ALBANY EASTERN RAILROAD COMPANY v. MARTELL (2020)

Plaintiff Albany & Eastern Railroad Company (AERC) petitions this court for reconsideration of its decision in Albany & Eastern Railroad Co. v. Martell, 366 Or. 715, 469 P.3d 748 (2020). In Albany & Eastern Railroad Co., this court ruled in favor of defendants, holding that the trial court correctly had concluded that defendants had established a prescriptive easement over plaintiff AERC's land. 366 Or. at 729, 469 P.3d 748. This court reversed the decision of the Court of Appeals and affirmed the judgment of the trial court. Id.

In its petition for reconsideration, plaintiff does not challenge the court's resolution of the prescriptive easement issue. Instead, plaintiff argues that this court erred in affirming the judgment of the trial court, rather than remanding the case to the Court of Appeals to consider a separate issue—the trial court's award of attorney fees to defendants under ORS 20.080(2). Plaintiff had argued to the Court of Appeals that, even if defendants successfully asserted a prescriptive easement counterclaim, the trial court had no authority to award attorney fees to defendants. According to plaintiff, a prescriptive easement is an equitable remedy that falls outside of ORS 20.080. In support of that argument, plaintiff cited Rose v. Rose and Freeman, 279 Or. 27, 29, 566 P.2d 180 (1977). Because the Court of Appeals ruled in favor of plaintiff on the prescriptive easement issue, that court vacated the trial court's judgment without resolving whether the trial court erred in awarding defendants attorney fees under ORS 20.080(2). Albany & Eastern Railroad Co. v. Martell, 298 Or. App. 99, 101, 445 P.3d 319 (2019).

Defendants filed a response to the motion for reconsideration, arguing that the trial court was correct in its award of attorney fees. They also filed petitions for attorney fees and costs and disbursements in this court and in the Court of Appeals. Plaintiff filed an objection to the request for attorney fees, arguing that the issue of defendants’ entitlement to fees had not yet been resolved and, alternatively, that defendants’ claimed fees were unreasonable.

We agree with plaintiff that the matter of attorney fees should have been remanded to the Court of Appeals following this court's disposition on the merits. Accordingly, we grant plaintiff's petition for reconsideration, and modify the disposition in Albany & Eastern Railroad Co. v. Martell, 366 Or. 715, 469 P.3d 748 (2020), as follows:

“The decision of the Court of Appeals is reversed, and the case is remanded to the Court of Appeals for further proceedings.”

Plaintiff's petition for reconsideration is allowed. The former opinion is modified and adhered to as modified. Defendants’ petition for attorney fees and costs and disbursements is denied without prejudice to defendants seeking attorney fees in the Court of Appeals for work performed in that court and the Supreme Court, should they prevail on remand. Costs are awarded to abide the determination of the prevailing party by the Court of Appeals on remand.

BALMER, J.