Brown v. Adult and Family Services

• Citation: 643 P.2d 1266,293 Or. 6
• Parties: Lavenna BROWN, Petitioner on Review, v. ADULT AND FAMILY SERVICES, Keith Putman, Administrator, Respondent on Review. Glen DAVIDSON, Petitioner on Review, v. EMPLOYMENT DIVISION, Raymond P. Thorne, Administrator, and Global Housing, Ltd., Respondents on Review. Linda HOWARD, Petitioner on Review, v. ADULT AND FAMILY SERVICES, Keith Putman, Administrator, Respondent on Review. Karol M. EVANS, Petitioner on Review, v. ADULT AND FAMILY SERVICES DIVN. OF the STATE OF OREGON, Keith Putman, Administrator, Respondent on Review. CA 16980, 17206, 17870 and 18398; SC 27838. *
• Decision Date: 27 April 1982
• Court: Supreme Court of Oregon

Page 1266

643 P.2d 1266

293 Or. 6

Lavenna BROWN, Petitioner on Review, v. ADULT AND FAMILY SERVICES, Keith Putman, Administrator,

Respondent on Review.

Glen DAVIDSON, Petitioner on Review, v. EMPLOYMENT DIVISION, Raymond P. Thorne, Administrator, and Global Housing, Ltd., Respondents on Review.

Linda HOWARD, Petitioner on Review, v. ADULT AND FAMILY SERVICES, Keith Putman, Administrator,

Respondent on Review.

Karol M. EVANS, Petitioner on Review, v. ADULT AND FAMILY SERVICES DIVN. OF the STATE OF OREGON, Keith Putman, Administrator, Respondent on Review.

CA 16980, 17206, 17870 and 18398; SC 27838.

Supreme Court of Oregon, In Banc ^*.

Argued and Submitted Nov. 4, 1981.

Decided April 27, 1982.

Tom Steenson, The Dalles, argued the cause for petitioners on review. With him on the briefs were Amy Veranth, Portland, Robert A. Payne and David L. Slansky, McMinnville. With him on the briefs in the Court of Appeals were Christopher Cadin, The Dalles, and Amy Veranth, Portland.

Stanton Long, Deputy Atty. Gen., Salem, argued the cause for respondents on review. On the brief was Dave Frohnmayer, Atty LENT, Justice.

Gen., and William F. Gary, Sol. Gen., Salem. On the briefs in the Court of Appeals were James M. Brown, Atty. Gen., John R. McCulloch, Jr., Sol. Gen., William F. Gary, Deputy Sol. Gen., Al J. Laue, James C. Rhodes, and Betty Smith, Asst. Attys. Gen., Salem.

We review the decisions of the Court of Appeals in four cases, consolidated for review before this court, to consider the common question concerning the Court of Appeals' exercise of its discretion to award attorney fees under ORS 183.495, which provides:

"Upon judicial review of a final order of an agency when the reviewing court reverses or remands the order it may, in its discretion, award costs, including reasonable attorney's fees, to the petitioner to be paid from funds appropriated to the agency."

In each of these cases, petitioner initially sought judicial review of an action or determination of a state administrative agency, and in each case the petitioner prevailed in the Court of Appeals. ¹ Following those decisions, each petitioner petitioned the Court of Appeals for an award of attorney fees pursuant to ORS 183.495. In each case, the Court of Appeals denied the petition for attorney fees. The court held in Brown v. Adult and Family Services, 51 Or.App. 213, 625 P.2d 160 (1981), that attorney fees would not be awarded because the record showed that the agency had not acted arbitrarily. In a footnote the court indicated the standard which it regarded as controlling: attorney fees would be awarded only when an agency action had been "arbitrary." 51 Or.App. 217 n. 2, 625 P.2d 161 n. 2. The Court of Appeals similarly denied petitions for attorney fees in Howard v. Adult and Family Services, 51 Or.App. 206, 625 P.2d 666 (1981), and Evans v. Adult and Family Services, 51 Or.App. 367, 625 P.2d 687 (1981), in per curiam opinions relying on Brown, supra. The court denied the petition in Davidson v. Employment Division, 51 Or.App. 219, 625 P.2d 162 (1981), stating that attorney fees were inappropriate where "the Employment Division and its Appeals Board acted not in the capacity of a party, but rather as a disinterested tribunal with quasi-judicial powers * * * which adjudicated rights between the employer and the employe." 51 Or.App. at 221, 625 P.2d at 163.

