author: OPINION BY KEITH RAPP, JUDGE:

text:
    Oliver Dale DALLAS, Plaintiff/Appellee, v. GEICO INSURANCE COMPANY, Defendant/Appellee, and The Pain Management Solution, PLLC, Claimant/Appellant, and Stover Physical Therapy, PC; Ocoms Imaging, LLC and Oliver A. Cvitanic, M.D., P.C., Claimants.
    Case No. 116,209
    Court of Civil Appeals of Oklahoma, Division No. 4.
    JUNE 24, 2019 Mandate Issued: July 24, 2019
    Chris Sloan, SLOAN LAW OFFICE, P.C., Oklahoma City, Oklahoma, for Plaintiff/Appellee
    R. Robyn Assaf, Alia Al-Assaf, Oklahoma City, Oklahoma, for Claimant/Appellant
    Gerald F. Pignato, Benjamin M. McCaslin, PIGNATO, COOPER, KOLKER & ROBERSON, P.C., Oklahoma City, Oklahoma, for GEICO
   OPINION BY KEITH RAPP, JUDGE:

¶1 The defendant, The Pain Management Solution, PLLC (Pain Management), appeals a judgment adjudicating claims in an action brought by the plaintiff Oliver Dale Dallas (Dallas). The remaining defendants, except Geico Insurance Company (Geico), either did not object to the judgment or did not appear. Geico provided the money which is the subject of this action.

BACKGROUND

¶2 Dallas alleged that he sustained injury as a passenger when his wife, the driver, applied the brakes to avoid a collision. The other vehicle left the scene and that driver has not been identified. Dallas received medical treatments from all of the medical provider defendants.

¶3 Dallas retained his attorney. The attorney pursued an uninsured motorist (UM) claim against Dallas's insurer, Geico. After negotiations, and without a lawsuit, the UM claim was settled for the sum of $60,614.78. This sum was insufficient to pay the attorney fee and the medical providers' charges.

¶4 Dallas's attorney filed this action to adjudicate medical liens and claims and to apportion the fund. The petition set out the source of the funds and the statement that counsel and Dallas had a fifty percent contingency fee contract. Counsel endorsed "Attorney's Lien Claimed" on the petition. The petition listed the medical providers and their claims and liens.

¶5 The trial court conducted a hearing. During the hearing, the trial court inquired of Dallas's attorney if he had a fifty percent, written fee contract, and counsel affirmed that he did have the contract. The trial court clearly accepted the statement without having the contract admitted into evidence. Counsel also explained that the reason for the amount of the contingency was due to the complex case circumstances of no collision, no other driver, and a criminal matter against Mrs. Dallas, which is apparently related to the traffic incident.

¶6 During the course of the hearing, counsel for Pain Management offered into evidence a letter purporting to be a $52,000.00 settlement offer from Geico. Dallas's attorney objected, and the trial court sustained the objection.

¶7 Dallas's attorney presented a proposed division of proceeds. The proposal awarded counsel the full attorney fee and costs and divided, proportionately, the balance among the participating medical claimants. Only Pain Management objected, and it now appeals. As briefed, Pain Management asserts error regarding evidentiary issues and error regarding whether Dallas's counsel has a lien and any legal right to priority.

STANDARD OF REVIEW

¶8 The principle issues in this case do not involve factual questions, but rather interpretations of statutes, rules and prior case law. Thus, the appeal presents questions of law which are reviewed de novo . Kluver v. Weatherford Hosp. Auth., 1993 OK 85, ¶ 14, 859 P.2d 1081, 1084. "Issues of law are reviewable by a de novo standard and an appellate court claims for itself plenary independent and non-deferential authority to reexamine a trial court's legal rulings." Id .

¶9 "[A] judgment will not be reversed based on a trial judge's ruling to admit or exclude evidence absent a clear abuse of discretion." Myers v. Missouri Pacific R.R ., 2002 OK 60, ¶ 36, 52 P.3d 1014, 1032-33. "An abuse of discretion takes place when the decision is based on an erroneous interpretation of the law, on factual findings that are unsupported by proof, or represents an unreasonable judgment in weighing relevant factors." Oklahoma City Zoological Trust v. State ex rel. Public Employees Relations Bd. , 2007 OK 21, ¶ 5, 158 P.3d 461, 463-64.

ANALYSIS AND REVIEW

A. Procedural Issues

¶10 The complaint about not requiring the written attorney contingent fee contract does not show error. The trial court specifically inquired and was told by the attorney that there is a contract. The trial court was satisfied as to its existence, and the critical point was the amount of the contingency. Pain Management has not demonstrated any abuse of discretion or absence of critical information for the trial court. Moreover, the Pain Management argument here is addressed more to the propriety of a fifty percent contingency than the existence of the fee contract.

¶11 Pain Management argues that its representative should have been allowed to testify that its bill was for the subject of the accident injuries. Dallas's attorney had mentioned that Pain Management had treated Dallas for unrelated matters. However, counsel further stated that the bills submitted in this case were for the auto injuries. Moreover, the adjudication proposed by Dallas's attorney included all of the charges from Pain Management, without challenge or deduction. No error has been demonstrated.

¶12 Pain Management claims that there was a $52,000.00 settlement offer from Geico and that it would be unethical for Dallas's attorney to claim a contingency on that part of the settlement. The trial court declined to admit the letter into evidence on the ground of hearsay and relevance.

¶13 A review of the letter, Exhibit 1, shows that it is not literally as represented by Pain Management in its argument. The letter appears to be handwritten from Dallas to the physician and asks him to accept a $52,000.00 settlement. Pain Management claims $64,795.62. The source basis of the $52,000.00 is not mentioned in the letter. No effort appears to have been made to call Dallas to identify and authenticate the document. Thus, interpreting the letter to mean that Geico offered to settle is an interpretation which cannot be made under the Record. No error has been demonstrated.

B. Legal Issues

¶14 There are two questions.

¶15 First, does Dallas's attorney have a lien? This question arises because Dallas did not file a UM lawsuit or tort action. Thus, there is no "lien claimed" endorsement or notice of lien based upon a prior UM or tort lawsuit.

¶16 Second, Dallas's attorney did endorse the interpleader action petition with "lien claimed." Does this endorsement establish a priority, or has counsel merely perfected a current lien on the settlement proceeds which is of equal priority with the established medical provider liens?

¶17 In what might be considered a typical case, an injured party files an action against the tortfeasor and recovers a judgment or settlement. The injured party's attorney perfects an attorney's lien by giving notice or endorsing the pleading "Lien Claimed." 5 O.S. Supp. 2018, § 6(A). The medical providers perfect liens. 42 O.S. Supp. 2017, § 46(A). Here, there are physicians' liens which were filed between 2012 and 2017. 42 O.S. Supp. 2017, § 46 (amended by 2018 Okla. Sess.

Laws, ch. 195, § 2.)

¶18 Thus, under the hypothetical case, the physician perfects a lien against recovery pursuant to Subsection A when the injured party "maintains a claim" against the tortfeasor. This lien is junior to the perfected attorney's lien according to Subsection A.

¶19 However, the Subsection A scenario is not what transpired here. This case comes under Subsection B. Subsection B gives the physicians a lien against the Geico settlement proceeds because Dallas asserted and maintained a claim against Geico. It is noted that Subsection B does not provide for the superiority of the attorney's lien as does Subsection A. The reason for this difference is not apparent. However, there is here no prior legal action against the tortfeasor for Dallas's attorney to give notice or to endorse "lien claimed."

¶20 The facts are clear that there was no attorney's lien at the point in time when Dallas first asserted and maintained the UM claim against the insurer, Geico. Moreover, according to the Record, Dallas's attorney did not follow the Section 6 alternative to the "lien claimed" endorsement by sending a notice to the physicians.

¶21 Therefore, the answer to the first question is: Prior to the filing of the interpleader, Dallas's attorney did not have an attorney's lien. Dallas's attorney has an attorney's lien only after filing the interpleader. That lien attached to the interpleader cause of action. 5 O.S. 2011, § 6(A). "The attorney's lien attaches to the client's cause of action, and any recovery thereon, albeit the recovery is effected in an action other than the action in which the services were rendered." Edwards v. Andrews, Davis, Legg, Bixler, Milsten & Murrah, 1982 OK 72, ¶ 18, 650 P.2d 857, 862.

¶22 Dallas relies upon Edwards to argue that the interpleader is a logical extension of the UM claim and settlement. There are significant differences between the facts in Edwards and the facts here. In Edwards , the attorney's lien had been established in the original litigation. The parties settled the litigation. The matter on appeal in Edwards resulted from an action to enforce the settlement. The Supreme Court ruled that this enforcement action was a continuation of the original action for purposes of the attorney's lien. Here, there is no prior action where an attorney's lien was perfected.

¶23 In addition, Dallas's interpleader is not a continuation of the UM claim or enforcement of the settlement of the UM claim. The UM claim against Geico is a contract claim, not a tort claim. Uptegraft v. Home Ins. Co., 1983 OK 41, 662 P.2d 681.

