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From the Desk of Joshua P. Hayward: Commercial general liability insurance policies issued in the state of Oregon typically include the duties to defend and indemnify. A common exclusion in these policies is an exclusion for intentional acts. If an insured is found liable for an intentional timber trespass, can the insurer rely on an intentional act exclusion for its refusal to indemnify? Read on to find out.

Content Types Archives: Case Updates

Attorney Profile Case Update Template - Josh

Oregon Case Law Update: Oregon Court of Appeals Requires an Insurer to Indemnify its Insured for Intentional Timber Trespass Claim Despite an Exclusion for Intentional Acts

From the Desk of Joshua P. Hayward: Commercial general liability insurance policies issued in the state of Oregon typically include the duties to defend and indemnify. A common exclusion in these policies is an exclusion for intentional acts. If an insured is found liable for an intentional timber trespass, can the insurer rely on an intentional act exclusion for its refusal to indemnify? Read on to find out.

Case Pointer: In this dispute arising from an insurer’s refusal to defend and indemnify a timber trespass claim, the Oregon Court of Appeals affirmed the trial court’s determination that the insurer had a duty to defend and indemnify. Despite the fact that the insured was found liable for intentional timber trespass, the insurer was required to defend and indemnify the insured because the insured did not expressly intend to damage the trees and other potential exclusions were ambiguous. This case is a reminder that any ambiguity or uncertainty contained in a policy will be construed against the insurance company.

Bighorn Logging Corp. v. Truck Ins. Exchange, 295 Or App 819 (Jan. 30, 2019).

In 2012, Bighorn Logging Corporation (“Bighorn”) was engaged in an extensive logging project on property owned by Dr. Edney (“Edney Property”). To assist in its operation, Bighorn sought and obtained permission from Paul Ater to use trees on his property as rope anchors to assist in the logging operation. Mr. Ater agreed to specified terms, including that Bighorn would use only two to three trees and use a special anchoring technique that would not damage the trees. Following the operation, Mr. Ater alleged that Bighorn cut down or damaged 18 trees on his property.  He filed a timber trespass lawsuit against Bighorn. In Oregon, if a plaintiff can prove timber trespass, they are entitled...

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Matt Ukishima

Washington Case Law Update: Washington Court Of Appeals Reminds Insurers That Ambiguous Insurance Provisions Must Be Resolved In Favor Of the Insured

From the desk of Matthew G. Ukishima: In Washington, insurance companies denying coverage are consistently challenged over ambiguous provisions in policies they issue. When provisions are ambiguous, courts have ruled in favor of the insured. When an underinsured motorist policy (“UIM”) specifically states it will pay compensatory damages for property damage, is it reasonable for an insured purchasing the insurance to interpret compensatory damages to include damages for loss of use, including covering rental car fees? Read on to find out.

Case Pointer: In this case revolving around disputed coverage for the reimbursement of rental car fees, the Washington Court of Appeals determined that an insurance provision was subject to two reasonable interpretations and was ambiguous as a matter of law, thus, must be construed against the insurer. Accordingly, it reversed the trial court’s denial of the insured’s motion for partial summary judgment. This case should serve as a reminder that, if and when a policy provision is reasonably susceptible to two different meanings, accepting coverage may be the safest route to avoid potential bad faith claims.

Kalles v. State Farm Mutual Automobile Ins. Co., Wash. Ct. App. No. 50827-3-II (Jan 23, 2019).

In this matter, Harold Kalles (“Plaintiff”) owned a new Land Rover that was damaged in an accident by an uninsured motorist. Plaintiff had obtained an insurance policy through State Farm (“Defendant”) which provided uninsured and underinsured motorist coverage. Defendant accepted coverage and paid to repair Plaintiff’s Land Rover, but declined to pay the fees Plaintiff incurred in renting a car while the Land Rover was in the repair shop. Plaintiff filed suit, arguing that his UIM coverage included compensation for the loss of use of his vehicle, which would have...

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Attorney Katie Buxman

Washington Case Law Update: Plaintiff Must Attempt Service at ALL Known Addresses of Defendant – Whether in Washington or Elsewhere – Before Substitute Service on Secretary of State is Proper

From the desk of Katie D. BuxmanWashington law permits a plaintiff injured in a car accident to serve the secretary of state with the summons and complaint—instead of the defendant—in certain circumstances. The statute, RCW 46.64.040, imposes strict conditions that an attorney must follow in order to properly divert service from the defendant to the secretary of state. This method of service is utilized when a non-resident is involved in a car accident and the resident plaintiff cannot, with due diligence, find the non-resident. What if a plaintiff attempting substitute service knows the out-of-state address of the defendant but fails to attempt service there? Can the plaintiff still comply with the statute and effectuate service by serving the secretary of state? Read on to find out.

