Country Mutual Insurance Company v. Pittman
Filing
40
OPINION AND ORDER: For the reasons indicated, the plaintiff's Motion for Summary Judgment 18 is DENIED; defendant's Motion for Summary Judgment 21 is GRANTED IN PART AND DENIED IN PART. Signed on 11/16/2012 by Magistrate Judge Dennis J. Hubel. (sm)
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UNITED STATES DISTRICT COURT
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DISTRICT OF OREGON
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PORTLAND DIVISION
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COUNTRY MUTUAL INSURANCE
)
COMPANY, dba Country Insurance)
and Financial Services, Inc., )
an Indiana corporation,
)
)
Plaintiff,
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v.
)
)
RONALD PITTMAN, an individual,)
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Defendant.
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No. 03:11-CV-00806-HU
MEMORANDUM OPINION AND ORDER ON
MOTIONS FOR SUMMARY JUDGMENT
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_________________________________________
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John A. Bennett
Stephen F. Deatherage
Andrew E. Passmore
BULLIVANT HOUSER BAILEY PC
888 SW Fifth Avenue, Suite 300
Portland, OR 97204-2089
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Attorneys for Plaintiff
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Laura N. Althouse
Richard A. Lee
BODYFELT MOUNT LLP
707 SW Washington Street, Suite 1100
Portland, OR 97205-3528
Attorneys for Defendant
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1 - MEMORANDUM OPINION AND ORDER
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HUBEL, Magistrate Judge:
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This matter is before the court on the parties’ motions for
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summary judgment. For the reasons discussed below, the plaintiff’s
4
motion (Dkt. #18) is denied, and the defendant’s motion (Dkt. #21)
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is granted in part and denied in part.
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SUMMARY JUDGMENT STANDARDS
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Summary judgment should be granted “if the movant shows that
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there is no genuine dispute as to any material fact and the movant
10
is entitled to judgment as a matter of law.”
Fed. R. Civ. P.
11
56(c)(2).
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“must not weigh the evidence or determine the truth of the matter
13
but only determine whether there is a genuine issue for trial.”
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Playboy Enters., Inc. v. Welles, 279 F.3d 796, 800 (9th Cir. 2002)
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(citing Abdul-Jabbar v. General Motors Corp., 85 F.3d 407, 410 (9th
16
Cir. 1996)).
In considering a motion for summary judgment, the court
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The Ninth Circuit Court of Appeals has described “the shifting
18
burden of proof governing motions for summary judgment” as follows:
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The moving party initially bears the burden of
proving the absence of a genuine issue of
material fact. Celotex Corp. v. Catrett, 477
U.S. 317, 323, 106 S. Ct. 2548, 91 L. Ed. 2d
265 (1986). Where the non-moving party bears
the burden of proof at trial, the moving party
need only prove that there is an absence of
evidence to support the non-moving party’s
case. Id. at 325, 106 S. Ct. 2548. Where the
moving party meets that burden, the burden
then shifts to the non-moving party to designate specific facts demonstrating the existence of genuine issues for trial.
Id. at
324, 106 S. Ct. 2548. This burden is not a
light one.
The non-moving party must show
more than the mere existence of a scintilla of
evidence.
Anderson v. Liberty Lobby, Inc.,
477 U.S. 242, 252, 106 S. Ct. 2505, 91 L. Ed.
2d 202 (1986). The non-moving party must do
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2 - MEMORANDUM OPINION AND ORDER
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more than show there is some “metaphysical
doubt” as to the material facts at issue.
Matsushita Elec. Indus. Co., Ltd. v. Zenith
Radio Corp., 475 U.S. 574, 586, 106 S. Ct.
1348, 89 L. Ed. 2d 528 (1986). In fact, the
non-moving party must come forth with evidence
from which a jury could reasonably render a
verdict in the non-moving party’s favor.
Anderson, 477 U.S. at 252, 106 S. Ct. 2505. In
determining whether a jury could reasonably
render a verdict in the non-moving party’s
favor, all justifiable inferences are to be
drawn in its favor. Id. at 255, 106 S. Ct.
2505.
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In re Oracle Corp. Securities Litigation, 627 F.3d 376, 387 (9th
Cir. 2010).
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BACKGROUND FACTS
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The plaintiff Country Mutual Insurance Company (“Country”) is
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part of a group of “personal lines insurance companies” that
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distributes various types of insurance products to “farmers, indi-
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viduals and small businesses.”1
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retired on September 30, 2005, the defendant Ronald Pittman was a
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registered
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McMinnville, Oregon.2
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against Country and Pittman by an individual named John Stuart (the
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“Stuart case”).
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insurance
agent
for
From January 1, 1993, until he
Country,
doing
business
in
This case arises from a lawsuit filed
At oral argument on the pending motions, the parties clarified
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the history of the Stuart case.
In March 2003, Stuart bought
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property in Yamhill County, Oregon, on which he planned to build a
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1
Dkt. #23-1, Agent’s Agreement, ¶ 1.
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2
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Dkt. #9, Amended Complaint ¶ 6; admitted by Pittman at Dkt.
#12, ¶ 1.
3 - MEMORANDUM OPINION AND ORDER
1
home.
Stuart owned an existing residence, and Country issued a
2
homeowner’s policy (which Pittman’s attorney referred to as an “ag
3
plus policy”) to Stuart to cover the existing residence.
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point, Stuart met with Pittman to discuss insurance for the new
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residence he planned to build.
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facts during oral argument on the current motions, the “new” policy
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was not to be an entirely new insurance policy at all, but rather
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was to be an amendment or rider to Stuart’s existing “ag plus”
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policy covering Stuart’s existing residence.
At some
As the attorneys described the
During their discus-
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sions, Stuart outlined the types of coverage he wanted, and Pittman
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made certain representations regarding what was available.
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Stuart’s Complaint in the Stuart case, he alleged Pittman provided
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him with an oral binder for insurance that would cover “any and all
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claims arising out of the course of construction of [the new
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residence],
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Country issued a “Builder’s Risk or course of construction policy”
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(as Country refers to it4) that did not contain the “course of
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construction” terms Stuart had requested.5
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policy Country issued to Stuart excluded “the perils of faulty
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workmanship, mold, and damage caused by water backup from sewer
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drains.”6
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insurance policy, despite several requests for a copy of the
including
‘Acts
of
God.’”3
According
to
In
Stuart,
In particular, the
Stuart claims he was never provided with a copy of the
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Dkt. #23-7, Stuart Complaint, ¶ 8.
See Dkt. #19, p. 2.
5
Dkt. #23-7, Stuart Complaint, ¶ 9.
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Dkt. #9, Amended Complaint, ¶ 17; admitted by Pittman at Dkt.
#12, ¶ 1.
