Ramex, Inc. v. Northwest Basic Industries

• Decision Date: 15 August 2001
• Citation: 176 Or. App. 75,29 P.3d 1211
• Parties: RAMEX, INC., an Oregon corporation; Ron Gibson; Shon Gibson; and Custom Rock and Minerals, an Oregon corporation, Appellants, v. NORTHWEST BASIC INDUSTRIES, an Alaska corporation; Paul Thomason; Paul Johnson; and Dick Simmons, Respondents, and Railtex, a Texas corporation; and Central Oregon & Pacific Railroad, Inc., a Delaware corporation, Defendants.
• Court: Oregon Court of Appeals

29 P.3d 1211

176 Or. App. 75

RAMEX, INC., an Oregon corporation; Ron Gibson; Shon Gibson; and Custom Rock and Minerals, an Oregon corporation, Appellants, v.NORTHWEST BASIC INDUSTRIES, an Alaska corporation; Paul Thomason; Paul Johnson; and Dick Simmons, Respondents, andRailtex, a Texas corporation; and Central Oregon & Pacific Railroad, Inc., a Delaware corporation, Defendants.

98-0506-L-2; A107986

Court of Appeals of Oregon.

Submitted on Record and Brief September 11, 2000.

Decided August 15, 2001.

John R. Huttl, Medford, filed the brief for appellants.

James R. Dole, Grants Pass, filed the brief for respondents Northwest Basic Industries, Paul Thomason, Paul Johnson, and Dick Simmons.

James V. Shepherd, Jon V. Buerstatte, and Gleaves Swearingen Larsen Potter Scott & Smith LLP, Eugene, filed the brief for defendants RailTex and Central Oregon & Pacific Railroad, Inc.

Before EDMONDS, Presiding Judge, and ARMSTRONG and KISTLER, Judges.

KISTLER, J.

The trial court granted defendants' motions to dismiss plaintiffs' complaint because their claims were barred by issue preclusion.The court awarded an enhanced prevailing party fee to defendants and entered judgment in their favor.Plaintiffs appealed, and defendants have moved to dismiss the appeal because plaintiffs paid the judgment voluntarily.We deny defendants' motion to dismiss the appeal, reverse the trial court's judgment, and remand for further proceedings.

This case involves an ongoing dispute regarding a mining business in Jackson County.Defendant Northwest Basic Industries (NWBI) is the fee simple owner of real property that includes a silica and limestone quarry.¹Defendant Central Oregon & Pacific Railroad (CORP)² owns a milling facility, which is located on NWBI's property near the quarry.NWBI leased the facility from CORP.This arrangement continued for a limited period of time, and, after NWBI's lease expired, CORP agreed to lease the facility to plaintiffs, who planned to use it as part of an independent mining operation.After securing the lease, plaintiffs entered into several "quarrying, processing and transporting" contracts that were to generate approximately $92,000 per year, and plaintiffs claim to have begun negotiating "future contracts," which would have generated another $5.5 million per year.In the summer of 1997, CORP terminated plaintiffs' lease and entered into a new lease with NWBI.

Plaintiffs brought claims for tortious interference with contractual relations and conversion against NWBI, a claim for tortious interference with contractual relations against CORP and its parent company, and a claim for tortious interference with business expectations against all defendants.³The essence of plaintiffs' tortious interference claims against NWBI is that NWBI persuaded CORP to terminate plaintiffs' lease by improper means and with improper motives.⁴Defendants moved "for an order pursuant to ORCP 21 A(8) dismissing the complaint with prejudice."The motion was based largely on the doctrine of issue preclusion; that is, defendants argued that the controlling issues had effectively been decided against plaintiffs in a previous action between the parties.Therefore, defendants argued, plaintiffs were barred from bringing the present action.In an order granting defendants' motion against the tortious interference claims, the trial court stated:

"All defendants have filed a motion to dismiss based upon issue preclusion and the theories set forth in Uptown Heights Associates v. Seafirst Corp.,320 Or. 638, 891 P.2d 639(1995).The motions contend that the final judgment in the case of Northwest Basic Industries Inc. v. Ron Gibson * * * has previously determined that the lease in question was properly terminated by Central Oregon and Pacific Railroad, Inc. and that under the Uptown Heights case, the plaintiffs cannot prevail in claims 1, 2 and 3.The motions are well taken and are hereby granted."

The trial court also granted a motion to dismiss plaintiffs' fourth claim for relief, the conversion claim against NWBI.Both motions were granted without leave to amend.The trial court awarded defendants an enhanced prevailing party fee and entered judgment in their favor.

Plaintiffs appealed but did not file a supersedeas undertaking.NWBI executed on the judgment, and plaintiff paid the judgment in response to the writ of execution.NWBI has filed a motion to dismiss plaintiffs' appeal.Relying primarily on City of Portland v. One 1973 Chevrolet Corvette,113 Or.App. 469, 470, 833 P.2d 1285(1992), NWBI argues that plaintiffs' failure to file an undertaking means that plaintiffs paid the judgment voluntarily and that their appeal is moot.Plaintiffs respond that NWBI's argument and, by extension, our decision in City of Portland are inconsistent with settled Supreme Court authority.

