Kirresh v. Gill ( 2021 )

47
Argued and submitted November 29, 2018, reversed and remanded
February 3, 2021
Rana KIRRESH,
Plaintiff-Respondent,
v.
Cecil C. GILL, and all others,
Defendant-Appellant.
Washington County Circuit Court
17LT05581; A165117
482 P3d 76
Defendant appeals a judgment of restitution entered in plaintiff’s favor in
a residential forcible entry and detainer action. The trial court awarded that
judgment primarily on the basis of a prior default judgment that resulted in dec-
larations that defendant had entered into the functional equivalent of a land sale
contract with plaintiff’s predecessor-in-interest, plaintiff had a superior inter-
est to defendant in the disputed property, and plaintiff was entitled to pursue
a forfeiture remedy to recover the property. On appeal, defendant argues that
the prior judgment did not entitle plaintiff to the forfeiture remedy, and, even
if there was an enforceable land sale contract at issue, it did not provide for a
forfeiture remedy as the governing statutes contemplate. Plaintiff argues that
defendant is precluded from making those arguments because he had the oppor-
tunity to litigate them in the prior proceeding. Alternatively, plaintiff argues
that she satisfied the statutory requirements for forfeiture because the remedy of
forfeiture arises from a land sale contract as a matter of law. Held: The trial court
erred. Defendant’s arguments were not precluded because the portion of the prior
judgment that awarded plaintiff the right to forfeiture was void for due process
reasons. Additionally, a forfeiture remedy did not arise as a matter of law from
the land sale contract at issue.
Reversed and remanded.
Beth L. Roberts, Judge.
Timothy R. Volpert argued the cause for appellant. Also
on the briefs was Tim Volpert P.C.
William E. Gaar argued the cause for respondent. Also
on the brief were Richard A. Uffelman, Jillian Pollock, and
Buckley Law, P.C.
Before DeHoog, Presiding Judge, and DeVore, Judge, and
Aoyagi, Judge.*
______________
* DeVore, J., vice Hadlock, J. pro tempore.
48 Kirresh v. Gill
DeHOOG, P. J.
Reversed and remanded.
Cite as 309 Or App 47 (2021) 49
DeHOOG, P. J.
Defendant appeals a judgment of restitution entered
in plaintiff’s favor in a residential forcible entry and
detainer (FED) action. The trial court awarded that judg-
ment primarily on the basis of an earlier proceeding,
which had resulted in declarations that (1) defendant had
entered into the “functional equivalent of a land sale con-
tract” with plaintiff’s predecessor-in-interest; (2) plaintiff’s
interest in the property was superior to defendant’s; and
(3) plaintiff was “entitled to pursue a forfeiture remedy under
ORS 93.905 through ORS 93.940 to recover” the property at
issue. Plaintiff then “pursued” forfeiture by issuing a notice
of default and opportunity to cure, and, when defendant did
not cure the claimed default, plaintiff recorded an affida-
vit of forfeiture. Finally, plaintiff initiated the present FED
action, which resulted in the judgment of restitution now on
appeal.
On appeal, defendant argues that the earlier declar-
atory judgment merely recognized plaintiff’s right to seek
forfeiture; the judgment did not, defendant argues, entitle
plaintiff to that remedy. And, in defendant’s view, plaintiff
was not entitled to forfeiture, because, even if there was an
enforceable land sale contract defining the parties’ respec-
tive rights, it did not provide for a forfeiture remedy, as the
governing statutes contemplate. Plaintiff responds that
defendant’s arguments are precluded because he had the
opportunity to litigate the availability of a forfeiture remedy
in the first proceeding. Plaintiff argues in the alternative
that she satisfied the statutory requirements for forfeiture.
We conclude that defendant’s arguments are not precluded,
and that plaintiff has not satisfied the statutory require-
ments for forfeiture. Accordingly, we reverse and remand.
Because she prevailed at trial, we view the facts in
the light most favorable to plaintiff. Harvey v. Davis, 276
Or App 680, 681, 371 P3d 1208, rev den, 360 Or 604 (2016)
(applying that standard in appeal of judgment of restitution
based on a land sale contract’s forfeiture provision).
In July 2009, plaintiff’s then husband, MacBale,
and defendant entered into a “Residential Purchase and
Sale Agreement and Receipt for Earnest Money” (sale
50 Kirresh v. Gill
agreement) for defendant’s purchase of the property at issue
in this case. Defendant also executed a promissory note
in MacBale’s favor at that time. The sale agreement pro-
vided for a total purchase price of $310,000 and required
defendant to make monthly payments of no less than $1,292
beginning on July 15, 2009, with the entire amount due on
or before June 15, 2019.
In 2013, plaintiff divorced MacBale and became his
successor in interest as to both the sale agreement and the
promissory note, which were awarded to her in the disso-
lution proceedings. Defendant failed to make the required
payments between June 15 and September 15, 2015. As a
result, plaintiff filed a complaint against defendant alleging
breach of contract and seeking declaratory relief. Plaintiff
specifically sought declarations that: (1) the agreement and
note, together, were “akin to a land sale contract” for the
property; (2) defendant had an equitable interest in the
property; (3) plaintiff had an equitable lien against the prop-
erty; and (4) “Plaintiff’s equitable lien against the Property
may be foreclosed.” (Emphasis added.) Despite being served
with a summons and a copy of the complaint, defendant did
not appear in response, and plaintiff ultimately obtained
a default judgment. Plaintiff’s motion for default in that
2015 proceeding purported to request “a judgment allowing
the relief sought in the complaint” but did not specifically
mention a right to foreclosure as alleged in the complaint.