4 - MEMORANDUM OPINION AND ORDER
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Declarations page, and despite Pittman’s assurance, in January
2
2004, “that a written binder for the Policy was forthcoming.”7
3
In January or February 2004, the home being built for Stuart
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suffered damage when it “was left open to the weather, and as a
5
result, the interior sheathing split, water accumulated in the
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crawl space, and mold grew.”8
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Country. In the present case, Country alleges “Pittman told Stuart
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that the damage caused by the weather would be covered and the mold
9
damage also might be covered.”9
Stuart timely reported the loss to
According to Stuart, a field
10
underwriter for Country inspected the damage in March 2004, before
11
any repairs were made, and Stuart “was advised to chronicle the
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repairs and to submit his claim in writing after repairs were
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complete.”10 Based on the exclusions contained in the policy issued
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by Country, it ultimately denied Stuart’s claim.11
15
Stuart obtained judgments against the architect/builder for
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the damage to the residence under construction; however, it appears
17
the architect was insolvent and unable to satisfy the judgments.12
18
Stuart filed suit against Country and Pittman in Yamhill County
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7
Dkt. #23-7, Stuart Complaint, ¶¶ 10 & 11.
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8
Dkt. #9, Amended Complaint ¶ 15; admitted by Pittman at Dkt.
#12, ¶ 1; see Dkt. #23-7, Stuart Complaint, ¶ 13.
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Dkt. #9, Amended Complaint, ¶ 16; denied by Pittman at Dkt.
#12, ¶ 2.
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Dkt. #23-7, Stuart Complaint, ¶ 14.
Dkt. #9, ¶ 17; admitted by Pittman at Dkt. #12, ¶ 1; cf. Dkt.
#23-4, letter dated March 7, 2005, from John Bennett to Arden
Olson.
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12
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See Dkt. #23-7, Stuart Complaint, ¶¶ 15-26, 29; Dkt. #23-15,
Country’s Motion for Summary Judgment in the Stuart case, p. 3.
5 - MEMORANDUM OPINION AND ORDER
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Circuit Court (the “trial court”), asserting claims against Country
2
for breach of contract, negligent misrepresentation, and attorney’s
3
fees; and a claim against both Country and Pittman for negligent
4
failure to procure insurance.13
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Pittman moved for summary judgment in the Stuart case, and his
motion was granted.14
Country also moved for summary judgment on
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See Dkt. #23-14, Stuart’s First Amended Complaint.
See Dkt. #23-8, a one-sentence order dated November 6, 2006,
granting Pittman’s motion for summary judgment in the Stuart case.
In Oregon, a negligence claim (including a claim for negligent
misrepresentation) that seeks only economic damages “must be predicated on some duty of the negligent actor to the injured party
beyond the common-law duty to exercise reasonable care to prevent
foreseeable harm.” Lewis-Williamson v. Grange Mut. Ins. Co., 179
Or. App. 491, 494, 39 P.3d 947, 949 (2002) (citing Onita Pacific
Corp. v. Trustees of Bronson, 315 Or. 149, 159, 843 P.2d 890, 896
(1992)); accord Miller v. Mill Creek Homes, Inc., 195 Or. App. 310,
315, 97 P.3d 687, 689 (2004). The issue of whether a particular
relationship is one that gives rise to such an enhanced duty is a
question of law, to be decided on a case-by-case basis. LewisWilliamson, 179 Or. App. at 495, 39 P.3d at 949 (citations
omitted). In Lewis-Williamson, the court held that a “captive”
insurance agent is viewed as an agent of the insurance company and
not of the insured (contrasted with the case of an independent
insurance agent, who generally “is viewed as an agent of the
insured and owes a duty of reasonable care to the principal
insured”). Therefore, a captive agent lacks the type of special
relationship that can give rise to liability to the insured based
on negligence in the context of purely economic loss. Id., 179 Or.
App. at 495-96, 39 P.3d at 949-50; accord Miller, supra.
According to Country, Pittman was dismissed from the Stuart
case on summary judgment because he “was Country Mutual’s captive
agent and had no ‘special relationship’ with Stuart.” Dkt. #19,
p. 2 n.1; see Dkt. #9, Amended Complaint, ¶ 18. In his Answer in
the present case, Pittman denies the allegation that he was dismissed from the Stuart case on that basis, Dkt. #12, ¶ 5; however,
in a Tolling Agreement between Pittman and Country, dated December 3, 2007, the parties agreed “Pittman was granted summary
(continued...)
6 - MEMORANDUM OPINION AND ORDER
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Stuart’s claims.15
2
Country was granted summary judgment on Stuart’s negligent misre-
3
presentation claim against Country. In a Second Amended Complaint,
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Stuart asserted claims against Country for breach of contract and
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attorney’s fees.16
The parties explained at oral argument that
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The case was tried to a jury, which found: (1) Pittman
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“entered into an oral contract of insurance different than the
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policy later issued by Country Mutual”; (2) the oral insurance
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contract eliminated the requirement of direct physical loss, and
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the exclusions for damage caused by mold, water (whether or not
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backed up through drains), and “faulty workmanship or construc-
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tion”; (3) Country’s “failure to provide insurance coverage consis-
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tent with the oral contract of insurance” damaged Stuart; (4) and
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Country failed “to mail or deliver the policy within a reasonable
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time,” which also damaged Stuart.17
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$268,417.00
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$168,035.91 in attorney’s fees. These awards were memorialized in,
in
damages,
and
the
The jury awarded Stuart
trial
court
awarded
Stuart
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(...continued)
judgment . . . because [he] did not have the type of special relationship with Stuart necessary for tort liability.” Dkt. #23-12,
p. 1.
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See Dkt. ##23-15, 23-16, & 23-17.
Id., ¶¶ 31-36. After Pittman’s motion for summary judgment
was granted, the parties stipulated to dismissal of Pittman with
prejudice in exchange for Pittman’s waiver of any costs in the
Stuart case.
See Dkt. #23-9. As a result, Stuart omitted any
claims against Pittman in his Second Amended Complaint. See Dkt.
#20-6, General Judgment in the Stuart case.
17
Dkt. #20-5, Verdict Form in the Stuart case.
7 - MEMORANDUM OPINION AND ORDER
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respectively, a General Judgment entered December 4, 2006, and a
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Supplemental Judgment dated May 29, 2007.18
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Country appealed.
Country and Pittman entered into a Tolling
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Agreement, effective December 3, 2007 (notably, as will be seen,
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one day short of one year after judgment was entered), for the
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purpose of “stop[ping] the passing of time, as to any contractual
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or statutory period of limitation applicable to Country Mutual’s
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proposed claims against Pittman, . . . until 30 days after the
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final decision and mandate of the appellate courts[.]”19
On May 5, 2010, the Oregon Court of Appeals reversed, finding
10
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there
was
“no
evidence
from
which
the
jury
could
find
that
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[Country’s] agent bound terms that clearly and expressly superseded
13
the usual terms of a course of construction policy or that [Stuart]
14
was damaged as a result of [Country’s] failure to timely deliver
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the policy,” and therefore it was error for the trial court to
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submit the case to the jury.20
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decision on ORS § 742.043(1), which provides that an oral binder
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for insurance is “‘deemed to include all the usual terms of the
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policy as to which the binder was given . . ., except as superseded
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by the clear and express terms of the binder.’”21
The Court of Appeals based its
The court noted
21
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See Dkt. #20-6, General Judgment, signed November 30, 2006,
and filed December 4, 2006; Dkt. #20-7, Supplemental Judgment,
signed and filed May 29, 2007.
