Shepard Investment Group LLC v. Ormandy

No. 20 July 20, 2023 285

IN THE SUPREME COURT OF THE

STATE OF OREGON

SHEPARD INVESTMENT GROUP LLC,

an Oregon limited liability company,

dba Umbrella Properties Management,

Respondent on Review,

v.

Bret Lee ORMANDY,

an individual and all other occupants,

Petitioner on Review.

(CC 19LT16199) (CA A173257) (SC S069726)

On review from the Court of Appeals.*

Argued and submitted March 6, 2023, at Lewis & Clark

Law School, Portland, Oregon.

Matthew G. Shepard, Salem, argued the cause and filed

the brief for petitioner on review.

John R. Roberts, Arnold Gallagher P.C., Eugene, argued

the cause and filed the brief for respondent on review.

Kristen G. Williams, Williams Weyand Law, LLC,

McMinnville, filed the briefs for amicus curiae Oregon Trial

Lawyers Association.

Before Flynn, Chief Justice, and Duncan, Garrett,

DeHoog, Bushong and James, Justices, and Nakamoto,

Senior Judge, Justice pro tempore.

JAMES, J.

The decision of the Court of Appeals is affirmed. The

judgment of the circuit court is reversed, and the case is

remanded to the circuit court for further proceedings.

Nakamoto, S. J., dissented and filed an opinion.

______________

* Appeal from Lane County Circuit Court, Kamala H. Shugar, Judge. 320

Or App 521, 514 P3d 1125 (2022).

286 Shepard Investment Group LLC v. Ormandy

Cite as 371 Or 285 (2023) 287

JAMES, J.

In this forceable entry and detainer (FED) action,

we are asked to determine the proper calculation of dam-

ages that may be awarded to a tenant, following multiple

instances of landlord noncompliance with certain util-

ity billing requirements that repeated each month, over a

series of months. ORS 90.315, part of the Oregon Residential

Landlord and Tenant Act (ORLTA), governs the inclusion of

utility or public service charges, such as for sewer or water

service, in rental agreements. Subsection (2) of that statute

concerns disclosure, requiring landlords to “disclose to the

tenant in writing at or before the commencement of the ten-

ancy any utility or service that the tenant pays directly to

a utility or service provider that benefits, directly, the land-

lord or other tenants.” Subsection (4) concerns pass-through

billing, stating that a landlord “may require a tenant to pay

to the landlord a utility or service charge or a public service

charge that has been billed by a utility or service provider

to the landlord.” However, paragraph (4)(b) conditions pass-

through billing upon a number of procedural requirements,

such as billing the tenant within 30 days, setting out the

utility or service charge separately from rent, and provid-

ing copies of the service provider’s bill or an opportunity to

inspect it. If a landlord engages in pass-through billing for

public service charges without having met all of the condi-

tions of ORS 90.315(4), a tenant may recover “an amount

equal to one month’s periodic rent or twice the amount

wrongfully charged to the tenant, whichever is greater.”

ORS 90.315(4)(f).

Here, after plaintiff (landlord) brought an FED

action against defendant (tenant) to recover possession of

the landlord’s premises, tenant alleged a counterclaim that

landlord had failed to comply with certain utility billing

requirements found in ORS 90.315(4)(b). The trial court

agreed with tenant, concluding that landlord had com-

mitted 12 separate violations—one per month over the 12

months within the one-year statute of limitations that gov-

erns ORLTA actions, ORS 12.125—and awarded tenant

statutory damages in an amount equal to 12 months of

rent. On landlord’s appeal, the Court of Appeals reversed,

concluding that the plain text of ORS 90.315(4)(f) showed

288 Shepard Investment Group LLC v. Ormandy

that the legislature had not intended for each landlord bill-

ing violation to be subject to a separate sanction. Shepard

Investment Group LLC v. Ormandy, 320 Or App 521, 531,

514 P3d 1125 (2022). We allowed review and now affirm the

decision of the Court of Appeals and reverse the judgment of

the trial court.

The relevant facts are not in dispute. Landlord owns

the Fairfield Village Apartments, and tenant has rented a

residential unit in that complex since 2008. In 2013, land-

lord began charging residents, including tenant, a monthly

$40 flat fee for several utilities, including water, sewer, and

garbage services. Landlord incorporated a corresponding

provision into tenant’s subsequent rental agreements.

In November 2019, tenant defaulted on that month’s

rent charges, causing landlord to issue a statutory “72-hour

notice” on November 8. The notice set forth landlord’s intent

to terminate tenant’s rental agreement for nonpayment of

rent. Landlord subsequently initiated this FED action on

November 13. Tenant counterclaimed, alleging that land-

lord had violated the utility billing requirements set forth in

ORS 90.315(4)(b). Tenant specifically alleged that, over the

previous year, landlord had failed to (1) timely bill him in

writing for each month’s utility charges, as required under

ORS 90.315(4)(b)(A); and (2) provide him with an expla-

nation of the “pass through charges” in either the written

rental agreement or separate billings, as required under

ORS 90.315(4)(b)(B). Tenant claimed that, because land-

lord had failed to comply with ORS 90.315(4)(b) once each

month over a year-long period, he was entitled to recover one

month’s “periodic rent,” ORS 90.315(4)(f), for each of land-

lord’s monthly violations.

The trial court made several factual findings:

(1) tenant’s monthly rent was $740 for the first 10 months

and $825 for the final two months; (2) over the year-long

period, landlord had charged tenant $40 monthly for util-

ities, totaling $480, but never had sent tenant correspond-

ing written or electronic bills for those charges; (3) landlord

never offered or provided the original utility bills for tenant’s

inspection; and (4) landlord had failed to explain, in either

the rental agreement or bills, both how the utility providers

Cite as 371 Or 285 (2023) 289

assessed their charges and how landlord distributed those

charges among Fairfield tenants. The court did not find

that landlord had overbilled or fraudulently represented the

value of the utility and service charges. However, the court

did find that landlord had failed to explain the pass-through

billing arrangement in the tenant’s rental agreement.