Rather, in relevant part, the motion sought a declaration
that “Plaintiff’s interest in the Property is superior to any
interest, lien, right, title or claim of the Defendant in the
Property,” and further requested allowance of “the relief
sought in the complaint” by “[g]ranting Plaintiff the right
to cancel the Note and Sale Agreement, declare Defendant’s
rights under this Note and Sale Agreement to be forfeited,
extinguish the debt, and retain sums previously paid under
this Contract by Defendant, in the manner provided in
ORS 93.905 to ORS 93.940.” (Emphasis added.) Plaintiff’s
motion for entry of a limited judgment by default certified
that she had served it on defendant. In December 2015,
the trial court found defendant in default and entered the
requested limited judgment (the 2015 judgment). In addi-
tion to describing the property subject to its terms, the
Cite as 309 Or App 47 (2021) 51
2015 judgment contained the declarations sought in plain-
tiff’s motion, including a specific declaration as follows:
“5. Plaintiff is entitled to pursue a forfeiture remedy under
ORS 93.905 through ORS 93.940 to recover the Property[.]”
Defendant did not appeal that judgment.1 In January
2017, plaintiff served defendant with notice of his default
under the sale agreement and of impending forfeiture. The
notice stated that the “default by virtue of which this forfei-
ture is declared is for failure to make timely payments at
such time and in such amounts as required under the Note
and Agreement.” The notice further explained that a “for-
feiture is proper under the Note and Agreement because, by
[the 2015] judgment * * * the Note and Agreement together
have been adjudged to be the functional equivalent of a land
sale contract.” Lastly, the notice informed defendant that
the “contract will be forfeited if the default is not cured by
March 21, 2017.”
Defendant did not timely cure his default, and plain-
tiff filed an affidavit of forfeiture on March 22, 2017. See ORS
93.930(1) (“When a contract for conveyance of real property
has been forfeited in accordance with its terms after the
seller has given notice to the purchaser * * * the seller shall
record an affidavit * * * setting forth that the default of the
purchaser under the terms of the contract was not cured
* * * and that the contract has been forfeited.”). Plaintiff’s
affidavit asserted that, because defendant had not cured his
default “within the time period provided by law,” the note
and agreement were forfeited. Plaintiff subsequently filed
this FED action seeking to evict defendant contending that
he was a “tenant at sufferance under ORS 91.040.”2 In the
1
The limited judgment also contained the following declarations relevant
here:
“2. Plaintiff’s [predecessor] in interest and Defendant entered into a
promissory note * * * and residential sale agreement * * * which, together are
the functional equivalent of a land sale contract.
“3. Defendant has an equitable interest in and to the Property[.]
“4. Plaintiff’s interest in the Property is superior to any interest, lien,
right, title or claim of the Defendant in the Property.”
2
Under ORS 93.930(2)(c), one of the effects of the recording of an affidavit
of forfeiture is that any persons remaining in possession of the property 10 days
after the affidavit is recorded “shall be deemed to be tenants at sufferance.” In
turn, ORS 91.040 provides: “One who comes into possession of the real estate of
52 Kirresh v. Gill
FED action, plaintiff sought possession of the premises, “as
well as her costs, disbursements, and attorney’s fees” under
the sale agreement. To support that request, plaintiff asked
the court to take judicial notice of the 2015 judgment and
enforce that ruling, thereby precluding defendant from relit-
igating those issues.
Defendant opposed plaintiff’s action, contending
that the property was not subject to any actual land sale con-
tract and that, even if the parties’ agreement was function-
ally equivalent to a land sale contract, plaintiff had not been
entitled to forfeiture, because the contract did not provide
for a forfeiture remedy as contemplated by the applicable
statutory scheme. When questioned by the trial court as to
why the 2015 judgment did not control, defendant answered
that the 2015 judgment resolved plaintiff’s claims for breach
of contract, declaratory relief, and foreclosure, and had
nothing to do with forfeiture. After taking judicial notice of
a statutory warranty deed transferring MacBale’s interest
to plaintiff, the sale agreement, the promissory note, plain-
tiff’s affidavit of forfeiture, and the 2015 judgment, the trial
court ruled as follows:
“I do find that there was an order of limited judgment
by default against the defendant in this case that specifi-
cally granted the plaintiff the right to pursue a forfeiture
remedy under ORS 93.905 through ORS 93.940. And the
opportunity for [defendant] to litigate that has long since
passed. And, therefore, the proper steps were taken and I
will grant the motion of the plaintiff.”
In accordance with that ruling, the trial court entered a
judgment of restitution and a money award in plaintiff’s
favor, which defendant now appeals.
On appeal, defendant raises two assignments of
error, which he addresses in a single combined argument. In
his first assignment, defendant asserts that “[t]he trial court
erred in entering a judgment of restitution of the premises
against defendant.” Defendant’s second assignment of error
contends that “[t]he trial court erred in granting plaintiff’s
another lawfully, but who holds over by wrong after the termination of the term,
is considered as a tenant at sufferance. No notice is required to terminate a ten-
ancy at sufferance.”
