Justia Insurance Law Opinion Summaries

At issue in this case was what constituted a "proof of loss" in a claim for UIM benefits and what sufficed to trigger the safe harbor provision. The insured provided notice of an injury automobile accident to her insurer, but did not submit a UIM benefits claim at that time. Nearly two years later, the insurer learned of the possible UIM claim. The insurer agreed in writing that it accepted coverage, that the only remaining issues were liability and damages, and that it was willing to submit to binding arbitration. After recovering on her UIM claim, the insured asked for attorney fees. The insurer claimed the benefit of the safe harbor provision of ORS 19 742.061(3). The Court of Appeals concluded that the insurer did not send its safe harbor letter within six months of the insured's "proof of loss." According to the Court of Appeals, the "proof of loss" was the initial report of injury two years earlier. Upon review, the Supreme Court concluded that the initial report of injury did not provide sufficient information to constitute a proof of loss for a UIM claim and that the insurer's safe harbor letter was sufficient to trigger the statutory exception to an attorney fee award. View "Zimmerman v. Allstate Property and Casualty Ins." on Justia Law

Portland General Electric Company (PGE) appealed a Court of Appeals decision that reversed and remanded a trial court order that denied Lexington Insurance Company's motion to set aside a default judgment entered in PGE's favor. Specifically, the issues were: (1) whether a default judgment awarding monetary relief violated ORCP 67C if the complaint did not specify amount of damages sought; and (2) if so, whether that omission rendered the judgment voidable or void. The Supreme Court held the judgment in question here did not violate ORCP 67C and that the judgment was not void. The case was remanded to the Court of Appeals for further proceedings. View "PGE v. Ebasco Services, Inc." on Justia Law

The issue before the Supreme Court in this case concerned the scope of Clackamas County's contractual obligation to provide health insurance benefits to command officer retirees of the County Sheriff's Office. A contract between the county and command officers, including Plaintiff Neil James, required the county to use a particular fund to pay for a certain level of benefits to command officers after they retired. The contract added that the obligation to pay benefits was "contingent upon the availability of sufficient funding in said fund to pay for the same." After plaintiff retired, the cost of insurance premiums increased to the point where the fund was and would for the foreseeable future continue to be insufficient to pay for the benefits required. The county entered into a new contract with certain union employees to provide lesser benefits from a more stable fund, and plaintiff (a retired officer, not a union employee) also was provided those lesser benefits. Plaintiff brought an action against the county, asserting breach of contract. He maintained that the first contract required the county to pay him full health insurance benefits and argued that the contingency provision did not apply because of the creation of the new fund, which had sufficient money to pay for those benefits. The trial court entered judgment in favor of plaintiff, but the Court of Appeals reversed. Upon review, the Supreme Court concluded that the new fund was the product of a contract that was separate and independent from the earlier contract. Because the prior fund was insufficient to provide the agreed level of benefits, the county did not breach its contractual obligation to provide that level of benefits. Accordingly, the Court affirmed the appellate court's decision. View "James v. Clackamas County" on Justia Law

ORS 742.061 authorizes an award of attorney fees to an insured who prevails in "an action * * * in any court of this state upon any policy of insurance of any kind or nature * * *." A later enacted statute, ORS 742.001, provides that ORS chapter 742 "appl[ies] to all insurance policies delivered or issued for delivery in this state * * *." The question in this case was whether ORS 742.001 precluded awarding attorney fees to an insured who prevailed in an action in an Oregon court on an insurance policy that was issued for delivery and delivered in the State of Washington. The trial court concluded that it did and entered a supplemental judgment to that effect. The Court of Appeals affirmed. Considering the text, context, and legislative history of Chapter 742, the Supreme Court concluded that the legislature did not intend that ORS 742.001 would limit the scope of ORS 742.061. "For us to hold otherwise, we would have to turn an expansion of the state's authority to impose substantive regulations on insurers transacting business in Oregon into a limitation on the remedial and procedural rules that affect insurers appearing in its courts. * * * we would have to read a limitation into the text of that section that the legislature did not include. We may not do that." The Court reversed the appellate court and remanded the case for further proceedings. View "Morgan v. Amex Assurance Company" on Justia Law

Claimant Crystal DeLeon sought workers' compensation benefits for a work-related injury to her back, neck and one shoulder. SAIF Corporation, her insurer, accepted the claim but awarded only temporary partial disability; the insurer did not award Claimant permanent partial disability. Claimant sought reconsideration, and the Department of Consumer and Business Services awarded her an eleven percent permanent partial disability for her shoulder. The insurer appealed the Department's award; the ALJ agreed with the insurer and reduced the permanent partial disability award to zero. Claimant appealed the ALJ's decision to the Workers' Compensation Board. The board reversed the ALJ and reinstated the eleven percent disability determination, and awarded attorney's fees. The issue on appeal concerned the authority of the Workers' Compensation Board to award attorney fees. Upon review, the Supreme Court found that the Board indeed has statutory authority to award attorneys' fees. View "SAIF Corp. v. DeLeon" on Justia Law

The issue in this case was whether a healthcare provider could be held liable for damages when the provider's negligence permitted the theft of its patients' personal information, though the information was never used or viewed by the thief or any other person. Plaintiffs Laurie Paul and Russell Gibson (individually and on behalf of all similarly-situated individuals) claimed economic and noneconomic damages for financial injury and emotional distress that they allegedly suffered when, through Defendant Providence Health System-Oregon's alleged negligence, computer disks and tapes containing personal information from an estimated 365,000 patients (including Plaintiffs') were stolen from the car of one of Defendant’s employees. The trial court and Court of Appeals held that Plaintiffs had failed to state claims for negligence or for violation of the Unlawful Trade Practices Act (UTPA). Upon review, the Supreme Court concluded that, in the absence of allegations that the stolen information was used in any way or even was viewed by a third party, Plaintiffs did not suffer an injury that would provide a basis for a negligence claim or an action under the UTPA.

