Wilson v. TRI-COUNTY MET., TRANS.

• Decision Date: 14 April 2010
• Docket Number: 030100495,A138860.
• Citation: 234 Or. App. 615,228 P.3d 1225
• Parties: Jefferson WILSON, Plaintiff-Appellant Cross-Respondent, v. TRI-COUNTY METROPOLITAN TRANSPORTATION DISTRICT OF OREGON, a municipal corporation, Defendant-Respondent Cross-Appellant.
• Court: Oregon Court of Appeals

228 P.3d 1225

234 Or. App. 615

Jefferson WILSON, Plaintiff-Appellant Cross-Respondent, v. TRI-COUNTY METROPOLITAN TRANSPORTATION DISTRICT OF OREGON, a municipal corporation, Defendant-Respondent Cross-Appellant.

030100495; A138860.

Court of Appeals of Oregon.

Argued and Submitted June 30, 2009.

Decided April 14, 2010.

Willard E. Merkel, Portland, argued the cause for appellant — cross-respondent. With him on the briefs was Merkel & Associates.

Kimberly Sewell, Portland, argued the cause and filed the briefs for respondent — cross-appellant.

Before LANDAU, Presiding Judge, and SCHUMAN, Judge, and ORTEGA, Judge.

LANDAU, P.J.

This is a case about attorney fees, specifically, about plaintiff's entitlement to attorney fees after prevailing on an uninsured motorist claim against defendant Tri-Met and, even more specifically, about the extent to which defendant's offer to settle the case affects plaintiff's entitlement to such an attorney fee award. The answer requires an examination of the interplay between ORS 742.061, a statute that applies to recovery of attorney fees in an action on an insurance policy, and ORCP 54 E, a rule that limits recovery of attorney fees after a party presents an offer of judgment to an opponent. The trial court concluded that defendant's offer did not preclude plaintiff from receiving an award of attorney fees under the statute, but that the rule did limit the amount that plaintiff could receive. We conclude that the trial court was correct as to the first holding, but incorrect as to the second. We therefore reverse and remand for entry of judgment awarding the full amount of the attorney fees requested, but otherwise affirm.

I. BACKGROUND

The facts are largely undisputed. Plaintiff was injured on January 31, 2002, when a Tri-Met bus driver braked suddenly in order to avoid a collision. Plaintiff, who was then uninsured, presented defendant with an uninsured motorist claim. Defendant, which is self-insured under the Financial Responsibility Law, ORS 806.010 to 806.300, denied the claim on the ground that plaintiff had failed to file an accident report within the time required by the Financial Responsibility Law. ORS 742.504(2)(g)(C).

Plaintiff filed the complaint in this proceeding, seeking insurance coverage as well as attorney fees. On July 29, 2003—more than six months after receiving plaintiff's proof of loss—defendant offered plaintiff judgment in his favor in the amount of "$10,000, inclusive of costs." At the time of the offer, plaintiff had incurred $762 in costs and $5,790 in attorney fees. Plaintiff did not accept the offer of judgment.

Defendant then moved for summary judgment on the ground that plaintiff's failure to file a police report of his injury within the time required by the statute precluded his claim. The trial court granted the motion, and we affirmed ensuing judgment of the trial court without opinion. Wilson v. Tri-County Metro. Trans. Dist., 200 Or.App. 291, 114 P.3d 1157 (2005). On review, the Supreme Court ultimately determined that plaintiff's failure to provide notice to the police of his accident did not bar his claim and remanded the case for further proceedings. Wilson v. Tri-County Metro. Trans. Dist., 343 Or. 1, 16, 161 P.3d 933 (2007) (holding the statutory notification requirement unenforceable).¹

On remand, plaintiff prevailed after a jury trial, obtaining a damages award of $5,930.58. He then petitioned for an award of attorney fees under ORS 742.061(1), which provides that, subject to exceptions not pertinent to this case,

"if settlement is not made within six months from the date proof of loss is filed with an insurer and an action is brought in any court of this state upon any policy of insurance of any kind or nature, and the plaintiff's recovery exceeds the amount of any tender made by the defendant in such action, a reasonable amount to be fixed by the court as attorney fees shall be taxed as part of the costs of the action and any appeal thereon."

(Emphasis added.) Plaintiff argued that his recovery—$5,930.58 plus costs and attorney fees—exceeded defendant's $10,000 offer, thus warranting an attorney fee award under the statute.

Defendant objected on two grounds. Defendant first argued that plaintiff was not entitled to attorney fees at all under ORS 742.061(1), because, in fact, plaintiff's recovery did not exceed the offer; according to defendant, although its offer was for "$10,000, inclusive of costs," the reference to "costs" did not include attorney fees. Thus, defendant argued, plaintiff's recovery of $5,930.58 plus "costs" (not including attorney fees) fell short of its $10,000 offer of judgment.

