BOSTON AVENUE MANAGEMENT, INC., Plaintiff/Appellee, and Office Design, Inc., Plaintiff, v. ASSOCIATED RESOURCES, INC., Defendant/Appellant.
No. 100,009
Supreme Court of Oklahoma
Jan. 30, 2007
2007 OK 5
As CorrectED Feb. 14, 2007.
Stephen R. McNamara and Brian Gaskill, Sneed Lang, P.C., Tulsa, OK, for Defendant/Appellant.
LAVENDER, J.
¶ 1 We decide in this case whether the Court of Civil Appeals (COCA), Division III erred in reversing a trial court order denying Defendant/Appellant, Associated Resources, Inc.‘s (Associated) motion for attorney fees and costs against Plaintiff/Appellee, Boston Avenue Management, Inc. (Boston) and re-
FACTUAL BACKGROUND AND PROCEDURAL HISTORY
¶ 2 Boston sued Associated for monetary relief for allegedly failing to pay the proper holdover rent required by two lease agreements. Associated filed an Offer of Judgment (hereafter Offer) pursuant to
¶ 3 Thereafter, Boston filed a First Amended Petition against Associated containing two counts.2 Basically, each count concerned a separate lease and alleged Plaintiff, Office Design, Inc. (Office Design), as landlord, entered the lease agreements with Associated, as tenant. The First Amended Petition alleged that subsequent to execution of the leases Boston purchased the leased premises and assumed the role of landlord. Each count essentially alleged the respective lease involved had a “holding over” clause, that Associated remained in possession of the premises after expiration of the terms of the leases for certain periods of time, but failed to pay the holdover rent for such periods required to be paid by the terms of each lease. Count I sought $14,897.25, plus attorney fees, costs and other proper relief; count II sought $3,834.24, plus attorney fees, costs and other proper relief.
¶ 4 Associated moved for “summary judgment,” asserting Boston was not the real party in interest to bring the suit. Associated‘s “summary judgment” motion was sustained solely on the basis Boston was not the real party in interest to sue under the leases (apparently because Boston had not received a valid assignment of the leases from Office Design) and the “summary judgment” order ostensibly dismissed with prejudice Boston‘s causes of action against Associated on that basis. However, obviously in an attempt to comply with
¶ 5 Office Design intervened and filed a Second Amended Petition that Associated concedes on appeal asserted the same causes of action against Associated as previously asserted by Boston.3 Although Boston is listed in the caption of the Second Amended Petition as a plaintiff, Boston is not mentioned in the body thereof.
¶ 6 Next, as pertinent here, Associated filed a motion for attorney fees and costs against Boston, citing
If no offer of judgment or counteroffer of judgment is accepted and the judgment awarded the plaintiff is less than one or more offers of judgment, the defendant shall be entitled to reasonable litigation costs and reasonable attorney fees incurred by the defendant with respect to the action or the claim or claims included in the offer of judgment from and after the date of the first offer of judgment which is greater than the judgment until the date of the judgment. Such fees and costs may be offset from the judgment entered against the offering defendant.
¶ 7 Prior to the trial court‘s ruling on Associated‘s motion for attorney fees and costs, Office Design (purportedly joined by Boston) filed a dismissal without prejudice of the suit. After supplemental and responsive submissions and oral argument regarding Associated‘s quest for attorney fees and costs, the trial court denied Associated‘s motion for attorney fees and costs. One basis for the trial court‘s denial was, in effect, a realization
¶ 8 The COCA, one judge dissenting, concluded that
¶ 9 We now hold the COCA erred and, like the trial court, are of the view that the “summary judgment” ruling on the real party in interest issue was not a judgment within the contemplation of
ANALYSIS
¶ 10 The focus of this appeal involves legal questions concerning the meaning of two legislative enactments,
¶ 11 We also recognize the following general rules concerning statutory interpretation. When called on to determine the meaning of a statute, a court‘s primary goal is to ascertain and then follow the intention of the Legislature. See TRW/Reda Pump v. Brewington, 1992 OK 31, 829 P.2d 15, 20. Legislative intent is ascertained by reviewing the whole act in light of its general purpose and object. Id. Fulsom further delineated certain well recognized principles concerning statutory interpretation. Fulsom states:
The plain meaning of a statute‘s language is conclusive except in the rare case when literal construction would produce a result demonstrably at odds with legislative intent. Also, a court is duty-bound to give effect to legislative acts, not to amend, repeal or circumvent them. A universally recognized principle in cases when a court is called on to interpret legislative enactments is that the court is without authority to rewrite a statute merely because the legislation does not comport with the court‘s conception of prudent public policy.
Fulsom, 2003 OK 96, ¶ 7, 81 P.3d at 655. (citations omitted).
