From the desk of Cliff J. Wilson: In what context will an award for attorney fees or enhanced prevailing party fees stemming from an arbitration likely be overturned? Read on to see how the Oregon Court of Appeals recently answered this question in a case involving contractual arbitration.
Claims Pointer: The Oregon Court of Appeals reversed the $27,035.50 in attorney fees awarded to plaintiff for work performed during an arbitration governed by the Oregon Uniform Arbitration Act, finding that the relevant statute limits recovery of fees to those incurred in any post-arbitration judicial proceeding. The Court of Appeals also required reconsideration of a $3,000.00 award for enhanced prevailing party fees due to conflicting conclusions made by the trial court, including that the defendant’s legal positions were both reckless and also objectively reasonable. This case is important in distinguishing arbitration and judicial proceedings and limiting unsupported fee awards.
Weitman Excavation, LLC v. CPM Development Corp., 276 Or App 583 (February 24, 2016)
CPM Development Corp (“CPM”), a general contractor, and Weitman Excavation LLC (“Weitman”), an excavation subcontractor, placed bids on a major airport utility project. Weitman submitted its bid to CPM and CPM incorporated that bid into its own for the project. When CPM was awarded the contract, it notified Weitman and provided a subcontract containing new terms as well as an arbitration clause. Weitman never signed the subcontract and withdrew from the project when the parties could not reach an agreement as to the new terms.
CPM initiated arbitration proceedings under the Oregon Uniform Arbitration Act, claiming that Weitman breached their contract. Weitman argued that the parties never entered into a contract compelling arbitration. It brought a declaratory judgment action in court, seeking a declaration that CPM had no enforceable contractual rights. CPM filed a petition to compel arbitration and...