Horton v. Western Protector Ins. Co.

• Jurisdiction: Oregon
• Court: Oregon Court of Appeals
• Writing for the Court: Edmonds
• Citation: Horton v. Western Protector Ins. Co., 176 P.3d 419, 217 Or. App. 443 (Or. App. 2008)
• Decision Date: 23 January 2008
• Docket Number: No. A132367.,No. 050707077.,050707077.,A132367.
• Parties: William P. HORTON, Plaintiff-Appellant, v. WESTERN PROTECTOR INSURANCE COMPANY, fka Oregon Mutual Insurance Company, Defendant-Respondent.

176 P.3d 419

217 Or. App. 443

William P. HORTON, Plaintiff-Appellant, v. WESTERN PROTECTOR INSURANCE COMPANY, fka Oregon Mutual Insurance Company, Defendant-Respondent.

No. 050707077.

No. A132367.

Court of Appeals of Oregon.

Argued and Submitted September 19, 2007.

Decided January 23, 2008.

William P. Horton, Portland, argued the cause and filed the briefs pro se.

Jeffrey D. Eberhard, Portland, argued the cause for respondent. With him on the brief were Kyle D. Riley, Portland, and Smith Freed & Eberhard, PC.

Before EDMONDS, Presiding Judge, and WOLLHEIM and SERCOMBE, Judges.

EDMONDS, P.J.

Plaintiff appeals after the trial court, pursuant to ORS 31.150, granted defendant's motion to strike plaintiff's complaint, dismissed his action for wrongful use of a civil proceeding, and awarded defendant attorney fees. On appeal, plaintiff makes three assignments of error. In his first assignment of error, he argues that ORS 31.150 is inapplicable to this action. He argues in his second assignment of error that, even if this action is subject to ORS 31.150, defendant's motion to strike was not timely filed. In his third assignment of error, plaintiff makes an unpreserved argument that ORS 31.150 violates his right to trial by jury. Because his second assignment of error is dispositive, we reverse.

Plaintiff, a member of the Oregon State Bar, represented an elderly client who was injured in a motor vehicle accident. The client was insured by defendant. Pursuant to its policy with plaintiffs client, defendant paid $10,000 in Personal Injury Protection (PIP) benefits to plaintiff, who placed the payment in his trust account on behalf of his client. Thereafter, plaintiff filed an action on behalf of his client against the other motorist and eventually recovered a settlement for $111,675. Defendant then demanded reimbursement from the settlement proceeds for the PIP benefits it had paid. When the parties were unable to resolve whether reimbursement was proper, defendant filed an action against plaintiff, alleging that he had converted monies that belonged to defendant. That action was referred to arbitration and, after an adverse arbitration award, plaintiff appealed to the circuit court. The circuit court, on de novo review, dismissed defendant's action for failure to state a claim, and defendant did not appeal that judgment.

Plaintiff then filed this action for wrongful use of a civil proceeding based on defendant's conversion action. After filing its answer, defendant filed a motion to strike plaintiffs. complaint under ORS 31.150, arguing that there was no probability that plaintiff could prevail. After hearing argument on the motion, the trial court, pursuant to ORS 31.150(2)(a), granted the motion and entered both a general judgment that dismissed plaintiffs complaint against defendant and a supplemental judgment that awarded attorney fees to defendant. Plaintiff appeals both judgments.

Plaintiff argues in his first assignment of error that the trial court erred in concluding that ORS 31.150(2)(a) applied to his complaint.¹ ORS 31.150 authorizes the filing of a special motion to strike a claim:

"(1) A defendant may make a special motion to strike against a claim in a civil action described in subsection (2) of this section. The court shall grant the motion unless the plaintiff establishes in the manner provided by subsection (3) of this section that there is a probability that the plaintiff will prevail on the claim. The special motion to strike shall be treated as a motion to dismiss under ORCP 21 A but shall not be subject to ORCP 21 F. Upon granting the special motion to strike, the court shall enter a judgment of dismissal without prejudice.

"(2) A special motion to strike may be made under this section against any claim in a civil action that arises out of:

"(a) Any oral statement made, or written statement or other document submitted, in a legislative, executive or judicial proceeding or other proceeding authorized by law;

"(b) Any oral statement made, or written statement or other document submitted, in connection with an issue under consideration or review by a legislative, executive or judicial body or other proceeding authorized by law;

"(c) Any oral statement made, or written statement or other document presented, in a place open to the public or a public forum in connection with an issue of public interest; or

"(d) Any other conduct in furtherance of the exercise of the constitutional right of petition or the constitutional right of free speech in connection with a public issue or an issue of public interest."