¶ 12 Fulsom also set out salient general rules regarding the recovery of attorney fees and statutory interpretation of enactments asserted to support an attorney fee allowance. In Fulsom the following is found:
This Court stated the following in State ex rel. Tal v. City of Oklahoma City, 2002 OK 97, ¶ 16, 61 P.3d 234, 243, concerning the well-known American Rule as to the recovery of attorney fees in litigation:
Oklahoma follows the American Rule.... The Rule is generally that each litigant pays for their own legal representation and our courts are without authority to assess attorney fees in the absence of a specific statute or contract allowing for their recovery. Exceptions to the Rule are narrowly defined and carved out with great caution because it is understood liberality of attorney fee awards against the non-prevailing party has a chilling effect on our open access to courts guarantee. [Citations omitted.]
Oklahoma jurisprudence, thus, recognizes that attorney fee statutes are strictly applied because to do otherwise holds out the real possibility of chilling access to the courts. For an award of attorney fees to be authorized under a particular statute the authorization must be found within the strict confines of the involved statute. Further, if the involved attorney fee statute requires interpretation it may be read in context with other parts of the statute and in light of the law in effect at the time of its enactment.
Fulsom, 2003 OK 96, ¶ 8, 81 P.3d at 655. (citations omitted).
¶ 13 Contrasted with the recognized purpose or rationale behind our jurisprudence following the American Rule are the general policy reasons supporting the recovery of attorney fees and costs, to wit: the encouragement of settlement and discouragement of the bringing of frivolous claims. Hicks v. Lloyd‘s General Ins. Agency, Inc., 1988 OK 97, 763 P.2d 85, 86. “These considerations recognize the limited availability of judicial resources and seek to penalize those [who] unnecessarily waste them.” Id. It is also generally recognized that the purpose of offer of judgment statutes “is to encourage judgments without protracted litigation” by “provid[ing] additional incentives to encourage a plaintiff to accept a defendant‘s offer to confess judgment” and to encourage a defendant “to offer an early confession of judgment [to] avoid further increases in costs which may be incurred [for] trial preparation.” See Dulan v. Johnston, 1984 OK 44, 687 P.2d 1045, 1047 (construing
¶ 14 Title
B. Other actions.
1. After a civil action is brought for the recovery of money or property in an action other than for personal injury, wrongful death or pursuant to Chapter 21 of Title 25 or Section 5 of Title 85 of the Oklahoma Statutes, any defendant may file with the court, at any time more than ten (10) days prior to trial, an offer of judgment for a sum certain to any plaintiff with respect to the action or any claim or claims asserted in the action. An offer of judgment shall be deemed to include any costs and attorney fees otherwise recoverable unless it expressly provides otherwise. If an offer of judgment is filed, the plaintiff or plaintiffs to whom the offer of judgment is made shall, within ten (10) days, file:
a. a written acceptance or rejection of the offer, or
b. a counteroffer of judgment, as described in paragraph 2 of this subsection.
If a plaintiff fails to file a timely response, the offer of judgment shall be deemed rejected. The fact an offer of judgment is made but not accepted or is deemed rejected does not preclude subsequent timely offers of judgment.
...
3. If no offer of judgment or counteroffer of judgment is accepted and the judgment awarded the plaintiff is less than one or more offers of judgment, the defendant shall be entitled to reasonable litigation costs and reasonable attorney fees incurred by the defendant with respect to the action or the claim or claims included in the offer of judgment from and after the date of the first offer of judgment which is greater than the judgment until the date of the judgment. Such fees and costs may be offset from the judgment entered against the offering defendant.9
¶ 15 In our view the plain language of
¶ 16 Section
A. REAL PARTY IN INTEREST. Every action shall be prosecuted in the name of the real party in interest. An executor, administrator, guardian, bailee, trustee of an express trust, a party with whom or in whose name a contract has been made for the benefit of another, or a party authorized by statute may sue in his own name without joining with him the party for whose benefit the action is brought. No action shall be dismissed on the ground that it is not prosecuted in the name of the real party in interest until a reasonable time has been allowed after objection for ratification of commencement of the action by, or joinder or substitution of, the real party in interest; and such ratification, joinder, or substitution shall have the same effect as if the action had been commenced in the name of the real party in interest. (emphasis added).
The purpose of
Substitution of plaintiffs has been liberally granted in Oklahoma where mistake or inadvertent error has caused the improper party to file an action. Saint Paul Fire and Marine Insurance Co. v. Spann, 355 P.2d 567 (Okla.1960). In Saint Paul Fire, the court explained that “courts should be inclined to disregard subtleties and answer technical objections to the sufficiency of a pleading in an honest effort to determine the real issues on their merits, and to try and do substantial justice to the litigants before them.” Id. at 570 (quoting Mostenbocker v. Shawnee Gas & Elec. Co., 49 Okla. 304, 152 P. 82, 85 (1915)). Furthermore, “where there is no change in the cause of action and the party substituted bears some relation of interest to the original party and to the action, the substitution may be allowed, as where the substitution is of one having the legal right to sue instead of one improperly named as plaintiff.” Id. at 571 (quoting Dierks v. Walsh, 196 Okla. 372, 165 P.2d 354 (1946)).