An action is one ex contractu when it is derived from (a) an express promise, (b) a promise implied in fact or (c) a promise implied in law. The uninsured motorist coverage constitutes a carrier's direct promise to the insured to pay indemnity for a specified loss. Because it is a promise by the insurer to pay its own insured, rather than a promise to its insured to pay some third party, the uninsured motorist coverage is understood, in insurance parlance, as "first-party coverage"-much like collision, comprehensive, medical payments or personal injury protection-and not as "third-party coverage," such as personal injury or property damage coverage of public liability insurance. In short, we are dealing here with an agreement to indemnify the insured for injuries caused by another-who was uninsured or underinsured-based on a showing that the other motorist was guilty of negligence resulting in injury to the insured. A suit founded upon the insured's allegations (a) that he is entitled to payment under one of the first-party coverage clauses in the contract and (b) that the carrier has refused payment thereby breaching its promise, is clearly a contract action. The circumstances of the uninsured motorist's culpability and of the insured's damages are matters which the insured must prove in order to recover from the insurer, but these are really conditions of the insurer's promise. The recovery of the insured is based ultimately upon the policy without which no liability could be imposed upon the insurer for the tort of another.

Uptegraft , ¶ 7, at 684-85 (citations omitted).

¶24 The statute specifically provides for priority of the attorney's lien in tort actions. 42 O.S. Supp. 2018, § 46(A). The statute is silent about priority when the injured party's claim is against the insurer. 42 O.S. Supp. 2018, § 46(B). The claim made by Dallas is a contract claim against his insurer, Geico.

¶25 Statutes are construed to carry out legislative intent. Estes v. ConocoPhillips Co ., 2008 OK 21, ¶ 16, 184 P.3d 518, 526. "We presume that the Legislature expressed its intent and intended what it expressed, and statutes are interpreted to attain that purpose and end, championing the broad public policy purposes underlying them." Id. Thus, the Legislature has clearly distinguished tort claims from contract claims for purposes of the priority of liens.

¶26 Last, examination of the underlying purposes for the attorney's lien and the physician's lien reveals no basis for preferring one or the other for priority purposes in the absence of statutory authority. Both liens serve the same purpose for the benefit of the covered profession. "The attorney's charging lien is based upon the equitable doctrine that an attorney should be paid out of the proceeds of the judgment secured by that attorney." Edwards , 1982 OK 72 ¶ 18, 650 P.2d at 862. The physician's lien is designed to ensure that physicians are paid for their services once their patients are compensated for their injuries. Broadway Clinic v. Liberty Mutual Ins. Co ., 2006 OK 29, ¶ 15, 139 P.3d 873, 877 (citations omitted).

¶27 Pain Management has not demonstrated any legal reasons to deny payment from the settlement to Dallas's attorney. However, the trial court erred by ruling that the attorney's lien for the attorney fee had priority. It must be noted that some claimants did not appear and some conceded the priority and did not object. Those claimants are now barred from re-litigating their priority.

¶28 Dallas's attorney and Pain Management each has a lien on the settlement proceeds. However, neither has priority. Moreover, the reason for providing a lien is the same for each profession. Thus, there are no statutory (or equitable) bases for priority.

¶29 The deductions from the settlement, for costs and two other claimants, leave a net fund of $58,038.83. Therefore, the judgment is reversed and the case is remanded with instructions to equitably divide this sum between Dallas's attorney and Pain Management.

CONCLUSION

¶30 This is a lien priority cause where the contestants are an attorney and a physician. The attorney pursued a UM claim on behalf of his client, but did not file any lawsuit against the tortfeasor. He settled the UM claim with the insurance company, Geico. The physician provided medical services and perfected a lien. The settlement was insufficient to pay all medical providers' claims and the attorney's fee. The attorney has filed an interpleader and included endorsement of "lien claimed" on the interpleader petition. This is the first, and only, occasion for the establishment of the attorney's lien.

¶31 The physician's lien statute provides that the attorney's lien has priority when a case has been filed against the tortfeasor. The statute does not provide priority when the claim is against the insurance company under the UM clause of the policy, as is the case here. However, the purposes of the two lien statutes are the same, that is, to see that the covered professional is compensated.

¶32 Under the facts of this case, both Dallas's attorney and Pain Management have liens against the UM insurance settlement proceeds. However, neither has priority. Two medical provider's claimants did not appear and received no award. Two other medical providers have accepted the judgment without objection. Therefore, the cause is reversed as to Pain Management and remanded for the trial court to award costs to Dallas's attorney and then equitably divide the balance between Dallas's attorney and Pain Management, after deduction of payments to the two claimants who have accepted the judgment. The judgment as to the two remaining claimants is undisturbed because they either did not file an answer or did not appear at the hearing.

¶33 AFFIRMED IN PART, REVERSED IN PART, AND REMANDED WITH INSTRUCTIONS .

BARNES, P.J., concurs, and WISEMAN, V.C.J., concurs specially.

WISEMAN, V.C.J., concurring specially:

I concur in the Majority's Opinion, but I write separately to suggest that when, as here, the attorney bases his claim on a written contingency fee contract, the better practice is to require the production and admission of the contract, particularly when the contractual fee is at the outside allowable limit (50%) for contingent fees, and the injured party (Dallas) receives no award in this settlement under the trial court's allocation.

      This appeal was assigned to this Judge and this Panel on April 4, 2019.

      GEICO was dismissed as a party on July 19, 2018.

      The trial and appellate records show that Geico has retained possession of the fund pending the outcome of the case.

      Tr., p. 4.

      Therefore, the parties' argument about whether the exhibit is a part of the appeal record is of no consequence. Moreover, Pain Management's contention that Dallas's attorney is ethically limited to the difference between the actual settlement and the $52,000.00 becomes moot.

      It is noted that Geico retained possession of the settlement proceeds, so Dallas's counsel does not have a possessory lien.

      Section 6(A) reads:
      A. From the commencement of an action, or from the filing of an answer containing a counterclaim, the attorney who represents the party in whose behalf such pleading is filed shall, to the extent hereinafter specified, have a lien upon his client's cause of action or counterclaim, and same shall attach to any verdict, report, decision, finding or judgment in his or her client's favor; and the proceeds thereof, wherever found, shall be subject to such lien, and no settlement between the parties without the approval of the attorney shall affect or destroy such lien, provided such attorney serves notice upon the defendant or defendants, or proposed defendant or defendants, in which he or she shall set forth the nature of the lien he or she claims and the extent thereof; and the lien shall take effect from and after the service of such notice, but such notice shall not be necessary provided such attorney has filed such pleading in a court of record, and endorsed thereon his or her name, together with the words "Lien claimed."

      The statute reads:
      A. Every physician who performs medical services or any other professional person who engages in the healing arts, within their scope of practice pursuant to Title 59 of the Oklahoma Statutes for any person injured as a result of the negligence or act of another, shall, if the injured person asserts or maintains a claim against such other person for damages on account of such injuries, have a lien for the amount due for such medical or healing arts services upon that part going or belonging to the injured person of any recovery or sum had or collected or to be collected by the injured person, or by the heirs, personal representative, or next of kin of the injured person in the event of his death, whether by judgment, settlement, or compromise. Such lien shall be inferior to any lien or claim of any attorney handling the claim for or on behalf of the injured person. The lien shall not be applied or considered valid against any claim for amounts due pursuant to the provisions of Title 85A of the Oklahoma Statutes.
      B. In addition to the lien provided for in subsection A of this section, every physician or professional person licensed under Title 59 of the Oklahoma Statutes who performs medical or healing arts within their scope of practice for any person injured as a result of the negligence or act of another, shall have, if the injured person asserts or maintains a claim against an insurer, a lien for the amount due for such medical or healing arts services upon any monies payable by the insurer to the injured person.
      C. No lien which is provided for in this section shall be effective unless, before the payment of any monies to the injured person, the attorney for the injured person, or legal representative as compensation for such injuries or death:
      1. A written notice is sent setting forth a statement of the amount claimed, identifying the insurance policy or policies against which the lien is asserted, if any, and containing the name and address of the physician or professional person licensed under Title 59 of the Oklahoma Statutes claiming the lien, the injured person, and the person, firm, or corporation against whom the claim is made, is filed on the mechanic's and materialman's lien docket in the office of the county clerk of the county where the principal office of the physician or professional person licensed under Title 59 of the Oklahoma Statutes is located; and
      2. The physician or professional person licensed under Title 59 of the Oklahoma Statutes sends, by registered or certified mail, postage prepaid, a copy of such notice with a statement of the date of filing thereof to the person, firm, or corporation against whom the claim is made and to the injured person. The physician or professional person licensed under Title 59 of the Oklahoma Statutes shall also send a copy of the notice to the attorney for the injured person, if the name and address of such attorney is known to the physician or professional person licensed under Title 59 of the Oklahoma Statutes.
      D. The liens provided for in this section may be enforced by civil action in the district court of the county where the lien was filed. Such an action shall be brought within one (1) year after the physician or professional person licensed under Title 59 of the Oklahoma Statutes becomes aware of final judgment, settlement or compromise of the claim asserted or maintained by or on behalf of the injured person. The practice, pleading, and proceedings in the action shall conform to the rules prescribed by the Oklahoma Pleading Code to the extent applicable.

      The 2018 amendment only recognized the renumbering of the Worker's Compensation Code.