Petitioners Brown, Davidson, Howard, and Evans filed a consolidated petition for review, which we allowed, 291 Or. 151, 634 P.2d 1344 (1981), ORS 2.520, in order to consider whether, in exercising its discretion, the Court of Appeals has taken action that is inconsistent with legislative intent as expressed in the statute. ²

Petitioners advance a variety of arguments, the gist of which is that the award of attorney fees should be made largely as a matter of right to a prevailing petitioner, absent some unusual circumstances which would justify denying these fees. Petitioners rest this argument primarily on Executive Management Corporation v. Juckett, 274 Or. 515, 547 P.2d 603 (1976). In effect, petitioners contend that that case, which construed another provision for the discretionary award of attorney fees, established a rule applicable to all statutory provisions allowing the discretionary award of attorney fees. Executive Management Corporation should not be read in such an expansive way. It concerned the application of ORS 91.755, which allowed attorney fees in landlord/tenant litigation. The case held, without discussion, that attorney fees generally should be awarded in cases brought under that statute. That terse conclusion was not intended to establish a general rule for all statutes allowing for attorney fees.

In enacting legislation covering landlord/tenant disputes, the legislature may have decided that these contests were best resolved through out-of-court settlement and concluded that the provision for attorney fees would encourage settlement by discouraging litigation. Several factors distinguish cases governed by ORS 91.755 from those governed by ORS 183.495. One difference is apparent on the face of the statute: ORS 91.755 provides for attorney fees to the prevailing party. ORS 183.495 does not allow an administrative agency to recover attorney fees in any circumstances. We conclude that Executive Management Corporation, is not persuasive authority with respect to ORS 183.495.

Petitioners also argue that attorney fees should be a matter of course in order to insure that persons dependent on various public assistance programs have full access to the appellate process. In Goldberg v. Kelly, 397 U.S. 254, 90 S.Ct. 1011, 25 L.Ed.2d 287 (1970), the United States Supreme Court held that due process required that welfare recipients have a meaningful pre-termination hearing on decisions threatening the cut-off of welfare benefits. The Court, however, specifically noted that it did not require that welfare recipients be provided with counsel in such hearings. See 397 U.S. at 270, 90 S.Ct. at 1022, 25 L.Ed.2d at 300. We know of no decision since Goldberg which has held that fundamental due process requires that the state must provide counsel in situations such as this. For us to hold that ORS 183.495 provides the automatic award of attorney fees to the prevailing party would, by indirection, go far toward requiring the state to provide counsel. We decline to take this step.

We also do not believe that a ruling establishing attorney fees as a matter of course would be consistent with the statutory language. The legislature clearly could have adopted language mandating the award of attorney fees to prevailing petitioners. There is nothing to indicate that in ORS 183.495 the legislature used the word "may" to mean "shall."

We conclude that ORS 183.495 vests the reviewing court, the Court of Appeals, with broad discretion in these cases. In adopting ORS 183.495, the legislature realized that it could not anticipate the wide variety of situations in which petitioners might prevail This statute vests primary discretion in the Court of Appeals, rather than in this court. Such a grant of discretionary authority is appropriate in these cases. Review before the Court of Appeals is a matter of right, and the court examines factual questions to determine that these are supported by substantial evidence. Review before this court is discretionary with the court and is reserved to matters of importance beyond the particular case.

on judicial review, or decide a priori in which of these situations the granting of attorney fees would be appropriate. Therefore, it vested the Court of Appeals with the task of evaluation according to the general or specific situation presented. The sparse legislative history of this statute suggests no clear standard for awarding attorney fees. It indicates only that the legislature intended that fees be awarded in some cases, though not all, and that it intended the authority to serve as a deterrent to agency error.

BROWN, HOWARD AND EVANS

We turn to the specific rules established by the Court of Appeals in these cases. In Brown, Howard and Evans, the Court of Appeals ruled that attorney fees would be awarded only where the agency action could be characterized as "arbitrary." We would note that in other contexts, the "arbitrary" standard has proven less than satisfactory. A precise definition applicable to all cases has proven impossible, and courts using this standard have reached inconsistent results. On the other hand, comparable terms do little to add precision. "Frivolous," "capricious," "unreasonable," and the like all require that the reviewing court exercise a large element of subjective judgment. Common to standards based on any of these terms is a notion that the reviewing court should award attorney fees if it determines that the agency action amounts to maladministration that should be deterred and which the award of attorney fees will deter.

The Court of Appeals' construction of its discretion in these kind of cases as depending upon arbitrariness of agency action is certainly consistent with the legislative history, which suggests that basis to have provided the very impetus for introduction of the bill which resulted in the legislation. ³ The Court of Appeals, in Brown, Howard and Evans, has not violated the statute; therefore, there is no basis for this court to direct a different result.

DAVIDSON

In Davidson v. Employment Division, supra, the court below purported to follow a different rule. In Wasco County v. AFSCME, 30 Or.App. 863, 569 P.2d 15 (1977), the court was concerned with judicial review of an order of the Employment Relations Board in a matter involving a complaint of an unfair labor practice. A reversal of the agency decision was obtained, and the prevailing party before the court sought an award of attorney fees, citing ORS 183.495 as authority. In Wasco County v. AFSCME, 31 Or.App. 765, 571 P.2d 549 (1977), the Court...