19
25
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Dkt. #23-12, Tolling Agreement, p. 1.
20
Stuart v. Pittman, 235 Or. App. 196, 207, 230 P.3d 958, 964
(2010), rev’d 255 P.3d 482 (Or. 2011).
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21
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Id., 235 Or. App. at 202, 230 P.3d at 962 (quoting ORS
§ 742.043(1)).
8 - MEMORANDUM OPINION AND ORDER
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the statute creates “a presumption that a binder includes those
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terms that are usually contained in the policy for which the binder
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was issued.”22
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and concluded it was “simply too vague and obscure” to show Pittman
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had clearly and expressly “modified or waived the terms of the
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‘usual’ course of construction policy or its exclusions from
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property coverage for faulty work, water damage, and mold.”23
The court reviewed the evidence presented at trial
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The Oregon Supreme Court allowed review24, and on June 3, 2011,
9
that court reversed the decision of the Oregon Court of Appeals.
10
The Oregon Supreme Court found the evidence was sufficient for the
11
trial court to submit the issues in the case to the jury for
12
decision, and further, the trial court did not err in its attor-
13
ney’s fee award.25
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appellate attorney’s fees in the amount of $201,288.50, and costs
15
of $682.77.26
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on September 15, 2011, $180,738.62 of which “was post-judgment
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interest at nine percent per year.”27
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entered its appellate judgment on October 6, 2011.28
The Oregon Supreme Court also granted Stuart
According to Country, it paid $819,738.62 to Stuart
The Oregon Supreme Court
19
20
Id. (citations omitted).
23
Id., 235 Or. App. at 204-05, 230 P.3d at 963.
24
Stuart v. Pittman, 349 Or. 173, 243 P.3d 468 (Table) (2010).
25
21
22
Stuart v. Pittman, 350 Or. 410, 255 P.3d 482 (2011).
22
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See Dkt. #9, Amended Complaint, ¶ 22; admitted by Pittman at
Dkt. #12, ¶ 7 (although Pittman indicates the costs allowed by the
Oregon Supreme Court were in the amount of $882.77).
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27
Dkt. #19, p. 2; Dkt. #9, ¶ 22.
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Dkt. #9, ¶ 22; admitted by Pittman at Dkt. #12, ¶ 7.
9 - MEMORANDUM OPINION AND ORDER
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Country filed the current action against Pittman in this court
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on July 1, 2011. Country asserts claims against Pittman for negli-
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gence, common-law indemnity, and “breach of duty as agent.”29
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parties now seek summary judgment.
Both
5
Preliminarily, the court notes Pittman has moved, “[i]n the
6
alternative, . . . for partial summary judgment on Country’s common
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law indemnity claim[.]”30 Country concedes Pittman cannot be liable
8
for common-law indemnity because he was dismissed from the Stuart
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case.31
Accordingly, Pittman’s motion for summary judgment on
10
Country’s Second Cause of Action for common-law indemnity is
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granted.
12
In Pittman’s motion for summary judgment, he argues Country
13
cannot maintain this action on procedural grounds. Country, on the
14
other hand, argues it is entitled to partial summary judgment on
15
the merits of its negligence claim against Pittman. I will address
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Pittman’s procedural motion first.
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PITTMAN’S MOTION FOR SUMMARY JUDGMENT
18
19
Pittman argues Country’s claims in this case are barred by an
20
arbitration clause contained in the Agent’s Agreement entered into
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by the parties.
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parties’ “Mutual Agreements,” subparagraph k of which provides as
23
follows:
Section 2 of the Agent’s Agreement contains the
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29
Dkt. #9, Amended Complaint.
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30
Dkt. #22, p. 3.
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31
Dkt. #27, p. 11.
10 - MEMORANDUM OPINION AND ORDER
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It is mutually agreed . . . [t]hat any claim
or controversy relating to or arising out of
the relationship between the Agent and
[Country], this Agreement (and/or any agreement superseded by this Agreement), or the
termination of this Agreement, whether the
parties’ rights and remedies are governed or
created by contract law, tort law, common law
or other wise [sic], or by federal, state or
local statute, legislation, rule or regulations, shall be resolved exclusively by
binding arbitration in Bloomington, Illinois
(unless otherwise provided by law), by one
arbitrator selected by [Country] and the
Agent, all in accordance with the commercial
arbitration rules of the American Arbitration
Association then in effect. Judgment upon any
arbitration award lawfully rendered may be
entered and enforced in any court having
jurisdiction.
Any claim governed by this
arbitration clause must be brought within one
year of the events giving rise to the claim or
controversy by serving on the other party
within such time a written request for
arbitration stating the grounds for the claim
and the relief requested.32
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Pittman asserts the arbitration clause applies to Country’s
16
claims against him in this case because those claims arise out of
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the parties’ contractual relationship.33
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this common-sense conclusion,34 and the court finds the arbitration
19
clause is applicable to Country’s claims against Pittman in this
20
case.
Country does not dispute
21
Pittman argues Country failed to make a demand for arbitration
22
within the one-year limitations period specified in the arbitration
23
clause. The parties’ disagreement centers on interpretation of the
24
language requiring a claim to be brought within one year of “the
25
26
32
Dkt. #23-1, Agent’s Agreement, p. 3, § 2(k) (emphasis added).
27
33
Dkt. #22, p. 7.
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34
See Dkt. #27.
11 - MEMORANDUM OPINION AND ORDER
1
events giving rise to the claim or controversy.”
2
the phrase “events giving rise to the claim” in the arbitration
3
clause differs from “the accrual of the claim.”
4
a statute-of-limitations context, Oregon applies a “discovery
5
rule,” such that a plaintiff must actually be aware, or reasonably
6
should be aware, of the elements of a claim before the limitation
7
period begins to run.
8
Country was aware it had a claim against him at least by the date
9
of the jury’s verdict in the Stuart case - November 17, 2006 - if
10
not much earlier, but Country did not make its written request for
11
arbitration pursuant to the Agent’s Agreement until November 4,
12
2011.
13
Pittman argues
He notes that in
Under this type of analysis, Pittman argues
Pittman goes further, asserting that the “events giving rise
14
to the claim” actually occurred even earlier.