Ultimately, the trial court concluded that landlord

had violated ORS 90.315(4)(b) 12 times, once each month

over the course of a year. As noted, the maximum statuto-

rily permissible award under ORS 90.315(4)(f) is an amount

equal to one month’s periodic rent or “twice the amount

wrongfully charged,” whichever is greater. Applying that

calculation to the amount actually billed to tenant over the

previous year would have totaled only $960 ($480 for the

billed utilities at $40 per month, for 12 months, then dou-

bled). However, the court awarded tenant $9,050 in statu-

tory damages, concluding that ORS 90.315(4)(f) required an

award totaling one month of rent awarded for each separate

monthly utility billing. The court awarded $740 per month

for the first 10 months and $825 per month for the last two

months, totaling $9,050. The court then deducted tenant’s

unpaid rent for November (in addition to other unpaid

charges), leaving tenant with a damages award of $7,195.

Tenant was later awarded an additional $5,068 in costs and

attorney fees through a supplemental judgment. Landlord

appealed.

Before the Court of Appeals, the parties presented

arguments mirroring their positions below. Landlord

asserted that ORS 90.315(4)(f) is not a damages provision

that should be applied “per violation,” that the legislature

clearly includes “per violation” language when that is its

intent, and that ORS 90.315(4)(f) punishes “a course of con-

duct which may consist of one or many related acts occurring

over an undefined period of time.” Landlord further argued

that the number of wrongful charges when a landlord is in

noncompliance with ORS 90.315(4)(b) is immaterial. Rather,

according to landlord, the statutory intent is to encourage

landlords to comply by attaching a penalty for statutory vio-

lations sufficient to encourage landlords to take remedial

action once they become aware of noncompliance with a

290 Shepard Investment Group LLC v. Ormandy

provision of the ORLTA. Tenant responded that the intent

of ORLTA is to penalize landlords for each act of noncom-

pliance and that, if damages are not imposed for each dis-

crete violation, then landlords will be incentivized to remain

noncompliant rather than addressing violations when they

arise. The Court of Appeals agreed with landlord, conclud-

ing that landlord’s reading comported with the plain text of

ORS 90.315(4)(f) because the legislature had chosen wording

that “[did] not direct a deciding court to award ‘one month’s

periodic rent or twice the amount wrongfully charged to the

tenant, whichever is greater’ for each and every separate

noncompliant bill sent by a landlord.” Shepard Investment,

320 Or App at 531. Consistently with its understanding

of the statute, that court held that tenant was entitled to

“twice the amount wrongfully charged,” totaling $960, and

it therefore reversed and remanded the trial court’s ruling.

Id. at 532-33. We allowed review.

The question before us is one of statutory interpre-

tation, which we resolve by applying our usual methodol-

ogy of considering text, context, and any helpful legislative

history. State v. Gaines, 346 Or 160, 171-72, 206 P3d 1042

(2009). A statute’s context includes, among other things,

its immediate context—the phrase or sentence in which

the term appears—and its broader context, which includes

other statutes on the same subject. See PGE v. Bureau of

Labor and Industries, 317 Or 606, 611, 859 P2d 1143 (1993).

We turn now to applying those principles to ORS

90.315, the statute at issue, beginning with a brief overview

of the ORLTA. In 1973, the legislature enacted the ORLTA,

originally modeled after the Uniform Residential Landlord

and Tenant Act to “clarify and restate the rights and obli-

gations of tenants and landlords.” L & M Investment Co. v.

Morrison, 286 Or 397, 405, 594 P2d 1238 (1979). The ORLTA

imposes obligations on, and creates remedies for, both land-

lords and tenants. As, the Court of Appeals explained, the

monthly billing transparency requirements found in ORS

90.315(4)(b) were enacted in 2015 (Or Laws 2015, ch 388,

§ 8); the court succinctly described them as “the product of a

coalition of landlord and tenant advocate groups” seeking to

draft legislation in unison. Shepard Investment, 320 Or App

at 526.

Cite as 371 Or 285 (2023) 291

ORS 90.315 imposes obligations on landlords rel-

ative to utility or service charges. In 1997, the legislature

added subsection (4) to that statute, permitting a landlord to

pass utility or service charges on to tenants without treat-

ing such charges as rent (pass-through billing), but only

if the landlord conforms to the specific requirements set

out in subsection (4) when doing so. Or Laws 1997, ch 577,

§ 16. In 1999, the legislature added the penalty provision at

issue here—discussed further below—to subsection (4). Or

Laws 1999, ch 603, § 18. ORS 90.315(4) was not again sub-

stantively amended until 2015, when the legislature added

stricter disclosure requirements related to service or utility

charges. Or Laws 2015, ch 388, § 8. The legislature has not

amended that statute since that time.

Turning to the text of subsection (4) of ORS 90.315,

paragraph (a) permits landlords to bill tenants for utility or

service charges on a pass-through basis, and it requires that

a landlord describe the pass-through charges in the rental

agreement.1 ORS 90.315(4)(b)(A) and (B), the provisions giv-

ing rise to the parties’ dispute here, provide as follows:

“(b)(A) If a rental agreement provides that a landlord

may require a tenant to pay a utility or service charge, the

landlord must bill the tenant in writing for the utility or

service charge within 30 days after receipt of the provid-

er’s bill. If the landlord includes in the bill to the tenant

a statement of the rent due, the landlord must separately

and distinctly state the amount of the rent and the amount

of the utility or service charge.

