Union Lumber Co. v. Miller
S062459
Or.Jan 20, 2017Background
- Union Lumber sued Ron and Linda Miller in 2010 for unpaid charges; Linda was personally served in Wisconsin and the Millers later executed powers of attorney authorizing their son Ean to "answer the complaint."
- Ean filed an answer on August 30, 2010, signing as "Ean Miller P.O.A." and listing a La Grande, Oregon address as defendants’ address.
- The case was sent to court-annexed arbitration; notices, hearing dates, and the arbitrator’s award were mailed to plaintiff’s counsel and to “Ean Miller POA” at the La Grande address.
- Neither the Millers nor Ean attended arbitration; the arbitrator struck the answer (because Ean was not a lawyer), awarded damages to Union Lumber, and a general judgment was entered.
- After Ean received notice of entry of judgment (mailed to the La Grande address), the Millers obtained counsel and moved under ORCP 71 B(1) to set aside the judgment for mistake and excusable neglect; the trial court denied relief and the Court of Appeals reversed.
- The Oregon Supreme Court granted review and reversed the Court of Appeals, affirming denial of the ORCP 71 B(1) motion and upholding the supplemental award of costs and fees to plaintiff.
Issues
| Issue | Union Lumber's Argument | Millers' Argument | Held |
|---|---|---|---|
| Whether defendants’ failure to defend was "excusable neglect" under ORCP 71 B(1) | Millers’ inaction was inexcusable; they designated La Grande address and did not update court | Their reliance on son and reasonable belief that mail would reach them made neglect excusable | Millers’ reliance on nonlawyer son and failure to follow up was unreasonable; neglect was inexcusable; motion denied |
| Whether a "mistake" by plaintiff/arbitrator in mailing to La Grande (not Wisconsin residence) required relief under ORCP 71 B(1) | Service to address in answer was proper under ORCP 9 B; no mistake | Mailing to La Grande (not residence) violated ORCP 9 B; same justified setting aside the judgment | "Last known address" means most recent place others know they can be found; La Grande address was defendants’ last known address; no mistake by plaintiff/arbitrator sufficient to require relief |
| Proper construction of ORCP 9 B phrase "last known address" | Address supplied in a party’s filed pleading can be the last known address | Court should treat residence (where substituted service was later made) as last known address | "Last known address" is the most recent place another party knows the party can be found or communicated with; pleadings-supplied address qualifies |
| Whether court abused discretion in denying relief even if mailing error occurred | Denying relief would be inequitable given notice failures | Even if mailing was mistaken, Millers facilitated error by designating La Grande; denial proper | Even assuming a mailing mistake, trial court permissibly denied relief because defendants were complicit and failed to protect interests |
Key Cases Cited
- Wagar v. Prudential Ins. Co., 276 Or 827 (courts liberal in granting relief where moving party reasonably protected interests)
- Hiatt v. Congoleum Industries, 279 Or 569 (excusable neglect analysis; appellate deference to trial-court fact findings)
- Wershow v. McVeety Machinery, 263 Or 97 (viewing undisputed facts favorably to the moving party when reviewing motion to set aside)
- McFarlane v. McFarlane, 45 Or 360 (policy favoring trials on merits where reasonable grounds excuse default)
- Lowe v. Institutional Investors Trust, 270 Or 814 (reasonableness of forwarding procedures for service)
- Newbern v. Gas-Ice Corp., 263 Or 250 (setting aside judgment for reasonable mistakes)
- Federal Reserve Bank of San Francisco v. Weant, 113 Or 1 (mistake of reasonable belief can justify relief)
- King v. Mitchell, 188 Or 434 (denial of relief improper only when moving party has no fault and clear meritorious defense)