Cite as 309 Or App 47 (2021) 53
motion for judicial notice to the extent the court took judicial
notice of the legal issues presented by the pleadings and by
the parties at trial.” Defendant argues that the 2015 judg-
ment and issue preclusion “are red herrings” in this case.
Defendant reasons that, because, by statute, the remedy
of forfeiture is self-executing when it is available, the 2015
judgment cannot be preclusive in this case because that
judgment “was not a legal prerequisite to obtaining forfei-
ture.” Defendant adds that the 2015 judgment
“cannot have any preclusive effect as to plaintiff’s entitle-
ment to forfeiture because plaintiff did not plead and cer-
tainly did not actually litigate forfeiture on the merits in
the Foreclosure action. Nor did defendant have a full and
fair opportunity in the Foreclosure action to be heard on
that issue. See Nelson v. Emerald People’s Utility Dist., 318
Or 99, 103-04, 862 P2d 1293 (1993).”
In oral argument on appeal, defendant expressed
his understanding that he could not collaterally attack the
2015 judgment and declined to characterize his challenge
as a collateral attack. He explained, rather, that the essence
of his argument was “that in that judgment there’s no evi-
dence that the issue of forfeiture was adjudicated.”
In response, plaintiff defends the trial court’s con-
clusion that the 2015 judgment is preclusive here. Relying
on the issue preclusion analysis set forth in Nelson, id.,plaintiff argues that she has met her burden of establishing
a prima facie case of preclusion in that the issues between
the two proceedings are identical, the issues were actually
litigated and essential to a final decision in the earlier pro-
ceeding, and defendant was a party to that prior proceed-
ing. Plaintiff further argues that, in light of that prima facie
showing, defendant must—but cannot—meet his burden
of establishing that he either did not have a full and fair
opportunity to be heard on the issues in the prior proceed-
ing or that the prior proceeding was not the type of proceed-
ing that warrants preclusive effect. See Berg v. Benton, 297
Or App 323, 327-28, 443 P3d 714 (2019) (discussing burdens
associated with Nelson’s issue-preclusion analysis). Plaintiff
argues that defendant had a full and fair opportunity to lit-
igate the issues in the earlier proceeding, but he elected to
forgo that opportunity by defaulting. As to the specific issue
54 Kirresh v. Gill
of forfeiture, plaintiff observed during oral argument that,
prior to defaulting, defendant was on notice that plaintiff
intended to seek a ruling on that issue, because she had
served him with a motion for limited judgment by default
identifying that as a matter to be addressed by the trial
court.
Although neither party has expressly raised the
issue, we begin by considering the jurisdictional implica-
tions of defendant’s arguments about the effect of the 2015
judgment. See Roley v. Sammons, 197 Or App 349, 352, 105
P3d 879 (2005) (recognizing our obligation to consider, sua
sponte, a trial court’s jurisdiction to enter a limited judg-
ment even where no party has raised the issue).3 Here, the
issue is not whether the trial court had both personal juris-
diction over defendant and subject matter jurisdiction to
hear the parties’ dispute—it did. See Montoya v. Housing
Authority of Portland, 192 Or App 408, 413-14, 86 P3d 80
(2004) (explaining that trial court had personal jurisdiction
over defendants where they had been properly served and
that “trial courts have subject matter jurisdiction over all
actions unless a statute or rule of law divests them of juris-
diction” (internal quotation marks omitted)). However, not-
withstanding the trial court’s personal and subject matter
jurisdiction, there remains a possibility that its judgment
was void and therefore incapable of having “legal force or
effect.” See PGE v. Ebasco Services, Inc., 353 Or 849, 855-
56, 306 P3d 628 (2013) (discussing that possibility). We pro-
ceed to consider whether such circumstances are present
here.
“Generally speaking, when a trial court has both
subject matter jurisdiction and personal jurisdiction, its
judgment, even if erroneous, is not void.” Id. at 856. Rather,
such a judgment typically is merely voidable. Id. That con-
clusion, however, “is a qualified one” subject to at least two
exceptions. Id. at 859. First, the violation of a statute by
3
We note that, although defendant has not raised any jurisdictional issues
on appeal and has expressly disavowed making any collateral challenge to the
2015 judgment, his arguments as to why that judgment should not be given pre-
clusive effect are somewhat analogous to the analysis that follows. However, in
light of our resolution of the jurisdictional question, we need not further consider
the parties’ preclusion arguments.
