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Yarbrough v. Viewcrest Investments, LLC

Court of Appeals of Oregon

August 28, 2019

Jack R. YARBROUGH, Plaintiff-Respondent,
v.
VIEWCREST INVESTMENTS, LLC, an Oregon limited liability company; Robert Harris, an individual; S. Fred Hall, Jr., an individual; Principal Holding Co., LLC, an Oregon limited liability company; and Jefferson Equities, LLC, an Oregon limited liability company, Defendants-Appellants.

          Argued and submitted December 3, 2018

          Linn County Circuit Court 13CV03671; Daniel R. Murphy, Judge.

          Steven E. Benson argued the cause for appellants and fled the reply brief. Also on the opening brief were Russ Baldwin and Melinda B. Wilde.

          William L. Ghiorso and Ghiorso Law Offce fled the brief for respondent.

          Before Lagesen, Presiding Judge, and DeVore, Judge, and James, Judge.

         Case Summary:

         Defendants to a foreclosure action appeal a corrected limited judgment and a limited judgment, assigning error to the trial court's entry of each judgment. Defendants argue that the court exceeded its authority under ORCP 71 A when it entered a corrected "limited" judgment to change the title of a mislabeled "general" judgment. Defendants further contend that, because the court lacked authority to enter that corrected limited judgment, the original general judgment still controlled, disposing of all claims and precluding subsequent entry of a separate limited judgment.

         Held:

         The trial court properly exercised its authority to address a clerical error under ORCP 71 A. The statute on changing a "general" judgment to a "limited" judgment did not limit the authority under [299 Or.App. 144] ORCP 71 A to correct a clerical error. ORS 18.112. Under the factual circumstances of this case, the judgment's designation qualified as the sort of clerical mistake that the trial court had jurisdiction to correct, regardless of the pending appeal, and the court followed the proper procedure. Consequently, because the court did not err in entering the corrected limited judgment, it was free to enter the limited judgment that followed.

          [299 Or.App. 145] DeVORE, J.

         Defendants to a foreclosure action appeal a corrected limited judgment and a limited judgment, assigning error to the trial court's decisions to enter each judgment. Defendants argue that the court exceeded its authority under ORCP 71 A when it entered a corrected "limited" judgment to fix the title of a mislabeled "general" judgment.[1] Specifically, defendants contend that: (1) ORS 18.112 provides the sole mechanism for correcting a judgment's designation; (2) the trial court lacked jurisdiction during an appeal; (3) the correction was not "clerical"; and (4) the court failed to follow the procedures of ORCP 71 A during an appeal. Defendants also argue that, because the court lacked authority to enter the new judgment, the original general judgment still controlled, disposing of all claims and precluding subsequent entry of a separate limited judgment. We conclude that the court did not err when it corrected the general judgment or entered the later limited judgment. Accordingly, we affirm.

         I. FACTS AND PROCEEDINGS

         The relevant facts are procedural and not in dispute. In June 2013, plaintiff brought a foreclosure action against Harris, Hall, Jefferson Equities, LLC, and Viewcrest Investments, LLC (hereafter referred to collectively as "Viewcrest") and Principal Holdings Co. ("Principal"). A trial was scheduled for December 2015. Principal failed to appear, and the court granted plaintiffs motion for an order of default. Viewcrest appeared and negotiated a settlement with plaintiff, and, in colloquy with the court, both parties confirmed that they understood the finality of that agreement.

         Viewcrest agreed to draft a limited judgment incorporating the settlement's terms.[2] Over the next month, there was related correspondence, including a letter from [299 Or.App. 146] Viewcrest's counsel to the court with a proposed version of the agreement enclosed. The trial court and parties planned to finalize the judgment against Viewcrest on January 29, 2016. However, a dispute arose as to what terms the December settlement agreement had entailed, delaying entry of that judgment. In February, the court held a hearing to resolve the dispute, reviewed an audio recording of the negotiation, and issued a letter opinion reciting the terms. It was late February when the court finally entered the limited judgment giving effect to the settlement agreement.

         Meanwhile, per the trial court's instruction, plaintiff drafted a general judgment of foreclosure against Principal, which he submitted on January 29, 2016. The trial court entered it three days later. The judgment recited that Principal had failed to appear for trial, and that the trial court had entered an order of default against Principal on the judicial foreclosure claim. The judgment then stated:

"[I]t is hereby ordered and adjudged that Plaintiff shall have final judgment against Defendant Principal Holding Co. on Plaintiffs claim for Judicial Foreclosure. From this day forward, Defendant Principal Holding Co. is foreclosed of any and all right, title, lien, interest, or claim in the Subject Property * * *."

(Capitalization omitted.)

         Principal appealed the general judgment of foreclosure, and Viewcrest appealed the limited judgment finalizing the settlement agreement.[3] The Appellate Commissioner, on the court's own motion, raised the issue of whether the limited judgment against Viewcrest was valid in light of the fact that the trial court had previously entered a general judgment in the case, effectively dismissing all claims with prejudice. The commissioner surmised that the predicament occurred "because plaintiff and defendants thought they had settled the case in late 2015, they anticipated that the limited judgment would be entered before the general judgment," and "the dispute over whether the settlement [299 Or.App. 147] should have included a particular term delayed entry of the limited judgment until after entry of the general judgment." The commissioner entered an order to show cause as to why he should not vacate the limited judgment as a nullity and dismiss the appeal, but he also suggested that "the designation of the respective judgments as general and limited judgments may be correctable under ORCP 71, as provided by ORS 18.112."