Claims Pointer: In this appeal from a grant of summary judgment, the Washington Court of Appeals interpreted RCW 46.64.040 to determine whether a plaintiff complied with the statute when her attorney failed to personally serve a non-resident defendant. Identifying that a plaintiff is required to strictly comply with the statute in order to properly attain substitute service, the court interpreted the statute to require a plaintiff to attempt service at all known addresses before submitting the summons and complaint to the secretary of state. The plaintiff’s attorney had failed to attempt service at a known, out-of-state address before serving the secretary of state. Accordingly, the plaintiff failed to strictly comply with the statute. This case explores the requirements imposed on a Washington plaintiff attempting to serve a non-resident defendant for a motor vehicle collision in Washington.

Davis v. Blumenstein, Wash. Ct. App. No. 76918-9-I (Jan. 14, 2019).

RCW 46.64.040...

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Attorney Profile Case Update Template - Josh

Oregon Case Law Update: Oregon Trial Court’s Award of Reduced Attorney Fees Subject to Remand Due to Insufficient Explanation

From the Desk of Joshua P. Hayward: Attorney fee exposure can cause small cases to turn into big problems. In some cases, the prevailing party’s fees may be reduced by the trial court if they are unreasonable, unrelated, or excessive. What factors does a judge weigh when making such a reduction? Does the court have to explain its reasoning when it does so? Read on to find out.

Claims Pointer: In this dispute with attorney fee exposure, the plaintiff received an award of $3,600 at the trial court and sought more than $7,000 in attorney fees. The trial court only awarded $2,000 in a single sentence opinion letter. The plaintiff appealed, arguing that the trial court abused its discretion in making such a large reduction without adequate explanation. The court of appeals reviewed the trial court’s decision and found that there was not enough of an explanation provided by the trial court to allow the court to adequately review the decision. Because of the insufficient record, the court remanded the case back to the trial court to provide an explanation of its reasoning. Attorney fee exposure is common in insurance defense, especially in 20.080 actions and first party cases. This case provides a good overview of the factors that go into a court will consider when making an attorney fee award.

Moreau v. Samalin, 295 Or App 534 (January 3, 2019).

Sandra Moreau (“Plaintiff”) agreed to rent an apartment from the defendant, a landlord, in Portland. The plaintiff found the apartment to be uninhabitable when she moved in. After terminating her lease, she unsuccessfully sought the return of her deposit and filed a lawsuit under Oregon’s Residential Landlord and Tenant Act (ORLTA). She secured a default judgment against defendant for $3,600 and sought $3,054 in attorney fees as authorized by the statute. Following the judgment, defendant...

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Washington Case Law Update: Summary Judgment Affirmed After Plaintiff Fails to Provide Evidence Showing the Cause of a Fall

From the desk of Kyle D. Riley: Claims for negligence in Washington require a plaintiff to prove (1) duty, (2) breach, (3) injury, and (4) proximate causation. If a plaintiff has 11 different theories potentially establishing liability, will that be sufficient to raise a jury question if the plaintiff is unable to prove how the incident occurred? Will the claim be subject to dismissal by summary judgment? Read on to find out.

Claims Pointer: In this unpublished personal injury case, a man was seriously injured when he fell from a ladder while helping a friend work on a structure. The man filed a negligence lawsuit against the friend with an alternative theory of res ipsa loquitor. During discovery, both the plaintiff and his friend testified that they did not know how the fall occurred, nor what caused it. The defendants moved for summary judgment on the basis that the plaintiff failed to provide evidence relating to what caused the plaintiff’s fall. The trial court granted summary judgment and the plaintiff appealed. The court of appeals affirmed the trial court’s grant of summary judgment, finding that the plaintiff’s failure to provide evidence of cause was fatal to his suit as a matter of law and the doctrine of res ipsa loquitor was unavailable.

Clarke v. Nichols et al., Wash. Ct. of App., No. 35477-6-III (January 3, 2019) (unpublished).