Cite as 309 Or App 47 (2021) 55
which “the legislature intended to impose a limitation on
the trial court’s authority to exercise its jurisdiction” may
render a judgment void. Id. (discussing ORCP 67 C’s pro-
visions related to relief granted in a judgment). “Second, a
statutory violation that also deprives a party of due process
may render a judgment void.” Id. at 860 (examining the
Due Process Clause of the Fourteenth Amendment to the
United States Constitution). A void judgment “is one that
has no legal force or effect and can be attacked at any time
and any place, whether directly or collaterally.” Id. at 856
(internal quotation marks omitted). As a result of that dis-
tinction, “principles relating to preservation do not apply to
void judgments; those principles do, however, apply to the
assertion of error with respect to judgments that are merely
voidable.” Id. at 856-57. The Supreme Court has recognized
a void judgment as being “ ‘incapable of being confirmed,
ratified, or enforced in any manner or to any degree.’ ” State
v. McDonnell, 343 Or 557, 562, 176 P3d 1236 (2007), cert den,
555 US 904 (2008) (quoting Black’s Law Dictionary 861 (8th
ed 2004)). Thus, even though defendant has not argued that
the 2015 judgment is void, if, in fact, that judgment is void,
then we cannot enforce it, whether through issue preclusion
or otherwise.
Our review of the Supreme Court’s reasoning in
PGE persuades us that the 2015 judgment is void. In PGE,
an insurer collaterally challenged a default judgment that
ordered the insurer to pay monetary relief, together with
costs and attorney fees. 353 Or at 852. After that challenge
failed, the insurer presented an unpreserved argument
on appeal that the judgment was void because it failed to
comply with ORCP 67 C4 by awarding relief in excess of the
amount prayed for in the pleadings. Id. at 853. On review by
the Supreme Court, the court assessed “whether a default
judgment awarding monetary relief violate[d] ORCP 67 C
[when] the underlying complaint did not state the specific
4
ORCP 67 C provides:
“Every judgment shall grant the relief to which the party in whose favor
it is rendered is entitled. A judgment for relief different in kind from or
exceeding the amount prayed for in the pleadings may not be rendered unless
reasonable notice and opportunity to be heard are given to any party against
whom the judgment is to be entered.”
56 Kirresh v. Gill
amount of money or damages being sought,” and whether
that violation “render[ed] the judgment void and therefore
subject to challenge at any time.” Id. at 851. Although the
court concluded that the entry of the judgment had violated
ORCP 67 C, the court held that the violation did not, in and
of itself, render the judgment void. Id. at 858-60 (examining
the scope of ORCP 67 C).
The Supreme Court then considered whether the
violation of ORCP 67 C had nonetheless deprived the insurer
of due process and, by virtue of that deprivation, had ren-
dered the judgment void. Id. at 860. As the court explained,
“even where a trial court has personal and subject matter
jurisdiction, a violation of due process notice requirements
may deprive the court of ‘jurisdiction’ to enter an order or
judgment.” Id. at 861. That being said, “not every defect in
notice renders a judgment void.” Id. “That is, due process
requires reasonable notice to a defendant before a default
judgment or order may be entered against it, but not nec-
essarily strict compliance with the applicable procedural
statutes and rules.” Id. In considering what constituted rea-
sonable notice, the court looked to federal case law applying
FRCP 54(c),5 the federal analog to ORCP 67 C. Id. at 863.
From that case law, the court gleaned the following rule:
“[I]nsofar as due process is concerned, a default judgment
cannot (1) award monetary relief that is greater than the
specific amount pleaded; or (2) provide other relief that is
different in kind from the relief sought in the pleadings,
because the defendant could not reasonably have expected
that its exposure to liability would exceed that amount or
be different in kind.”
Id. at 864. In PGE, the court identified the primary purpose
of the rule to be that the “defending party should be able
to decide on the basis of the relief requested in the original
pleading whether to expend the time, effort, and money nec-
essary to defend the action.” Id. (internal quotation marks
omitted).
5
FRCP 54(c) states that “[a] default judgment must not differ in kind from,
or exceed in amount, what is demanded in the pleadings. Every other final judg-
ment should grant the relief to which each party is entitled, even if the party has
not demanded that relief in its pleadings.”
Cite as 309 Or App 47 (2021) 57
The PGE court concluded that the judgment at
issue there did not implicate those concerns. Id. First, the
court noted that the insurance company had not asserted
that the default judgment was void for awarding relief of a
different kind than that sought in the complaint. Id. Next,
although the court acknowledged that the complaint in that
case had not requested any specific amount of damages, let
alone the amount that was eventually awarded, it did not
consider that fact dispositive. Id. The court reasoned that,
while the failure to allege damages in any specific amount
may have rendered the complaint defective, that defect “was
apparent on the face of the complaint when [the insurer] was
served with a copy of it and the required summons.” Id. As a
result, the court concluded, the insurer had had “[m]ultiple
prejudgment options to remedy that defect.” Id. The court
emphasized that the insurer had neither moved to make the
complaint more definite and certain under ORCP 21 D, nor
moved to dismiss for failure to allege sufficient facts to state
a claim. Id. at 864-65. The court held, therefore, that the
judgment was not void, reasoning that “the complaint itself
provided [the defendant insurer] with notice of that defect,
and the Oregon Rules of Civil Procedure provided it with
ample opportunities for a predefault hearing at a meaning-
ful time and in a meaningful manner.” Id. at 865. In terms
of the identified purposes of notice, the court concluded that
“the complaint in [that] case could not have led [the defen-
dant insurer] to believe that only a certain type and dimen-
sion of relief was being sought, so that it could attempt to
limit the scope and size of the potential judgment by not
appearing or otherwise defaulting.” Id. (internal quotation
marks omitted).
