OAG 81-51.

Case Date:June 24, 1981
Oregon Attorney General Opinions 1981. OAG 81-51. 527OPINION NO. 81-51[41 Or. Op. Atty. Gen. 527]No. 8039June 24, 1981The Honorable Robert SmithState Senator FIRST QUESTION PRESENTEDDo the amendments to ORCP 32G(2) and (3) and 32N, reflected in ORCP 32F(2) and (3) and 32L as submitted by the Council on Court Procedures, amount to the deletion of a prohibition against so-called "fluid recovery" in class actions?ANSWER GIVENThe amendments remove certain procedural obstacles to "fluid recovery." They do not authorize fluid recovery.SECOND QUESTION PRESENTEDIf the answer to the first 528question presented is yes, do the amendments to ORCP 32 as submitted by the Council on Court Procedures exceed the Council's rulemaking authority under ORS 1.735 in that they "abridge, enlarge or modify the substantive rights of any litigant"?ANSWER GIVENNo. THIRD QUESTION PRESENTEDDoes new ORCP 32F(4) as submitted by the Council on Court Procedures, which provides that the court may require the defendant in a class action to bear some or all of the costs of post-certification notice to class members after a preliminary hearing on the defendant's liability, exceed the Council's rulemaking authority under ORS 1.735 in that it may "abridge, enlarge or modify the substantive rights of any litigant"?ANSWER GIVENYes.FOURTH QUESTION PRESENTEDIf any of the above amendments to ORCP 32 do exceed the rulemaking authority of the Council on Court Procedures under ORS 1.735, does the amended rule nevertheless take effect 90 days after adjournment absent affirmative action by the legislature?ANSWER GIVEN No. INTRODUCTION In the analysis of these questions, it is important to note the structure of the Council on Court Procedures, the history of its formation, and the relationship between the council and the Legislative Assembly. For decades before establishment of the council in 1977, scholars, judges and practitioners had criticized both the archaic nature of the existing Oregon Code of Civil Procedure - virtually unchanged since the Deady Code - and the unsystematic and piecemeal method of its amendment through the legislative process.(fn1) The Council on Court Procedures was created to consider and implement systematic reform. Accordingly, the Council on Court Procedures (council) has the duty to review and revise the rules governing civil procedure in Oregon trial courts. ORS 1.725 - 1.750. Under ORS 1.745, all previous statutes on civil procedure are now deemed rules of court. The council is authorized under ORS 1.735 to promulgate new rules, which may modify, supersede or repeal the previous laws. At least three distinct mechanisms constrain the discretion of the council. First, the rules, by whatever means promulgated, must comply with constitutional restrictions on their content and process of formulation. Second, the council's statutory mandate declares that the proposed rules are to regulate only "practice and procedure," and may 529not "abridge, enlarge or modify the substantive rights of any litigant." ORS 1.735. Third, the rules promulgated by the council must be presented to the Legislative Assembly, and take effect 90 days after the adjournment sine die of the Assembly. ORS 1.735. It is explicit in the structure of this process that the legislature, by law, may ratify, amend or repeal any such rule before its effective date. It is implicit in this scheme that the legislature is not restricted to reviewing whether the council's rules are within the scope of its delegated authority to enact rules of "practice and procedure." The Legislative Assembly may alter the council's determination based upon its view that a proposed rule might abridge, enlarge or modify a substantive right, or simply that the council's proposal is not consistent with the Legislative Assembly's view of sound public policy relating to court procedure. Legislative authority in this regard is plenary, limited only by federal and state Constitutions, and by whatever might ultimately be determined to be state constitutional constraints on the legislature's ability to prescribe the internal procedures of the judicial branch of government. On this latter question, we express no present opinion. In December, 1980, the council promulgated revised ORCP 32, governing class actions, and the revised rule is now before the legislature for its consideration. The questions presented ask us whether some of the proposed changes affect the substantive rights of the litigants, thereby exceeding the council's authority, and if so, what effect this has on the validity of the rule. REVIEW OF LEGAL BASIS FOR DECISION We do not write on a clean slate. In the abstract, the determination whether a rule might "abridge, enlarge or modify