Specifically, plaintiff argues that ORS 31.150(2)(a) does not apply because the gravamen of his wrongful use of a civil proceeding claim is not conduct that was in furtherance of the exercise of the constitutional rights of petition and free speech in connection with a public issue or an issue of public interest. In his complaint, plaintiff alleges that defendant filed a complaint against him alleging that he collected $10,000 from defendant "without authorization," that he refused to return those monies to defendant, that he was liable for "conversion" of those monies, and that defendant filed the complaint for an improper purpose, i.e., "with the primary purpose of coercing, threatening, embarrassing, or otherwise harassing" plaintiff and "not for the primary purpose of the proper adjudication" of defendant's claim. In light of those allegations, plaintiff interprets paragraph (d) of subsection (2) of the statute to add a requirement to paragraphs (a), (b), and (c). Thus, he concludes that ORS 31.150(2)(a), when considered in context with paragraph (d), should be interpreted to apply only to claims involving conduct that implicates a "public issue or an issue of public interest." It follows, in plaintiff's view, that ORS 31.150 does not apply to his claim for wrongful use of a civil proceeding because only the private interests of plaintiff and defendant are involved.

Defendant responds that, when properly interpreted, the paragraphs in ORS 31.150(2) are independent of each other and that paragraph (d) is not part of the requirements under paragraph (a). Thus, under defendant's view, ORS 31.150, applies because, under paragraph (2)(a) of the statute, plaintiff's civil action arises out of defendant's filing of a written statement (defendant's complaint for conversion) in a judicial proceeding.

Plaintiff's first assignment of error presents an interesting question concerning the scope of ORS 31.150, but we need not resolve that issue of statutory construction in this case.² Rather, we agree with plaintiff that, even assuming that ORS 31.150 authorizes the filing of a motion to strike in this case, defendant's motion was untimely and should have been denied for that reason.

In his second assignment of error, plaintiff argues that, because ORS 31.150(1) incorporates by reference ORCP 21 A and because defendant filed its motion to strike plaintiff's complaint after it filed its answer, ORCP 21 A operates to make defendant's motion untimely. It follows, in plaintiff's view, that the trial court erred by granting defendant's motion to strike his complaint based on a motion that was not timely filed. Defendant counters that the motion was timely filed because ORS 31.152(1) provides that a movant has 60 days from the date of the service of the complaint to file a motion to strike under ORS 31.150 and it filed its motion within that time period. Defendant also argues that, because its motion to strike was not based on any of the enumerated defenses in ORCP 21 A, that rule does not require a motion under ORS 31.150 to be filed before an answer or responsive pleading is filed.

Like the first assignment of error, plaintiff's second assignment of error frames an issue of statutory construction, which we review for errors of law. Our task is to discern the legislature's intent, a task that we undertake by first examining the text and the context of the statute. If the statute is susceptible to more than one plausible interpretation, we resort to the legislative history and ultimately to canons of statutory construction, if necessary, to determine what the legislature intended. PGE v. Bureau of Labor and Industries, 317 Or. 606, 610-12, 859 P.2d 1143 (1993).

We turn first to the text and the context of the applicable statutes. Again, ORS 31.150(1) provides:

"A defendant may make a special motion to strike against a claim in a civil action described in subsection (2) of this section. The court shall grant the motion unless the plaintiff establishes in the manner provided by subsection (3) of this section that there is a probability that the plaintiff will prevail on the claim. The special motion to strike shall be treated as a motion to dismiss under ORCP 21 A but shall not be subject to ORCP 21 F. Upon granting the special motion to strike, the court shall enter a judgment of dismissal without prejudice."

(Emphasis added.) ORCP 21 A, in turn, provides that every defense to a claim for relief shall be asserted in a responsive pleading, except that certain defenses may be asserted by a motion to dismiss. It further provides that "[a] motion to dismiss making any of these defenses shall be made before pleading if a further pleading is permitted." According to plaintiff, by requiring a special motion to strike to be "treated as a motion to dismiss under ORCP 21 A," the legislature incorporated the requirement that such a motion be made "before pleading if a further pleading is permitted." Because defendant's motion to strike was made after defendant filed an answer to the complaint, plaintiff argues that it was untimely and should have been denied for that reason.

Defendant, in response, argues that the legislature did not intend to incorporate any such timing requirement into ORS 31.160. Rather, the legislature intended a special motion to strike to be "treated as a motion to dismiss un...