Stanfield v. Laccoarce

• Decision Date: 04 March 1980
• Citation: 607 P.2d 177,288 Or. 659
• Parties: Dorna Dee STANFIELD, James P. O'Neal, and James H. Spence, Respondents, v. James P. LACCOARCE and Judith Elaine Laccoarce, Petitioners, James T. Laccoarce, Pauline L. Laccoarce, Umpqua Credit Adjusters, Inc., Robert H. Ruth, Associates Capital Services Corporation, an Indiana corporation, State of Oregon, acting by and through the State Scholarship Commission for the use and benefit of its Student Loan Funds, Douglas County, and William Stanfield, Defendants. CA 12007; SC 26358.
• Court: Oregon Supreme Court

Page 177

607 P.2d 177

288 Or. 659

Dorna Dee STANFIELD, James P. O'Neal, and James H. Spence, Respondents, v. James P. LACCOARCE and Judith Elaine Laccoarce, Petitioners, James T. Laccoarce, Pauline L. Laccoarce, Umpqua Credit

Adjusters, Inc., Robert H. Ruth, Associates Capital Services

Corporation, an Indiana corporation, State of Oregon, acting

by and through the State Scholarship Commission for the use

and benefit of its Student Loan Funds, Douglas County, and

William Stanfield, Defendants.

CA 12007; SC 26358.

Supreme Court of Oregon.

Argued and Submitted Jan. 8, 1980.

Decided March 4, 1980.

Randolph Slocum of Slocum & Hill, Roseburg, argued the cause and filed briefs for petitioners.

James H. Spence of Spence, O'Neal & Banta, Roseburg, argued the cause and filed a brief for respondents.

Before DENECKE, C. J., and TONGUE, HOWELL, LENT and LINDE, ^* JJ.

HOWELL, Justice.

Plaintiffs filed this suit to foreclose a land sale contract. Plaintiffs are the assignees of the original vendors. The primary defendants are James T. and Pauline Laccoarce, who are the original vendees (hereinafter "vendees") and James P. and Judith Laccoarce (hereinafter "defendants"), the subpurchasers from James T. and Pauline Laccoarce. The trial court allowed plaintiff's motion for summary judgment against defendants and entered a decree of strict foreclosure. The Court of Appeals affirmed without opinion. We granted review.

It is difficult to piece together the facts from the pleadings in this confusing and complicated transaction.

In their complaint for foreclosure filed in September, 1977, plaintiffs alleged that they were assigned the interest of the original vendors in August, 1977; that the original vendees had entered into a conditional sale contract in September, 1967, to purchase the real property; that the vendees were in default in various particulars, including a failure to make payments when due; and that the vendees had sold the property to defendants without the permission required in the land sale contract. The complaint named the vendees and the defendants as party-defendants and also alleged that the defendants "have or claim to have some right, title or interest in the real property."

The vendees did not enter an appearance and an order of default was taken against them.

Defendants, however, filed an answer and cross-complaint. In the answer they admitted that they have an interest in the property, and they denied plaintiffs' allegations of default. In the cross-complaint, they attached a copy of a 1973 agreement between the vendees and themselves, they alleged that they have been assignees of the vendees since 1973, and they alleged that plaintiffs (and their predecessors) knew of their assignment, accepted their payments, and waived any breaches of performance. ¹ The cross-complaint also contained allegations of damages which are not material to the issue of strict foreclosure.

After the trial court allowed plaintiffs' motion to strike the cross-complaint, defendants filed an amended answer which was similar to the original answer, except that defendants alleged their claims for damages in separate counts. The trial court sustained plaintiffs' demurrer to the cross-complaint and to defendants' allegations that the plaintiffs knew of the assignment, accepted payments, and waived any breach.

Defendants filed a second amended answer and a cross-complaint, again alleging knowledge by plaintiffs of defendants' interest acceptance of payments and waiver of any breaches. Again the trial court sustained plaintiffs' motion to strike or, in the alternative, to demur to the cross-complaint. The trial court explained, in a Memorandum, that the agreement between defendants and the original vendees is not an assignment, but is a separate and distinct contract of sale. The trial court was of the opinion that, because defendants are not privy to the original contract, they had no rights as against the plaintiffs.

