509 P.3d 750
Or. Ct. App.2022Background
- Greenleaf Auto Repair (plaintiff) entered a consignment agreement with Ideal Auto Works (Ideal) to sell vehicles and split profits 50/50; Ideal sold vehicles but did not remit Greenleaf’s share.
- Plaintiff sued Ideal, Ideal’s sole member Julie Crosse, and Bradley Crosse (who signed for Ideal and was later defaulted). Claims: breach of contract, conversion, and piercing the corporate veil.
- Ideal and Crosse moved to dismiss under ORCP 21 A(8); the trial court dismissed all claims against Crosse and the conversion claim against Ideal.
- The trial court awarded attorney fees on the conversion claims and on the breach claim against Crosse, plus a $1,000 enhanced prevailing party fee to Crosse; Ideal’s request for an enhanced prevailing party fee was stayed for supplemental decision.
- Plaintiff appealed; the Court of Appeals reviewed the ORCP 21 dismissal for legal error and affirmed the trial court in all respects.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether consignment proceeds are "specific money" supporting conversion | Proceeds from vehicle sales are specific money and therefore convertible | Proceeds are not specific money; conversion requires identifiable specific funds | Affirmed dismissal of conversion claims; proceeds are not "specific money" (argument unpreserved and without legal support) |
| Whether Crosse can be sued for breach of contract individually | Crosse is individually liable on the contract (plaintiff asserted she should be treated as party) | Contract was between plaintiff and the LLC; complaint lacks facts showing Crosse individually was a contracting party | Affirmed dismissal of breach claim against Crosse for failure to allege Crosse was party to the contract |
| Whether plaintiff pleaded facts sufficient to pierce the corporate veil | Alleged co-mingling of funds and inability to collect establishes veil piercing | Complaint lacks factual allegations showing causal link from Crosse’s conduct to plaintiff’s harm | Affirmed dismissal of veil-piercing claim for failure to allege causation and lack of alternative adequate remedy |
| Whether attorney fees and prevailing party fee were properly awarded | Plaintiff’s claims were reasonable | Claims lacked objective legal or factual support | Affirmed fee awards; conversion and the breach claim against Crosse were objectively unreasonable, so fees were proper |
Key Cases Cited
- Chang v. Chun, 305 Or App 144 (discusses standard of review for ORCP 21 A(8) dismissal)
- Wood Ind’l Corp. v. Rose, 271 Or 103 (proceeds from distributions are not "specific money" for conversion)
- State ex rel Neidig v. Superior Nat’l Ins. Co., 343 Or 434 (elements for piercing the corporate veil; veil piercing is an extraordinary, last-resort remedy)
- North Marion Sch. Dist. #15 v. Acstar Ins. Co., 206 Or App 593 (standard for awarding fees under ORS 20.105: objective reasonableness; abuse-of-discretion review)