“(B) The landlord must provide to the tenant, in the

written rental agreement or in a bill to the tenant, an

explanation of:

1

ORS 90.315(4)(a) provides:

“[With exceptions for certain tenancies,] if a written rental agreement

so provides, a landlord may require a tenant to pay to the landlord a utility

or service charge or a public service charge that has been billed by a utility

or service provider to the landlord for utility or service provided directly, or

for a public service provided indirectly, to the tenant’s dwelling unit or to

a common area available to the tenant as part of the tenancy. A utility or

service charge that shall be assessed to a tenant for a common area must

be described in the written rental agreement separately and distinctly from

such a charge for the tenant’s dwelling unit.”

292 Shepard Investment Group LLC v. Ormandy

“(i) The manner in which the provider assesses a util-

ity or service charge; and

“(ii) The manner in which the charge is allocated

among the tenants if the provider’s bill to the landlord cov-

ers multiple tenants.”

The remainder of ORS 90.315(4)(b), subparagraphs

(C) through (E), include additional requirements and guide-

lines for landlords related to billing tenants for utility or

service charges.2 ORS 90.315(4)(c) describes specific services

for which landlords may charge an additional amount to ten-

ants above the original cost of the service and the procedure

for doing so.3 Those services can include cable television,

direct satellite, other video subscription services, or internet

2

ORS 90.315(4)(b)(C) through (E) provide:

“(C) The landlord must:

“(i) Include in the bill to the tenant a copy of the provider’s bill; or

“(ii) If the provider’s bill is not included, state that the tenant may

inspect the provider’s bill at a reasonable time and place and that the tenant

may obtain a copy of the provider’s bill by making a request to the landlord

during the inspection and upon payment to the landlord for the reasonable

cost of making copies.

“(D) A landlord may require that a bill to the tenant for a utility or ser-

vice charge is due upon delivery of the bill. A landlord shall treat the tenant’s

payment as timely for purposes of ORS 90.302 (3)(b)(A) if the payment is

made by a date that is specified in the bill and that is not less than 30 days

after delivery of the bill.

“(E) If a written rental agreement so provides, the landlord may deliver

a bill to the tenant as provided in ORS 90.155 or by electronic means.”

3

ORS 90.315(4)(c) provides:

“Except as provided in this paragraph, a utility or service charge may

only include the cost of the utility or service as billed to the landlord by the

provider. A landlord may add an additional amount to a utility or service

charge billed to the tenant if:

“(A) The utility or service charge to which the additional amount is

added is for cable television, direct satellite or other video subscription ser-

vices or for Internet access or usage;

“(B) The additional amount is not more than 10 percent of the utility or

service charge billed to the tenant;

“(C) The total of the utility or service charge and the additional amount

is less than the typical periodic cost the tenant would incur if the tenant

contracted directly with the provider for the cable television, direct satellite

or other video subscription services or for Internet access or usage;

“(D) The written rental agreement providing for the utility or service

charge describes the additional amount separately and distinctly from the

utility or service charge; and

Cite as 371 Or 285 (2023) 293

access or usage. ORS 90.315(4)(c). ORS 90.315(4)(d) explains

the conditions that landlords must follow when amending

rental agreements to require tenants to pay different util-

ity or service charges than previously provided for in their

rental agreements.4 ORS 90.315(4)(e) explains that utility or

service charges are neither rents nor fees and describes the

proper statutory process for landlords to terminate a rental

agreement for nonpayment of those charges.5

Finally, ORS 90.315(4)(f), the damages provision

that is at issue in this case, provides as follows:

“If a landlord fails to comply with paragraph (a), (b), (c)

or (d) of this subsection, the tenant may recover from the

landlord an amount equal to one month’s periodic rent or

twice the amount wrongfully charged to the tenant, which-

ever is greater.”

Procedurally, as this court previously has explained, ten-

ants can seek damages from landlords through an “ ‘implicit

withholding remedy: if the landlord is in noncompliance

with [the landlord’s] obligations under the ORLTA to the

monetary damage of the tenant, the tenant can withhold

rent[;] and if the landlord commences an FED action, the

“(E) Any billing or notice from the landlord regarding the utility or ser-

vice charge lists the additional amount separately and distinctly from the

utility or service charge.”

4

ORS 90.315(4)(d) provides:

“(A) A landlord must provide 60 days’ written notice to a tenant before

the landlord may amend an existing rental agreement for a month-to-month

tenancy to require a tenant to pay a public service charge that was adopted

by a utility or service provider or a local government within the previous six

months.

“(B) A landlord may not hold a tenant liable for a public service charge

billed to a previous tenant.

“(C) A landlord may not require a tenant to agree to the amendment of

an existing rental agreement, and may not terminate a tenant for refusing

to agree to the amendment of a rental agreement, if the amendment would

obligate the tenant to pay an additional amount for cable television, direct

satellite or other video subscription services or for Internet access or usage as

provided under paragraph (c) of this subsection.”

5

ORS 90.315(4)(e) provides:

“A utility or service charge, including any additional amount added pur-

suant to paragraph (c) of this subsection, is not rent or a fee. Nonpayment of a

utility or service charge is not grounds for termination of a rental agreement

for nonpayment of rent under ORS 90.394 but is grounds for termination of a

rental agreement for cause under ORS 90.392.”

294 Shepard Investment Group LLC v. Ormandy

tenant can counterclaim’ ” for appropriate damages under

ORS 90.315(4)(f). Eddy v. Anderson, 366 Or 176, 181, 458

P3d 678 (2020) (quoting Napolski v. Champney, 295 Or 408,

418, 667 P2d 1013 (1983)).

Turning now to the damages provision in dispute—

ORS 90.315(4)(f)—as noted, the crux of the parties’ dispute

is whether, when a landlord “fails to comply” with certain

statutory requirements, the tenant’s permitted recovery of

an amount equal to “one month’s periodic rent or twice the

amount wrongfully charged to the tenant” (whichever is

greater), ORS 90.315(4)(f), is intended to apply per a tenant’s

monthly billing cycle. We first observe that the plain statu-

tory text contains no express confirmation of that intended

reading. Damages are awarded when a landlord “fails to

comply.” “Fails to comply,” by its terms, is not limited to

discrete failures; ongoing failures to comply are included.