Pittman claims a
15
plausible interpretation of the arbitration clause would require
16
Country to demand arbitration “within one year of the alleged oral
17
binder to Stuart and some damage to Country - which would have been
18
when Country started to incur attorney fees to defend this claim -
19
by March 2005 or at least by the time Stuart’s lawsuit was filed on
20
December 9, 2005.”35
21
Country argues the “event” giving rise to its claim was the
22
Oregon Supreme Court’s issuance of a final judgment in the Stuart
23
case.
24
therefore, there was no “claim.”36
25
argues it first suffered damage on December 4, 2006, when judgment
It argues that until then, it did not suffer “damage,” and
26
27
35
Dkt. #34, p. 4.
28
36
Dkt. #27, pp. 2-3.
12 - MEMORANDUM OPINION AND ORDER
In the alternative, Country
1
was entered against it in the Stuart case.
Country notes that the
2
issue of whether Pittman bound the coverage alleged by Stuart was
3
vigorously disputed by Country both during the course of the Stuart
4
case in the trial court, and on appeal, with the jury agreeing with
5
Stuart, the Oregon Court of Appeals reversing, and the Oregon
6
Supreme Court reinstating the jury’s verdict.
7
argues, the earliest date on which it even possibly could have been
8
damaged for purposes of starting the limitations clock was when the
9
original judgment was entered on December 4, 2006, memorializing
10
the jury’s finding that Pittman orally bound insurance different
11
from the policy actually issued by Country.37
12
year later, the parties entered into the tolling agreement that
13
stopped the clock until 30 days after the final appellate judgment
14
was issued.
15
October 6, 2011, and Country made written demand for arbitration on
16
November 4, 2011.38 Country argues, therefore, that its arbitration
17
demand was timely.
Thus, Country
A day less than one
The Oregon Supreme Court’s judgment was issued on
18
Pittman maintains that because Country drafted the arbitration
19
clause at issue, the court cannot rule in Country’s favor without
20
concluding that Country’s interpretation of the “events giving rise
21
22
23
24
37
25
38
26
27
28
Id., pp. 7-8.
See Dkt. #20-11, letter from Country’s attorney to Pittman’s
attorney making “written request for arbitration.” (The letter
also notes the parties mutually agreed not to arbitrate the case,
and Country was making the written request “only . . . in order to
satisfy the arbitration demand requirement in the Agent’s Agreement
- assuming that it applies.”)
13 - MEMORANDUM OPINION AND ORDER
1
to the claim” language is the only plausible interpretation.39
2
Pittman further asserts that if the “events giving rise to”
3
language is ambiguous, then his interpretation must prevail, again
4
because Country drafted the contract language.40
5
6
DISCUSSION
7
The parties’ disagreement centers on the language requiring
8
any claims arising under the Agent’s Agreement to “be brought
9
within
one
year
of
the
events
giving
rise
to
the
claim
or
10
controversy. . . .”
11
interpreted, the court is guided by general principles of Oregon
12
law regarding the construction of a contract.
13
contract, the “court’s goal is to give effect to the intention of
14
the contracting parties.”
15
ton N. & Santa Fe Ry. Co., 38 F. Supp. 2d 1185, 1191 (D. Or. 1999)
16
(Ashmankas, J.) (citations omitted).
17
the construction of a contract “is a question of law for the
18
court.”
19
P.2d 315, 320 (1995), in turn citing Timberline Equip. Co. v. St.
20
Paul Fire & Marine Ins. Co., 281 Or. 639, 643, 576 P.2d 1244, 1246
21
(1978)).
22
In considering how this language should be
In construing a
Hoyt Street Properties, LLC v. Burling-
Generally, under Oregon law,
Id. (citing Anderson v. Divito, 138 Or. App. 272, 277, 908
Oregon courts follow a three-step inquiry in contract inter-
23
pretation.
Id. (citing Yogman v. Parrott, 325 Or. 358, 361, 937
24
P.2d 1019, 1021 (1997)). The first step is to analyze the disputed
25
26
27
28
39
Dkt. #22, p. 7 (citing Hoffman Const. Co. v. Fred S. James
Co., 313 Or. 464, 470-71, 836 P.2d 703, 706-07 (1992)).
40
Id.
14 - MEMORANDUM OPINION AND ORDER
1
provision’s text, in the context of the contract as a whole, to
2
determine whether the meaning of the provision is clear on its
3
face.
4
disputed terms as a matter of law.
5
Ass’n of Seventh-Day Adventists, 209 Or. App. 380, 383, 149 P.3d
6
217, 218-19 (2006) (citing Yogman, supra).
If the meaning is clear, then the court construes the
Madson v. Western Or. Conf.
7
In determining whether contract language is clear on its face,
8
the court considers whether the disputed provision is ambiguous.
9
“Whether terms of a contract are ambiguous is a question of law.”
10
Yogman v. Parrott, 325 Or. 358, 361, 937 P.2d 1019, 1021 (1997).
11
Contract language is ambiguous “if it is susceptible to more than
12
one reasonable interpretation,” Madson, 209 Or. App. at 384, 149
13
P.3d at 219 (emphasis added) (citing Batzer Constr., Inc. v. Boyer,
14
204 Or. App. 309, 313, 129 P.3d 773, 776 (2006)), or if it “is
15
capable of more than one sensible and reasonable interpretation[.]”
16
Deerfield Commodities v. Nerco, Inc., 72 Or. App. 305, 317, 696
17
P.2d 1096, 1104-05 (1985); accord Batzer Constr., Inc. v. Boyer,
18
204 Or. App. 309, 313, 129 P.3d 773, 776 (2006).
19
If the contractual provision at issue is ambiguous, then the
20
court proceeds to the second step of the interpretation analysis;
21
i.e., examination of extrinsic evidence of the parties’ intent.
22
See Yogman v. Parrott, 325 Or. 358, 363, 937 P.2d 1019, 1022 (1997)
23
(citing ORS § 41.740, which provides that extrinsic evidence may be
24
considered to explain an ambiguity).41
The parties’ intent is to
25
26
27
28
41
Notably, the Ninth Circuit has held extrinsic evidence may
not be examined to determine if there is an ambiguity in the first
place, but may be used only as an aid in determining the parties’
intent once the court has determined, from the text and context,
(continued...)
15 - MEMORANDUM OPINION AND ORDER
1
be pursued if possible.
2
(citing
3
extrinsic evidence of their intent.
4
proceed to “the third and final analytical step,” in which “the
5
court relies on appropriate maxims of construction.”
ORS
§
Yogman, 325 Or. at 364, 937 P.2d at 1022
42.240).
Here,
the
parties
have
provided
no
The court, therefore, must
Id.
6
If the disputed provision is ambiguous then, as “a basic tenet
7
of contract law,” the ambiguous language “is construed against the
8
drafter of the contract.”
