Thompson v. Estate of Adrian L. Pannell

• Decision Date: 15 August 2001
• Citation: 176 Or. App. 90,29 P.3d 1184
• Parties: Laurie K. THOMPSON, Appellant, v. ESTATE OF Adrian L. PANNELL, Deceased, Administratrix, and Portland School District No. 1J, a public corporation, Respondent.
• Court: Oregon Court of Appeals

29 P.3d 1184

176 Or. App. 90

Laurie K. THOMPSON, Appellant, v.ESTATE OF Adrian L. PANNELL, Deceased, Administratrix, andPortland School District No. 1J, a public corporation, Respondent.

9706-04406; A103183

Court of Appeals of Oregon.

Argued and Submitted April 24, 2000.

Decided August 15, 2001.

John Wittrock, Portland, argued the cause for appellant.On the briefs were Kathleen O'Brien and Wittrock & O'Brien.

Thomas W. McPherson argued the cause for respondent.With him on the brief was Mersereau & Shannon.

Before LANDAU, Presiding Judge, and ARMSTRONG and BREWER, Judges.

BREWER, J.

In this declaratory judgment action, plaintiff appeals from a judgment on the pleadings in favor of defendant school district as to plaintiff's claim that she was entitled to uninsured motorist (UM) benefits under defendant's self-insurance for motor vehicle liability.Plaintiff also appeals from summary judgment for defendant as to plaintiff's claim for breach of an implied contract of accidental medical and dental insurance for school volunteers.We affirm.

Plaintiff's children attended school in defendant school district.In June 1995, plaintiff's daughter's class took a three-day school-sponsored trip to a camp on the Oregon coast.Plaintiff volunteered to act as a chaperone on the trip.At the request of school staff, plaintiff transported the students' luggage to and from the camp in her van.During the return trip, plaintiff's van was struck head-on by a vehicle driven by an uninsured motorist.The uninsured motorist was killed, and plaintiff was seriously injured.

At the time of plaintiff's accident, defendant was self-insured for liability, including liability arising out of motor vehicle accidents.It also carried excess liability insurance covering losses exceeding $1 million, up to a limit of $2 million.Although defendant's excess liability insurance policy included coverage for bodily injury and property damage arising out of automobile accidents, it did not include uninsured UM coverage.¹

Plaintiff recovered UM and personal injury protection (PIP) benefits under her own motor vehicle liability insurance policy.Because her medical expenses exceeded the amount recovered, plaintiff also sought additional benefits from defendant.Defendant denied coverage.

Plaintiff then brought this action, seeking a declaration that she was entitled to coverage under defendant's motor vehicle liability self-insurance.In that context, plaintiff alleged that she was engaged in defendant's business as a volunteer and as defendant's agent or bailee; that defendant had made representations to volunteers, including plaintiff, regarding insurance coverage for volunteers; that defendant was self-insured for motor vehicle liability pursuant to ORS 806.130; and that plaintiff was "within the class of persons" whom statutes relating to UM coverage were intended to benefit.Relying on defendant's "Guidebook for Volunteers"—stating, in part, that "volunteers are covered by accidental medical and accidental dental insurance while performing on site volunteer service"—plaintiff separately claimed that, in denying coverage, defendant breached an implied contract of accidental medical and dental insurance for school volunteers.²In its answer, defendant admitted that it was self-insured for motor vehicle liability and admitted that it had denied coverage to plaintiff, but it denied plaintiff's other allegations.In addition, as an affirmative defense to plaintiff's claim for declaratory relief, defendant asserted that it was exempt from the Insurance Code pursuant to ORS 731.036(4) and (5)andORS 30.282.

Defendant then moved for judgment on the pleadings as to plaintiff's claim for declaratory relief.Defendant argued that, as a matter of law, it was not subject to the Financial Responsibility Law, ORS 806.010 et seq.,³ because a school district is not a "person" for the purpose of that statutory scheme.Defendant also argued that it was expressly exempted, under ORS 731.036, from the Insurance Code, including the UM-related provision in ORS chapter 742.⁴Defendant argued that, even assuming that it was subject to the Financial Responsibility Law and was not exempt from Insurance Code requirements for UM coverage, plaintiff's vehicle was not covered under its self-insurance, because it was a nonowned vehicle.Finally, defendant argued that plaintiff's own UM coverage exceeded any UM benefits to which plaintiff might be entitled under defendant's self-insurance or its excess liability policy.Defendant also moved for summary judgment on plaintiff's implied contract claim on the grounds that plaintiff had failed to allege an essential term of the purported implied contract of insurance for school volunteers, namely, the amount of coverage; that the coverage extended only to accidental injuries that occurred "on site" of school district property; and that such coverage was limited to $5,000 in medical and dental expenses.

