Background
Charles Ringo sued Colquhoun Design Studio, LLC, and Jennifer Cohoon for allegedly failing to perform under a contract. Defendants answered and asserted two counterclaims, including a breach-of-contract counterclaim alleging that Ringo had failed to pay amounts owed under the parties’ agreement.
The case proceeded to arbitration, where defendants prevailed. The arbitrator awarded them attorney fees under ORS 20.082, and the circuit court rejected Ringo’s exceptions and entered judgment incorporating that award. Ringo appealed, arguing that defendants had neither requested attorney fees in their counterclaim nor pleaded all facts necessary to establish entitlement to statutory fees.
The Court’s Holding
The Court of Appeals held that ORCP 68 C(2)(a) barred the attorney-fee award. When a party seeks fees under a statute, its pleading must identify the statutory basis or allege all facts required to satisfy the statute. For fees under ORS 20.082, those necessary facts include that the claim is based on contract, the requested damages are $10,000 or less, and the contract contains no attorney-fee provision.
Defendants did not request attorney fees in their breach-of-contract counterclaim and did not allege that the contract lacked an attorney-fee provision. The mandatory pleading requirement continued to apply in arbitration because an arbitrator may award fees only when applicable law allows them. The court therefore reversed the portion of the judgment awarding attorney fees and otherwise affirmed.
Key Takeaways
- A party seeking statutory attorney fees must plead the statutory basis or every fact necessary to establish entitlement to the award.
- ORS 20.082 requires, among other things, an allegation that the contract at issue contains no attorney-fee provision.
- Referral to arbitration does not eliminate ORCP 68 C(2)(a)’s mandatory pleading requirements.
Why It Matters
The decision underscores that attorney-fee eligibility and the procedure for calculating fees are distinct issues. Although arbitrators have considerable discretion over fee-setting procedures, they cannot award fees when a party failed to plead a legally sufficient basis for recovering them.
Contract litigants seeking fees under ORS 20.082 should expressly request them and allege every statutory prerequisite in their pleadings. The opinion is nonprecedential under ORAP 10.30 and may be cited only as that rule permits.