2017 ORS 86.767¹
Failure to give notice of sale
  • action by omitted person
  • defense
  • pleading and proving knowledge of sale
  • attorney fees
  • exclusive remedy

(1) If the trustee fails to give notice of the sale to a person entitled to notice under ORS 86.764 (Notice of sale for certain persons) (2)(c), and the person did not have actual notice of the sale at least 25 days before the date on which the trustee conducted the sale, the omitted person has the same rights that the holder of a junior lien or interest who was omitted as a party defendant in a judicial foreclosure proceeding possesses, and the purchaser at the trustee’s sale or the purchaser’s heirs, assigns or transferees, have the same rights that a purchaser at a sheriff’s sale following a judicial foreclosure possesses.

(2) The omitted person may also commence an action against the trustee in the circuit court in the county where the real property is located. In an action against the trustee, the omitted person is entitled to damages if the omitted person proves that:

(a) The trustee did not give notice of the sale to the omitted person in the manner required by ORS 86.764 (Notice of sale for certain persons) (2)(c) and 86.774 (Service and publication of notice);

(b) A search of the record under the name of the grantor as the grantor’s name appears on the trust deed, or as the name of the grantor’s successor in interest appears, would have revealed the omitted person’s interest;

(c) The omitted person could and would have cured the default under ORS 86.778 (Discontinuance of foreclosure proceedings after cure of default); and

(d) The omitted person sustained actual damages as a result of the person’s loss of the opportunity to cure the default under ORS 86.778 (Discontinuance of foreclosure proceedings after cure of default) (1).

(3) In an action against the trustee under subsection (2) of this section, a defendant or third party defendant may move for dismissal on the ground that the omitted person would not or could not have cured the default and reinstated the trust deed if the omitted person had received the notice required by ORS 86.764 (Notice of sale for certain persons) (2)(c). The court shall hold a hearing on the motion before a hearing on a motion for summary judgment, and before trying the action. The court shall deny the motion only if the omitted person produces affidavits or other evidence sufficient for a reasonable jury to find, applying a standard of clear and convincing evidence, that the omitted person had the financial ability to cure the default under ORS 86.778 (Discontinuance of foreclosure proceedings after cure of default) before the date of the trustee’s sale, and that the omitted person would have done so had the omitted person received the notice required by ORS 86.764 (Notice of sale for certain persons) (2)(c). If the court grants the motion to dismiss, the court shall award attorney fees under subsection (5) of this section.

(4) In an action against the trustee or another party under this section the omitted person shall plead that the omitted person did not have actual knowledge of the sale at least 25 days prior to the date the trustee conducted the sale, but thereafter the defendant has the burden of proving that the omitted person did have notice.

(5) In an action brought under this section, the applicable court may, upon entering judgment, allow to the prevailing party as a part of the costs a reasonable amount for attorney fees at trial and on appeal.

(6) The remedies described in subsections (1) to (5) of this section are the sole remedies available to a person entitled to notice of foreclosure by advertisement and sale under ORS 86.764 (Notice of sale for certain persons) (2)(c), who failed to receive notice. The person’s failure to redeem or to commence an action against the trustee within five years of the date of a trustee’s sale under ORS 86.782 (Sale of property) bars any action under this section or any other applicable law. [Formerly 86.742]

Notes of Decisions

For purposes of Oregon Trust Deed Act, beneficiary of trust deed is per­son named or otherwise designated in trust deed as per­son to whom secured obliga­tion is owed. Niday v. GMAC Mortgage, LLC, 251 Or App 278, 284 P3d 1157 (2012), aff’d on other grounds, 353 Or 648, 302 P3d 444 (2013)

Statutes regulating trust deeds do not regulate transfers of promissory notes. Sovereign v. Deutsche Bank, 856 F. Supp. 2d 1203 (D. Or. 2012)

Statutes regulating trust deeds are not preempted by federal Home Owner’s Loan Act. Higley v. Flagstar Bank, FSB, 910 F. Supp. 2d 1249 (D. Or. 2012)

For purposes of Oregon Trust Deed Act, “beneficiary” is lender to whom obliga­tion that trust deed secures is owed or lender’s successor in interest; an entity that is not a lender may not be trust deed’s “beneficiary” unless it is lender’s successor in interest. Niday v. GMAC Mortgage, LLC, 353 Or 648, 302 P3d 444 (2013); Brandrup v. ReconTrust Co., 353 Or 668, 303 P3d 301 (2013)

For purposes of Oregon Trust Deed Act, only pertinent interests in trust deed are beneficial interest of beneficiary and legal interest of trustee. Brandrup v. ReconTrust Co., 353 Or 668, 303 P3d 301 (2013)

Law Review Cita­tions

23 WLR 37, 55 (1987); 67 OLR 306 (1988); 69 OLR 851 (1990)

1 Legislative Counsel Committee, CHAPTER 86—Mortgages; Trust Deeds, https://­www.­oregonlegislature.­gov/­bills_laws/­ors/­ors086.­html (2017) (last ac­cessed Mar. 30, 2018).
 
2 Legislative Counsel Committee, Annotations to the Oregon Revised Stat­utes, Cumulative Supplement - 2017, Chapter 86, https://­www.­oregonlegislature.­gov/­bills_laws/­ors/­ano086.­html (2017) (last ac­cessed Mar. 30, 2018).
 
3 OregonLaws.org assembles these lists by analyzing references between Sections. Each listed item refers back to the current Section in its own text. The result reveals relationships in the code that may not have otherwise been apparent.