Summary
The Oregon Supreme Court considers whether a seller of goods that has resold the goods after a buyer's breach may recover market-price damages under ORS 72.7080(1) when those damages exceed resale-price damages under ORS 72.7060. The court concludes that the seller may elect market-price damages and reverses the limitation imposed by the trial court. The court also concludes that the contract provision allowing recovery of "charges for collection of payment" does not authorize attorney fees.
Topics
Practice areas
Questions Presented
- Whether an aggrieved seller that resells goods after a buyer's breach may recover market-price damages under ORS 72.7080(1), even when those damages exceed the resale-price damages available under ORS 72.7060.
- Whether the contracts' incorporated NORAMSEED Rule authorizing recovery of charges for collection of payment entitled Peace River to recover attorney fees.
Holdings
- An aggrieved seller may seek either market-price damages under ORS 72.7080(1) or resale-price damages under ORS 72.7060. Reselling goods does not preclude the seller from recovering market-price damages, even when those damages exceed the resale-price measure.
- Peace River did not establish that the incorporated NORAMSEED Rule authorizing recovery of charges for collection included attorney fees. The record did not establish a relevant usage of trade or the parties' intent supporting that interpretation.
Key quotations
“In sum, when viewed in light of the bargained-for market risks and the UCC’s rejection of the doctrine of election of remedies, the text, context, and legislative history of the sellers’ remedy provisions demonstrate that an aggrieved seller can seek damages under either ORS 72.7080(1) or ORS 72.7060.” (61)
“For the reasons explained above, we conclude that plaintiff can recover its market price damages under ORS 72.7080(1).” (71)
“However, we agree with the trial court, although for different reasons, that plaintiff is not entitled to recover its attorney fees under the NORAMSEED Rule that allows a seller to recover “charges for collection.”” (71)
Factual background
Peace River and Proseeds entered into fixed-price contracts under which Proseeds agreed to purchase grass seed produced on specified acreage over two years. After grass-seed prices fell, Proseeds stopped providing shipping instructions for additional conforming seed, and Peace River canceled the contracts. Peace River later resold at least some of the seed to other buyers and sought damages under the UCC's market-price measure. The contracts incorporated the NORAMSEED Rules, including provisions concerning charges for collection and damages.
Procedural history
The parties submitted their contract dispute to arbitration, and an award for Peace River was initially enforced by the trial court. The Court of Appeals remanded for trial after determining that the arbitration was not binding. Following a bench trial, the circuit court found that Proseeds breached the contracts, awarded resale-price damages, and denied attorney fees. The Court of Appeals reversed and remanded, concluding that Peace River could pursue market-price damages and that the attorney-fee issue required further contract interpretation. The Oregon Supreme Court affirmed in part, reversed in part, and remanded.
Remand instructions
The circuit court must award Peace River the market-price damages calculated in Exhibit 409, calculate prejudgment interest on that amount, account for any amount Proseeds already paid, and enter an appropriate judgment. The denial of attorney fees is affirmed.