      Pain Management's reliance on Hudson v. Fisher , 2010 OK CIV APP 69, 239 P.3d 970, is misplaced. There, a lawsuit was filed, an attorney's lien perfected, and a settlement was obtained through mediation. Then, counsel filed the interpleader, but failed to notify a physician lienholder, even though this lienholder was known. The trial court apportioned the fund, with priority to the attorney's lien. The omitted lienholder moved to vacate, and the trial court agreed. After a hearing, the trial court ordered a refund from the attorney of the portion of the fund that would have gone to the omitted physician. It was this portion of the fund that the Hudson Opinion referenced when it stated that the attorney did not have a priority.


source: Caselaw Access Project

author: BALMER, J.

license: Public Domain

text:
    TROUBLED ASSET SOLUTIONS, LLC, in its capacity as Receiver for The Mortgage Exchange, Inc., pending in Washington County Circuit Court Case No. C112822CV, Petitioner on Review, v. Eddie WILCHER, and All Occupants, Respondent on Review.
    Eddie Wilcher, Respondent on Review, v. Troubled Asset Solutions, LLC, in its capacity as Receiver for The Mortgage Exchange, Inc., pending in Washington County Circuit Court Case No. C112822CV, Petitioner on Review.
    CC C142009EV, C145657CV (SC S066097)
    Supreme Court of Oregon, En Banc.
    Argued and submitted March 5, 2019. August 1, 2019
    Jonathan M. Radmacher, McEwen Gisvold LLP, Portland, argued the case and filed the brief for petitioner on review.
    Terrance Slominski, Slominski & Associates, Tigard, argued the cause and filed the brief for respondent on review. Also on the brief was David W. Venables.
   BALMER, J.

This case requires us to consider and apply the legal standard for the reformation of a contract to include a term that all parties had intended, but that one of the parties, by mistake, had failed to include in the written agreement. The trial court reformed the contract to include the term, finding that the mistake "was easily missed," and that the "evidence is clear that all parties intended" the term to be included. The Court of Appeals reversed, concluding that reformation is permissible only if the party seeking the remedy demonstrates that it was not "grossly negligent," and holding that the facts in this case did not meet that standard. Troubled Asset Solutions v. Wilcher , 291 Or. App. 522, 422 P.3d 314 (2018). For the reasons explained below, we conclude that the trial court did not err in reforming the contract to express the parties' agreement. Accordingly, we reverse in part the decision of the Court of Appeals and remand the case to that court for further proceedings.

I. FACTUAL AND PROCEDURAL HISTORY

We take the facts from the pleadings and the trial court record. Sierra Development, LLC (Sierra), a real estate development company in which both Wilcher and his son were involved, borrowed approximately $5 million from The Mortgage Exchange (MEX), the predecessor in interest of plaintiff Troubled Asset Solutions, LLC (TAS). Wilcher and his son signed a promissory note for the loan as members of Sierra; Wilcher, his son, and his son's wife also signed the promissory note as "individual guarantor(s)." The promissory note stated that it was secured by a trust deed on Sierra Heights, the property owned by Sierra that was to be developed with the loan proceeds, and also by "[a]dditional security" that was "required on this loan." The promissory note identified as that "additional security" three other properties owned personally by Wilcher, one of which was described as "15 (+/-) acres including residence, Tax Lot 700, Klamath County, Oregon valued at $450,000."

The same three individuals that signed the promissory note also executed the critical document in this case: a deed of trust identifying more than a dozen separate parcels of land as collateral for the loan. The trust deed described the properties that would be subject to the trust and security for the loan as "SIERRA HEIGHTS, Klamath Falls, OR plus additional collateral in Keno, OR," and the record makes clear that the "Keno" property included Wilcher's residence, which he owned personally. The trust deed then listed the various lots that comprised the Sierra Heights development and also listed as "additional security" the properties owned personally by Wilcher, including the 15-acre property with his residence. Exhibit A to the trust deed contained metes and bounds descriptions of the properties that were collateral for the loan, including a legal description of the property with the residence. Other documents and testimony at trial confirm that the parties clearly intended that the loan be secured not only by the properties owned by Sierra, but also by properties owned individually by Wilcher, including the property with his residence. The signature block of the trust deed identifies, under the designation "Corporate or Partnership Grantors," "SIERRA DEVELOPMENT, LLC." Wilcher and his son signed on signature lines that set out their names and the designation "Member." Wilcher's son's wife also signed the deed of trust. Both the trust deed and the promissory note had been prepared by MEX.

The dispute in this case arises because, although the trust deed identifies the collateral as including the properties owned personally by Wilcher and contains legal descriptions of those properties, the only name that appears in the space labeled "GRANTOR" on the first page of the trust deed is Sierra. Wilcher, individually, is not identified as a "grantor" in the trust deed. After the loan went into default, TAS initiated foreclosure proceedings against one of the properties owned personally by Wilcher ("the property").

Following unsuccessful settlement efforts, Wilcher brought a quiet title action in Klamath County Circuit Court seeking a declaration that the trust deed did not grant any interest in the property to TAS. That action was later dismissed for improper venue. TAS then filed an action for forcible entry and detainer against Wilcher in Washington County Circuit Court, seeking to remove him from the property. Wilcher renewed his quiet title claim in a separate action in that court, and TAS filed a counterclaim seeking to reform the trust deed to add Wilcher, individually, as a grantor.

The two actions in Washington County were consolidated for trial, and the trial court ultimately entered a judgment granting TAS's claim for reformation and related relief. The trial court found that the parties to the loan transaction knew and intended that Wilcher's individually owned property, including his residence, would be subject to the trust deed and collateral for the loan. That property was listed as collateral in the trust deed and also in the promissory note, which, as noted, Wilcher had signed both individually and as a member of Sierra. The trial court also found that the error in the trust deed in failing to list Wilcher individually as a "grantor" was "easily missed." The trial court further observed that, because some of the claims before it were equitable in nature, it was required to do what was "fair." It also found that, since signing the deed, and prior to the present litigation, Wilcher had consistently behaved as though the property was encumbered. The trial court ordered reformation of the trust deed to include Wilcher, individually, as a grantor of the property.

On appeal, Wilcher asked the Court of Appeals to review the record de novo and argued that the trial court had erred in reforming the trust deed, because TAS had failed to prove any of the elements necessary for reformation. He also raised several other assignments of error. The Court of Appeals denied the request for de novo review, but nevertheless agreed with Wilcher that the trial court had erred in reforming the trust deed. Troubled Asset Solutions , 291 Or. App. at 525, 535, 422 P.3d 314. The Court of Appeals took its test for when a court can reform a written agreement from this court's opinion in A&T Siding, Inc. v. Capitol Specialty Ins. Corp. , 358 Or. 32, 43, 359 P.3d 1178 (2015) (citing Jensen v. Miller , 280 Or. 225, 228-29, 570 P.2d 375 (1977) ). That test identifies three requirements: (1) "an antecedent agreement to which the contract can be reformed;" (2) a mutual mistake in the contract (or a unilateral mistake by one party with inequitable conduct by the other party); and (3) the absence of "gross negligence" by the party seeking reformation. A&T Siding, Inc. , 358 Or. at 43, 359 P.3d 1178. The Court of Appeals considered only the third requirement, determining that it was dispositive. Troubled Asset Solutions , 291 Or. App. at 532, 422 P.3d 314. It held that TAS had failed to prove "lack of gross negligence" on the part of MEX and therefore was not entitled to reformation of the trust deed to express the parties' agreement that the property was subject to that contract. Id. at 533-35, 422 P.3d 314. The court concluded: "[N]o factfinder could conclude that failing to name Wilcher as a grantor was 'mere oversight, inadvertence, or mistake.' " Id. at 534, 422 P.3d 314 (quoting Foster v. Gibbons , 177 Or. App. 45, 54, 33 P.3d 329 (2001) ). We allowed review to consider the meaning and application of the "gross negligence" requirement when a court is asked to exercise its equitable powers to reform a contract.

II. ANALYSIS

On review, TAS makes two related arguments. First TAS asserts that the Court of Appeals erred in articulating and applying the "gross negligence" requirement to the facts here by failing to consider, as part of that determination, whether the balance of equities, including prejudice to either party, favors reformation. TAS argues that this court's cases always have interpreted the gross negligence element of the reformation test to include consideration of broader equitable principles, and that Court of Appeals erred by departing from those cases here, as well as by failing to credit the trial court's express and implicit findings that demonstrated the absence of gross negligence on the part of MEX. Second, TAS argues that this court should clarify and restate (if not rename) the "gross negligence" standard, consistent with this court's cases on contract reformation and the Restatement (Second) of Contracts , to emphasize underlying equitable principles, including the presence or absence of prejudice, good faith, and unjust enrichment.

Wilcher responds that "gross negligence" has been adequately defined by the Oregon courts to mean "heightened negligence" and that it does not incorporate other equitable principles. Wilcher asserts that while a party to a transaction is not grossly negligent for failing to read a document, "a party is grossly negligent and reformation will be barred if it fails to obtain information readily available; thus, a party must take reasonable measures to be informed." (Emphasis in Wilcher's brief in this court.) He argues that the Court of Appeals correctly applied the "gross negligence" standard to the facts of this case. He also argues that the trial court found neither an antecedent agreement or a mutual mistake, and that the record would not support such findings.