9
150 P.3d 424, 427 (2006) (citing Hill v. Qwest, 178 Or. App. 137,
10
143, 35 P.3d 1051, 1054 (2001), in turn citing Neighbors v. Blake,
11
167 Or. App. 343, 347, 3 P.3d 172, 175 (2000)).
12
argues he “is entitled to utilize any interpretation of the clause
13
that is plausible,” and Country can only prevail if it shows “its
14
interpretation
15
pretation.”42
As discussed below, the court disagrees, and finds
16
the
language
17
reasonable interpretation.”
disputed
of
the
Berry v. Lucas, 210 Or. App. 334, 339,
contract
is
is
subject
the
to
only
only
Thus, Pittman
plausible
one
inter-
“sensible
and
18
The parties have not cited any Oregon case interpreting
19
language substantially similar to the “events giving rise to”
20
language here.
21
any court, federal or state, that provide examples of similar
Indeed, the court has located very few cases from
22
23
24
25
26
41
(...continued)
that an ambiguity exists. Webb v. Nat’l Union Fire Ins. Co. of
Pittsburgh, 207 F.3d 579, 581-82 (9th Cir. 2000) (finding Yogman
implicitly overruled the contrary holding in Abercrombie v. Hayden
Corp., 320 Or. 279, 883 P.2d 845 (1994)).
27
42
28
Dkt. #22, p. 7 (citing Hoffman Const. Co. v. Fred S. James
Co., 313 Or. 464, 470-71, 836 P.2d 703, 706-07 (1992)).
16 - MEMORANDUM OPINION AND ORDER
1
language to assist in the interpretation of when the “events giving
2
rise to” a claim begin.
3
In McNeil v. United States, slip op., 2012 WL 1415364, at *2
4
(Fed. Cir. Apr. 4, 2012), reh’g en banc denied, June 12, 2012, for
5
purposes of when a claim must be brought in the Court of Federal
6
Claims, the court, in dicta, equated “the events giving rise to
7
[the plaintiff’s] claims against [the defendants]” with the time a
8
“claim first accrues.” The court explained the six-year statute of
9
limitations begins to run “when all events have occurred that are
10
necessary to enable the plaintiff to bring suit, i.e., when all
11
events have occurred to fix the Government’s alleged liability,
12
entitling the claimant to demand payment and sue . . . for his
13
money[.]”
14
Therefore, “the events giving rise to” the plaintiff’s claims must
15
have occurred within six years of the filing of his complaint.
Id. (internal quotation marks, citations omitted).
Id.
16
Several courts have considered the timeliness of claims for
17
purposes of the six-year limitation period specified in section 15
18
of the National Association of Securities Dealers (“NASD”) Code of
19
Arbitration.
20
language similar to that at issue here, to-wit: “‘No dispute, claim
21
or controversy shall be eligible for submission to arbitration
22
under this Code where six (6) years shall have elapsed from the
23
occurrence or event giving rise to the act or dispute, claim or
24
controversy.’”
25
Pa. Aug. 24, 1993) (quoting § 15; emphasis added).
26
Peabody & Co. v. Brandt, 131 F.3d 1001 (11th Cir. 1997), the court
27
held “that the occurrence or event giving rise to a claim for
28
purposes of § 15 of the NASD Code is the one necessary to make the
Section 15 of the NASD Code of Arbitration contains
Piccolo v. Fargalli, 1993 WL 331933, at *2 (E.D.
17 - MEMORANDUM OPINION AND ORDER
In Kidder,
1
claim viable, the occurrence or event after which a complaint
2
specifying the facts would withstand a Federal Rule of Civil
3
Procedure 12(b)(6) motion.”
4
noted that in some cases, “the last ‘occurrence or event’ necessary
5
to make a claim viable depends on the nature of a particular
6
claim.”
7
established when a single, specific event occurs, such as when
8
striking someone gives rise to a claim for battery.
9
cases, a course of events, or even several separate occurrences or
10
events, will be required before a claim is viable. The court gave
11
the example of a negligence action based on the defective design of
12
a product, noting the action would not be viable until the product
13
caused injury.
14
claim are established by the company’s act of marketing the
15
product, that act does not establish the causation and injury
16
elements of the claim.”
Id., 131 F.3d at 1004.
Id., 131 F.3d at 1002.
The court
For instance, sometimes a claim is
Id. In other
“Although the duty and breach elements of such a
Id.
17
Another example of how the facts of each case drive the
18
determination of the date of the “occurrence or event giving rise
19
to” a claim is illustrated by the contrast between claims for false
20
arrest and malicious prosecution. “For false arrest, the plaintiff
21
can plead all elements [of the claim] on the day of the arrest
22
regardless of later proceedings. . . .
23
all the elements cannot be pled until the proceedings are ter-
24
minated in the plaintiff’s favor.” Sneed v. Rybicki, 146 F.3d 478,
25
481 (7th Cir. 1998) (construing Illinois law).
For malicious prosecution,
26
Interesting though these analyses may be, none of these cases
27
provides definitive guidance in determining the point in time of
28
the “events giving rise to” Country’s claims against Pittman.
18 - MEMORANDUM OPINION AND ORDER
1
Similarly, the court finds the analyses in the attorney malpractice
2
cases cited by the parties does not carry the day.
3
must determine when all of the events had occurred that were neces-
4
sary to fix Pittman’s alleged liability sufficiently to allow
5
Country to bring suit.
The court still
See McNeil, supra.
6
Pittman argues that under a statute-of-limitations analysis,
7
the event giving rise to Country’s claims was, at the latest, the
8
date of the jury’s verdict in the Stuart case.
Pittman notes
9
Oregon
to
recognizes
a
“discovery
rule,”
pursuant
which
the
10
limitations period begins to run when a plaintiff knows, or has
11
reason to know, of the elements of the claim.43
12
that a “key component” of a statute-of-limitations analysis under
13
Oregon law is that Oregon “does not require the setting of final
14
damages for accrual of a claim.”44
15
Fireman’s Fund Ins. Co., 302 Or. 343, 353, 730 P.2d 542, 547
16
(1986), a case Country argues is distinguishable from the present
17
case.45
Pittman asserts
Pittman relies on Bollam v.
18
In Bollam, the plaintiffs alleged their liability insurer had
19
improperly handled a claim against the plaintiffs arising from an
20
automobile accident. The plaintiffs claimed their insurer’s negli-
21
gence in handling the claim caused them to incur liability for
22
excess damages above their policy limits, and for attorney’s fees
23
to protect their interests.
24
insureds’ claim against the insurer arose, causing the statute of
The issue in the case was when the
25
43
Dkt. #22, pp. 9-10.
27
44
Id., p. 10.
28
45
See Dkt. #27, pp. 3-5.
26
19 - MEMORANDUM OPINION AND ORDER
1
limitations to begin to run.
The insureds argued their claim
2
against the insurer arose at the time they paid their own funds to
3
the claimant to settle the claim.
4
arose when the insureds became aware of their potential liability
5
above their policy limits, and as a result, incurred attorney’s
6
fees to protect their interests.