         Following that suggestion, in June 2016, plaintiff moved under ORCP 71 to correct the label of the general judgment to a limited judgment. Plaintiff explained that he had mistakenly designated the judgment against Principal as "general" rather than "limited," and that the court could correct the mistake pursuant ORS 18.107, ORS 18.112, and ORCP 71 B.

         The trial court held a hearing on plaintiff's motion to correct the judgment, which it eventually granted by order in December 2016. The court explained:

"Under ORCP 71A the court may, on its own motion, correct clerical mistakes in judgments, orders or other parts of the record and errors therein arising from oversight or omission 'may be corrected by the court at any time on its own motion or on the motion of another party'. It is clear to the court that the submission of the general judgment by plaintiff was done in error simply because there is no other explanation consistent with the facts in this case. *** The court has a vested interest in making sure its orders and judgments are correct and reflect a proper ruling of the court. The court likewise has an interest in correcting its own errors. Therefore the court can and does, on its own motion, as well as plaintiffs, correct the general judgment to render it a limited judgment."

         Once the trial court granted the motion to correct the judgment, the Appellate Commissioner returned to Viewcrest's appeal. The commissioner determined that the trial court's decision granting the motion "[redenominating" the judgment against Principal would remove "the impediment to the validity" of the limited judgment against Viewcrest. Operating under the assumption that, "in due course, the trial court [would] enter a judgment, titled as a limited judgment, disposing of plaintiffs claims" against [299 Or.App. 148] Principal, the commissioner proceeded to consider arguments around Viewcrest's appeal.[4]

         As it would turn out, however, the trial court did not immediately enter a corrected judgment; Viewcrest objected to, and delayed, that action. Come May 2017, when no corrected judgment had been entered, the Appellate Commissioner issued an order on behalf of the Court of Appeals that vacated the limited judgment against Viewcrest as a nullity and dismissed the appeal.

         In August 2017, the trial court was satisfied that it did, indeed, have authority under ORCP 71 A to correct the designation of the general judgment against Principal. It issued an opinion letter stating,

"If the plaintiff submits a corrected limited judgment which is identical in content to the February 16, 2016 limited judgment it will constitute the correction of a clerical mistake and not the alteration of a substantive provision. It will not deviate in any respect from what the parties agreed upon and expressed on the record in open court. It will not add or delete one substantive provision. Under ORCP 71A this court retains the jurisdiction to enter such a corrected limited judgment under the cases cited in this case.
"This court will enter a proper Corrected Limited Judgment when submitted by the plaintiff with a current date of entry. The court will compare the submitted judgment with the February 2016 judgment to insure it is identical and if it is not it will not be signed. This will be done on the Court's own motion pursuant to ORCP 71 A."

(Emphasis omitted.) Thereafter, the trial court entered a corrected limited judgment of foreclosure against Principal that mirrored the prior general judgment in every respect but the label. No longer precluded from doing so, the court entered a new limited judgment against Viewcrest that, as before, effectuated the December 2015 settlement agreement. Principal and Viewcrest appeal those judgments respectively.

         [299 Or.App. 149] II. TIMELINESS OF APPEAL

         As a preliminary matter, we dispose of Principal's appeal due to its untimely filing. See ORS 19.255(1) ("Except as provided in this section, a notice of appeal must be served and filed within 30 days after the judgment appealed from is entered in the register."). The trial court entered the original judgment against Principal in February 2016, but Principal filed the current appeal in October 2017. We decided the merits of an appeal from that general judgment. Yarbrough v. Viewcrest Investments, LLC, 293 Or.App. 121, 432 P.3d 1168 (2018), rev den, 364 Or. 535 (2019). Principal now appeals the corrected limited judgment. However, the two judgments against Principal were identical except for title; nothing changed with respect to the disposition of claims against Principal. Because re-designating the judgment's title did not affect a substantial right of Principal, the deadline for filing remains the same. ORS 18.107(2) ("Unless a correction to a judgment affects a substantial right of a party, the time for appeal of the judgment commences upon entry of the original judgment."). Even if that prior decision did not bar Principal's appeal on the merits, we could not entertain Principal's appeal because it is time-barred.

         Viewcrest's appeal is timely because it was filed in November 2017 and arises from the limited judgment that the court entered in October 2017. Therefore, we consider the merits of that appeal.

         III. ARGUMENTS AND ANALYSIS

         On appeal, the remaining defendants challenge the trial court's decisions to enter a corrected limited judgment against Principal and a limited judgment against Viewcrest. They argue that the trial court lacked authority to correct the general judgment on its own motion under ORCP 71 A without having plaintiff satisfy ORCP 71 B's requirements. Defendants contend that, because the court lacked authority to enter a corrected limited judgment, the original general judgment resolved all claims and controlled, such that the court erred in entering a subsequent limited judgment against Viewcrest.

         [299 Or.App. 150] Defendants offer several theories as to why the trial court lacked authority under ORCP 71 A. First, they assert that ORS 18.112 provides the only means by which a court can change a judgment's designation. Second, defendants argue that ORS 19.270(1), which enumerates the powers of a trial court during the pendency of an appeal, permits the court to decide a motion for relief under ORCP 71 B, but not ORCP 71 A. Third, defendants contend that ORCP 71 A is limited to "clerical mistakes made by court staff to speak the truth," and that changing the judgment's designation did not qualify because it was a "legal determination that only a judge can make." Finally, defendants claim that, while an appeal is pending, ORCP 71 A only allows a ...


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