As we will explain, although Wilcher is not necessarily inaccurate in quoting some of the formulations of the "gross negligence" requirement, he advances a cramped and abstract interpretation of that requirement that is inconsistent with our case law. We conclude that the Court of Appeals erred as a matter of law in its application of that standard by focusing only on the conduct of MEX and its agents and by failing to consider the equities of the case, notably whether anyone would be prejudiced by reformation of the contract. We also agree with TAS that it is appropriate to reconsider the utility of the "gross negligence" standard, which we do below. A. Preliminary Matters

We begin by revisiting the Court of Appeals' decision and the applicable standard of review. As the Court of Appeals noted, having declined Wilcher's request for de novo review, the court was left to review the trial court's factual findings "to determine whether there is any evidence in the record to support them, and its legal conclusions for legal error." Troubled Asset Solutions , 291 Or. App. at 525, 422 P.3d 314. Here, the Court of Appeals did not identify any specific misunderstanding of the relevant law on the part of the trial court. Rather, it based its decision solely on its view that the evidence at trial was insufficient to support the trial court's conclusion that the mistake was excusable and therefore could be the basis for reformation. Id. at 533, 422 P.3d 314 ("there was insufficient evidence in the record for the court to find that the mistake was excusable under the circumstances"). Yet under the applicable standard of review, the Court of Appeals was obligated to "view the evidence in the light most favorable to the [trial] court's disposition to determine if it supports the court's legal conclusions." Dept. of Human Services v. S.J.M. , 364 Or. 37, 40, 430 P.3d 1021 (2018) (citing, inter alia , ORS 19.415 ). As this court recently stated in reviewing a trial court's legal conclusion based on that court's assessment of facts presented at trial:

"[W]e are bound by the court's factual findings as long as the record contains evidence that supports those findings. To the extent that the trial court did not explicitly state its factual findings, we assume that it found facts consistent with its conclusion (assuming, again, that the evidence in the record would support such findings)."

Crimson Trace Corp. v. Davis Wright Tremaine LLP , 355 Or. 476, 489, 326 P.3d 1181 (2014). We will return to the standard of review again below.

Before turning to the central dispute between the parties over the meaning and application of the gross negligence standard, however, we briefly address the two other elements that a party must prove to obtain reformation of a contract: antecedent agreement and mistake. Although the Court of Appeals did not decide those issues, Wilcher briefed them in this court and they are intertwined with the gross negligence issue, so in the interest of judicial and litigant economy we will consider them. The trial court found that there was an antecedent agreement that the property owned by Wilcher personally and described in the trust deed, including the parcel with Wilcher's residence, was intended by the parties to be collateral for the loan and that the parties intended Wilcher, personally, to be named as a grantor in the trust deed. It also found that the failure to include Wilcher as a grantor in that document was a mistake that no party caught-indeed, that Wilcher had been under the impression that he was signing the trust deed in his personal capacity. Although Wilcher argues that there was no evidence to support those findings, we disagree-the trial court's findings on those elements, discussed throughout this opinion, were amply supported by the record and must be upheld under the applicable standard of review. This was a classic example of a mutual mistake, where the written document failed accurately to express the agreement of the parties.

B. The Court of Appeals' Determination of Gross Negligence

The Court of Appeals recognized that the term "gross negligence," at least as used in the contract reformation context, is "not well-defined," that it requires consideration of all the facts to determine whether the party seeking reformation is entitled to relief, based on the equities, and that in order to bar equitable relief, a party's conduct " 'must go beyond mere oversight, inadvertence, or mistake and, instead, must amount to a degree of inattention that is inexcusable under the circumstance.' " Troubled Asset Solutions , 291 Or. App. at 532-33, 422 P.3d 314 (quoting Foster , 177 Or. App. at 54, 33 P.3d 329 ). That standard " 'requires careful consideration of the facts to determine if the party seeking reformation is, both in light of his or her own actions and as a matter of equity , entitled to such relief.' " Id. (emphasis added). But the Court of Appeals strayed from that standard in this case.

The crux of the Court of Appeals' legal conclusion was its agreement with Wilcher's argument that MEX, TAS's predecessor in interest, "had access to all of the information necessary to avoid its mistake, and its failure to obtain or utilize that information constituted gross negligence." Troubled Asset Solutions , 291 Or. App. at 532, 422 P.3d 314 (internal quotes omitted). The court noted that MEX's chief executive officer, Wilson, agreed that, although the trust deed and other closing documents were prepared by one of his most experienced employees, the trust deed contained a mistake in that it failed to include Wilcher as a grantor. Id. at 533, 422 P.3d 314. Wilson also had assumed that the title company would review the documents and catch any errors before closing. Id. The Court of Appeals determined that MEX "had all the pertinent information available to it before drafting the trust deed * * *." Id. at 534, 422 P.3d 314. The court distinguished cases where it had held that "a party's failure to read a document, by itself, will generally not constitute gross negligence sufficient to bar reformation," and asserted that "the omission of a crucial term when drafting a trust deed can rise to the level of gross negligence." Id. (internal quotation marks and citation omitted; emphasis in Troubled Asset Solutions ).

The Court of Appeals essentially viewed as dispositive MEX's conduct in making a drafting error regarding an important contract term when it had "access to all of the information necessary to avoid the mistake." Id. In those circumstances, it concluded, "no factfinder could conclude that failing to name Wilcher as a grantor was 'mere oversight, inadvertence, or mistake.' " Id. at 534, 422 P.3d 314 (quoting Foster , 177 Or. App. at 54, 33 P.3d 329 ). The court did not discuss any potential prejudice to TAS, Wilcher, or others in connection with its analysis of the "gross negligence," nor did it balance any other equitable considerations. As Wilcher describes the Court of Appeals decision in his brief, that court viewed "gross negligence" as meaning simply "heightened negligence," and as not incorporating "a variety of equitable principles." We return to the Court of Appeals decision after reviewing our cases that articulate and apply the "gross negligence" standard.

C. The Gross Negligence Standard

This court first used the term "gross negligence" in connection with contract reformation by courts of equity in Lewis v. Lewis , 5 Or. 169, 174 (1874), where we placed it squarely in the traditional equitable context of preventing injustice and advantage, while protecting intervening rights:

"[T]he class of cases wherein courts of equity interfere to correct mistakes are said to be those where the mistake is of so fundamental a character that the minds of the parties have never in fact met, or where an unconscionable advantage has been gained by mere mistake or misapprehension, and there was no gross negligence on the part of the plaintiff either in falling into error or in not sooner claiming redress, and no intervening rights have accrued, and the parties may still be placed in statu quo. But even in cases like these it is said that equity will interfere in its discretion, in order to prevent intolerable injustice. The prevention of intolerable injustice appears to be the cause which, according to this authority, impels the court to grant relief."

(Emphasis in original; citation omitted.) We emphasized the importance of the absence or presence of prejudice as part of the absence of gross negligence requirement in contract reformation in another early case, Powell v. Heisler , 16 Or. 412, 19 P. 109 (1888). We noted that the result in such cases will be fact dependent, and we quoted Pomeroy's treatise on equity jurisprudence to underscore that " 'even clearly established negligence' " may be insufficient to deny reformation " 'if it appear that the other party has not been prejudiced thereby.' " 16 Or. at 416, 19 P. 109 (quoting John N. Pomeroy, 2 A Treatise on Equity Jurisprudence , § 856, 322 (1st ed. 1886)).

Other reformation cases similarly have highlighted the importance of whether the other party to the transaction or a third party would be prejudiced by reformation. In Wolfgang v. Henry Thiele Catering Co. , 128 Or. 433, 275 P. 33 (1929), this court affirmed reformation of a written contract to change a particularly important-but erroneous-word. The court found that changing the word so that the contract accurately reflected the parties' agreement would not cause any prejudice: "no element of estoppel is present; no bona fide purchaser, without notice, has become interested in the restaurant property." 128 Or. at 447, 275 P. 33. Summarizing the law on this issue, this court a few years later concluded: "Some mistakes prejudice no one except those who commit them, and therefore, cancellation will prejudice no one. In such a case a considerable degree of carelessness can be tolerated." Holzmeyer v. Van Doren , 172 Or. 176, 189, 139 P.2d 778 (1943).

The clearest application of that principle is found in Edwards Farms v. Smith Canning Co. , 197 Or. 57, 63, 251 P.2d 133 (1952). In that case, the defendant in a breach of contract action argued that the contract should be reformed based on a mutual mistake. Id. at 58-59, 251 P.2d 133. The plaintiff-a farm run by two brothers-and the defendant had made an oral agreement that the plaintiff would grow and harvest a crop of lima beans, and sell the beans to the defendant at $180 per ton. Id. at 59-61, 251 P.2d 133. Later, the plaintiff requested that the agreement be reduced to writing, and two employees of the defendant quickly drafted a contract. Id. at 59-60, 251 P.2d 133. They did a notably sloppy job: the price at which the beans were to be sold was misstated as $80 per ton, the contract specified that the beans were "to be grown upon the following described land owned by the seller" but never described any land, and the contract required the "buyer"-the defendant-rather than the grower-the plaintiff-to harvest the crop. Id. at 60, 64, 251 P.2d 133. Those errors were apparently the product of the short timeframe in which the contract was drafted, and the failure of the employee who dictated the contract to have read it. Id. at 64, 251 P.2d 133. The price error was corrected a few days later, but the requirement that the defendant harvest the crop became the basis for the plaintiff's lawsuit, and is the term that the defendant asked to be reformed. Id.