Applying that reasoning here, we conclude that the
2015 judgment awarding plaintiff the right to forfeiture is—
as to at least that provision—void. Plaintiff’s complaint in
the 2015 litigation sought relief that differed in kind from
the relief that the trial court awarded in the 2015 judgment.
Whereas the complaint, in relevant part, sought a decla-
ration that “Plaintiff’s equitable lien against the Property
may be foreclosed,” the court entered a declaration that
plaintiff was “entitled to pursue a forfeiture remedy under
ORS 93.905 through ORS 93.940 to recover” the property at
58 Kirresh v. Gill
issue.6 (Emphases added.) Thus, unlike in PGE, because the
complaint in the 2015 litigation requested a different kind
of relief than that awarded in the 2015 judgment, it could
not have been apparent to defendant from the outset that
he could be subject to that kind of relief. Stated differently,
“the complaint in this case could * * * have led [defendant] to
believe that only a certain type and dimension of relief was
being sought, so that [he] could attempt to limit the scope
and size of the potential judgment by not appearing or other-
wise defaulting.” Id. (internal quotation marks omitted). We
recognize that plaintiff served defendant with the motion for
limited judgment by default that identified her right to forfei-
ture as an issue to be determined by the judgment. However,
that motion, which plaintiff served only eight days before
the trial court issued the limited judgment,7 was the first
and only notice that defendant would have had that plaintiff
had altered her claim for relief. Under those circumstances,
we cannot conclude that defendant was given adequate
notice and opportunity, let alone the multiple opportunities
given the insurer in PGE, to have a “predefault hearing at
a meaningful time and in a meaningful manner.” Id. Thus,
as a matter of due process, to the degree that the 2015 judg-
ment provided relief not sought in the underlying complaint,
that judgment is void and cannot be given legal effect. See
Montoya, 192 Or App at 416 (concluding that the judgment
at issue was void “to the extent that the amount of the judg-
ment exceed[ed] the amount prayed for”).
That conclusion alone warrants reversal of the judg-
ment of restitution and a remand for further proceedings
in the underlying FED action. Nonetheless, we proceed to
address the legal issue raised by defendant’s appeal, because
that issue “is likely to arise on remand.” State v. Savage, 305
Or App 339, 342, 470 P3d 387 (2020). Specifically, we consider
whether, under ORS 93.905 to 93.940, forfeiture is available
6
Plaintiff has never argued that, by requesting a declaration that she was
entitled to foreclose her equitable lien against the property, she was effectively
seeking a declaration of her right to forfeiture, that is, that a right to foreclosure
is a right to forfeiture. Thus, we proceed with the parties’ apparent understand-
ing that foreclosure and forfeiture are distinct forms of relief.
7
Defendant was served with the motion for limited judgment by default
on November 30, 2015. The order for limited judgment by default issued on
December 8, 2015.
Cite as 309 Or App 47 (2021) 59
as a remedy in a suit to enforce a land sale contract, even
when the contract being enforced does not expressly provide
for that remedy.
Although defendant’s argument on appeal is focused
on what, in his view, the 2015 judgment means, the crux of
his argument rests on his understanding of the applicable
statutes, namely that, “not everyone who pursues a forfeiture
remedy can legally qualify for forfeiture under the statutory
scheme.” From that premise, he proceeds to argue that, it “is
plain from undisputed facts in the record that plaintiff was
not legally entitled to forfeiture, notwithstanding the fact
than an Affidavit of Forfeiture was filed.” Defendant does
not reprise his argument that his agreement with MacBale
did not constitute a land sale contract. However, he argues
that, even assuming, as set forth in the 2015 judgment, that
the sale agreement and note were the functional equivalent
of a land sale contract, plaintiff was not entitled to the rem-
edy of forfeiture.8
In support of that argument, defendant identifies
what he views as qualifying language throughout the stat-
utes governing forfeiture, ORS 93.905 to 93.940. Defendant
argues that, under those provisions, for the remedy of forfei-
ture to be available in the event of a buyer’s default under a
land sale contract, the contract must expressly provide for
that remedy. Therefore, defendant argues, whether or not
plaintiff may be entitled to pursue a forfeiture remedy, that
pursuit cannot succeed, because the agreement and note
comprising the land sale contract in this case did not con-
template that remedy. Ultimately, defendant asserts, the
trial court erred in awarding a judgment of restitution to
plaintiff “because she does not have any right to possess the
premises by forfeiture or otherwise.”9
8
Although we recognize that the conclusion in the 2015 judgment that the
sale agreement and promissory note were the “functional equivalent” of a land
sale contract is not at issue in this appeal, we observe, for what it may be worth,
that, under the statutes at issue here, ORS 93.905 to 93.940, the legislature has
provided that the statutory term “ ‘contract for transfer or conveyance of an inter-
est in real property’ shall not include earnest money or preliminary sales agree-
ments, options or rights of first refusal.” ORS 93.905. We express no opinion as to
that statute’s bearing, if any, on the 2015 ruling.
9
Defendant argues in the alternative that “even if plaintiff had acquired
a right to possess the premises by forfeiture, an FED action was not the proper
60 Kirresh v. Gill
In response, plaintiff does not dispute that neither
the sale agreement nor the note referenced a forfeiture rem-
edy.10 She argues, however, that, “[n]either ORS 93.910 nor
ORS 93.930(1) expressly requires that there * * * be a con-
tract with an express forfeiture remedy before a party may
pursue a forfeiture remedy.” Citing our decision in Ochs v.