The Supreme Court has long recognized that voluntarily paying a judgment does not preclude a party from appealing from that judgment.Cottrell, et ux. v. Prier, et ux.,191 Or. 571, 573, 231 P.2d 788(1951);Staiger v. Holman,144 Or. 67, 69, 6 P.2d 43, 18 P.2d 591, 23 P.2d 917(1933);Duniway v. Cellars-Murton Co.,92 Or. 113, 170 P. 298, 179 P. 561(1919);Eilers Piano House v. Pick,58 Or. 54, 113 P. 54(1911);Edwards v. Perkins,7 Or. 149, 154-55(1879).As the court first explained in Edwards,an appellant can file an undertaking promising to pay the judgment, if affirmed, and also take an appeal from the judgment.7 Or. at 154-55.The situation is no different if the appellant pays the judgment instead of filing the undertaking.Id.The "payment [pending appeal is] simply another mode of effecting the purpose of such undertaking,"Staiger,144 Or. at 69, 23 P.2d 917(explainingEdwards ), and the appellant"is in no worse position from having paid the judgment voluntarily than if he had settled the execution with costs,"id.(quotingEdwards,7 Or. at 155).In both situations, an appellant may pursue his or her appeal.Staiger,144 Or. at 69, 23 P.2d 917;Edwards,7 Or. at 155.

The court has recognized at least three exceptions to that general rule.In some circumstances, complying with a judgment may also entail accepting its benefits, and the court has recognized that a person who voluntarily accepts the benefits of a judgment may not challenge it on appeal.SeeCottrell,191 Or. at 574-75, 231 P.2d 788;Lord v. Pettibon,102 Or.App. 607, 795 P.2d 607(1990).In Cottrell, for example, the trial court held that the plaintiffs were entitled to specific performance of a real estate contract and entered a judgment directing the defendants to deliver the deed to the plaintiffs in return for plaintiffs' paying defendants the contract price.191 Or. at 572-73, 231 P.2d 788.In compliance with the judgment, the defendants both delivered the deed and accepted payment.Id.They later sought to appeal.Id.The court dismissed the appeal because the defendants could not both accept the benefits of the judgment and appeal from it, at least as long as they had the option of staying enforcement of the judgment by tendering the deed into the court.Id. at 574-76, 231 P.2d 788.

At first blush, there is some tension between the reasoning in Edwards and Cottrell.In one case, the failure to take advantage of procedures to stay enforcement of the judgment did not preclude an appeal while it did in the other.Any tension between the cases can be resolved, however, by considering the differing principles at work in each case.In Edwards, compliance with the judgment did not entail accepting the benefits of the judgment.There is nothing inconsistent with voluntarily complying with the obligation that the judgment imposed and challenging the judgment on appeal.Conversely, in Cottrell,the appellant could not comply with the judgment without also accepting its benefits, thus bringing into play the principle that a party may not accept the benefits of a judgment and simultaneously appeal from it.Cottrell,191 Or. at 575, 231 P.2d 788;see alsoLord,102 Or.App. at 610, 795 P.2d 607.Cottrell accordingly holds that, in those circumstances, an appellant who fails to take advantage of procedures to stay enforcement of a judgment will voluntarily accept the benefits of the judgment and be barred from challenging it on appeal.191 Or. at 575, 231 P.2d 788.⁵

Two other exceptions to the general rule in Edwards deserve brief mention.Staiger explains that "[w]hen a judgment is rendered against a party, his payment of the [judgment] will not preclude him from maintaining an appeal, unless it satisfactorily appears to the court that the payment was not coerced and was made with a view of settlement."144 Or at 69, 23 P.2d 917.Although one might question when a party would pay the judgment as part of an effort to settle the case, a judgment could give the respondent some but not all the relief that he or she had sought.In those circumstances, the appellant could agree to pay the judgment in return for the respondent agreeing not to cross-appeal.⁶

Finally, when compliance with the judgment causes the "entire subject matter of the appeal" to disappear leaving nothing that "a reversal of the decree could affect," the appeal will be dismissed as moot.Duniway,92 Or at 116, 170 P. 298.Compliance with a writ of mandamus may moot the appeal, for example.SeeEilers Piano House,58 Or. at 56, 113 P. 54;School District v. Crowell,33 Or. 11, 13-14, 52 P. 693(1898).As the court has explained, in light of the nature of the relief sought in mandamus, "it would be a vain thing, indeed, to adjudge that an inferior tribunal was under no obligation to perform an act after it had been fully accomplished."School District,33 Or. at 13, 52 P. 693.Conversely, when an appellate court can grant the appellant some of the relief he or she seeks, the appeal will not be moot.SeeDuniway,92 Or at 116, 170 P. 298;McFadden v. Swinerton,36 Or. 336, 354, 59 P. 816, 62 P. 12(1900...