Far West Landscaping, Inc. v. Modern Merchandising, Inc.

• Decision Date: 30 October 1979
• Docket Number: No. 77-5-332,CA,77-5-332
• Citation: 287 Or. 653,601 P.2d 1237
• Parties: FAR WEST LANDSCAPING, INC., an Oregon Corporation, Respondent/Cross-Appellant, v. MODERN MERCHANDISING, INC., a Minnesota Corporation doing business as Jafco, Inc., New York Life Insurance Company, a New York Corporation; and Pacific National Bank of Washington, a National Banking Association, Respondents/Cross-Respondents, Pacific Cascade Corporation, a Washington Corporation and doing business as Joseph Lane & Associates Corporation, Appellant/Cross-Respondent. 12380; SC 26064.
• Court: Oregon Supreme Court

Page 1237

601 P.2d 1237

287 Or. 653

FAR WEST LANDSCAPING, INC., an Oregon Corporation Respondent/Cross-Appellant, v. MODERN MERCHANDISING, INC., a Minnesota Corporation doing business as Jafco, Inc., New York Life Insurance Company, a New York Corporation; and Pacific National Bank of Washington, a National Banking Association Respondents/Cross-Respondents Pacific Cascade Corporation, a Washington Corporation and doing business as Joseph Lane & Associates Corporation, Appellant/Cross-Respondent.

No. 77-5-332, CA 12380; SC 26064.

Supreme Court of Oregon.

Argued and Submitted July 3, 1979.

Decided Oct. 30, 1979.

Ridgway K. Foley, Jr. of Souther, Spaulding, Kinsey, Williamson & Schwabe, Portland, argued the cause for appellant/cross-respondent and respondents/cross-respondents. With him on the petition was Neva T. Campbell, Portland.

Daniel H. Skerritt of Lindsay, Nahstoll, Hart, Neil & Weigler, Portland, argued the cause for respondent/cross-appellant.

Before DENECKE, C. J., and HOLMAN, HOWELL, LENT, LINDE and PETERSON, JJ.

HOLMAN, Justice.

Plaintiff brought a suit to foreclose a lien for landscaping work. The trial court found there was no valid lien but gave judgment to plaintiff for the reasonable value of the work. Subsequent to the trial and within the time during which defendant could appeal, defendant's lawyer called the trial judge inquiring whether the judgment for plaintiff had yet been signed. The trial judge mistakenly told her the judgment order had not been signed, when, in fact, it had been signed and entered. Defendant's lawyer requested that the court not sign the judgment order until after a certain date because she was going to be out of town and her clients might want to appeal. She did not want the time to elapse during her absence. The trial judge assured her he would accommodate her request. This arrangement was confirmed by letter to the judge from defendant's counsel, but no copy was furnished to plaintiff's lawyer.

Defendant relied upon the arrangement and did not discover the judge's mistake until it was too late to appeal. Defendant then filed a motion to set aside the judgment, pursuant to ORS 18.160, as one taken through mistake, inadvertence, surprise or excusable neglect. This motion was allowed, the judgment order was set aside by the trial judge, and a new, identical order was entered, thus allowing defendant time to appeal from the new order. It is clear that the only reason for the revocation of the original judgment order and the substitution of an identical one was for the purpose of allowing defendant additional time within which to appeal.

Defendant filed an appeal to the Court of Appeals from the second judgment and plaintiff moved to dismiss the appeal on the basis that the trial court had no authority to set aside its original judgment and enter the second one. The Court of Appeals allowed the motion to dismiss the appeal and this court granted defendant's petition for review.

In Tongue v. Brewster, 35 Or. 228, 58 P. 38 (1899), the plaintiff received judgment which was entered. The defendant inquired of both the clerk and the trial judge whether the judgment had been entered and was erroneously informed that it had not been. He did not discover he had been misled until after the time for an appeal had elapsed. He then filed a motion with the court to set aside the judgment under a statute which was the predecessor of ORS 18.160 and which contained substantially the same language. The trial court refused to set aside the judgment and the defendant appealed. The plaintiff, as in this case, filed a motion to dismiss the appeal in this court, which motion was allowed. The court said:

" * * * Ordinarily, a party to a motion of this kind (under the predecessor of ORS 18.160) seeks relief from an order or judgment against him, so that he may be let in to defend upon the merits of the case. The sole purpose of the motion interposed, however, was to have the judgment vacated, that the defendants might be let in to except to the findings of the court, and prosecute their appeal within the statutory time after the judgment was again entered. It was not designed to have a new trial awarded, or a new hearing upon the merits, but merely that the defendants might be accorded the privilege of putting their case in such a condition that the errors of the trial court may be made available for review in this court * * * They could easily have consulted the record, and ascertained therefrom the true condition of the case; but, not having done so, the neglect was inexcusable and they ought not to be relieved from the judgment upon the showing made, especially for the purpose of having another of the same sort entered in order that they may prosecute an appeal." 35 Or. at 229-30, 58 P. at 39.