Albin, 137 Or App 213, 220, 903 P2d 906 (1995), plaintiff
argues that, if a party defaults on a land sale contract, “the
remedy of forfeiture arises by operation of law.” Therefore,
notwithstanding our conclusion that the 2015 judgment is
not preclusive on the issue of plaintiff’s entitlement to forfei-
ture, her position would remain that, under Ochs, the rem-
edy of forfeiture is available to her. That is, because the 2015
judgment established that the parties’ agreement was the
“functional equivalent” of a land sale contract, a conclusion
defendant no longer challenges, Ochs dictates the conclusion
that the remedy of forfeiture is available to her as a matter
of law.
We turn to those arguments, beginning with a
review of the statutes at issue. We then consider our decision
in Ochs for its bearing, if any, on the disposition of this case.
For the reasons that follow, we agree with defendant’s con-
struction of the statutes. We further conclude that, although
there is language in Ochs that could be viewed as support-
ing plaintiff’s argument that, upon a buyer’s default under a
land sales contract, the remedy of forfeiture arises by opera-
tion of law, that decision does not control the outcome of this
case.
The parties’ arguments require us to construe ORS
93.910 and ORS 93.930(1). When construing statutes, we
remedy” to seek. Defendant, however, failed to preserve that argument for appeal.
See, e.g., State v. Gray, 286 Or App 799, 806, 401 P3d 1241 (2017), rev den, 362
Or 482 (2018) (“[T]he presence of a common thread between an objection at trial
and an argument on appeal does not satisfy the preservation requirement if the
two arguments are qualitatively different.” (Internal quotation marks omitted.)).
Accordingly, we do not consider it further.
10
Nor, we note, did those writings indicate the parties’ intent to prepare a
separate land sale contract setting forth the terms of their agreement. In that
regard, this case differs from Ochs v. Albin, 137 Or App 213, 215, 903 P2d 906(1995) (quoting parties’ sale agreement, including terms anticipating that pur-
chaser would draft a land sale contract reflecting agreed-upon terms), a case we
discuss in greater depth below.
Cite as 309 Or App 47 (2021) 61
attempt to determine the legislature’s intended meaning by
focusing primarily on the statutory text in its context, while
also considering any relevant and available legislative his-
tory “ ‘for what it’s worth.’ ” Kinzua Resources v. DEQ, 366 Or
674, 680, 468 P3d 410 (2020) (quoting State v. Gaines, 346 Or
160, 171, 206 P3d 1042 (2009)).
We apply that framework here. Again, defendant
argues that, under ORS 93.910 and ORS 93.930(1), forfei-
ture is not available as a remedy upon a buyer’s default
under a land sale contract unless the contract being enforced
expressly provides for such a remedy. Our initial examina-
tion of the relevant statutory text provides some support for
that argument. In its entirety, ORS 93.910 provides:
“Whenever a contract for transfer or conveyance of
an interest in real property provides a forfeiture remedy,
whether the remedy is self-executing or is optional, forfei-
ture of the interest of a purchaser in default under the con-
tract may be enforced only after notice of the default has
been given to the purchaser as provided in ORS 93.915, not-
withstanding any provision in the contract to the contrary.”
(Emphases added.) And, in relevant part, ORS 93.930(1)
states:
“When a contract for conveyance of real property has
been forfeited in accordance with its terms after the seller
has given notice to the purchaser as provided in ORS
93.915, the seller shall record an affidavit with the prop-
erty description, a copy of the notice of default and proof
of mailing attached, setting forth that the default of the
purchaser under the terms of the contract was not cured
within the time period provided in ORS 93.915 and that
the contract has been forfeited. * * *”
(Emphases added.)
Both ORS 93.910 and ORS 93.930(1) begin with con-
junctions: “Whenever” and “When.” Those terms, together
with their associated clauses—“a contract * * * provides a
forfeiture remedy” and “a contract * * * has been forfeited
in accordance with its terms”—modify the balance of each
provision. Thus, although ORS 93.910 permits “forfeiture of
the interest of a purchaser in default under the contract [to]
be enforced,” that statute may, as a matter of plain text and
62 Kirresh v. Gill
grammar, be viewed as limiting its application to specific
circumstances, namely, “[w]henever a contract * * * provides”
that remedy.11 (Emphasis added.) See Webster’s Third New
Int’l Dictionary 2602 (unabridged ed 2002) (defining conjunc-
tion “whenever” as “at any or all times that : in any or every
instance in which” (emphases added)). Similarly, rather than
somehow authorizing a forfeiture remedy every time a buyer
defaults under a land sale contract, ORS 93.930(1) can be
viewed as merely providing a process for seeking that rem-
edy if it is available, that is, “[w]hen a contract * * * has been
forfeited in accordance with its terms.” (Emphasis added.)
See Webster’s at 2602 (defining “when” in relevant part as
“in the event that : on condition that : IF” (emphasis added)).
We can conceive of no argument that a contract can be for-
feited “in accordance with its terms” when, as is the case
here, neither the term “forfeiture” nor any comparable term
appears in the sale agreement or note that served as the
“functional equivalent” of a land sale contract.
