Oregon Court of Appeals Rules Special Relationship Required for Purely “Psychic Damages” in Negligence Claims

From the Desk of Melanie Rose: Recently, the Oregon Court of Appeals was asked to clarify when a plaintiff may recover noneconomic damages in a negligence case when the Plaintiff did not suffer a physical injury.

Claims Pointer: In this case, the Oregon Court of Appeals held that in the absence of physical injury, a plaintiff may recover noneconomic emotional and psychological damages, aka “psychic damages,” only if they establish that they had a “special relationship” with the defendant.

R.S.R. v. State of Oregon, 3190 Or App 149 (2022).

Facts:

Prior to this suit being filed, the Department of Human Services (“DHS”), removed Plaintiff’s son, R, from Plaintiff’s care based on allegations that R was the victim of sexual assault. The DHS proceeding was subsequently dismissed without a finding against Plaintiff, and R was ultimately returned to Plaintiff’s care. Plaintiff and his son then filed an action against DHS, Kaiser Permanente, and a Kaiser employee who had diagnosed R as the victim of sexual abuse. Plaintiff alleged various causes of action including a claim against DHS for negligent infliction of emotional distress (“NIED”) for removing R from his care. Plaintiff did not claim that a physical injury had occurred and instead only sought $750,000 in noneconomic emotional and psychological damages, aka “psychic damages.” 

The trial court entered an order dismissing Plaintiff’s NIED claim, holding that Plaintiff had not established a special relationship with DHS, sufficient to recover purely psychic damages in a negligence action. Plaintiff appealed.

Law:

Under Oregon negligence law, a plaintiff can typically recover for injuries that are the foreseeable result of the unreasonable conduct of a defendant. Fazzolari v. Portland School Dis. No 1J, 303 Or 1, 734 P2d 1326 (1987). However, when a plaintiff sues based only on negligently caused emotional or psychological harms (“psychic injuries”) the mere foreseeability of the injuries is not enough to establish liability.

In absence of physical injury, a party may recover damages of psychic injuries if they establish that they have a “special relationship” with the other party that creates a heightened duty of care. See Lowe v. Philip Morris USA, Inc., 207 Or App 532, 551, 142 P3d 1079 (2006)

Analysis:

Though the Court spent a majority of its opinion evaluating the timeliness of Plaintiff’s appeal, the Court also discussed the merits of Plaintiff’s negligence claim, which alleged only psychic injuries.

On appeal, Plaintiff argued that the trial court erred in dismissing his NIED claim for failing to establish a “special relationship” with DHS that would support the claim. Plaintiff did not dispute that the damages he sought were “purely psychic” damages, nor did he challenge the notion that, in order to recover those damages, that he was required to establish a “special relationship” between himself and DHS. Instead, Plaintiff argued that while no special relationship was pled in the Complaint, the existence of various child-protection statutes and administrative rules established the necessary special relationship. In Plaintiff’s view, the existence of the statutes and rules demonstrated on their own that a special relationship existed because they established that R’s parents were clients of DHS, DHS was required to work towards the reestablishment of a parent-child relationship between R and his parents, and that R’s father held a liberty interest with his child. However, even on appeal, Plaintiff’s briefing to the Court of Appeals curiously provided citations to the statutes and rules governing DHS and at no point did Plaintiff’s appellate briefing attempt to apply the cited authorities to the facts of his case.

In analyzing this argument, the Court stated that when a plaintiff sues solely on negligently caused “purely psychic” injuries, the mere foreseeability of the injuries is not enough to establish liability; instead, there must be another “legal source of liability” for the plaintiff to recover.

Based on this, the Court found that although Plaintiff cited child-protection statutes and related administrative rules that could potentially demonstrate the necessary “special relationship” with DHS, Plaintiff had “insufficiently developed” his case because he did not apply these authorities to the facts of his case. To this, the Court said that “it is insufficient for Plaintiff to merely identify [. . .] authorities and task us with determining how, under controlling case law, they apply to the case.” Therefore, because the Plaintiff did not sufficiently develop his pleadings in the underlying action or his argument on appeal, the Court of Appeals affirmed the trial court’s dismissal of the NIED claim.

Big Picture:

In negligence actions, if a party is only alleging noneconomic emotional or psychological damages, they must establish that a special relationship existed to justify a higher standard of duty, and the basis for the special relationship must be pled in the Complaint.