Unsurprisingly, the plaintiff argued that reformation was barred by the defendant's gross negligence in preparing the contract. Id. at 63, 251 P.2d 133. Citing Pomeroy and Holzmeyer , this court explained, "a universal formula cannot be adopted which will define the degree of carelessness which would bar a party from the right to seek equitable relief." Id. Thus, before looking at whether the defendant had been sufficiently negligent so as to bar reformation, the court first determined "that plaintiff would not be prejudiced by the reformation * * *." Id. Having so concluded, the court excused the defendant's considerable oversights by noting that "[the defendant's employee] was importuned by plaintiff to draw up a contract. He hurriedly did so in the space of an hour, and when the completed document was ready it is indicated by the evidence that he did not read it * * *." Id. at 64, 251 P.2d 133. Naturally, those facts do not suggest that negligence was in short supply. The court instead took them to show that the error was an honest one that, in light of an absence of prejudice, did not amount to gross negligence, in the specialized sense in which that term is used in our reformation jurisprudence. Although Edwards Farms involved a contract that was "hastily drawn," id. at 64, 251 P.2d 133, we do not read that case to set up a special exemption for such documents. Rather, Edwards Farms ' insistence on a sliding scale approach to gross negligence brings home that, where there is no prejudice, "a considerable degree of carelessness can be tolerated." Holzmeyer , 172 Or. at 189, 139 P.2d 778.

Those cases teach that whether a party's mistake is so inexcusable as to constitute "gross negligence" and thus to bar reformation is not simply a matter of the level of carelessness of the party now seeking reformation, as the addition of the adjective "gross" to the noun "negligence" might otherwise suggest. Contrary to Wilcher's contention, gross negligence does not simply mean "heightened negligence." Rather, whether the error is "inexcusable" and can constitute gross negligence will depend in substantial part on the equities, including whether the parties acted in good faith and whether the other party to the contract or an innocent third party, such as bona fide purchaser, will be prejudiced. And that approach is consistent with other authorities. Indeed, the Restatement (Second) of Contracts section 157 eschews the term gross negligence as "not well defined." Restatement (Second) of Contracts § 157 comment a (1979). Instead, in discussing "the effect of fault of [the] party seeking relief" when a written contract mistakenly fails to express the actual agreement of the parties, the Restatement focuses on good faith:

"A mistaken party's fault in failing to know or discover the facts before making the contract does not bar him from avoidance or reformation *** unless his fault amounts to a failure to act in good faith and in accordance with reasonable standards of fair dealing."

Id. See also Richard A. Lord, 27 Williston on Contracts § 70.49, 347-48 (4th ed. 2003) (reformation appropriate under "gross negligence" standard if party "is entitled to such relief" based on consideration of facts "both in light of personal action taken and as a matter of equity"). Similarly, in Pioneer Resources, LLC v. D. R. Johnson Lumber Co. , 187 Or. App. 341, 342, 68 P.3d 233 (2003), the Court of Appeals exhaustively reviewed its own and this court's reformation cases. The court observed that the concept of "gross negligence" "is innately circumstantial and elastic," and after examining earlier cases, concluded:

"[T]he determination of 'gross negligence' is ultimately grounded in the equitable principles underlying reformation. So understood, 'gross negligence' in this context connotes the result of a balancing of equities ***."

Id. at 384, 68 P.3d 233.

D. Application of the Gross Negligence Test

Having reviewed some of the key cases explaining and applying the "gross negligence" element of the equitable remedy of contract reformation, we return to the Court of Appeals' decision in this case. As discussed earlier, that court relied heavily on the fact that MEX had access to the information necessary to avoid the mistake and yet failed to do so. But that fact merely indicates that MEX may have been negligent. Our cases from 1874 to the present stress the importance of considering whether reformation would prejudice the other party to the transaction or a third party, as well as whether other equities may favor one party or the other. Yet nothing in the Court of Appeals' opinion suggests that it gave any consideration to prejudice or to other equitable principles. That was legal error.

Aside from the general requirement that prejudice and other equitable matters be considered, cases from this court are directly responsive to specific arguments that Wilcher raises. It is certainly true, for example, that the fact that a party has the "information available" to avoid a drafting mistake, yet still makes the mistake, is relevant to determining whether the mistake is excusable or not. Yet Wilcher effectively argues that that fact is a defense to a reformation action-a position that this court explicitly rejected over 130 years ago. In Powell , the party seeking to avoid reformation argued that "if [the party seeking reformation] possessed the means of information, or by the exercise of reasonable diligence could have obtained the knowledge, the court will not relieve him." 16 Or. at 415, 19 P. 109. This court disagreed: "But we think in this class of cases, involving mistakes, arising from an alleged want of proper diligence, the jurisdiction will in a great measure depend upon the particular facts and circumstances surrounding the transaction." Id. at 415-16, 19 P. 109. The court went on to quote Pomeroy's treatise, in a manner particularly relevant here: " '[E]ven a clearly established negligence may not of itself be sufficient ground for refusing relief, if it appears that the other party has not been prejudiced thereby.' " Id. at 416, 19 P. 109 (quoting Pomeroy, 2 A Treatise on Equity Jurisprudence § 856 at 322).

The Court of Appeals also emphasized that "MEX employees drafted and then executed the trust deed without ensuring the accuracy of a crucial term in the document * * *." Troubled Asset Solutions , 291 Or. App. at 534, 422 P.3d 314. As noted previously, the court drew a sharp distinction between a party that makes a mistake in drafting a document and one that makes a mistake in not reading a document that the party then signs. Id. That distinction is not drawn sharply in our cases. A century ago we observed that "the failure of a complainant to read an instrument" was not "conclusive evidence, as a matter of law, that the mistake was due to his negligence." Welch v. Johnson , 93 Or. 591, 601-02, 183 P. 776 (1919). Yet the operative facts in Welch not only involved failure to read a document, but also involved a party's drafting error: "The deed which the plaintiff seeks to have reformed was prepared in his office by his stenographer." Id. at 598, 183 P. 776. The court nevertheless concluded that "[i]f, as the trial court expressly found, the assumption clause was inserted in the paper 'by and through a mistake or oversight of the scrivener, and without the knowledge or consent of either the grantor or grantee,' [the plaintiff] is entitled to a reformation of the deed * * *." Id. at 600, 183 P. 776. Although the existence of negligence attributable to the party seeking reformation was raised, this court again cited Pomeroy's principle that even clear negligence would not bar relief in the absence of prejudice. Id. at 600-01, 183 P. 776 ; see also Edwards Farms , 197 Or. at 63, 251 P.2d 133 (affirming reformation of contract; although the party seeking reformation had prepared the contract with the erroneous term, the other party "would not be prejudiced by the reformation").

Neither the fact that MEX had the "information available to it" nor the fact that it drafted the trust deed-or anything else identified in the Court of Appeals' opinion or by either party-suggests that the failure to identify Wilcher as a grantor in the trust deed was anything other than a careless mistake, of the type that we never have found to bar reformation absent prejudice to the other party. The Court of Appeals quoted and relied on its decision in Murray v. Laugsand , 179 Or. App. 291, 39 P.3d 241 (2002), regarding a party's failure to obtain available information about a transaction. However, that case explicitly recognized that reformation is common, even if the party seeking reformation "failed to detect objectionable content in a legal document," when "both parties were mistaken about what boiled down to a scrivener's error." Id. at 307, 39 P.3d 241. That was the case here. The Court of Appeals never explained why it considered MEX's error to demonstrate " 'a degree of inattention that is inexcusable under the circumstance." Troubled Asset Solutions , 291 Or. App. at 533, 422 P.3d 314 (quoting Foster , 177 Or. App. at 54, 33 P.3d 329 ), rather than a "scrivener's error" or "excusable neglect." And nothing in the record suggests any basis for doing so.

Conversely, the Court of Appeals rejected TAS's argument that, because the MEX employees who handled the transaction "were highly qualified, they necessarily used 'reasonable care to prepare the loan documents properly.' " Troubled Asset Solutions , 291 Or. App. at 532, 422 P.3d 314. The Court of Appeals was justified in its skepticism, as far as it goes. Using qualified lawyers or accountants or real estate professionals, of course, does not guarantee that the documents that they prepare will be error-free or that a party might not be adversely affected by any errors that might be made. And yet, using "highly qualified" personnel for a major real estate transaction is ordinarily the reasonable course and supports the argument of a party seeking reformation that it was not negligent at all, let alone grossly negligent, when a mistake is made in one of the transaction documents. Here, according to Wilson, the CEO of MEX, whom the trial judge found credible, the employee responsible for the trust deed had worked for Wilson for thirty-five years, had prepared over five hundred sets of loan documents, and Wilson had never previously found errors in her documents. Those facts, which the trial judge was entitled to credit, support the conclusion that there was no "inexcusable inattention," either on the part of MEX or Wilson in designating a qualified employee to oversee the preparation of the documents, or on the part of the employee who prepared the trust deed.