We recognize that, although each of the foregoing
clauses provides support for a narrow interpretation of
the statutes, such as defendant advocates, neither wholly
forecloses the possibility that forfeiture might be available
even in instances where the underlying contract does not
expressly provide for that remedy. That is, even though the
statutes appear to address circumstances in which land sale
contracts expressly permit forfeiture, neither statute explic-
itly prohibits forfeiture when a contract is silent on that point.
See Dement Ranch v. Curry County Board of Commissioners,
306 Or App 315, 321, 474 P3d 435 (2020) (“We must be mind-
ful when we construe statues to not ‘insert what has been
omitted[.]’ ” (Quoting ORS 174.010.)).
For further guidance, therefore, we look to the
available legislative history and the context in which the
legislature enacted the forfeiture provisions of ORS chapter
93. Before the enactment of those provisions in 1985, our
courts had developed “a well-recognized rule that, because
the forfeiture of rights under contracts is not favored,
11
Under ORS 93.910, enforcement is also subject to another condition—the
purchaser must be given notice of the default “as provided in ORS 93.915.” Notice
of defendant’s default under the parties’ agreement is not at issue in this case.
Cite as 309 Or App 47 (2021) 63
contract provisions which may result in forfeitures are to
be construed liberally in favor of the party against whom
such a forfeiture may be claimed.” Roth Develop. v. John
Gen’l Contr., 263 Or 561, 568, 503 P2d 493 (1972) (applying
that rule to a land sale contract). That being said, contrac-
tual forfeiture provisions were, as a general rule, deemed
enforceable, notwithstanding the absence of any statutory
provision for that remedy. Id. at 570 (noting enforceability of
“self-executing” forfeiture proceedings); cf. Elsasser v. Wilcox,
286 Or 775, 779, 596 P2d 974 (1979) (when contract includes
multiple remedies, including forfeiture, a seller must give
reasonable notice to defaulting party before invoking forfei-
ture). However, it is apparent from that case law that, at
the time the forfeiture statutes were enacted, the remedy
of forfeiture would generally not have been available if the
land sale contract being enforced did not authorize it. That
is, given that our courts construed contract provisions that
might allow for forfeiture liberally in favor of the defaulting
party, it stands to reason that a contract that did not pro-
vide for forfeiture at all would not have been understood to
authorize such a remedy.
That common-law context informs both our interpre-
tation of the forfeiture statutes and our understanding of the
available legislative history. When the bill containing those
statutes was before the House Judiciary Subcommittee, the
then-prevailing understanding of the forfeiture remedy was
described as follows:
“There are some deficiencies with the forfeiture remedy in
that, depending on the type of * * * provision for forfeiture
in the contract, the buyer may or may not be entitled to
notice of the default and an opportunity to cure whatever
the default is. The Oregon courts have held that if the pro-
vision is self-executing—which means that * * * there are
no alternative remedies in the contract, there’s only one
remedy and that’s forfeiture—* * * then there is no notice
required for the buyer and the buyer has no right to cure
the default and basically that’s the end of it. * * * Even if
the provision is not self-executing, and there are alterna-
tive remedies as is true of most real estate contracts, the
courts have varied [in determining] how much time the
buyer is allowed to cure the default. * * * The purpose of
this bill is to clarify what kind of notice is required; to set
64 Kirresh v. Gill
up a procedure whereby the buyer has the opportunity to
cure the default; and to provide an opportunity for those
who hold an interest subordinate to the buyer, to also cure
the default.”
Tape Recording, House Subcommittee II on Judiciary, HB
2361, Mar 5, 1985, Tape 180 (statement of Don Carter,
Oregon State Bar). Later in that testimony, the same wit-
ness explained that “this bill only applies if the contract
does provide for forfeiture remedy. * * * In other words, if
the contract has nothing about forfeiture remedies in it, this
doesn’t add anything.” Id. at Tape 182.
As that legislative history indicates, the legisla-
ture’s goal in adopting what is now ORS 93.905 through
93.940 was not to create a forfeiture remedy where none
existed, i.e., when the land sale contract being enforced did
not provide for forfeiture. The goal instead appears to have
been to address perceived deficiencies related to the require-
ment of notice and the opportunity to cure, which, at the
time, tended to vary with “the type of * * * provision for for-
feiture in the contract.” Nothing suggests that the legisla-
ture sought to address contracts that did not provide for for-
feiture at all; rather, the contracts under consideration were
either those providing only that remedy or those providing
that remedy as one of several alternatives. That, of course,
is wholly consistent with text that the legislature adopted.
See ORS 93.910 (relating to a contract that “provides a for-
feiture remedy, whether the remedy is self-executing or is
optional”); ORS 93.930(1) (establishing notice requirements
when a contract is “forfeited in accordance with its terms”).
Thus, the legislative history, understood in the context in
which the forfeiture statutes were enacted, further supports
defendant’s interpretation. In light of that review of the
text, context, and legislative history of the forfeiture stat-
utes at issue, we conclude that neither ORS 93.910 nor ORS
93.930(1) can reasonably be understood to give rise to a for-
feiture remedy in every land sale contract.