For example, if a landlord fails to provide a tenant “in the

written rental agreement” an explanation of “the manner in

which the provider assesses a utility or service charge,” as

required under ORS 90.315(4)(b)(B)(i), the harm is a lack of

notice. The harm from that lack of notice does not exist only

once. That harm persists for as long as the rental agree-

ment lacks the required explanation, and the lack of notice

continues.

Relatedly, ORS 90.315(4)(f) provides for damages in

the amount of one month’s periodic rent, or twice the “amount

wrongfully charged.” ORS 90.315 lists a wide variety of

ways in which a pass-through utility charge—the basis for

the parties’ dispute here—can be wrongful. It can be sub-

stantively wrongful in amount, by, for example, including

an incorrect or fraudulent amount, or an upcharge beyond

the 10 percent limit provided in ORS 90.315(4)(c)(B). Under

that provision, the harm would be the billing of an exces-

sive or unauthorized amount. But a pass-through utility

charge could also be procedurally wrongful—for example,

an allegation that an undisputed charge had been assessed

without a required disclosure in the rental agreement or

other authorized means of notice. Again, that type of harm

may be ongoing. Failures in the rental agreement have the

potential to render all pass-through utility billing wrongful.

Cite as 371 Or 285 (2023) 295

Because a landlord can fail to comply with para-

graphs (a) through (d) of ORS 90.315(4) in ways that are

ongoing, not discrete, and because utilities may be wrong-

fully charged not just in substance, but procedurally, so as

to affect multiple services in multiple billings over time, the

term “amount wrongfully charged,” as that phrase appears

in ORS 90.315(4)(f), is properly understood as an aggregate

term encompassing both discrete and ongoing violations, see

Webster’s Third New Int’l Dictionary 72 (unabridged ed 2002)

(defining “amount” as, among other things, “the total num-

ber or quantity : aggregate”), that is, as determining the

appropriate compensation for the aggregate harm result-

ing from the landlord’s statutory violation.6 The plain and

natural reading of the text is that damages, for purposes

of ORS 90.315(4)(f), are calculated by totaling the utilities

wrongfully billed over time, doubling that figure (“twice

the amount”), and then comparing it against the tenant’s

monthly periodic rent. Tenant’s proposed interpretation

would require us to insert language that has been omitted,

such as “[Each billing cycle that] a landlord fails to com-

ply with paragraph (a), (b), (c) or (d) of this subsection, the

tenant may recover * * *.” Or, alternatively, “the tenant may

recover * * * an amount equal to one month’s periodic rent or

twice the amount wrongfully charged to the tenant [during

a monthly billing cycle], whichever is greater.” In construing

a statute, however, we may not “insert what has been omit-

ted.” ORS 174.010.

Construing “wrongfully charged” as an aggre-

gate term also harmonizes the damages provision in ORS

90.315(4)(f) with its close counterpart provision earlier in

the same statute, set out in subsection (3). Subsection (3)

of ORS 90.315 is the damages provision that applies to vio-

lations of subsection (2), which requires a landlord to give

written notice, “at or before the commencement of the ten-

ancy,” of “any utility or service that the tenant pays directly

to a utility or service provider that benefits, directly, the

landlord or other tenants.” As we noted in connection with

6

The dissent draws significance from the use of “amount” rather than

“amounts.” 371 Or at 304 (Nakamoto, J., dissenting). Given our conclusion that

“amount” is an aggregate term, it is not clear why “amount wrongfully charged”

would have a different meaning from “amounts wrongfully charged.”

296 Shepard Investment Group LLC v. Ormandy

ORS 90.315(4), a failure to give such a notice arguably per-

sists throughout the life of the tenancy, until such time as

it is remedied. When a landlord fails to provide the notice

required by subsection (2) of ORS 90.315, the measure of

damages is structurally the same as ORS 90.315(4)(f): “[T]he

tenant may recover twice the actual damages sustained or

one month’s rent, whichever is greater.” ORS 90.315(3).

In Brewer v. Erwin, 287 Or 435, 445, 600 P2d

398 (1979), abrogated on other grounds by McGanty v.

Staudenraus, 321 Or 532, 901 P2d 841 (1995), we construed

the nature of statutory damages in the context of residential

tenancy. In that case, we held that, “when other statutory

indications are lacking, the key to damages seems to be to

determine what kind of harm, in the setting of a normal

residential rental transaction, can reasonably be said to lie

within the contemplation of the protective provision of the

act upon which the claim is founded.”

Looking to the harm contemplated, tenant argues

that interpreting the damages provision in subsection (4) of

ORS 90.315 to apply to each discrete time period in which

a violation occurred (in this case, every month) is neces-

sary to prevent landlords from gaining a “windfall” from

ongoing violations. But in so arguing, tenant fails to grap-

ple with the structurally similar damages provision of ORS

90.315(3). Under tenant’s reasoning, an ongoing notice defi-

ciency would apparently be parsed into time periods where

damages might accumulate; each month, each week, each

day—tenant does not say. There is no indication, and tenant

does not argue, that such a result would comply with the

ORLTA’s general requirement that the act “shall be so

administered that an aggrieved party may recover appro-

priate damages.” ORS 90.125(1) (emphasis added). Tenant

offers no plausible explanation of how, or why, the text of

ORS 90.315(3) would not impose damages per occurrence,

but the text of ORS 90.315(4)(f) would, when the legislature

used structurally similar language within the same statute.

We have explained before that, “in the absence of evidence

to the contrary, we ordinarily assume that the legislature

uses terms in related statutes consistently.” State v. Cloutier,

351 Or 68, 99, 261 P3d 1234 (2011); see also PGE, 317 Or at

611 (noting that “use of the same term throughout a statute

Cite as 371 Or 285 (2023) 297

indicates that the term has the same meaning throughout

the statute”).