Oklahoma‘s interpretation of section 2017 is fully consistent with the construction commonly placed on Federal Rule of Civil Procedure 17, from which section 2017 derives. The advisory committee notes to the 1966 amendment to Rule 17 describe the rationale for permitting liberal substitution of the plaintiff for the real party in interest in actions brought under the Federal Rules.
The provision that no action shall be dismissed on the ground that it is not prosecuted in the name of the real party in interest until a reasonable time has been allowed, after the objection has been raised, for ratification, substitution, etc., is added simply in the interests of justice. (Emphasis added).
F.R.C.P. 17, Advisory Committee Notes, 1966 Amendment. The committee notes stress that the provision “is intended to prevent forfeiture when determination of the proper party to sue is difficult or when an understandable mistake has been made.” Id. The committee explains that “the modern function of the rule in its negative aspect is simply to protect the defendant against a subsequent action by the party actually entitled to recover.” Id. Where the defendant‘s interests are protected, substitution should be allowed.
Thus, the purpose of the real party in interest requirement from the defendant‘s perspective is to insure that the defendant will not be later subjected to a second suit based on the same cause or claim. See Joplin v. Ely, 1961 OK 244, 365 P.2d 735, 736 (referring to predecessor real party in interest
¶ 17 Here, in essence, Associated persuaded the trial court that Office Design was the party having the actual right to recover (if entitlement to recovery was ultimately shown at all), not Boston, and the real party in interest purpose from Associated‘s perspective was served. When Office Design was allowed to intervene in the lawsuit, Office Design was, in effect, substituted in the place of Boston to litigate the same action and claims against Associated as had been initially brought by Boston. Although the “summary judgment” order of the trial judge handling the case prior to the judge that ruled on Associated‘s motion for attorney fees and costs used the unfortunate language that Boston‘s causes of action against Associated were dismissed with prejudice on the basis that Boston was not the real party in interest, the substantive effect of the “summary judgment” ruling was that Boston was dismissed as a party to the lawsuit and Office Design, once it decided to file a Second Amended Petition asserting the same claims, was substituted for Boston as the real party in interest plaintiff to carry forward the same action and the same claims as initially brought against Associated by Boston.
¶ 18 By virtue of the last phrase of
¶ 19 In the case of Triad Bank, N.A. v. A & A Materials Co., Inc., 2002 OK CIV APP 3, 39 P.3d 820, the COCA, Division III (the same division that reversed the trial court order involved here) basically recognized that an essential element or condition precedent to recovery of attorney fees and costs under
¶ 20 For us to rule here that the “summary judgment” ruling on the real party in interest issue was a judgment within the legislative contemplation of
CONCLUSION
¶ 21 For the purposes of the recovery of attorney fees and costs under
¶ 22 For the reasons set forth in this opinion, the COCA‘s opinion is VACATED and the trial court Order denying Associated‘s motion for attorney fees and costs against Boston is AFFIRMED.
¶ 23 EDMONDSON, V.C.J., LAVENDER, HARGRAVE, OPALA, KAUGER, WATT, TAYLOR and COLBERT, JJ., concur.
¶ 24 WINCHESTER, C.J., concurs in result.
Further, we have reviewed the cases cited by Associated from other jurisdictions concerning the pertinent enactments in those jurisdictions as to the recovery of attorney fees and/or costs and fact situations involving multiple plaintiffs and/or unapportioned offers of judgment, compromise or settlement. We conclude those cases are not helpful to reach an appropriate disposition in the instant case. None of them dealt with the situation, as here, where during the litigation an intervening plaintiff was, in effect, substituted as the real party in interest plaintiff for the originally named plaintiff to carry forward the same claims that were the subject of the offer of judgment. For the same reason, we do not find two cases from our own Court of Civil Appeals concerning
¶ 1 This controversy was spawned by misused labels. When Associated Resources, Inc., defendant below, asked for “summary judgment” it meant to secure the action‘s dismissal for want of a proper party plaintiff. The so-called “summary judgment” that was entered in this cause was in law but an order dismissing the claim because the plaintiff was not the real party in interest to bring the suit. The provisions of
¶ 2 Summary judgment is a “judgment on the merits“.2 See statutory definition of judgment in
Notes
The defendant, in an action for the recovery of money only, may, at any time before the trial, serve upon the plaintiff or his attorney an offer, in writing, to allow judgment to be taken against him for the sum specified therein. If the plaintiff accept the offer and give notice thereof to the defendant or his attorney, within five days after the offer was served, the offer, and an affidavit that the notice of acceptance was delivered within the time limited, may be filed by the plaintiff, or the defendant may file the acceptance, with a copy of the offer, verified by affidavit; and in either case, the offer and acceptance shall be noted in the journal, and judgment shall be rendered accordingly. If the notice of acceptance be not given in the period limited, the offer shall be deemed withdrawn, and shall not be given in evidence or mentioned on the trial. If the plaintiff fails to obtain judgment for more than was offered by the defendant, he shall pay the defendant‘s costs from the time of the offer.
In Bullard v. Grisham Const. Co., 1983 OK 21, 660 P.2d 1045, 1047, the Court recognized that § 1101 does not allow for the recovery of attorney fees.