(1) As used in this section, “contract” includes:
(a) Express contracts;
(b) Implied contracts; and
(c) Instruments or documents evidencing a debt.
(2) Except as provided in this section, a court shall allow reasonable attorney fees to the prevailing party on any claim based on contract if:
(a) The amount of the principal together with interest due on the contract at the time the claim is filed is $10,000 or less; and
(b) The contract does not contain a clause that authorizes or requires the award of attorney fees.
(3) Attorney fees may not be awarded to a plaintiff under the provisions of this section unless written demand for payment of the claim was made on the defendant not less than 20 days before the commencement of the action or the filing of a formal complaint under ORS 46.465, or not more than 20 days after the transfer of the action under ORS 46.461. The failure of a plaintiff to give notice under the provisions of this subsection does not affect the ability of a defendant to claim attorney fees under the provisions of this section.
(4) Attorney fees may not be awarded to a plaintiff under the provisions of this section if the court finds that the defendant tendered to the plaintiff, prior to the commencement of the action or the filing of a formal complaint under ORS 46.465, or not more than 20 days after the transfer of the action under ORS 46.461, an amount not less than the amount awarded to the plaintiff.
(5) The provisions of this section do not apply to:
(a) Contracts for insurance;
(b) Contracts for which another statute authorizes or requires an award of attorney fees;
(c) Any action for damages for breach of an express or implied warranty in a sale of consumer goods or services that is subject to ORS 20.098; or
(d) Any action against the maker of a dishonored check that is subject to ORS 30.701.