Combined with the Court of Appeals' suggestion that a party responsible for a drafting error will find it difficult to prove lack of gross negligence, the court's comments on using qualified personnel suggest that it would view any substantive mistake by the party that prepared the documents, or an agent acting on that party's behalf, as likely to constitute gross negligence attributable to that party. Such a standard would dramatically alter the landscape of contract reformation by collapsing gross negligence into ordinary negligence, as well as explicitly jettisoning the prejudice and equitable considerations inquiry that we have discussed at length above. That would eliminate many cases where reformation is appropriate, because the party must first show mistake-and mistake usually presupposes negligence of some kind, which would doom the reformation action at the outset. See Restatement § 157 comment a ("The mere fact that a mistaken party could have avoided the mistake by the exercise of reasonable care does not preclude * * * reformation * * *. Indeed, since a party can often avoid a mistake by the exercise of such care, the availability of relief would be severely circumscribed if he were to be barred by his negligence.").

Finally, the Court of Appeals dismissed the trial court's statement that the "mistake was easily missed," stating that the trial court otherwise "made no explicit findings regarding whether MEX was grossly negligent in drafting the trust deed ***." Id. at 533. That is not an entirely charitable reading of the trial court's decision. Read in context, the trial court's reference to the drafting error as "easily missed" articulated that court's conclusion that MEX may have been negligent, but that the error was "excusable neglect" not rising to the level of gross negligence. The statement comes in a paragraph of the letter opinion where the court cites Jensen , which set out the requirements for reformation as an antecedent agreement, mistake, and absence of gross negligence, and where the trial court also finds that TAS proved the other two requirements. There is no doubt that the trial court examined the conduct of the parties and also considered the equities-including reaching a result that the court believed was "fair"-when it concluded that MEX's conduct did not constitute gross negligence. Moreover, under the standard of review discussed above, the Court of Appeals was bound by the implicit, as well as the explicit, factual findings of the trial court (if supported by the evidence) that were the basis for the trial court's legal conclusion regarding gross negligence. See Crimson Trace Corp. , 355 Or. at 489, 326 P.3d 1181 (stating that standard). Here, that conclusion was well-supported, based on Wilson's testimony about how the documents were prepared as well as the trial court's own examination of the loan documents and trust deed. Because MEX's conduct in preparing the trust deed, although perhaps negligent, did not amount " 'to a degree of inattention that is inexcusable under the circumstances ,' " the trial court did not err in concluding that it was not gross negligence. Pioneer Resources , 187 Or. App. at 374, 68 P.3d 233 (quoting Foster , 177 Or. App. at 54, 33 P.3d 329 ) (emphasis in Pioneer Resources ).

E. Reconsideration of the Gross Negligence Standard

As we noted at the outset, TAS urges us to abandon the term "gross negligence" because it is not helpful in determining the kind of conduct that will preclude a party from obtaining equitable relief through the reformation of a contract to reflect the parties' actual agreement. TAS points to the Restatement (Second) of Contracts , which replaces the concept of gross negligence with considerations of good faith and fair dealing.

Wilcher responds that the Restatement approach appears to inject standards regarding "good faith" and "fair dealing," which are used in the Uniform Commercial Code § 1-203 but have never been part of Oregon reformation cases. It is true that the Oregon cases have used terms such as "prejudice," "injustice," and "unclean hands," rather than "good faith" and "fair dealing," but there is certainly overlap in the concepts, and the broad principles of equity can include assessment of the mental states of the parties and the overall fairness of their dealings with one another.

Although we see little wrong with the considerations identified in the Restatement- and we agree with TAS and the Court of Appeals that "gross negligence" is "not well defined"-we decline to reject all use of the term that we first used in 1874. Our cases always have read that term to incorporate the consideration of the equities of reforming a contract, including whether reformation would cause prejudice to the other party to the contract or to an innocent third party. And our cases also have examined the specific circumstances related to the contract-the parties' knowledge, intent, and reliance, among the myriad of other details that will help a court balance the equities. Imperfect as the term "gross negligence" may be, understood as we have applied it here and in cases going back more than a century, we believe it is sufficient to guide courts of equity in determining whether reformation is appropriate in a given case. Accordingly, we decline to eliminate that standard in favor of the Restatement approach, although we doubt that there would be many cases decided differently under the two standards.

III. CONCLUSION

We return to the facts and to the trial court's decision. The record supports the trial court's conclusion that the trust deed should be reformed to include Wilcher, personally, as a grantor, as to the properties identified in the trust deed that he personally owned. Evidence in the record supports the trial court's explicit and implicit factual findings of the requirements for reformation of a contract: antecedent agreement, mutual mistake, and absence of gross negligence. Both parties understood and agreed that Wilcher's personal properties were part of the collateral for the loan to Sierra; the trust deed contained a mutual mistake in that it did not include him, personally, as a grantor. The mistake "was easily missed," and the record indicates no fraud, misrepresentation, or other improper conduct by either party leading up to the preparation of the documents or the closing of the transaction. Correction of the error did not prejudice Wilcher or anyone else-Wilcher does not argue that he took any actions in reliance on the misdescription in the trust deed; the trial court found, based on evidence in the record, that "Wilcher's behavior after he signed the Trust Deed was consistent with his understanding that his property was encumbered."

On appeal, the Court of Appeals declined to review the case de novo. It nevertheless reversed the trial court, determining that MEX had the information it needed to avoid the drafting error that it made and was not under any time constraints. In contrast to the trial court, however, the Court of Appeals failed to consider the equities, as required by our cases that set out the absence of gross negligence requirement. Such consideration would have identified the lack of prejudice to Wilcher if the trust deed was reformed and the harm to MEX's successor in interest, TAS, if the trust deed was not reformed. That was legal error. On this record, and under the appropriate standard of review, we affirm the trial court's ruling that the elements of reformation were satisfied, such that it was appropriate for the trial court to reform the trust deed to include Wilcher as a grantor of the property that he owned personally that is identified in the trust deed.

Because the Court of Appeals reversed the trial court's decision reforming the trust deed, it did not address other assignments of error asserted by Wilcher. We remand to that court to consider those assignments of error in the first instance.

The decision of the Court of Appeals is reversed in part. The case is remanded to the Court of Appeals for further proceedings.

      The parties review the facts in detail, as did the courts below, from the execution of the relevant documents to post-foreclosure settlement efforts. We set out only the facts necessary to reach the legal questions we resolve in this opinion.

      The "15 (+/-) acre property," which is the subject of this dispute, consists of three separate parcels-one parcel with Wilcher's residence and two adjoining parcels.

      The trial court also made findings of fact as to the conduct of the parties after Sierra defaulted on loan, including that Wilcher had waived any claim that his individually owned property was not subject to the trust deed, that he was estopped from asserting that TAS was not entitled to foreclose on that property, and that he was not credible. Because we conclude that TAS proved that MEX was not grossly negligent when it prepared the trust deed that mistakenly omitted Wilcher's name as a grantor, we need not rely on the trial court's conclusions regarding waiver, estoppel, or other legal theories.

      A&T Siding, Inc. accurately summarized the reformation standard articulated in earlier cases. However, that case did not address, explain, or apply the "gross negligence" requirement because the issue there was a mistake about the legal effect of a contract term, as to which the "equitable remedy of reformation is not available." 358 Or. at 47, 359 P.3d 1178.

      In this opinion, we use the term "gross negligence" in the specialized way the term has been used by courts of equity to identify one element in contract reformation cases: specifically, to determine when a party's fault will bar equitable relief. We recognize that the term sometimes is used in tort law, and it is included in ORS 30.115, Oregon's statute granting "guest passenger" immunity. See State v. Gutierrez-Medina , 365 Or. 79, 88, 442 P.3d 183 (2019). The term also appears, on occasion, in other cases and statutes. See, e.g. , ORS 672.200(2) (engineering license may be revoked for "gross negligence, negligence or incompetence in the practice of engineering"). Nothing in this opinion is intended to suggest that the meaning of the equitable concept of "gross negligence" in contract reformation and rescission that we discuss here relates in any way to the function and meaning of that term in other contexts.

      Williston makes the point directly:
      "If by mistake of the parties some part of what was agreed upon is omitted from the writing, then it is not, in truth, the parties' contract. To enforce such an incomplete contract would be to disappoint the parties and to miscarry them into a conclusion neither contemplated and into which neither would have wittingly entered."
      Richard A. Lord, 27 Williston on Contracts § 70.49, 352-53 (4th ed. 2003). Williston goes on to say that "[s]uch a contract may be reformed to express the actual agreement * * *." Id. See also A&T Siding, Inc. , 358 Or. at 42, 359 P.3d 1178 ("Reformation * * * is an equitable remedy by which a court may revise the written expression of an agreement to conform to the intentions of the parties to it.").

