that SB 794 was not intended to change the normal
rules for determining attorney fees.
The legislative history confirms what the text, read
in context, implies: A property owner who accepts an offer
of compromise under ORS 35.300(2) may recover both the
pre-offer costs and fees reasonably incurred in litigating the
merits of the condemnation action and the post-offer costs
and fees reasonably incurred in determining the amount of
the resulting fee award.11

* * *

10 Auerbach was apparently referring to ORCP 54, which allocates costs and
fees when a party asserting a claim accepts or rejects an offer to allow judgment
on the claim. See ORCP 54 E(2), (3). ORS 35.300(2) is comparable to ORCP
54 E(2), which provides that when the party asserting a claim accepts an offer
to allow judgment, the court shall enter a stipulated judgment for the amount
offered and accepted; ORCP 54 E(2) also provides that the party asserting the
claim may recover its costs and fees “as provided in Rule 68.” When the legislature
enacted ORS 35.300, settled precedent interpreting ORCP 68 permitted
a party to recover both the costs and fees reasonably incurred in litigating the
merits of the fee-generating claim and the costs and fees reasonably incurred in
determining the amount of the resulting fee award.
11 The issue in this case is whether the direction in ORS 35.300(2) to include
an award of pre-offer costs and fees in the judgment precludes an award of the
costs and fees incurred in determining that fee award. This case does not require
us to decide whether ORS 35.300(4) limits a party’s ability to recover “fees on
fees,” and we express no opinion on that issue.

Outcome: The decision of the Court of Appeals and the judgment
of the circuit court are affirmed.

Plaintiff's Experts:

Defendant's Experts:

Comments:



 
 
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