The insurer argued the claim
7
The Bollam court “held that when the Bollams retained and paid
8
an attorney to protect their interests, the Statute of Limitations
9
began to run.”
DeJonge v. Mutual of Enumclaw, 90 Or. App. 533,
10
537, 752 P.2d 1277, 1279 (1988) (citing Bollam, 302 Or. At 353, 730
11
P.2d at 547).
12
arise until the defendant’s behavior has caused harm and resulting
13
damages to a plaintiff,” R.A. Hatch Co. v. American Insurance Co.,
14
728 F. Supp. 1499, 1503 (D. Or. 1990) (Frye, J.) (citing Bollam,
15
302 Or. at 347, 730 P.2d at 544), “the statute of limitations
16
begins to run when an injured party discovers that he has been
17
harmed by the acts of the defendant even though the extent of the
18
injury is not yet known, and payment may not be made for some
19
time.”
20
687 P.2d 1083 (1984), the Oregon Supreme Court distinguished
21
between “two discrete concepts, the occurrence of harm and the
22
extent of damages,” noting “‘[i]t is immaterial that the extent of
23
damages could not be determined at the time of the [tort]’ for
24
purposes of determining when the statute of limitation commenced to
25
run.”
26
Industrial Plating Co. v. North, 175 Or. 351, 354, 153 P.2d 835,
27
836 (1944)).
Although “a cause of action for negligence does not
Id. (citation omitted). In Jaquith v. Ferris, 297 Or. 783,
Jaquith, 297 Or. at 788, 687 P.2d at 1086-87 (quoting
Thus, “[t]he critical focus is when damage first
28
20 - MEMORANDUM OPINION AND ORDER
1
occurred, not when the full extent of damage is identifiable.”
2
DeJonge, 90 Or. App. at 537, 752 P.2d at 1279.
3
In the present case, Country asserts that the earliest it was
4
“damaged” by Pittman’s conduct was the date judgment was entered in
5
the trial court - December 4, 2006.
6
liable to pay either damages to Stuart or the costs of an appeal.
7
Thus, Country argues, “as a matter of law, [Country] had incurred
8
actionable
9
St. Paul Fire & Marine Ins. Co. v. Speerstra, 63 Or. App. 533, 539,
10
666 P.2d 255, 258 (1983). Pittman, however, argues the latest date
11
when Country was harmed was the date of the jury’s verdict.
12
Pittman notes that in a letter from Country’s attorney to Pittman’s
13
attorney dated March 7, 2007, Country acknowledged that it knew of
14
its claim against Pittman as of the time of the jury’s verdict.46
15
In the letter, Country’s attorney stated, among other things, the
16
following:
17
harm
by
the
time
of
At that time, Country became
the
entry
of
judgment.”
. . . As you know, [Stuart] prevailed at
trial. . . . The jury found that Mr. Pittman
made promises to the insured to bind a type of
insurance coverage that, to my knowledge, does
not exist. Needless to say, it is not coverage written by Country Mutual. . . . [W]e must
now address responsibility for the judgment
and the cost of appeal, as between the agent
and the company.
18
19
20
21
22
.
.
.
Country Mutual believes that the judgment
is the ultimate responsibility of agent
Pittman.
Though I disagree with the jury’s
verdict, the jury made findings of fact that
agent Pittman bound Country Mutual to coverage
23
24
25
26
27
28
the
46
Dkt. #22, pp. 10-11 (citing Dkt. #23-11).
21 - MEMORANDUM OPINION AND ORDER
it does not write.47
As such, the agent is
obligated to indemnify the insurer.
See,
United Pacific Insurance v. Price, 39 Or App
705, 593 P2d 1214 (1979) and Lynch v. First
Colony Life Ins. Co., 108 Or App 159, 814 P2d
552 (1991).48
1
2
3
4
5
Thus, Pittman argues, Country knew as of the jury’s verdict that it
6
had a potential claim against him.
7
the jury’s verdict, not the formal judgment, that started the clock
8
ticking; “[t]he judgment enforcing the verdict was merely a natural
9
consequence of the jury’s verdict.”49
Pittman further argues it was
10
Pittman’s position is unsupportable. It is the judgment, when
11
entered, that “[b]ecomes the exclusive statement of the court’s
12
decision in the case and governs the rights and obligations of the
13
parties that are subject to the judgment[.]”
14
Country’s liability to Stuart did not arise until the judgment was
15
entered.50
ORS § 18.082(a).
16
47
17
18
19
20
21
22
found.
This is a misstatement of what the jury in the Stuart case
See Dkt. #20-5, Verdict form.
48
Dkt. #23-11. Although Country’s attorney claimed Pittman was
“obligated to indemnify the insurer,” the Price and Lynch cases he
cited actually hold an agent is liable in negligence, not
indemnity, for the type of conduct alleged here. As noted earlier
in this opinion, Country now recognizes it has no indemnity claim
against Pittman.
49
Dkt. #22, p. 11 n.1.
23
50
24
25
26
27
28
Indeed, in this case, the difference between the jury’s
verdict and the ensuing judgment is analogous to the order by the
trial court judge in the Stuart case granting Pittman’s motion for
summary judgment.
No formal judgment ever was entered to
memorialize that order; instead, the parties reached a settlement
that resulted in Pittman’s dismissal from the case.
Had the
parties in the Stuart case reached a settlement of Stuart’s claims
after the jury rendered its verdict, but before the court entered
(continued...)
22 - MEMORANDUM OPINION AND ORDER
1
Pittman also argues Country knew of its claims against him,
2
triggering Country’s obligation to demand arbitration, as early as
3
March 21, 2005, when Stuart’s attorney wrote to Country’s attorney,
4
stating Stuart “intended to hold Country liable for not issuing a
5
policy in conformance with Pittman’s oral binder.”51 Pittman argues
6
Stuart’s counsel reiterated, in a letter dated October 28, 2005,
7
that “Stuart intended to file litigation against both Pittman and
8
Country based upon Pittman’s conduct.”52
9
his lawsuit, he included claims against both Country and Pittman,
10
and his claims against Country were based on Pittman’s oral
11
representations. However, Country maintained throughout the Stuart
12
case that Pittman never made oral representations for any type of
13
insurance
14
construction policy.53
15
tions, and advocated for Pittman’s version of events, to which he
16
testified at trial of the Stuart case.
coverage
other
than
what
Indeed, when Stuart filed
was
provided
in
Stuart’s
Country defended against Stuart’s allega-
According to Country, it
17
18
19
20
50
(...continued)
judgment, the jury’s verdict would have had no effect.
51
21
22
23
24
25
26
27
28
Dkt. #22, pp. 11-12 (referring to Dkt. #23-5, letter dated
March 21, 2005, from Arden J. Olson to John A. Bennett).
52
Id. (citing Dkt. #23-6, letter from Arden J. Olson to an
unknown recipient, referred to by Pittman’s attorney as “Pittman’s
representative, with a copy to Pittman’s attorney; see Dkt. #23,
¶ 7).