      One passing reference in the Court of Appeals opinion could be read as suggesting that Wilson was aware of the mistake before the documents were signed: "Wilson testified that he was not alarmed by the mistake in the trust deed *** because he assumed that the title company in Klamath Falls would read over the documents and catch any errors before closing." Troubled Asset Solutions , 291 Or. App. at 533, 422 P.3d 314. Such an implication is not supported by the record. Wilson's testimony was about what he would have done if he had noticed a mistake while reviewing the document: "But if I was reading this, I would not be alarmed with that being in there because I would go down and find out that it is-that his property had been described and included in the document that he was putting in that for additional collateral." Nothing in the record suggests that Wilson knew of the mistake in the trust deed at the time of closing. The trial court found that, when the documents were signed, Wilcher thought that the trust deed did pledge his personally owned property as collateral for the loan, and that finding is supported by evidence in the record.

      We recognize that, in considering whether there has been negligence in drafting a contract, a wide range of individuals might be responsible. There might have been negligence on the part of the employee asked to prepare the contract; a supervisor may have been negligent in hiring or training or in delegating the drafting to the employee; or an employee may have failed to exercise reasonable care in selecting an independent party-a lawyer or real estate professional-to prepare the documents. Here, the documents were prepared by agents of MEX, a party to the transaction, and no one disputes that MEX was responsible for their preparation.

      The Restatement adds the critical caveat that the duty of good faith and fair dealing "extends only to the performance and enforcement of the contract and does not apply to the negotiation stage prior to the formation of the contract. *** During the negotiation stage each party is held to a degree of responsibility appropriate to the justifiable expectations of the other." Restatement § 157 comment a.

      As noted earlier, the trial court made certain findings adverse to Wilcher based on conduct after the loan went into default, but we do not rely on those findings here. Wilcher also asserts that TAS engaged in improper conduct after default, by foreclosing prior to reforming the trust deed and by arguing for reformation during eviction proceedings. To the extent those assertions relate to the reformation of the trust deed, we find them unpersuasive or irrelevant. To the extent they may relate to other assignments of error raised by Wilcher in the Court of Appeals and that may be addressed by that court on remand, we express no opinion regarding them.


text:
    PORTFOLIO RECOVERY ASSOCIATES, LLC v. SANDERS
    A159821(S066456)
    Supreme Court of Oregon.
    March 28, 2019
    Review Allowed.


author: JAMES, J.

text:
    STATE of Oregon, BY AND THROUGH the DEPARTMENT OF LAND CONSERVATION AND DEVELOPMENT, and Friends of Yamhill County, Plaintiffs-Appellants, v. YAMHILL COUNTY, Defendant-Respondent, and Gordon Cook, individually, Respondent-Respondent.
    A162583
    Court of Appeals of Oregon.
    Argued and submitted November 21, 2017. June 19, 2019
    Ralph O. Bloemers argued the cause and filed the briefs for appellant Friends of Yamhill County.
    Frederick M. Boss, Deputy Attorney General, Benjamin Gutman, Solicitor General, and Judy C. Lucas, Assistant Attorney General, filed the briefs for appellant State of Oregon.
    Charles F. Hudson, Portland, argued the cause for respondents. Also on the brief were Lane Powell PC and Timothy S. Sadlo and Yamhill County Counsel's Office.
    Before Lagesen, Presiding Judge, and DeVore, Judge, and James, Judge.
   JAMES, J.

Friends of Yamhill County (FOYC) and the State of Oregon (jointly, appellants) appeal a judgment entered in a writ-of-review proceeding that affirmed Yamhill County's determination that Gordon Cook (claimant) has a vested right under section 5(3) of Ballot Measure 49 (2007) to complete a 10-lot subdivision on his property. The county and circuit court decisions at issue in this appeal were made on remand from the Supreme Court after the court's opinion in Friends of Yamhill County v. Board of Commissioners , 351 Or. 219, 264 P.3d 1265 (2011) ( Friends II ).

Two of our recent cases have resolved the main issues in this case, and our conclusion with respect to the second issue obviates the need to address appellants' other arguments. First, in Oregon Shores v. Board of County Commissioners , 297 Or. App. 269, 441 P.3d 647 (2019), we held that a statute requiring nonconforming uses to be continuous, ORS 215.130, and a county ordinance implementing that statute are immaterial to a claimant's Measure 49 claim when any discontinuance that occurred took place after December 6, 2007, the only date on which a vested right had to exist. See id. at 279-80, 441 P.3d 647 ("The text of section 5(3) requires a showing that a claimant's vested right existed on December 6, 2007, and no other date.") Here, as in Oregon Shores , any discontinuance that occurred took place after December 6, 2007. Consequently, we reject, without further discussion, appellants' argument that that statute and the Yamhill County ordinance implementing it apply to, and extinguish, claimant's claim under section 5(3) of Measure 49. The writ-of-review court did not err in affirming the county's determination that the statute and ordinance did not apply.

Second, in Friends of Yamhill County v. Board of Commissioners , 298 Or. App. 241, --- P.3d ---- (2019) ( Biggerstaff II ), we agreed with one of the arguments that appellants raise in this case and held that the claimants could not satisfy section 5(3) of Measure 49 because their plan, on and before December 6, 2007 (when Measure 49 took effect), was to subdivide his or her property and sell buildable lots. Considering the text of section 5(3) of Measure 49, we concluded that the relief that a claimant can obtain "under section 5(3) of Measure 49 is limited to the relief that would have been allowed under a claimant's Measure 37 waivers." Id. at 250, --- P.3d ----. And, after considering the text and structure of Measure 37, the law of nonconforming uses, and the possibility of vested rights arising under Measure 37 alone, we concluded that "Measure 37 waivers did not allow [the claimants] to sell buildable lots." Id. at 258, --- P.3d ----.

Claimant in this case, like the claimants in Biggerstaff II , concedes that, up to December 6, 2007, when Measure 49 took effect, he intended to subdivide his property and sell buildable lots; he did not intend to build houses on the lots. However, as we explained in Biggerstaff II , the relief allowed under section 5(3) of Measure 49 is no broader than the relief to which a claimant was entitled under the claimant's Measure 37 waivers, and claimant's Measure 37 waivers did not allow him to sell buildable lots. Id. at 258, --- P.3d ----. Consequently, claimant does not have a vested right, for purposes of section 5(3) of Measure 49, to subdivide and build houses, because his planned development was to sell lots on which others would build houses, but that arrangement was not allowed under his Measure 37 waivers. The county misconstrued the law in concluding otherwise, and the circuit court erred in affirming the county's order.

Reversed and remanded.

      For a detailed explanation of the complex legal context in which this dispute arose, as well as the facts of this case, see Friends II , 351 Or. at 222-25, 264 P.3d 1265.


author: PER CURIAM

text:
    STATE of Oregon, Plaintiff-Respondent, v. Don Lacey HAMILTON, Defendant-Appellant.
    A162335
    Court of Appeals of Oregon.
    Submitted April 30, 2018. August 7, 2019
    Ernest G. Lannet, Chief Defender, Criminal Appellate Section, and Meredith Allen, Deputy Public Defender, Office of Public Defense Services, filed the briefs for appellant.
    Ellen F. Rosenblum, Attorney General, Benjamin Gutman, Solicitor General, and David B. Thompson, Assistant Attorney General, filed the briefs for respondent.
    Before Ortega, Presiding Judge, and Egan, Chief Judge, and Powers, Judge.
   PER CURIAM

Affirmed. State v. Foos , 295 Or. App. 116, 433 P.3d 493 (2018).


author: POWERS, J.

text:
    STATE of Oregon, Plaintiff-Respondent, v. Justin Shane SEMORE, Defendant-Appellant.
    A163779 (Control) A163781
    Court of Appeals of Oregon.
    Submitted September 13, 2018. June 26, 2019
    Ernest G. Lannet, Chief Defender, Criminal Appellate Section, and Erin J. Snyder Severe, Deputy Public Defender, Office of Public Defense Services, filed the brief for appellant.
    Ellen F. Rosenblum, Attorney General, Benjamin Gutman, Solicitor General, and Sharia Mayfield, Assistant Attorney General, filed the brief for respondent.
    Before Ortega, Presiding Judge, and Egan, Chief Judge, and Powers, Judge.
   POWERS, J.

In this consolidated criminal appeal, defendant seeks reversal of his conviction for driving while suspended, ORS 811.182, and the imposition of a $100 traffic fine under ORS 137.286(1). As a result of the conviction, the trial court also found defendant in violation of the terms of his probation relating to an unrelated, prior conviction. Consequently, defendant also seeks reversal of the judgment of the probation violation. On appeal, defendant advances two assignments of error: (1) the trial court erred in denying the motion to suppress evidence of his suspended license; and (2) the trial court erred in applying ORS 137.286(1) by imposing a $100 traffic fine in addition to a $1,000 conviction fee. The state argues that the trial court did not err in denying defendant's motion to suppress but concedes that the trial court erred in imposing a $100 fine. As explained below, we agree with defendant that the facts articulated by the deputy do not establish reasonable suspicion that defendant had committed or was about to commit a crime. Thus, the trial court erred in denying defendant's motion to suppress. Given our disposition of defendant's first assignment of error, we need not address defendant's second assignment of error. Accordingly, we reverse and remand to the trial court both the judgment of conviction and the judgment finding defendant in violation of his probation.