Although the legislative history surrounding ORS

90.315(4)(f) is not extensive, it does provide some insight.

Namely, the legislature was primarily interested in ensur-

ing proper notice to tenants, and the presence of a financial

penalty to landlords was simply a mechanism to encourage

such notice, and to encourage landlords to remedy deficien-

cies once they were discovered. Nothing in the history of

ORS 90.315(4)(f) suggests a legislative intent to impose a

particularly punitive penalty. And nothing indicates that

the legislature envisioned the result that would follow from

tenant’s proposed interpretation, where $480 in utility

pass-through billings, defective only in procedure and not

amount, could result in $9,050 in penalties to the landlord.

Rather, there is some indication that the legislature envi-

sioned the monthly periodic rent as being the upper ceiling

of potential penalties:

“Section 18. Amends ORS 90.315, regarding utility or

services charges that a landlord may pass directly through

to a tenant from the utility provider, without treating such

a charge as rent. (Increases in rent require a 30 day written

notice; nonpayment supports a 72 hour termination notice.)

One small amendment is to expand the world of such

charges to include internet access or usage, an increasingly

common practice * * *. The amendment provides a penalty

for landlord noncompliance. The penalty provision provides

for an amount equal to one month’s rent as a possible pen-

alty, reflecting an assumption that week-to-week tenancies

are unlikely to have utility markups.”

Testimony, Senate Committee on Business and Consumer

Affairs, HB 3098, May 10, 1999, Ex O (comments of John

Van Landingham (emphasis added)).

In sum, after considering the text, context, and leg-

islative history of ORS 90.315(4)(f), we conclude that dam-

ages under that provision are calculated by aggregating

the value of the utilities wrongfully billed, doubling that

figure (“twice the amount”), and then comparing it against

the tenant’s monthly periodic rent. We therefore further

conclude that the trial court erred when it awarded dam-

ages to tenant in the amount of 12 months of periodic rent

298 Shepard Investment Group LLC v. Ormandy

totaling $9,050.7 Instead, tenant should have been awarded

the greater of one month’s periodic rent ($740 or $825) or

twice the amount wrongfully charged in the aggregate.8

Here, there is no dispute that twice the amount wrongfully

charged, $960, is the larger of those two sums.9

The decision of the Court of Appeals is affirmed.

The judgment of the circuit court is reversed, and the case

is remanded to the circuit court for further proceedings.

NAKAMOTO, S. J., dissenting.

As tenant established at trial, landlord Shepard

Investment Group LLC repeatedly, and in multiple ways,

7

At argument in this case the parties theorized that a tenant, rather than

asserting a counterclaim in response to an FED action, could affirmatively file a

claim against a noncompliant landlord each month, upon improper utility billing.

In this case we are not called upon to decide, and do not decide, whether such

an affirmative claim is permissible, nor whether ORS 90.315(4)(f) would support

multiple months of rent equivalent penalties when sought in the context of multi-

ple separate actions brought by a tenant.

8

In allowing limited review in this case, we declined to reach the question

of whether the amount of monthly rent at the time of trial should be used when

applying the ORS 90.315(4)(f) formula. In this case, twice the amount wrongfully

charged in the aggregate is greater using either rent amount.

9

The dissent does not seem to engage with the consequences of its posi-

tion. We understand the dissent to contend that each separate violation of

ORS 90.315(4)(a) through (d) should trigger the penalty clause. 371 Or at 302

(Nakamoto, J., dissenting) (“I conclude that paragraph (f) of ORS 90.315(4) can

reasonably be read to require a penalty for each violation[.]”). The dissent adds

that landlord committed four violations each month. Id. at 300 (Nakamoto, J.,

dissenting) (noting the trial court finding “that landlord violated four different

requirements separately enumerated in ORS 90.315(4) during each of the 12

months at issue between 2018 and 2019”).

If those premises are correct, then the dissent’s argument implies that

the award should have been one month’s rent, times four violations per month,

times 11 months—over $36,000. Yet the dissent instead agrees with the trial

court that $9,050 is the proper measure of damages. Id. at 307 (Nakamoto, J.,

dissenting).

We also note that the dissent’s position implies that the legislature’s direction

to award “twice the amount wrongfully charged the tenant” may never be given

effect. Here, for example, the utility pass-through charges—even doubled—are

only one-tenth the monthly rent, and so under the dissent’s theory there is no

circumstance in which the utility pass-through charges would ever be used to

measure damages.

Moreover, assuming that there may exist rare leases where the utility pass-

through charges exceed half the rent, it seems unlikely that the legislature

would be so concerned about that uncommon event that it would enact a special

provision solely to address it—and yet not mention it anywhere in the legislative

history.

Cite as 371 Or 285 (2023) 299

violated requirements in ORS 90.315(4), a subsection of a

statute in the Oregon Residential Landlord and Tenant

Act (ORLTA) that permits landlords to charge tenants for

utilities, but only if landlords properly bill tenants and give

tenants notice and disclosures when choosing that option.

Paragraph (f) of that subsection penalizes a landlord who

fails to meet the requirements associated with charging a

tenant for utilities: “If a landlord fails to comply with para-

graph (a), (b), (c) or (d) of this subsection, the tenant may

recover from the landlord an amount equal to one month’s

periodic rent or twice the amount wrongfully charged to

the tenant, whichever is greater.” Because tenant estab-

lished that landlord had engaged in multiple violations of

ORS 90.315(4) every month during a 12-month period, the

trial court awarded tenant 12 months of periodic rent. The

majority today reverses the trial court and restrictively

construes paragraph (f)—which says nothing about how it

applies when a landlord violates different statutory require-

ments repeatedly over time—as plainly offering a limited,

one-time remedy. I dissent.

