Oregon Case Law Update: Plaintiff Must Provide Substantiating Information with ORS 20.080 Demand to Recover Attorney Fees

Oregon Case Update: Plaintiff Must Provide Substantiating Information with ORS 20.080 Demand to Recover Attorney Fees
An Oregon statute, ORS 20.080, provides for an award of reasonable attorney fees in low-value ($10,000 or less) tort cases if the plaintiff makes a pre-suit written demand, no settlement is reached, and the plaintiff later recovers more than the defendant offered. The demand must comply with specific requirements of the statute, including providing substantiating information that is in the plaintiff’s possession or that is reasonably available to the plaintiff. But when the plaintiff fails to provide that information, who has the burden of proving that the information was not reasonably available to the plaintiff? Read on to find out.
Claims Pointer: In this case arising out of a multiple-car collision, the Court of Appeals held that the plaintiff was not entitled to an award of attorney fees because she did not provide any substantiating information in her pre-suit demand letter, nor did she demonstrate that the information was not reasonably available to her. The court also made it clear that it was the plaintiff’s burden to show that she complied with the statutory requirements. The case provides important clarity on the plaintiff’s burden of proof in ORS 20.080 cases.
Alsaedi v. Conroy, 285 Or App 95 (April 26, 2017)
Rayaheen Alsaedi (“Alsaedi”) was involved in a multiple-car accident on January 18, 2014. On January 28, 2014, the insurer of one of the defendants prepared an estimate of the cost to repair plaintiff’s car. On February 26, 2014, Alsaedi’s attorney sent a demand letter to defendant Roger Conroy and his insurer. The letter simply demanded payment of $10,000 in “damages” that resulted from the collision. The letter also indicated that the demand was made pursuant to ORS 20.080. Alsaedi’s attorney then sent identical demand letters to the other defendants and their insurers.
Alsaedi subsequently filed a complaint against defendants for property damage to her car. The case was arbitrated, and on December 10, 2014, the arbitrator found the defendants liable and awarded Alsaedi damages. Alsaedi then petitioned for attorney fees under ORS 20.080. Defendants objected, arguing that her demand was insufficient under statute and she was therefore not entitled to fees. The arbitrator denied the attorney fee request, and Alsaedi filed an exception with the trial court. Following a hearing, the trial court denied the exception and entered a general judgment and money award for Alsaedi’s property damage and costs, and made no award of attorney fees.
Alsaedi appealed, arguing that she was entitled to attorney fees pursuant to ORS 20.080. In addition to pleading $10,000 or less and making a written demand on the defendant(s) at least 30 days before commencing an action, the statute requires that the plaintiff substantiate her damages. In an action for property damage, the demand must include documentation of the repair of the property, a written estimate for the repair, or a written estimate of the difference in value as a result of the damage, if the information is in the plaintiff’s possession or is reasonably available to the plaintiff. If the plaintiff fails to comply with these requirements, the statute prohibits any recovery of attorney fees. The statute’s policy rationale is to encourage settlement of small claims, to prevent insurers and tortfeasors from refusing to pay just claims, and to discourage plaintiffs from inflating their claims.
The Court of Appeals held that Alsaedi’s demand letter failed to meet the statutory requirements. The court made it clear that Alsaedi had the burden of proving that when she petitioned for attorney fees, her demand letter either included the required information or demonstrated that the information was not in her possession or reasonably available to her when she made the demand. Because the letter demanded $10,000 without any information substantiating the claim (or even specifying what the alleged damages were for), it did not satisfy the statutory requirements. As the court explained, an unsubstantiated demand letter is in conflict with the statute’s policy to encourage settlement and discourage inflated claims.
The court was careful to point out that one of the defendants’ insurers prepared an estimate for the cost of repairing Alsaedi’s car nearly a month before she mailed her first demand letter, and at no point did Alsaedi present evidence to the arbitrator that this estimate was not in her possession or reasonably available to her. In her response to defendants’ objections to her petition for attorney fees, Alsaedi stated that it was defendants’ burden to prove that she possessed the required information at the time of her demand. The court disagreed, however, noting that the statute prohibits a plaintiff from recovering attorney fees if the plaintiff fails to comply with the statutory requirements. Thus, it was Alsaedi’s burden to demonstrate compliance with the statute in order to recover attorney fees.
Because Alsaedi failed to satisfy the statutory requirements, the trial court did not err in denying her exception to the denial of attorney fees. The trial court was affirmed.
View full opinion at: http://www.publications.ojd.state.or.us/docs/A159011.pdf
Case updates are intended to inform our clients and others about legal matters of current interest. They are not intended as legal advice. Readers should not act upon the information contained in this article without seeking professional counsel.