Goodyear Tire & Rubber Co. v. Tualatin Tire & Auto, Inc.

• Decision Date: 16 February 1996
• Citation: 932 P.2d 1141,325 Or. 46
• Parties: The GOODYEAR TIRE & RUBBER COMPANY, an Ohio corporation, Respondent on Review, v. TUALATIN TIRE & AUTO, INC., an Oregon corporation, Petitioner on Review. CC C89-0099CV; CA A73536; SC S41806. . On Respondent on Review's Petition for Reconsideration
• Court: Oregon Supreme Court

Page 1141

932 P.2d 1141

325 Or. 46

The GOODYEAR TIRE & RUBBER COMPANY, an Ohio corporation Respondent on Review, v. TUALATIN TIRE & AUTO, INC., an Oregon corporation Petitioner on Review.

CC C89-0099CV; CA A73536; SC S41806.

Supreme Court of Oregon In Banc.

On Respondent on Review's Petition for Reconsideration Feb 16, 1996. Reconsideration Allowed July 23, 1996. Resubmitted March 7, 1997. ^* Decided March 20, 1997.

James N. Westwood and William H. Walters of Miller, Nash, Wiener, Hager & Carlsen, Portland, filed the petition for reconsideration for respondent on review.

Kim E. Hoyt and Mark E. Griffin, of Ferder, Brandt, Cooper, Hoyt & French, LLP, Salem, filed a memorandum for petitioner on review.

William L. Hallmark and Lindsey H. Hughes, of Hallmark, Keating & Abbott, P.C., Portland, filed a brief for amicus curiae Oregon Association of Defense Counsel.

GILLETTE, Justice.

In Goodyear Tire & Rubber Co. v. Tualatin Tire & Auto, 322 Or. 406, 908 P.2d 300 (1995), this court concluded that, in the context of a dispute between Goodyear Tire & Rubber Company (Goodyear) and its franchisee, Tualatin Tire & Auto (Tualatin), the "we can't tell" rule of Whinston v. Kaiser Foundation Hospital, 309 Or. 350, 788 P.2d 428 (1990), does not justify the granting of a new trial on appeal when, by operation of ORCP 63, C, the appellant is deemed to have waived that remedy. ¹ In accordance with that ruling, we reversed the decision of the Court of Appeals, which had remanded certain of Tualatin's counterclaims for a new trial.

Goodyear timely petitioned for reconsideration of our decision, arguing that we had misconstrued the effect of ORCP 63, C and that, properly interpreted, that rule does not preclude a new trial in its case. We allowed the petition. On reconsideration, we adhere to our view that ORCP 63, C bars a party from obtaining a new trial on appeal, if that new trial is based on errors that the party asserted as grounds for a judgment notwithstanding the verdict (j.n.o.v.) in the trial court, but the party failed in the trial court to move in the alternative for a new trial on the basis of those same errors. However, we further conclude that ORCP 63, C, as we construe it and apply it to the facts of this case, does not operate to deny Goodyear a new trial. ² We therefore modify our former opinion as it pertains to Goodyear's entitlement to a new trial.

Although this case involves numerous claims and counterclaims, only Tualatin's counterclaims against Goodyear for common law fraud and for violations of the California Franchise Investment Law (CFIL) and the Oregon Franchise Act (OFA) are presently relevant. Those counterclaims all are based on the same 13 allegations of misrepresentations by Goodyear to Tualatin. At trial, Goodyear moved to have six of those allegations withdrawn from the jury's consideration. That motion was denied. Later, the jury returned general verdicts for Tualatin on its counterclaims, awarding, respectively, $74,000 on the CFIL claim, $112,000 on the OFA claim, and $260,000 on the common law fraud claim.

Goodyear moved for a j.n.o.v., arguing narrowly that the fraud damages were not supported by the evidence. ³ Goodyear did not move, in the alternative, for a new trial as to that issue. When its j.n.o.v. motion was denied, Goodyear appealed, arguing, among other things, that the trial court had erred in denying its motion to withdraw the six allegedly unsupported allegations from the jury's consideration.

The Court of Appeals agreed that the evidence supporting four of the allegations was deficient. Because it could not tell whether the disputed verdicts were based on those evidentiary deficiencies, the court applied the "we can't tell" rule and remanded the common law fraud, CFIL, and OFA claims for a new trial. Goodyear Tire & Rubber Co. v. Tualatin Tire & Auto, 129 Or.App. 206, 213-214, 879 P.2d 193 (1994).