53
See Dkt. #27, p. 6 n.1, quoting language from Country’s
motion for summary judgment in the Stuart case (Dkt. #23-15 in this
case), where Country argued, “There is no evidence that [Stuart]
and Mr. Pittman agreed to a type of coverage other than that
required by [Stuart’s] construction contract,” and “no enforceable
binder insurance contract exists.”
23 - MEMORANDUM OPINION AND ORDER
1
relied on Pittman’s testimony both at trial and during the appeal.54
2
Thus, simply being put on notice of Stuart’s claims against Country
3
and
4
sufficiently to trigger the one-year period within which Country
5
had to demand arbitration.
Pittman
was
not
enough
to
establish
harm
to
Country
6
The court finds the “event[] giving rise to” Country’s claim
7
against Pittman, and therefore triggering the one-year time limit
8
for Country to demand arbitration, was entry of the judgment in the
9
Stuart case on December 4, 2006; and further, this is the only
10
sensible, reasonable, plausible interpretation of the language of
11
the arbitration clause.55
12
entered into the Tolling Agreement that stopped the “passing of
13
time, as to any contractual or statutory period of limitation
14
applicable to Country Mutual’s proposed claims against Pittman,
15
. . . until 30 days after the final decision and mandate of the
16
appellate courts[.]”56
17
Court entered final judgment in the Stuart case, Country made its
18
written demand for arbitration.
19
limitation specified in the arbitration clause of the Agent’s
Less than one year later, the parties
Within 30 days after the Oregon Supreme
Country complied with the time
20
21
22
23
24
54
25
55
26
27
28
See Dkt. #19, p. 4.
The court is not persuaded that Pittman’s supplemental
authority, see Dkt. #38 (citing Dial Temporary Help Service, Inc.
v. DLF International Seeds, Inc., ___ P.3d ___, 252 Or. App. 376
(Sept. 26, 2012), changes this conclusion.
56
Dkt. #23-12, Tolling Agreement, p. 1.
24 - MEMORANDUM OPINION AND ORDER
1
Agreement.57
2
Pittman’s motion for summary judgment is denied.
As
a
result,
Country’s
claims
are
timely,
and
3
4
5
COUNTRY’S MOTION FOR PARTIAL SUMMARY JUDGMENT
Country moves for summary judgment on its First Cause of
6
Action for negligence.58
7
jury’s findings and the circuit court and appellate court judgments
8
under Oregon’s issue preclusion rules.”59
9
in this diversity action, Oregon law applies to the court’s
10
analysis of the preclusive effect, if any, of the judgments in the
11
Stuart case.60
Country argues “Pittman is bound by the
The parties agree that
12
For the elements of issue preclusion, both parties cite Nelson
13
v. Emerald People’s Utility District, 318 Or. 99, 914 P.2d 697
14
(1996). In Nelson, the Oregon Supreme Court considered whether “an
15
unemployment compensation decision by the Employment Division
16
should be given preclusive effect in a subsequent civil action.”
17
Nelson, 318 Or. at 101, 862 P.2d at 1295.
18
“[i]ssue preclusion arises in a subsequent proceeding when an issue
The court explained that
19
20
21
22
23
24
25
57
Indeed, Pittman’s position raises a question as to his
motivation for entering into the Tolling Agreement in the first
place. If Pittman’s position were correct, then by the time the
tolling Agreement was executed, there was nothing to toll, as one
year from the date of the jury’s verdict had long since passed, and
it had been even longer since Stuart initially raised his claims.
Thus, if Pittman’s position were correct, the court is left to
wonder why he did not take that position instead of agreeing to the
Tolling Agreement.
26
58
Dkt. #19.
27
59
Dkt. #19, p. 9.
28
60
See id.; Dkt. #28, p. 10.
25 - MEMORANDUM OPINION AND ORDER
1
of ultimate fact has been determined by a valid and final deter-
2
mination in a prior proceeding.”
3
court specified five requirements that must be met for a decision
4
in one tribunal to preclude relitigation of the issue in a subse-
5
quent proceeding, to-wit:
6
Id. (citations omitted).
1.
The issue in the two proceedings is identical.
2.
The issue was actually litigated and was
essential to a final decision on the
merits in the prior proceeding.
3.
The party sought to be precluded has had
a full and fair opportunity to be heard
on that issue.
4.
The party sought to be precluded was a
party or was in privity with a party to
the prior proceeding.
5.
The
The prior proceeding was the type of
proceeding to which this court will give
preclusive effect.
7
8
9
10
11
12
13
14
15
16
17
Nelson, 318 Or. at 104, 862 P.2d at 1296-97 (citations omitted).
The parties agree as to which party bears the burden of proof
18
on each of these elements.
19
proving elements 1, 2, and 4.
20
the identical issue was decided in a previous action, and “was
21
necessary to the judgment in the prior action.”
22
Anderson, 214 Or. App. 660, 666, 167 P.3d 994, 999 (2007) (citation
23
omitted). “Whether the issues are identical and whether a par-
24
ticular matter was actually decided are questions of law for the
25
court.”
26
Inc., 275 Or. 97, 104-05, 550 P.2d 1185, 1188-89 (1976) (citation
27
omitted).
Country has the burden, initially, of
The court first addresses whether
Barackman v.
State Farm Fire & Cas. Co. v. Century Home Components,
The Century Home court further explained:
28
26 - MEMORANDUM OPINION AND ORDER
1
Once the court has concluded that the evidence
is sufficient to establish that an identical
issue was actually decided in a previous
action, prima facie the first judgment should
be conclusive. The burden then shifts to the
party against whom [preclusion] is sought to
bring to the court’s attention circumstances
indicating the absence of a full and fair
opportunity to contest the issue in the first
action or other considerations which would
make the application of preclusion unfair.
2
3
4
5
6
7
Id. (internal quotation marks, citations omitted).
The Barackman
8
court noted that although the Century Home court did not expressly
9
say so, “the party asserting issue preclusion also bears the burden
10
on the fourth Nelson factor” - the privity issue.
11
Or. App. at 667, 167 P.3d at 999 (citation omitted).
12
Barackman, 214
Thus, the court’s first task is to determine whether Country
13
has met its burden to prove elements 1 and 2.
14
Country claims it is entitled to summary judgment in the present
15
case is Pittman’s negligence. In support of its claim that Pittman
16
was negligent, Country asserts the following facts:
17
a.
The issue on which
Pittman promised Stuart, and bound Country, to
18
provide coverage that “does not, and has never,
19
existed.”61
20
b.
Pittman failed to communicate accurately to Stuart
21
what was covered under, and what was excluded from,
22
Country’s course-of-construction policy.62
23
24
25
26
27
61
Dkt. #9, Amended Complaint, ¶ 25.
28
62
Id.