The next pleading appearing in the record is plaintiffs' motion for summary judgment based "upon ORS 18.105 and the records and files herein." Plaintiffs did not file any supporting documents. Defendants, however, filed an affidavit specifically denying the allegations in plaintiffs' complaint concerning breaches of the contract. Thereafter the trial court entered an order allowing the motion for summary judgment, entered an interlocutory decree of strict foreclosure, and subsequently entered a final decree of strict foreclosure.

When the trial court allowed plaintiffs' motion for summary judgment he stated in a Memorandum that he did so for two independent reasons: (1) the defendants have "no standing to affirmatively contest the foreclosure of a contract to which they are not a party"; ² and (2) the "defendants have not, by an affidavit of denial, or otherwise, demonstrated there is a genuine issue of fact as required by ORS 18.105(4) and Gleason v. International Multigoods (sic) Corporation. (282 Or. 253, 577 P.2d 931 (1978))."

We disagree with the trial court's first reason for granting plaintiffs summary judgment. From the record it appears that the trial court's ruling was based on the erroneous assumption the defendant had no defense. Even if defendants are subpurchasers, and not assignees, they may contest the foreclosure of the original real estate contract. In their complaint plaintiffs named defendants as party-defendants in the suit, alleged that defendants had purchased the real property, and alleged that defendants have or claim to have some interest in the property. If we accept plaintiffs' allegations, then these defendants are entitled to contest the foreclosure suit because they are named party-defendants who claim an interest in the property. Furthermore, defendants alleged in their answers that plaintiffs had been aware of defendants' interest, had accepted payments from them for over four years, and had waived any breaches of the original contract. As party-defendants who claim an interest in the real property, these defendants are entitled to allege and prove these facts. ³

The trial court should not have granted the motion for summary judgment on the grounds the defendants had no standing to resist the foreclosure. On remand the trial court should re-examine its rulings on plaintiffs' motions and demurrers based on this decision.

We also disagree with the trial court's second reason for granting summary judgment. The trial court applied ORS 18.105(4) which requires a party responding to a properly supported motion for summary judgment not to rest upon the mere allegations or denials of his pleading, but to set forth by affidavit or otherwise specific facts showing that there is a genuine issue as to a material fact. The trial court relied on Gleason v. International Multifoods Corp., 282 Or. 253, 577 P.2d 931 (1978).

The trial court's reliance on ORS 18.105(4) and on Gleason is misplaced. This court has previously noted that ORS 18.105(4) applies when the party moving for summary judgment has adequately supported his motion with affidavits or other material. See Engelking v. Boyce, 278 Or. 237, 242, 563 P.2d 703 (1977); Pelege v. Chrysler, 278 Or. 223, 563 P.2d 701 (1977). See also First Nat. Bank v. Cities Service, 391 U.S. 253, 288-89, 88 S.Ct. 1575, 1592, 20 L.Ed.2d 569 (1968); 10 Wright & Miller, Federal Practice and Procedure: Civil § 2739 (1973). In Gleason we applied ORS 18.105(4) because the party moving for summary judgment supported his motion by affidavit. See 282 Or. at 258, 577 P.2d 931. In the instant case the plaintiffs did not support their motion for a summary judgment by affidavit or otherwise. ORS 18.105(4) therefore does not apply to the instant case.

Plaintiffs, the party moving for summary judgment, had the burden of showing that there are no genuine issues of material fact and that they were entitled to judgment as a matter of law. The record on summary judgment is viewed in the light most favorable to the party opposing the motion. See Seeborg v. General Motors Corporation, 284 Or. 695, 588 P.2d 1100 (1978); Uihlein v. Albertson's, Inc., 282 Or. 631, 580 P.2d 1014 (1978); Santilli v. State Farm, 278 Or. 53, 59, 562 P.2d 965 (1977). See also United States v. Diebold, Inc., 369 U.S. 654, 82 S.Ct. 993, 8 L.Ed.2d 176 (1962); 10 Wright & Miller, supra, § 2716.

In the instant case the plaintiffs filed no supporting material but merely rested on their pleadings. ⁴ Defendants, however, did not rely solely upon their answer, which had denied the allegations of the complaint and had alleged payments by them accepted by plaintiffs, but went further and filed an affidavit in opposition to the motion for summary judgment. The affidavit stated that they...