In Haas v. Scott et al., 115 Or. 580, 239 P. 202 (1925), the defendant's attorney inquired of a deputy clerk and was erroneously told the decree had not been entered and, as a result, let the time for appeal lapse. This court indicated that the defendant's failure to examine the records, for the purpose of determining whether the judgment had been entered, was not justified and said:

"Where a motion is made to vacate a decree, as in the present case, and the effect of granting the request would be solely to put the defendants in a position to take an appeal from the original decree and have the cause reviewed by this court, the defendants having allowed the statutory time for appeal to expire, the appeal from the decree denying the motion to vacate the decree should be dismissed. Section 103, Or.L. (the predecessor to ORS 18.160), was not enacted for the purpose of giving relief in such a case as this. * * *." 115 Or. at 589, 239 P. at 204.

Again, in Western Land, etc., Co. v. Humfeld, 118 Or. 416, 247 P. 143 (1926), the defendant made inquiry of the clerk and was misled. A motion under the predecessor statute to ORS 18.160 was granted, allowing vacation of the decree and a new identical decree was then entered. A motion to dismiss the appeal from the substituted decree was allowed on the basis that the facts were insufficient to authorize the court to vacate the original decree and such a vacation would amount to a nullification of the statute fixing the time within which an appeal could be taken. Also see Tierney v. Duris, 21 Or.App. 604, 611-12, 536 P.2d 431 (1975).

In any event, ORS 18.160 can never apply. The present factual situation does not fall within the statute's provisions. The statute gives the trial judge authority to set aside a judgment taken through mistake, inadvertence, surprise or excusable neglect. This judgment was not so taken. It Had been taken several days before the facts upon which defendant now depends even occurred.

The next question is whether the trial court had the inherent authority to do as it did without regard to ORS 18.160. The cases we have discussed do not consider that problem. With the exception of Tierney, they were all decided during a time when a common law rule required the court to exercise whatever inherent power it had to rectify a mistake in a decree or judgment within the term during which the original decree or judgment was entered. Because term time had elapsed, this rule prevented the parties in the cases discussed from invoking any inherent authority the trial court might have to rectify mistakes and forced them to avail themselves of whatever benefits the predecessor of ORS 18.160 might afford them because it allowed a year in which to file the motion. In 1959 the legislature enacted ORS 1.055, which provided:

"(1) A term of court is a period of time appointed for the convenient transaction of the business of the court. The existence or nonexistence of a term of court has no effect on the duties and powers of the court.

"(2) Notwithstanding that an act is authorized or required to be done before, during or after the expiration of a term of court, it may be done within a reasonable period of time."

This statute removed the stricture of the common law rule upon the exercise of the inherent authority of the trial court to rectify its mistakes.

There is no doubt but that under normal circumstances trial courts have inherent authority to vacate or amend their judgments. Bakker v. Baza'r, Inc., 275 Or. 245, 551 P.2d 1269 (1976); Braat v. Andrews, 266 Or. 537, 514 P.2d 540 (1973); Bailey v. Steele, 263 Or. 399, 502 P.2d 586 (1972); Morphet v. Morphet, 263 Or. 311, 502 P.2d 255 (1972); Koennecke v. Koennecke, 239 Or. 274, 397 P.2d 203 (1964); Slipp v. Amato, 231 Or. 512, 373 P.2d 673 (1962); Seufert v. Stadelman, 178 Or. 646, 167 P.2d 936 (1946); Jackson v. United Railways Co., 145 Or. 546, 28 P.2d 836 (1934); Hudelson v. Sanders-Swafford Co., 111 Or. 600, 227 P. 310 (1924); Lahey v. Lahey, 109 Or. 146, 219 P. 807 (1923); Ayers v. Lund, 49 Or. 303, 89 P. 806 (1907). However, in none of these cases was the inherent authority of the trial court to rectify its mistake approved for the purpose of lengthening the statutory time for appeal. ORS 19.033(2) provides:

"The serving and filing of the notice of appeal as provided in ORS 19.023 to 19.029 is jurisdictional and may not be waived or extended."

It is our conclusion that in the face of the statute the trial court has no authority to set aside one judgment and enter another For the sole purpose of extending the time for appeal. Such action would be in direct contradiction of the statute. ¹

Defendant contends the Court of Appeals lacked jurisdiction to consider plaintiff's challenge to the circuit court's act of setting aside the original judgment because the notice of appeal referred not to the order setting aside the original judgment but only to the new judgment; and, in any event, the order is not an appealable order, and the power of the trial court to enter the order is the basic issue involved. Defendant has overlooked ORS 19.140, which provides that

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