27 - MEMORANDUM OPINION AND ORDER
1
c.
Pittman’s representations to Stuart altered the
2
risk Country was willing to take, and promised
3
coverage Country was not willing to provide.63
4
d.
Pittman had a duty, as Country’s agent, to protect
5
its interests, bind only coverage Country provided,
6
and not waive any of Country’s policy provisions.64
e.
7
Pittman “had a duty to timely mail or deliver
8
Stuart’s
course-of-construction
policy
to
him.”
9
Any delay in delivery of the policy to Stuart was
due to Pittman’s actions.65
10
f.
11
Country sustained damages due to Pittman’s negli-
12
gence in binding Country to coverage it did not
13
provide, and in failing to deliver Stuart’s policy
14
to him in a timely manner.66
15
16
17
Contrast the above with what the jury found in the Stuart
case:
1.
Pittman “enter[ed] into an oral contract of insur-
18
ance different than the policy later issued by
19
Country Mutual[.]”67
20
2.
The
oral
contract
of
insurance
eliminated
any
21
requirement of direct physical loss, and exclusions
22
for damage by mold, water (whether or not backed up
23
63
Id.
64
Id., ¶ 26.
26
65
Id., ¶ 27.
27
66
Id., ¶¶ 28 & 29.
28
67
Dkt. #20-5, Verdict form, Question 1.
24
25
28 - MEMORANDUM OPINION AND ORDER
1
through drains), and faulty workmanship or con-
2
struction.68
3
3.
Stuart was damaged by Country’s “failure to provide
4
insurance coverage consistent with the oral con-
5
tract of insurance[.]”69
6
4.
within a reasonable time[.]”70
7
8
Country “fail[ed] to mail or deliver the policy
5.
9
Stuart was damaged in the amount of $268,417 by
“the failure to mail or deliver the policy within a
reasonable time[.]”71
10
11
In its brief, Country indicates it “anticipates that Pittman
12
will agree that the issue in the two proceedings (that Pittman made
13
an oral insurance binder to Stuart and failed to timely provide the
14
written policy) is identical, and that the issue was actually
15
litigated and essential to a final decision.”72 Country, therefore,
16
devotes
17
Country’s assumption was erroneous; Pittman argues the issues were
18
not identical.74
19
with those pled by Country in the present case shows how the issues
its
argument
to
the
element
68
Id., Question 2.
69
Id., Question 3.
70
Id., Question 4.
71
Id., Questions 5 & 6.
72
Dkt. #19, p. 10.
27
73
See id., pp. 10-12.
28
74
See Dkt. #28, pp. 12-15.
22
23
24
25
26
privity.73
However,
Comparing the issues decided by the Stuart jury
20
21
of
29 - MEMORANDUM OPINION AND ORDER
1
differ. At issue in the Stuart case, according to the questions on
2
the Verdict form, was whether the oral contract of insurance
3
Pittman bound was “different than the policy later issued by
4
Country Mutual.”75
5
Country is whether Pittman orally bound coverage that “does not,
6
and has never, existed.”76
7
In the present case, the issue as pled by
These issues are not identical.
Country states the second issue as whether Pittman “failed to
8
timely provide the written policy.”77
9
form, the issue in the Stuart case was whether Country failed to
Again looking to the Verdict
10
make timely delivery of the policy.78
11
Pittman, or some other Country employee, who failed to deliver the
12
policy was not decided in the case.
The issue of whether it was
13
Oregon law provides that the only matters considered to be
14
“determined by a former judgment” are those that “appear[] on its
15
face to have been so determined or which [were] actually and
16
necessarily included therein or necessary thereto.”
17
In relying on the jury’s verdict and the Oregon Supreme Court
18
judgment in the Stuart case, Country “must take for better or for
19
worse the adjudicated facts upon which it rests.”
20
Indemnity Ins. Co. of N. Am., 227 Or. 508, 512, 363 P.2d 740, 742
21
(1961) (citing Am. Surety Co. of N.Y. v. Singer Sewing Mach. Co.,
22
18 F. Supp. 750, 753-54 (S.D.N.Y. 1937)). Country alleges Pittman
23
issued an oral binder for a type of coverage that “does not, and
24
75
Dkt. #20-5, Question 1.
26
76
Dkt. #9, ¶ 25.
27
77
Dkt. #19, p. 10.
28
78
Dkt. #20-5, Question 4.
25
30 - MEMORANDUM OPINION AND ORDER
ORS § 43.160.
Jarvis v.
1
has never, existed”79; Pittman did not accurately communicate the
2
available coverage to Stuart80; and Pittman’s representations to
3
Stuart altered the risk Country was willing to take, and promised
4
coverage Country was not willing to provide.81 The jury in the
5
Stuart case found Pittman had entered into an oral contract of
6
insurance that differed from “the policy later issued by Country,”82
7
specifically by eliminating certain requirements and exclusions
8
that the policy Country issued actually contained.83
9
findings do not match Country’s allegations in this lawsuit.
The jury’s
The
10
jury made no finding regarding whether the type of insurance
11
Pittman described to Stuart exists, or ever has existed, nor did
12
the jury make any finding as to whether Pittman accurately repre-
13
sented a type of coverage that actually was available from Country.
14
The jury simply found Pittman had made certain representations, and
15
the policy issued by Country did not match those representations,
16
damaging Stuart.
17
regarding Pittman’s failure to timely deliver the policy to Stuart.
18
Similarly, determinations regarding the contractual relation-
19
ship between Country and Pittman, Pittman’s duties and obligations
20
to Country, and whether those duties and obligations were breached,
21
were neither included in the jury’s verdict in the Stuart case, nor
22
“necessary thereto.”
Further, the Stuart jury made no findings at all
23
79
Dkt. #9, ¶ 25.
80
Id.
26
81
Id.
27
82
Dkt. #20-5, Question 1.
28
83
Id., Question 2.
24
25
31 - MEMORANDUM OPINION AND ORDER
1
On this record, all of these matters constitute genuine issues
2
of
material
3
judgment.
4
fact
in
the
present
case
that
preclude
summary
denied.84
Accordingly, Country’s motion for summary judgment is
5
6
7
CONCLUSION
For the reasons discussed above, Country’s motion for summary
8
judgment (Dkt. # 18) is denied.
9
judgment is granted as to Country’s Second Cause of Action for
10
common-law indemnity, but is
11
Pittman’s motion for summary
Country’s claims are untimely.
12
denied
to the extent he argues
IT IS SO ORDERED.
13
Dated this 16th day of November, 2012.
14
15
16
/s/ Dennis James Hubel
Dennis James Hubel
Unites States Magistrate Judge
17
18
19
20
21
22
23
24
25
26
27
28
84
The court does not reach the issue of privity, because the
court has found the issues in the two cases were not identical.
See Century Home, 275 Or. at 104-05, 550 P.2d at 1188-89.
32 - MEMORANDUM OPINION AND ORDER
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