In the spring of 2013, Michael Clarke (“Plaintiff”) accompanied his friend Jay Nichols to a property owned by Mr. Nichols and his sisters (collectively, “Defendants”) to help spruce up a shed. Plaintiff was experienced with the type of work they aimed to accomplish, which involved climbing ladders to install soffit to the shed. Mr. Nichols had set up two A-Frame ladders in anticipation of the project. The ladders were wooden, approximately six-feet tall, and set about six-feet apart on...

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Attorney Profile Case Update Template - Josh

Washington Case Law Update: Insured’s Bad Faith Lawsuit is Revived after the Washington Court of Appeals Interprets Ambiguous Insurance Terms against the Insurer

From the Desk of Joshua P. Hayward: Washington law permits insureds to bring bad faith actions against insurers when claims made under their insurance policies are denied. Occasionally, these lawsuits focus on the interpretation of insurance policies and can possibly lead to increased damages if the insurer wrongfully denied claims. What if the insurance company denies coverage based on language that the court deems ambiguous? May the insurance company be subjected to bad faith? Read on to find out.

Claims Pointer: In this bad faith lawsuit, The Washington Court of Appeals interpreted an insurance policy to determine whether an insurer was required to cover the costs incurred by its insured who rebuilt a similar structure after a fire. The court of appeals found that the language relied upon to deny coverage to the insured was ambiguous. Once the court found that the language was ambiguous, it construed the language against the drafter. Accordingly, the insurer was subject to a bad faith denial of coverage. This case serves as an important reminder that Washington courts consistently favor the insured in disputes against insurers. When contemplating denying an insured’s claim, it is important to ensure that the language relied upon is unambiguous. If there is any question, seek legal advice.

Poole v. State Farm, 2018 Wash. App. Lexis 2851 (Dec. 18, 2018).

In 2014, Michael and Vicky Poole’s (“the Pooles’”) home, attached shop, and separate barn—all insured under a State Farm homeowner’s policy—burned to the ground. The Pooles began construction on replacement structures and sought compensation under their homeowner’s policy. State Farm accepted coverage for the Pooles’ replaced home and barn but denied coverage for the Pooles’ new shop. State Farm denied coverage based upon its...

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Washington Case Law Update: Washington Supreme Court Adopts the “Apparent Manufacturer” Doctrine in Product Liability Actions Arising Before 1981

From the desk of Tom McCurdy: Washington law permits injured plaintiffs to bring product liability actions against product manufacturers when they are injured as the result of a manufacturing defect. What if a company does not manufacture a product, but holds itself out to the public as a manufacturer of the product? Will they be subject to liability as a manufacturer? Read on to find out.

Case Pointer: In this product liability action, the Washington Supreme Court adopted the apparent manufacturer doctrine for common law product liability claims predating the 1981 product liability and tort reform act (“WPLA”). This doctrine already applies to causes of action arising after 1981. It provides that an entity that presents a product to the public as its own—despite not manufacturing the product—will be subject to the same liability as the true manufacturer. This case expands the potential liability of resellers when they hold themselves out to the public as the manufacturers of the product.

Rublee v. Pfizer, Inc., et. al., 428 P.3d 1207 (2018).

In this matter, Margaret Rublee (“Plaintiff”), brought a wrongful death action against Pfizer as the surviving spouse of Vernon Rublee, who succumbed to mesothelioma related to asbestos exposure. Vernon worked as a machinist at the Puget Sound Naval Shipyard from 1966 to 1980. During this time, Vernon was exposed to asbestos products manufactured, sold, and distributed by a manufacturer called Quigley. Unbeknownst to Vernon, Quigley became a fully owned subsidiary of Pfizer when Pfizer purchased the company in 1968. As part of the transition, Quigley redesigned its marketing and packaging materials to include noticeable reference to Pfizer. As Vernon observed, the name “Pfizer” was prominently printed on the bags containing the asbestos products.

Once the...

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Matt Ukishima

Oregon Case Law Update: Oregon Supreme Court Limits the Applicability of Oregon’s Statute of Repose in Product Liability Actions

From the Desk of Matt Ukishima: Oregon limits the timeframe for initiating a product liability civil action for personal injury or property damage to ten years from the date of purchase (statute of ultimate repose). In cases where the product was manufactured in a different state with a longer statute of repose, plaintiffs may sue in Oregon and get the benefit of the longer limitations period. But, what happens if the manufacturing state has no statute of repose for product liability claims? Read on to find out.