any substantive right" of a litigant invites a journey into an uncharted bog of argument and speculation. To articulate an analytical destinction between substance and procedure is a most difficult task. However, the history of this language is illuminating. This phraseology of ORS 1.735 is taken almost verbatim from the Enabling Act of the Federal Rules of Civil Procedure, 28 USC sec 2072. No evidence of legislative history in Oregon demonstrates convincingly that legislators themselves were aware of the origins of the language, other than in an isolated expression of concern that the distinction between substance and procedure was both a difficult and time-honored inquiry. See remarks of Representative Frohnmayer, House Committee on the Judiciary, February 24, 1977, tape 12, side 1 at 0953. However, it is a universally accepted rule of statutory construction that if one jurisdiction adopts the law of another, the pre-existing judicial construction of the law in the jurisdiction of its origin is persuasive, if not binding, authority on the later interpretation of the law in the borrowing state. See University of Oregon Co-op Store v. Dept. of Revenue, 273 Or 539, 542 P2d 900 (1975); Pacific Supply Co-op v. State Tax Com., 224 Or 556, 356 P2d 939 (1960).530Our point of departure, then, is the stark conclusion that no Federal Rule of Civil Procedure has yet been found by the United States Supreme Court to "abridge, enlarge or modify any substantive rights." C. Wright, Federal Courts 294 (3d ed. 1976). The principles enunciated in the cases cited for this proposition, id. at n 19 initiate our central inquiry. In Sibbach v. Wilson & Co., 312 US 1 (1941), the Court upheld FRCP 35(a) which provided for an order requiring a litigant whose condition was in question to submit to a physical or mental examination. The Court said that it is not enough that a right affected is "important or substantial" to bring it within the proviso that the rules regulating procedure shall not "abridge, enlarge or modify substantive rights.""The test must be whether a rule really regulates procedure,--the judicial process for enforcing rights and duties recognized by substantive law and for justly administering remedy and redress for disregard or infraction of them." 312 US at 14.In Mississippi Pub. Corp. v. Murphree, 326 US 438 (1946), the Court sustained FRCP 4(f). That rule provided for service of process of a United States District Court anywhere in the state in which the district was located, and not merely in the district. In the particular case, other statutes and rules of substantive import gave venue to the Court. The Court said:"Undoubtedly most alterations of the rules of practice and procedure may and often do affect the rights of litigants. Congress' prohibition of any alteration of substantive rights of litigants was obviously not addressed to such incidental effects as necessarily attend the adoption of the prescribed new rules of procedure upon the rights of litigants who . . . have been brought before a court authorized to determine their rights. [Citation omitted.] The fact that the application of Rule 4(f) will operate to subject petitioner's rights to adjudication by the district court for northern Mississippi will undoubtedly affect those rights. But it does not operate to abridge, enlarge or modify the rules of decision by which that court will adjudicate its rights. It relates merely to 'the manner and the means by which a right to recover * * * is enforced.' [Citation omitted.] In this sense the rule is a rule of procedure and not of substantive right, . . ." 326 US at 445-446.Sears Roebuck & Co. v. Mackey, 351 US 427 (1956) and Cold Metal Process Co. v. United Co., 351 US 445 (1956), were both "multiple claims" actions, in which the Court was faced with a challenge to the right to appeal a judgment on one or more but not all of the claims, as permitted by FRCP 54(b) upon certification that there was no just reason for delay and an express direction for the entry of judgment. The Court sustained Rule 54(b), rejecting assertions that it violated 28 USC sec 1291 granting appellate jurisdiction only "from all final decisions of the district courts . . . ." (Emphasis added.) In the Cold Metal case, the "separate claim" left unadjudicated was a "compulsory" counterclaim, i.e., a counterclaim based in substantial part upon the same facts and circumstances as the original claim. In a separate opinion concurring in the Sears Roebuck case and dissenting in Cold Metal, Justice Frankfurter agreed that Rule 54(b) was valid, stating that it did not impair 28 USC sec 1291. The Cold Metal counterclaim was simply an inseparable part of the litigation, he said, hence sec 1291 prohibited...

To continue reading