On Tualatin's petition for review, we reversed. We concluded that, because Goodyear had moved in the trial court for a j.n.o.v., without joining an alternative motion for a new trial, the remedy of a new trial no longer was available. We based that decision on what we perceived to be the clear meaning of ORCP 63, C from its text and context ⁴--the price for failing to move in the alternative for a new trial is a waiver of that alternative remedy of a new trial. In settling on that meaning, we rejected an alternative interpretation offered by Goodyear: that ORCP 63, C contemplates only the waiver of the right to request a new trial from the trial court and does nothing to alter the inherent authority of trial and appellate courts to order a new trial.

In its petition for reconsideration of that decision, Goodyear continues to assert that an ORCP 63, C waiver pertains only to a party's right to ask for a new trial from the trial court. It argues that our contrary view is inconsistent with the rule's wording and fails to take into account certain contextual evidence of the legislature's intent. Goodyear argues, in the alternative, that the rule should not in any event have applied under the facts of the present case.

Although Goodyear's arguments do not convince us that our original construction of the rule was incorrect, they do convince us that we applied the rule inappropriately in this case. They also persuade us that a more detailed explanation of our reading of ORCP 63, C is warranted. We therefore begin again from the beginning, looking first at the rule's text and context. PGE v. Bureau of Labor and Industries, 317 Or. 606, 610-11, 859 P.2d 1143 (1993).

ORCP 63, C provides, in part:

"A motion in the alternative for a new trial may be joined with a motion for judgment not withstanding the verdict, and unless so joined shall, in the event that a motion for judgment notwithstanding the verdict is filed, be deemed waived."

Goodyear argues, and we agree, that, under the foregoing wording, it is the motion for a new trial that is deemed waived. However, we do not agree with the conclusion that Goodyear draws from that wording, i.e., that a party's relinquishment of the right to move for a new trial has no effect on the inherent ability of an appellate court to award a new trial. We believe that, in the circumstances described by ORCP 63, C, the waiver of the motion for a new trial implies a waiver of the new trial remedy itself--at least with respect to the specific errors asserted in the j.n.o.v. motion.

It is true that, in many circumstances, a party's failure to move for a new trial does not prevent a trial court from ordering a new trial on its own motion, should it consider the record to justify such a step. See ORCP 64, G (so providing); see also Maulding v. Clackamas County, 278 Or. 359, 362-65, 563 P.2d 731 (1977) (describing circumstances in which trial court may order a new trial). It also is true that, in normal circumstances, a party's failure to move for a new trial does not preclude a right to appeal or the derivative right to obtain a new trial on appeal, where that remedy is appropriate. See National Council v. McGinn, 70 Or. 457, 462-63, 138 P. 493 (1914) (existence of remedy by motion for a new trial does not exclude other remedy by appeal). But in those circumstances, a party's failure to move for a new trial establishes nothing about that party's right to receive a new trial as a remedy for the asserted error.

That is not the case when a losing party is faced with the join-it-or-lose-it requirement of ORCP 63, C. That rule has an obvious effect: It forces a party who is seeking one remedy for an asserted error--j.n.o.v.--simultaneously to inform the trial court whether the party is willing to accept the lesser (and possibly, the only appropriate) remedy, viz., a new trial. The party's failure to move for a new trial at that point establishes that party's unwillingness to accept that remedy for the error asserted in the j.n.o.v. motion. The party hardly can complain at a later point that a new trial is necessary to correct the error. After choosing to ask for either the j.n.o.v. remedy or nothing, the party loses any legitimate claim to a new trial and thereby waives that remedy on appeal. Put differently--once the trial court has been told, "I want a j.n.o.v., but I don't want a new trial, if that is all that I would be entitled to," it is inappropriate to posit reversible error on the trial court's failure to give the very remedy--a new trial--that the party chose not to seek in moving only for j.n.o.v.

Of course, if there were some clear evidence in ORCP 63, C that the legislature nonetheless intended to insulate litigants from that predictable legal consequence, we would give effect to that intent. But, in the absence of such evidence, we assume that the legislature intended that litigants be held to the natural consequences of their choices. Here, that means that, with respect to the error...