In opposition to defendant's motion for judgment on the pleadings as to her claim for declaratory relief, plaintiff contended that, as a self-insurer, defendant was required under ORS 806.130 to extend coverage to at least the limits specified in ORS 806.070 and that, consistent with ORS 742.502(2)(a)—providing that a motor vehicle bodily injury liability policy shall have the same limits for uninsured motorist coverage as for bodily injury liability coverage unless a lower limit is elected in writing—defendant's UM coverage limit was $1 million, the amount up to which it apparently was insured for bodily injury under its self-insurance.In opposition to defendant's motion for summary judgment on her implied contract claim, plaintiff asserted that there were issues of material fact as to whether the accident took place "on site," within the meaning of that phrase in the "Guidebook for Volunteers," and as to whether defendant's liability to school volunteers was limited to $5,000 or was, instead, a matter within defendant's discretion up to the limits of defendant's self-insurance and its excess liability insurance policy.

The trial court concluded that, under ORS 806.130, a self-insurer for motor vehicle liability was required to provide UM coverage only in the minimum amount stated in ORS 806.070, namely, $25,000, and that ORS 742.502 did not require a higher amount.Because plaintiff had already recovered an amount in excess of that amount under her own coverage, the court granted defendant's motion for judgment on the pleadings with respect to plaintiff's claim for declaratory relief.It also granted defendant's motion for summary judgment on plaintiff's implied contract claim, subject to entry of judgment in plaintiff's favor for $5,000 in damages.

On appeal, plaintiff first assigns error to the trial court's entry of judgment on the pleadings as to her claim for declaratory relief.She again asserts that, considered in the context of defendant's excess liability insurance policy—insuring defendant for amounts in excess of $1 million—defendant's self-insurance constitutes, in effect, an insurance "policy" providing bodily injury liability coverage of $1 million; that, under ORS 742.502, defendant's self-insurance must be deemed to provide UM coverage in that amount; and that she is entitled to benefits under that coverage.⁵Defendant again asserts that, as a public body, it is not subject to the Financial Responsibility Law; that, as a self-insured entity, it is exempt from the Insurance Code; that plaintiff was not an "insured" and that her vehicle was not an "insured vehicle" for the purposes of either defendant's self-insurance or its excess liability policy; and that any UM coverage available to plaintiff under defendant's self-insurance was exceeded by her own UM coverage.

On review of the trial court's entry of judgment on the pleadings as to plaintiff's claim for declaratory relief, ORCP 21 B, we review the pertinent pleadings in the light most favorable to plaintiff to determine whether, in their entirety, they affirmatively demonstrate that plaintiff has not stated a claim for relief or that defendant has a complete defense.SeeSlogowski v. Lyness,324 Or. 436, 439, 927 P.2d 587(1996);Williams v. Tri-Met.,153 Or.App. 686, 958 P.2d 202, rev. den.327 Or. 431, 966 P.2d 222(1998).In this case, whether plaintiff was entitled to a declaration of UM coverage under defendant's self-insurance for motor vehicle liability is purely a question of law under applicable statutes, including ORS 806.010 et seq.andORS 742.502.See, e.g., Fox v. Country Mutual Ins. Co.,169 Or.App. 54, 7 P.3d 677(2000), rev. den.332 Or. 137, 27 P.3d 1043(2001)(determining, as a matter of statutory interpretation, whether the trial court erred in granting the defendants' motion for summary judgment against the plaintiff's claim for a declaration of entitlement to UM benefits).We answer that question by applying the familiar methodology of statutory interpretation set out in PGE v. Bureau of Labor and Industries,317 Or. 606, 611-12, 859 P.2d 1143(1993).

ORS 806.010 provides for the offense of "driving uninsured," that is, driving while not in compliance with the motor vehicle-related "financial responsibility requirements" of this state.ORS 806.060 sets out methods by which the financial responsibility requirements can be satisfied.It provides, in part:

"(1) To meet the financial responsibility requirements, a person must be able to respond in damages in amounts not less than those established under the payment schedule under ORS 806.070.

"(2) A person may only comply with the financial responsibility requirements of this state by establishing the required ability to respond in damages in one of the following ways:

"(a) Obtaining a motor vehicle liability policy meeting the requirements under ORS 806.080 that will provide at least minimum limits necessary to pay amounts established under the payment schedule under

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