To read the majority opinion, one might conclude

that landlord made one procedural mistake that it never

rectified before seeking to evict tenant through its forceable

entry and detainer (FED) action. But the trial court’s fac-

tual findings establish that landlord violated ORS 90.315(4)

in multiple ways, not merely by committing one violation

that recurred monthly. The trial court found that landlord

had assessed tenant a utility charge of $40 per month for his

use of garbage service, water service, and sewer service at

the apartment complex in which he was a tenant. The court

found that the utility charge had been described as a flat

fee charge for the utility services in both the 2017 and 2019

written rental agreements between the parties. The court

further found that landlord never sent any written or elec-

tronic bills to tenant for the utility charge, nor did it offer

him access to, or provide him with copies of, the underlying

bills from the water, sewer, and garbage utility providers.

The trial court found that the bills from the utility providers

for water, sewer, and garbage services at the apartment com-

plex all covered multiple tenants at the complex. However,

the court found, landlord never provided tenant with an

300 Shepard Investment Group LLC v. Ormandy

explanation of the manner in which the providers assessed

charges for the utility in either the written rental agree-

ment or a utility bill to the tenant and did not describe the

manner in which landlord allocated the charges for water,

sewer, and garbage service among the tenants within the

apartment complex.

Based on its findings, the trial court concluded

that landlord had violated four different requirements sep-

arately enumerated in ORS 90.315(4) during each of the 12

months at issue between 2018 and 2019.1 Landlord failed to

bill tenant properly for the utility charge, violating two sep-

arate billing requirements. First, pursuant to ORS 90.315

(4)(b)(A), “the landlord must bill the tenant in writing for the

utility or service charge within 30 days after receipt of the

provider’s bill,” and, second, pursuant to ORS 90.315(4)(b)(C),

the landlord must include in the bill “a copy of the provid-

er’s bill” or “state that the tenant may inspect the provider’s

bill at a reasonable time and place and that the tenant may

obtain a copy of the provider’s bill by making a request to the

landlord * * *.”2 In a third violation, landlord failed to provide

tenant, in either a utility bill or the written rental agree-

ment, with a written explanation of the manner in which

the water, sewer, and garbage service providers assessed

charges for utility service. See ORS 90.315(4)(b)(B)(i) (requir-

ing the landlord to provide the tenant, “in the written rental

agreement or in a bill to the tenant,” an explanation of the

“manner in which the provider assesses a utility or service

charge”). And fourth, landlord failed to provide tenant, in

either a utility bill or the written rental agreement, with a

written explanation of the manner in which the charges for

water, sewer, and garbage services were divided among the

tenants, as required by ORS 90.315(4)(b)(B)(ii) (requiring the

landlord to provide an explanation of the “manner in which

the charge is allocated among the tenants if the provider’s

bill to the landlord covers multiple tenants”).

1

The ORLTA has a one-year statute of limitations. See ORS 12.125 (actions

“arising under a rental agreement or ORS chapter 90 shall be commenced within

one year”).

2

Tenant argued to the trial court that landlord had engaged in both billing

violations without specifically citing ORS 90.315(4)(b)(C), and the trial court’s

findings of fact established both of landlord’s billing violations.

Cite as 371 Or 285 (2023) 301

The trial court awarded tenant $9,050 in statu-

tory damages on tenant’s counterclaim for all the statutory

violations landlord committed in each of the 12 months at

issue in the counterclaim. Essentially, the court assessed

the greater of one month’s rent or twice the utility charge

for each month in which landlord violated statutory require-

ments, awarding the rental amount for 12 months (10

months of rent at $740 per month and two months of rent

at $825 per month). As a result, although tenant owed land-

lord one month of rent and some utility and other charges,

tenant was the prevailing party in the FED action.

The text of paragraph (f) of ORS 90.315(4) is silent

with respect to how to assess a penalty for multiple and ongo-

ing violations of the requirements in the statute permitting

landlords to charge tenants for utilities. I disagree with the

majority’s conclusion that the text of that paragraph has but

one “plain and natural” meaning: that a landlord is penal-

ized once for multiple violations of ORS 90.315(4) by “total-

ing the utilities wrongfully billed over time, doubling that

figure, and comparing it against the monthly periodic rent,”

with the greater amount being levied as the penalty. 371

Or at 295. Even if I were to accept the majority’s view that

the same statutory violation recurring on a monthly basis

should be treated as a single violation that gives rise to a

penalty equal to the greater of one month’s rent or double the

utility charges wrongfully assessed during those months, I

would remain skeptical that the legislature intended not to

penalize a landlord for other statutory violations. The one-

sentence text of ORS 90.315(4)(f) suggests the contrary: A

violation of any statutory requirement gives rise to the pen-

alty (“[i]f a landlord fails to comply with paragraph (a), (b), (c)

or (d) of this subsection,” then “the tenant may recover from

the landlord” the described penalty amount). The majority

opinion does not explain why four separate statutory viola-

tions give rise to but one penalty, with the majority’s dis-

cussion of context centering on hypothetical violations that

repeat each month and no legislative history indicating that

the legislature viewed the penalty as a one-time occurrence,

no matter how many ways and how many times a land-

lord disregarded its obligations to its tenant when assess-

ing the tenant for utility charges. To state it bluntly, the

302 Shepard Investment Group LLC v. Ormandy

court’s decision declares without support that the legislature

intended to allow a landlord immunity for disregarding mul-

tiple separate duties that attach when it chooses to charge a

tenant for utilities. At the very least, tenant should have a

judgment for an amount equal to four months of rent on his

counterclaim, because tenant suffered from landlord’s four

different violations of statutory requirements.

My skepticism of the majority’s decision further

extends to the conclusions that the majority draws about

the legislature’s intention not to penalize landlords for ongo-

ing violations of the same statutory requirement over time.

