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Benavente v. Thayer

Court of Appeals of Oregon

April 26, 2017

Dominic BENAVENTE, Plaintiff-Appellant,
v.
Willy THAYER, Defendant-Respondent.

          Argued and submitted October 6, 2015.

         Washington County Circuit Court C133267CV; D. Charles Bailey, Jr., Judge.

          Willard E. Merkel argued the cause for appellant. With him on the briefs was Merkel & Associates.

          John R. Bachofner argued the cause and fled the brief for respondent.

          Before Duncan, Presiding Judge, and DeVore, Judge, and Flynn, Judge pro tempore.

         Case Summary:

         After plaintiff accepted defendant's offer to allow judgment pursuant to ORCP 54 E, defendant fled a motion to use the interpleader process of ORCP 31 to resolve third-party interests in the settlement. The trial court allowed that motion and entered a judgment reflecting that ruling as well as a supplemental judgment awarding attorney fees under ORCP 31 C for defendant's time pursuing interpleader. Plaintiff appeals both judgments, arguing that the trial court lacked authority to "hear and grant" the motion for interpleader once the offer to allow judgment was accepted. Held: The trial court erred in granting the motion for interpleader. Once an offer of judgment under ORCP 54 E has been made and accepted, the court's authority is limited to entering judgment according to the terms to which the parties have agreed and, when necessary, resolving disputes regarding the terms to which the parties have agreed. The court lacked authority to order interpleader here, because that process for resolving third-party claims varied from the terms to which the parties had agreed, at a minimum, by giving defendant an automatic right to recover attorney fees from plaintiff, which was not a term of the accepted offer of judgment. Thus, the supplemental judgment is reversed. However, the Court of Appeals declined to reach plaintiff's challenge to the general judgment because the trial court has since released the full amount of the interpleaded funds to plaintiff, and plaintiff identified no practical effect that a decision by the court could have on plaintiff's rights under the general judgment.

         Supplemental judgment reversed; otherwise affirmed.

          FLYNN, J. pro tempore

         Plaintiff appeals from a corrected general judgment[1] and from a supplemental judgment awarding attorney fees, which the trial court entered after plaintiff accepted defendant's offer to allow judgment, pursuant to ORCP 54 E. The challenged judgments reflect the trial court's post-acceptance ruling allowing defendant to use the interpleader process of ORCP 31 to resolve third-party interests in the settlement and ordering plaintiff to pay defendant's attorney fees. Plaintiff contends that the court exceeded its authority under ORCP 54 E by "hearing and then granting" defendant's motion for interpleader because the terms of defendant's offer did not provide for interpleader. Defendant contends that the order for interpleader is "consistent" with the terms of the offer of judgment. We conclude that the court erred in granting defendant's motion, because the ruling resulted in judgments that varied from the terms of the offer of judgment. Accordingly, we reverse the supplemental judgment and otherwise affirm.

         ORCP 31 AND ORCP 54 E

         We pause to provide a brief overview of the two rules of civil procedure that are at the heart of this dispute. As pertinent to this appeal, ORCP 54 E allows the party against whom a claim has been asserted to serve an "offer to allow judgment to be entered against the party making the offer" for the sum of money or other relief specified in the offer. ORCP 54 E(1). The offer serves at least two purposes. If the claiming party accepts the offer and files it under the process described in the rule, ORCP 54 E(2) specifies that, "thereupon judgment shall be given accordingly as a stipulated judgment." The offer to allow judgment can also serve to cut off a party's potential liability for costs and fees if the claiming party rejects the offer; if the claiming party prevails at an adjudication but fails to obtain a judgment more favorable than the offer to allow judgment, then that party "shall not recover costs, prevailing party fees, disbursements, or attorney fees incurred after the date of the offer."ORCP54E(3).

         The interpleader process of ORCP 31 permits a party that is concerned about potential "double or multiple liability" to bring all competing claims before the court and to let the court sort out the competing claims. ORCP 31 A. As used here, the rule allows a party to deposit with the court property or an amount of money for which the party admits it is liable. The rule then allows the party to obtain both a discharge of liability and an order requiring any parties with interests in the money to resolve their claims only through interpleader in the existing action. See ORCP 31 B. The rule also provides that "the party filing suit or action in ...


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