We turn to whether our decision in Ochs dictates
a different understanding of those statutes or otherwise
requires us to conclude that there was a forfeiture remedy
available to plaintiff in this case. In Ochs, the plaintiff had
Cite as 309 Or App 47 (2021) 65
persuaded the defendant to sell a house by presenting her
with a proposed earnest money agreement and a $1,000
earnest money check. 137 Or App at 215. The agreement
was set out in a document entitled “Owner’s Sale Agreement
and Earnest Money Receipt” and provided, among other
things, that the parties would enter into a land sale con-
tract to be drafted by plaintiff’s attorney at his expense. Id.Although both parties signed the agreement and the plain-
tiff arranged to have the contract drafted, the defendant
notified the plaintiff that she would not be going through
with the sale. Id. at 216. The plaintiff sued, seeking specific
performance of the parties’ agreement. Id. at 216-17.
The trial court in Ochs concluded that the parties
had entered into a valid contract and that the defendant had
breached that agreement. Id. However, the court declined
to specifically enforce the contract by requiring the defen-
dant to enter into a land sale contract, apparently reasoning
that, because the parties had agreed to enter into a further
agreement whose terms were uncertain, the earnest money
agreement was itself insufficiently certain to enforce. Id. at
217. The plaintiff appealed. Id.After reviewing Supreme Court case law regarding
the specific enforcement of agreements under similar cir-
cumstances, we concluded on appeal that the parties’ agree-
ment was sufficiently certain to specifically enforce. Id. at
218-19 (“If all of the material terms that are to be incorpo-
rated into a future writing have been agreed on, the initial
agreement is specifically enforceable.”). We held that the
essential terms of every land sale agreement—in addition
to any unique terms specifically contemplated—are “the
designation of the parties, * * * identification of the prop-
erty to be sold, the promise to sell and to buy, the purchase
price,” how it will be paid, and the time of closing. Id. at
218. Considering the agreement of the parties in that case,
we concluded that it was “sufficiently definite to be enforce-
able,” id. at 219, which entitled the plaintiff “to specific per-
formance of the earnest money agreement that the parties
executed,” id. at 220.
In reaching that conclusion, we considered the
defendant’s argument that the earnest money agreement
66 Kirresh v. Gill
was unenforceable because it did not specify what remedies
would be available to her “in the event of a default to protect
her security interest in the property.” Id. at 220. Without
deciding whether, given the above list of “essential terms,”
the absence of a remedy provision would render the con-
tract unenforceable, we concluded that “a land sale contract
implicitly provides a remedy to the seller on default, because
the title remains with the seller until the purchase price is
paid in full.” Id.12 As relevant here, we went on to say that,
“[i]n the event of a default on a land sale contract, the rem-
edies such as forfeiture or foreclosure arise by operation
of law. See, e.g., ORS 93.905 - ORS 93.915 (procedure for
declaring a forfeiture of vendee’s interest in a land sale[ ]
contract).”
Id. (emphasis added). As noted, plaintiff in this case relies on
that discussion in Ochs to conclude that, if a party defaults
on a land sale contract, “the remedy of forfeiture arises by
operation of law.”
Having placed that reference to forfeiture in con-
text, however, we disagree with plaintiff that our decision
in Ochs is controlling here. First, rather than deciding
whether every land sale contract automatically carries with
it the specific remedy of forfeiture, our point in Ochs appears
to have been that every such contract implicitly provides
for some remedy—“forfeiture or foreclosure”—sufficient to
meet a contract’s particularity requirements. Id. (emphasis
added). Second, our parenthetical discussion of ORS 93.905
to 93.915 neither purports to construe those statutes nor
says anything different than we have said above, namely,
that ORS chapter 93 sets out a “procedure” by which forfei-
ture may be declared; that parenthetical does not say that
the statutes insert that remedy into every land sale contract
regardless of its terms. See id.Given that context, we cannot give our reference to
forfeiture in Ochs the significance that plaintiff gives it. Our
close examination of the statutory text and its legislative
history persuade us that the remedy of forfeiture does not
12
It is not apparent from our discussion in Ochs whether our reference to a
“land sale contract” was directed at the parties’ earnest money agreement or the
hypothetical land sale contract that the parties’ agreement contemplated.
Cite as 309 Or App 47 (2021) 67
arise as a matter of law by virtue of ORS chapter 93, as
plaintiff contends. Furthermore, in light of the common-law
background for the forfeiture provisions of that chapter, we
see no basis for a broad understanding that, by statute or
otherwise, every land sale contract carries with it the spe-
cific remedy of forfeiture, a remedy that our courts histori-
cally have disfavored. For those reasons we read Ochs nar-
rowly, so as to not reach such broad conclusions.
Ultimately, we conclude that the trial court erred
in enforcing the 2015 judgment against defendant to the
extent that the judgment decided an issue—plaintiff’s right
to forfeiture—not asserted in the operative complaint or
adequately raised during the proceedings leading up to
that judgment. We further conclude that, contrary to plain-
tiff’s argument, a forfeiture remedy did not arise as a mat-
ter of law, notwithstanding the trial court’s conclusion in
2015 that the sale agreement and note in this case were the
“functional equivalent” of a land sale contract. Accordingly,
we reverse the judgment of restitution and remand for fur-
ther proceedings.
Reversed and remanded.