I conclude that paragraph (f) of ORS 90.315(4) can reason-

ably be read to require a penalty for each violation and that

the legislature would have understood that a penalty for

each violation, including when repeated over time, would be

applied when it enacted paragraph (f).

Again, the text is consistent with that reading: If

the landlord fails to comply with the requirements in para-

graphs (a), (b), (c), or (d) of ORS 90.315(4), then the penalty

applies. The text does not specify how it is to be applied in a

case like this one, with multiple statutory violations by the

landlord that repeat monthly. However, the fact that the leg-

islature provided that the penalty may be the amount of a

month’s rent—and will be if monthly rent is more than twice

the amount of the wrongful utility charge—suggests that

the legislature could have contemplated a month-by-month

assessment of penalties in view of a tenant’s monthly rent

obligations.

The majority’s admonishment about construing

only the text before us—that to apply a penalty for the viola-

tions that landlord committed each month would be to insert

phrases (such as “during a monthly billing cycle”) that have

been “omitted,” 371 Or at 295—applies equally to the major-

ity’s position. The majority inserts qualifiers into paragraph

(f) of ORS 90.315(4) that do not appear in the text in at least

two ways. First, the majority implicitly adds that a land-

lord’s various methods of noncompliance with the statutory

requirements will be lumped together for purposes of the

remedy: “If the landlord fails to comply with paragraph (a),

(b), (c) or (d) of this subsection, [regardless of noncompliance

Cite as 371 Or 285 (2023) 303

with multiple statutory requirements], the tenant may

recover from the landlord an amount equal to one month’s

periodic rent or twice the amount wrongfully charged to the

tenant, whichever is greater.” Because the legislature was

trying to ensure that landlords complied with the require-

ments for assessing utility charges, that reading undercuts

the aim of the penalty.

Second, the majority, concluding that the phrase

“amount wrongfully charged” in paragraph (f) is “an aggre-

gate term,” reads that paragraph with essentially another

addition: “If the landlord fails to comply with paragraph

(a), (b), (c) or (d) of this subsection, [regardless of noncompli-

ance with multiple statutory requirements], the tenant may

recover from the landlord an amount equal to one month’s

periodic rent or twice the amount wrongfully charged to the

tenant [in each month, added together for all months in the

time period covered by the claim], whichever is greater.” But

that is not the only way that the text may be understood.

Paragraph (f) says that the penalty may be twice “the amount

wrongfully charged,” not “amounts wrongfully charged”

over time. The determination of the penalty depends on a

comparison of two amounts, “one month’s periodic rent” and

“the amount wrongfully charged,” and, because the amount

charged for utilities will be on a monthly basis, consid-

ering how utilities charge for services, it is reasonable to

think that the legislature intended the comparison of “the

amount” of the wrongful utility charge and the rent amount

to occur monthly.

The majority explains that context, specifically, the

penalty provision in subsection (3) of ORS 90.315, bolsters

its view of paragraph (f). Subsection (2) requires a landlord

to “disclose to the tenant in writing at or before the com-

mencement of the tenancy any utility or service that the

tenant pays directly to a utility or service provider that ben-

efits, directly, the landlord or other tenants.” The penalty

for a landlord who “knowingly” fails to comply then is set

out in subsection (3): “[T]he tenant may recover twice the

actual damages sustained or one month’s rent, whichever

is greater.” The majority suggests that, because a knowing

failure to include a written disclosure at the commencement

304 Shepard Investment Group LLC v. Ormandy

of the tenancy as required by subsection (2) “arguably per-

sists throughout the life of the tenancy, until such time

as it is remedied,” 371 Or at 295-96, the legislature must

have understood that the penalty amount would be either

one month’s rent, even if the violation persisted over the

time period covered by the claim, or else twice the amount

of “damages sustained” over the time period covered by

the claim, whichever is greater, see id. at 296. Notably, the

majority views the penalty in paragraph (f) and the penalty

in subsection (3) as containing “structurally the same” pen-

alty. Id.

In two ways, that contextual analysis by the major-

ity is unpersuasive. The majority assumes that the penalty

in subsection (3) is either one month’s rent or two times dam-

ages sustained over time. But that issue is not before the

court, and the issue has not been previously addressed by

the court, so one premise of the majority’s analysis is merely

an assumption. It is possible, assuming a continuing viola-

tion of the requirement in ORS 90.315(2) to provide a writ-

ten disclosure at the outset of a tenancy, that the compari-

son in the penalty provided by subsection (3) is on a monthly

basis: one month’s rent or twice the damages—presumably,

the amount that the tenant had paid for utilities that the

landlord knew had benefited the landlord rather than the

tenant—sustained in the month in which the violation

continues.

But even if the majority correctly views the opera-

tion of subsection (3) of ORS 90.315 as a one-time comparison

of one month’s rent with twice the sum of damages sustained

over the period covered by the claim, the text and context of

the penalty provisions in subsection (3) and paragraph (f)

of subsection (4) meaningfully differ. The penalty in sub-

section (3) compares the monthly rent amount with “twice

the actual damages sustained” when a landlord charges the

tenant for utilities that are delivered to areas other than the

tenant’s dwelling unit, such as common areas in an apart-

ment complex, and knowingly fails to disclose that infor-

mation in writing “at or before the commencement of the

tenancy.” ORS 90.315(2). The phrase “damages sustained”

suggests a total summed amount for the claim, whereas the

counterpart in paragraph (f) of subsection (4), “the amount

Cite as 371 Or 285 (2023) 305

wrongfully charged to the tenant,” suggests a singular

amount, such as an overcharge billed to the tenant in a par-

ticular month. The context for the penalty in paragraph (f)—

the variety of requirements that a landlord must meet, not

all of which necessarily will involve the assessment of a util-

ity charge, e.g., ORS 90.315(4)(d)(C) (prohibiting termination

of a rental agreement in certain circumstances)—further

suggests that the legislature viewed the penalty as focused

on each violation of a statutory requirement, rather than

focusing on a cumulative sum of utility charges as compared

to one month’s rent.