We review the denial of defendant's motion to suppress evidence for legal error and, in so doing, we are "bound by the trial court's findings of fact if they are supported by the record." State v. Baker , 350 Or. 641, 650, 260 P.3d 476 (2011). If the trial court did not make explicit findings on facts that could be decided more than one way based on the evidence in the record, then we will infer that the court found those facts consistent with the trial court's ultimate conclusion. Ball v. Gladden , 250 Or. 485, 487, 443 P.2d 621 (1968). We describe the facts in a manner consistent with those standards.

As part of his routine during a shift, Deputy Prince of the Washington County Sheriff's Office drives by a Goodwill donation trailer located in a secluded, back area of a church parking lot because there have been problems with theft and illegal dumping in the past. Signs posted near the donation trailer indicate that it is unlawful to drop off items after hours. The church is located in a residential neighborhood and there are no other businesses nearby. Prince testified that, if he sees someone near the trailer, he contacts them. He testified that he regularly finds items that have been illegally dumped or taken from the site, and that he has caught approximately five or six people for theft or illegal dumping in the past six years.

At approximately 12:40 a.m. on the night defendant was stopped, Prince contacted an unrelated individual that had dumped some baggage at the trailer after hours. Prince gave that individual a warning and told him to leave. Within minutes after Prince left the parking lot, he remembered that individuals in the past had cut the lock on the trailer during theft attempts, so he decided to turn around to make sure that the trailer lock was not cut.

As Prince drove back to the church, he saw a vehicle in the parking lot about 10 to 15 feet away from the donation trailer with its headlights on facing the trailer. Prince quickly turned into the parking lot and pulled up right behind the vehicle. As he approached, he saw defendant, empty-handed, "moving in a hurried fashion" from the fence line behind the trailer toward the vehicle. Defendant then got in the driver's seat and sat down. Prince activated his overhead lights because "it looked like he was trying to leave." Prince suspected that the crime of offensive littering or theft had occurred. According to Prince, he believed that he had reasonable suspicion:

"I've dealt with thefts before at that trailer. It's clearly posted that you cannot-that you can't dump anything there overnight. I'm sorry, the thefts and the dumping that I've dealt with before, the posting on the trailer there, the fact that [defendant] was there, and nobody is ever there in that area, the fact that he was hurriedly going back to his car at that point."

Following the stop and a brief discussion with defendant, Prince ran defendant's information and discovered that his license was suspended. Defendant was charged with driving while suspended, ORS 811.182.

Before trial, defendant filed a motion to suppress and argued that the circumstances of this case were insufficient to establish that Prince had reasonable suspicion to believe that defendant had committed or was about to commit a crime. Conversely, the state argued that, under the totality of the circumstances, Prince's suspicion that defendant committed or was about to commit theft or offensive littering was objectively reasonable.

The trial court denied defendant's motion to suppress, concluding that Prince had reasonable suspicion for the stop. The trial court reasoned that, in light of other explanations for defendant's presence at the trailer being implausible, e.g. relieving himself or parking to make a phone call, Prince made a "reasonable conclusion" based on his "instincts that [defendant was] either dropping something off he shouldn't, or he's taking something that doesn't belong to him."

Following the trial court's denial of defendant's motion to suppress, defendant waived his right to a jury, proceeded to trial, and the court convicted defendant of driving while suspended. In addition to entering the judgment of conviction, the trial court entered a separate judgment finding defendant to be in violation of the terms of his probation based on the new conviction. The trial court later entered an amended judgment for the driving while suspended conviction, assessing a $100 traffic fine in addition to a $1,000 conviction fee.

On appeal, defendant seeks reversal of both the amended judgment of conviction and the judgment finding defendant in violation of his probation. In his first assignment of error, defendant reprises his arguments from the motion to suppress. Defendant argues that his presence in a particular area known for criminal activity, without more evidence suggesting that he was engaged in criminal conduct, is insufficient to establish reasonable suspicion of theft or offensive littering. The state remonstrates that the deputy had reasonable suspicion that defendant was committing, or was about to commit, theft or offensive littering by listing a number of factors including the time of the stop, the location of the stop, and defendant's hurried motion back to his vehicle.

As explained below, we conclude that, under the totality of the circumstances, the facts articulated by Prince are not sufficient to support reasonable suspicion that defendant was engaged in theft or offensive littering at the time Prince stopped defendant.

Article I, section 9, of the Oregon Constitution protects individuals against unreasonable searches and seizures. For purposes of Article I, section 9, a stop is a seizure and it must be supported by reasonable suspicion of criminal activity. State v. Rodgers/Kirkeby , 347 Or. 610, 621, 227 P.3d 695 (2010). A stop is supported by reasonable suspicion when an officer "actually suspect[s] that the stopped person ha[s] committed a specific crime or type of crime, or was about to commit a specific crime or type of crime," and based on the record, the officer's "subjective belief * * * was objectively reasonable under the totality of the circumstances existing at the time of the stop." State v. Maciel-Figueroa , 361 Or. 163, 182, 389 P.3d 1121 (2017). An officer's subjective belief is objectively reasonable when the officer can point to specific and articulable facts that support a reasonable inference that the defendant has committed or is about to commit the crime that the officer suspects. Id. at 184, 389 P.3d 1121 ; State v. Holdorf , 355 Or. 812, 825, 333 P.3d 982 (2014). Reasonable suspicion does not require that the articulated facts "conclusively indicate illegal activity but, rather, only that those facts support the reasonable inference of illegal activity by that person." State v. Hiner , 240 Or. App. 175, 181, 246 P.3d 35 (2010).

The parties agree that Prince stopped defendant the moment Prince turned on his overhead lights behind defendant's vehicle. The parties further agree that Prince held a subjective belief that defendant had committed or was about to commit a crime. Thus, the central question before us is whether Prince's belief was objectively reasonable, viz. , whether Prince provided specific and articulable facts to support an inference that defendant committed or was about to commit theft or offensive littering.

Whether an officer's suspicion is objectively reasonable "depend[s] on the inferences drawn from the particular circumstances confronting the officer, viewed in the light of the officer's experience." State v. Ehly , 317 Or. 66, 80, 854 P.2d 421 (1993). However, "[o]fficer intuition and experience alone are not sufficient." Holdorf , 355 Or. at 823, 333 P.3d 982. Importantly, an officer's suspicion "must be particularized to the individual based on the individual's own conduct." State v. Miglavs , 337 Or. 1, 12, 90 P.3d 607 (2004). Moreover, "an officer may not stop a person simply because the person's conduct is consistent with criminal conduct; the nature of the conduct matters." State v. Martin , 260 Or. App. 461, 469-70, 317 P.3d 408 (2014).

Prince articulated several facts regarding his suspicion at the time of the stop: the secluded location of the donation trailer; the time of the encounter and lack of businesses nearby; his experience with theft and illegal dumping at the trailer, including his encounter earlier that night; and defendant moving quickly from the fence to his vehicle when Prince pulled into the parking lot. Taken together, those facts do not support reasonable suspicion of criminal activity; rather, they amount to a generalized suspicion that is not "particularized to [defendant] based on [defendant's] own conduct." Miglavs , 337 Or. at 12, 90 P.3d 607.

The state's argument primarily relies on the location of the trailer and the fact that the encounter took place at night when no one would be in the parking lot. Those facts, however, add little to the analysis given that "mere presence" in a high-crime area is insufficient to establish reasonable suspicion of criminal activity. State v. Acuna , 264 Or. App. 158, 168, 331 P.3d 1040, rev. den. , 356 Or. 400, 339 P.3d 440 (2014). In this case, of course, there is more than just "mere presence" because the deputy testified to defendant's conduct-moving to his vehicle in a hurried fashion-and we must add that to the reasonable suspicion calculus. The nature of that conduct, however, even in light of the other articulated circumstances, does not support a reasonable inference that defendant was engaged in criminal activity. Defendant's presence in an area known for theft or offensive littering combined with his quick entry into his vehicle is not inherently suggestive of the commission of a crime or an intent to commit a crime, let alone a specific crime or type of crime.

Moreover, Prince's experience of prior criminal activity at the donation trailer cannot serve as a basis for reasonable suspicion that a quick-moving individual is engaged in the same conduct sufficient to support a stop. See State v. Greer , 93 Or. App. 409, 412-13, 763 P.2d 158 (1988) (holding that the officer did not have reasonable suspicion of burglary when defendants were sitting in a vehicle at 3:00 a.m. next to a drive-thru window notwithstanding the officer's experience that drive-thru windows had been used as points of entry for burglaries at fast-food restaurants). This conclusion does not suggest that the deputy must stand idly by; rather, he could have engaged in mere conversation or continued observing defendant's conduct. See State v. Messer , 71 Or. App. 506, 510, 692 P.2d 713 (1984) (stating that, because the officer did not have reasonable suspicion of burglary to stop defendant who was sitting in his vehicle outside a retail store at 3:45 a.m., the officer's choices were to engage in mere conversation or leave).

In short, we conclude that, because defendant was stopped when Prince activated the overhead lights of his patrol car, and because the stop was not supported by reasonable suspicion that defendant was engaged in criminal activity, the trial court erred in denying defendant's motion to suppress. Accordingly, we reverse and remand both the judgment of conviction and the judgment finding defendant in violation of his probation.

Reversed and remanded.