On March 25, 2011, the Oregon Supreme Court reviewed the case Menasha Forest Products Corporation v. Curry County Title, Inc. and Transnation Title Insurance Company, stemming from a circuit court decision. The Court of Appeals' ruling on attorney fees was reversed, while the remainder of their decision was affirmed, as were the circuit court judgments. The core issue involved whether the defendants, Curry County Title (CCT) and Transnation, were entitled to attorney fees from the plaintiff, Menasha Forest Products. The escrow contract stipulated that if CCT prevailed, it would be entitled to reasonable attorney fees. The trial court awarded $31,449.85 in fees after determining that Transnation's payment of those fees did not impact CCT's contractual right to recover them. However, the Court of Appeals reduced the award to $2,500, citing limitations set by an agency agreement between CCT and Transnation.
On review, the Supreme Court sided with the trial court, affirming that Transnation's payment did not limit CCT's right to attorney fees under the escrow contract. Furthermore, the Court ruled that Transnation, as a prevailing party, could also recover its attorney fees without reduction. Prior to the dispute, CCT had an agency agreement with Transnation for providing title insurance, which included indemnification clauses for certain losses, including attorney fees. The escrow contract between Menasha and CCT, drafted by CCT, specified that CCT would be entitled to costs and fees if it prevailed in any related action. The underlying issue arose from CCT's erroneous preparation of a title report that included property not owned by Menasha, leading to the breach of contract claim.