Pursuant to ORS 742.061, Plaintiffs Zidell Marine Corporation petitioned to recover attorney fees that they incurred for the preparation of appeals before both the Court of Appeals and Supreme Court. Defendant Lloyds of London contended that as a result of a 2005 amendment to the statute, Zidell could not recover fees incurred after the effective date of the amendment. In the alternative, Lloyds argued that Zidell was only entitled to fees for work it did to establish Lloyds had a duty to defend, or that the billing records Zidell submitted did not support its request for fees. Upon review of the applicable legal authority, as well as the billing records and the Lloyds insurance contract, the Supreme Court held that Zidell could recover the attorney fees in incurred to establish Lloyds' duty to defend and for the preparation of the fee petition.

This case concerned the proper application of stare decisis and required the Supreme Court to decide whether "Collins v. Farmers Ins. Co." was still good law. In "Collins," the Court held that an exclusion in a motor vehicle liability insurance policy that purported to eliminate all coverage for a claim by one insured against another insured under the same policy was unenforceable to the extent that it failed to provide the minimum coverage required by the Financial Responsibility Law (FRL). The exclusion, however, was enforceable as to any coverage beyond that statutory minimum. In this case, Plaintiff Farmers Insurance Company issued an insurance policy to Defendant Tosha Mowry that contained an exclusion identical to the exclusion in "Collins". Defendant was injured in an accident in which her friend -- a permissive user and thus an insured person under the policy -- was driving. Plaintiff brought this action seeking a declaration that Defendant had $25,000 available in coverage under her policy -- the minimum coverage required by the FRL for bodily injury to one person in any one accident. Defendant argued that her coverage was $100,000, the insurance amount stated on the declarations page of her policy. The parties filed cross-motions for summary judgment, and the trial court granted Plaintiff's motion and denied Defendant's. The Court of Appeals affirmed in a per curiam opinion that cited "Collins." The Supreme Court concluded that Defendant "advanced no argument that this court has not previously considered for reaching a different result from that in 'Collins.' Defendant failed to carry the burden for overturning a fully considered precedent of this court."

Defendants Farmers Insurance Company of Oregon, Mid-Century Insurance Company and Truck Insurance Exchange (Farmers) petitioned the Supreme Court to reconsider an opinion that affirmed a trial court's judgment against it for approximately $8.9 million in compensatory and punitive damages. Farmers contended that the Court's resolution of certain state law issues violated its federal due process rights. Farmers was required by statute and contract to provide personal injury protection to its insureds by covering all reasonable and necessary medical expenses within a year of the insured's injury. Plaintiff Mark Strawn filed a class action suit against Farmers, alleging that Farmers' claims handling process breached its contractual obligations to its insureds. According to Farmers, the Court, in its prior decision, created an "irrebuttable presumption" that altered what was required under state law to prove a fraud claim in a class action in a way that violated due process. The Court held that "Farmers's argument misses the mark" by characterizing the Court's conclusion in its prior holding as "novel" by "assuming the answer to one of the legal questions that [the] Court had to resolve." The Court concluded that Farmers' premises on appeal were incorrect, and that "Farmers's legal arguments therefore fail."

Plaintiff John Stuart decided to build a new house on a small farm. He contacted his insurance agent of nineteen years, Defendant Ronald Pittman for "course-of-construction" insurance to cover any problems in the course of building his house. Mr. Pittman discussed the scope of coverage that the policy would provide. Relying on Mr. Pittman's oral assurance of what the policy would cover, Plaintiff agreed to it. Construction started in 2003. Plaintiff received a premium statement, but not a written copy of the policy. An ice storm struck Plaintiff's building project. Plaintiff contacted Mr. Pittman to initiate an insurance claim. Mr. Pittman told Plaintiff that damage should be covered by the policy. In 2004, Plaintiff received a declaration page from Country Mutual Insurance Company, and found that damage to his house was not covered. Plaintiff brought an action against both Mr. Pittman and the Insurance Company alleging breach of the oral "policy" that he and Mr. Pittman agreed to at the onset of the building project. At the conclusion of the trial's evidentiary phase, Defendant moved for a directed verdict, arguing that Plaintiff failed to prove that the oral insurance binder covered his project. The trial court denied the motion, and the jury would later rule in favor of Plaintiff. The verdict was overturned on appeal. The court held that there was no evidence from which a jury could have found in favor of Plaintiff. On appeal to the Supreme Court, Plaintiff argued that the appellate court misinterpreted the Oregon law that required him to prove that the oral binder superseded the "usual exclusions" of the written policy. The Supreme Court found that the written policy was, as a matter of law, deemed to include all terms of the oral binder. Accordingly, the Court reversed the appellate court's decision and affirmed the judgment of the trial court.