An implicit premise underlying the majority opin-

ion is that “the amount wrongfully charged” means the sum

of utility charges assessed in any month during which the

landlord violated at least one statutory requirement in ORS

90.315(4)(a) through (d). The legislative history of the 1999

amendments to ORS 90.315(4), which added the penalty pro-

vision now codified in paragraph (f), suggests that “wrongful

charges” refers instead to charges for utilities that exceed

the charges allowed by statute and not to the amount of the

utilities assessed during months in which the landlord com-

mitted a violation of any statutory requirement, even if the

landlord was otherwise entitled to pass on the utility cost

to the tenant. If that legislative history correctly reflects

the legislature’s intention, the history serves as further evi-

dence that the majority’s view of how the penalty works in

paragraph (f) is wrong.

In 1997, the legislature first addressed, and permit-

ted landlords to assess tenants, actual costs for utility ser-

vices without treating the charges as rent. Or Laws 1997,

ch 577, § 16. The pass-through utility charge provisions

were and remain codified in ORS 90.315(4). The law did not

contain a penalty provision if the landlord violated any of

the requirements associated with passing on utility charges

to tenants.3

3

The 1997 legislation included the following requirements: (1) the charge

must be authorized in the written rental agreement; (2) pass-through charges

for common areas must be set out separately; (3) the landlord could add no addi-

tional costs, such as administrative fees; and (4) unless the rental agreement

spelled out the method of allocating utility charges to the tenant, the tenant had

the right to a copy of the utility provider’s bill as a condition to payment of the

charges. Or Laws 1997, ch 577, § 16.

306 Shepard Investment Group LLC v. Ormandy

In 1999, the legislature amended ORS 90.315. Or

Laws 1999, ch 603, § 18. The law largely amended para-

graph (a) of subsection (4) and added paragraphs (b) through

(d) to subsection (4) to address video and internet utility ser-

vices. Id. Through the amendments, landlords could charge

tenants for video and internet services as utilities, including

an ability for landlords to add “an additional amount,” up to

a 10 percent profit, so long as the markup was disclosed on

the tenant’s bill and the total charge to a tenant was below

the market price that the tenant would have to pay the pro-

vider for the same service individually. Id. All other util-

ity services could not be marked up. The term “additional

amount” was repeated throughout the amendments to sub-

section (4). Id.

Significantly, the amendment included a new pen-

alty provision in paragraph (e) of subsection (4) of ORS

90.315, for violations of paragraphs (a) through (d), that is in

substance the same one now found in paragraph (f). Id. The

tenant could recover a penalty of one month’s periodic rent

or twice the amount wrongfully charged to the tenant.

In view of the added requirements for landlords as

of 1999 in subsection (4) of ORS 90.315 pertaining to the

restrictions on the amount of charges that landlords could

assess, the legislature’s addition of a penalty that could be

the amount of one month’s rent or twice the amount wrong-

fully charged suggests that part of the penalty determina-

tion depended on the amount of an overcharge for utilities.

As for whether the 1999 legislature viewed the penalty as

applying in any given month when the landlord violated the

charging requirements, a witness testified that the penalty

for landlord noncompliance with the requirements “provides

for an amount equal to one month’s rent as a possible pen-

alty, reflecting an assumption that week-to-week tenancies

are unlikely to have utility markups.” Testimony, Senate

Committee on Business and Consumer Affairs, HB 3098,

May 10, 1999, Ex O (comments of John Van Landingham).

That testimony is far from definitive, but it is consistent

with the view that the legislation was directed at monthly

billing and penalizing landlords with as much as a month’s

rental amount if they violated the requirements in any given

month.

Cite as 371 Or 285 (2023) 307

The procedural requirements added to ORS

90.315(4)(b) that landlord violated in this case were not

added until 2015. See Or Laws 2015, ch 388, § 8. Thus, those

amendments should not be considered in assessing what

the 1999 legislature intended when it enacted the penalty

now codified in paragraph (f). Substantively, the 2015 legis-

lature retained the same penalty provision now codified in

paragraph (f), and the parties have presented no legislative

history indicating that the legislature intended to treat vio-

lations of the procedural requirements any differently than

the requirements limiting the amount of the utility charges

a landlord assessed to the tenant.

Finally, I disagree with the majority’s suggestion,

while citing ORS 90.125(1) (providing that the ORLTA “shall

be so administered that an aggrieved party may recover

appropriate damages”), that the penalty awarded by the

trial court was inappropriate. 371 Or at 296. Although the

majority contends that tenant offered no plausible explana-

tion for why a four-figure damage amount is appropriate, id.,

tenant explained in his brief, citing Brewer v. Erwin, 287 Or

435, 442, 600 P2d 398 (1979), that remedial statutory pen-

alties in the ORLTA are designed to ensure landlord compli-

ance with statutory obligations and to “make it unprofitable

to engage in an improper practice when a defendant might

otherwise be prepared to bear the risk of having to pay for

the resulting harm as an acceptable business cost.” In hold-

ing that punitive damages were unavailable for violations

of the ORLTA, we explained in Brewer that the ORLTA

included statutory damages that are often noncompensatory

and that the legislature’s uses of those types of statutory

damages accomplish the same deterrent effect as punitive

damages. Id. at 443. In my view, the penalty amount in this

case serves as a deterrent for landlords, who can disregard

the requirements for charging for utilities and who can rep-

licate those violations with many different tenants. It was

and is an appropriate amount and constitutes an exercise

of the legislature’s judgment about the appropriate penalty

that would ensure a landlord’s compliance with all of the

statutory requirements concerning utility charges in the

ORLTA. I respectfully dissent.