Claims Pointer: The Oregon Supreme Court determined that, while Oregon imposes a statute of repose of 10 years for product liability claims, when the product is manufactured in a state with no applicable statute of repose, then the claim is not subject to any repose period. In effect, this ruling expands the potential liability exposure for manufacturers, sellers, distributors, and others in the chain of manufacturing and sale for products and components manufactured in the 32 states that do not employ product liability statutes of repose.

Miller v. Ford Motor Co., 363 Or 105 (June 7, 2018).

In this matter, Aline L. Miller (“Plaintiff”) owned a Ford Escape, first sold in June 2001 and manufactured in Missouri. In May 2012, the Escape caught fire in Miller’s garage due to a faulty engine sensor. Plaintiff’s home was damaged and Plaintiff was injured when she fled the fire. In April 2014, Plaintiff filed a product liability lawsuit against Ford Motor Company (“Ford”) in Oregon State Court. Ford removed the case to Federal District Court and moved for summary judgment based on Oregon’s statute of repose for product liability actions. After the District Court denied Ford’s motion, the case was appealed to the Ninth Circuit Court of Appeals, which then turned to the Oregon Supreme Court with a certified question...

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Oregon Case Update: Oregon Supreme Court Restricts the Scope of Discoverable Communications Between Plaintiffs and Treating Physicians 

From the Desk of Ryan McLellan: Communications between plaintiffs and their treating physicians have long been discoverable in Oregon depositions after the plaintiff has put their injuries at issue. Does the physician-patient privilege in Oregon’s evidence code now allow plaintiffs to refuse to answer questions about such communications? Read on to find out.

Claims Pointer: In this personal injury lawsuit, a woman was injured when she fell through an allegedly faulty deck at an apartment. After filing her lawsuit against the apartment, defense counsel took her deposition and sought to learn what she told her treating physician about her injuries. Plaintiff’s attorney objected to the question as constituting a violation of Oregon’s physician-patient privilege. After the defense obtained a ruling from a trial court compelling plaintiff to answer the questions, plaintiff sought mandamus review by the Oregon Supreme Court. The Supreme Court reversed the trial court, finding that plaintiff’s communications with her treating physician were protected. This case has changed the longstanding practice of defense counsel in Oregon. It will now be more challenging for defense counsel and claims professionals to get all of the information they need to fully evaluate their claims.

Hodges v. Oak Tree Realtors, 363 Or 601 (September 13, 2018).

Rule 504-1 of Oregon’s Evidence Code establishes a privilege commonly known as the physician-patient privilege. In a civil lawsuit, a patient has the privilege to refuse to disclose any communications with his or her physician “made for the purposes of diagnosis or treatment of the patient’s physical condition…” The privilege is subject to a non-exclusive list of three exceptions. Importantly in this matter, the privilege does not extend to “communications made in the course of a...

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Attorney Katie Buxman

Washington Case Law Update: Washington Court of Appeals Sets the Stage for a Change in PIP Billing Practices 

From the Desk of Katie D. Buxman: Some insurers use automated software to adjust their PIP payments to match the standard rate for specific procedures in specified geographic areas. Some states, such as Oregon, have prohibited this practice. Is Washington the next state to follow that trend? Read on to find out.

Claims Pointer: In this class action lawsuit, a chiropractic clinic brought a Consumer Protection Act claim against an insurer for its use of software to determine the reasonableness of PIP payments. After the lawsuit was dismissed by the trial court, the court of appeals reversed and reinstated the lawsuit. It concluded that the chiropractic clinic properly alleged a violation of Washington’s CPA because the insurer failed to individually examine claims to determine whether they were reasonable and necessary. This case may be the first step Washington courts take towards eliminating an insurer’s ability to use software such as Fair Health to determine the reasonableness of PIP payments to providers.  

Folweiler Chiropractic PS (“Folweiler”) is a chiropractic clinic based out of King County, Washington. In 2016, Folweiler filed a class action lawsuit against American Family Insurance Company (“American Family”) alleging violations of Washington’s Consumer Protection Act. Folweiler alleged that, from 2012 to 2016, it treated numerous patients with PIP coverage provided by American Family and was directed to bill American Family directly. However, Folweiler alleged, rather than accepting and paying each bill, American Family processed the bills through a payment database maintained by Fair Health which compared Folweiler’s bills to the same procedures in the same zip code and reduced such bills to the 80th percentile of payments in the database. Folweiler argued that American Family’s use of the software violated its duty to...

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