Defendant next argued that, even if plaintiff's recovery did exceed the offer, the amount of attorney fees to which plaintiff would be entitled was limited to those fees that had been incurred at the time the July 29, 2003, offer of judgment was made, under ORCP 54 E.² At the relevant time, that rule provided:

"E(1) Except as provided in ORS 17.065 through 17.085, the party against whom a claim is asserted may, at any time up to 10 days prior to trial, serve upon the party asserting the claim an offer to allow judgment to be given against the party making the offer for the sum, or the property, or to the effect therein specified.

"E(2) If the party asserting the claim accepts the offer, the party asserting the claim or such party's attorney shall endorse such acceptance thereon, and file the same with the clerk before trial, and within three days from the time it was served upon such party asserting the claim; and thereupon judgment shall be given accordingly, as a stipulated judgment. If the offer does not state that it includes costs and disbursements or attorney fees, the party asserting the claim shall submit any claim for costs and disbursements or attorney fees to the court as provided in Rule 68.

"E(3) If the offer is not accepted and filed within the time prescribed, it shall be deemed withdrawn, and shall not be given in evidence on the trial; and if the party asserting the claim fails to obtain a more favorable judgment, the party asserting the claim shall not recover costs, prevailing party fees, disbursements, or attorney fees incurred after the date of the offer, but the party against whom the claim was asserted shall recover of the party asserting the claim costs and disbursements, not including prevailing party fees, from the time of the service of the offer."

(Emphasis added.) Defendant argued that the emphasized portion of ORCP 54 E(2) makes clear that the terms "costs" and "attorney fees" are not synonymous. Accordingly, it argued, its July 29, 2003, offer of judgment—which did not mention attorney fees—did not include attorney fees and, as a result, plaintiff's recovery at trial did not exceed that offer. As a result, defendant argued, under ORCP 54 E(3), plaintiff is limited to recovering only those attorney fees that he had incurred up to the date of the July 29, 2003, offer.

In reply, plaintiff argued that defendant's reliance on ORS 742.061(1) fails. Citing Dockins v. State Farm Ins. Co., 329 Or. 20, 985 P.2d 796 (1999), plaintiff argued that defendant's offer of judgment did not comply with the tender requirement of ORS 742.061(1), because any tender was more than six months after defendant had received plaintiff's proof of loss and, therefore, could not defeat plaintiff's entitlement to attorney fees under that statute. As for defendant's ORCP 54 E argument, plaintiff asserted that, among other things, that rule should not be read to cut off his right to attorney fees under ORS 742.061(1).

The trial court concluded that, as to plaintiff's entitlement to attorney fees under ORS 742.061(1), defendant's tender was untimely because it was not made within six months of proof of loss. Thus, the court ruled, defendant's tender could not bar plaintiff's entitlement to fees, even if it exceeded the ultimate recovery.

The court also concluded, however, that ORCP 54 E limited plaintiff's recovery to those attorney fees that had accrued at the time of defendant's offer of judgment. The court explained that, because the offer of judgment was silent concerning attorney fees, it did not include them; therefore, the court reasoned, no attorney fees should be considered in comparing the offer of judgment to the actual judgment. When calculated in that way, the court concluded, defendant's offer of judgment exceeded plaintiff's award. The court therefore limited plaintiff's attorney fees to those that had accrued through the date of defendant's offer of judgment.

II. ANALYSIS

On appeal, plaintiff asserts that the trial court erred in determining that the judgment did not exceed defendant's offer of judgment, contending that the trial court incorrectly determined that the offer of judgment was exclusive of attorney fees. Plaintiff also contends that ORS 742.061 and ORCP 54 E are in conflict, and that, as the more specific provision, ORS 742.061 must be regarded as an exception to ORCP 54 E, not subject to limitations stated in the rule. Defendant cross-appeals, contending that the trial court erred in determining that plaintiff was entitled to fees under ORS 742.061(1).

A. Cross-Appeal: Whether Plaintiff Is Entitled to Any Attorney Fees

We first address the cross-appeal, because it requires us to resolve the preliminary question of whether plaintiff was entitled to any attorney fees at all. As we have noted, the only claimed source of attorney fees in this case is ORS 742.061(1), which provides, as relevant:

"Except as otherwise provided in subsections (2) and (3) of this section, if settlement is not made within six months from the date proof of loss is filed with an insurer and an action is brought in any court of this state upon any policy of insurance of any kind or nature, and the plaintiff's recovery exceeds the amount of any tender made by the defendant in such action, a reasonable amount to be

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