:: Archive 2006

ARE ATTORNEY FEES RECOVERABLE?
As a general rule, Oregon courts will not award attorney fees to the prevailing party in litigation absent a statute or contract providing for fees. The Oregon legislature has created a number of exceptions to this rule for particular classes of cases.

As shown by the sampling of recent cases below, the fees awarded in these cases can be far greater than the damages awarded to the plaintiff. In cases in which fees are recoverable, an early attempt at resolution may be worthwhile with the hope that the case can be settled before extensive fees are incurred.

CASE NOTES-ATTORNEY FEES
In Grigsby v. Progressive Preferred Insurance Company, 207 Or App 592, 142 P3d 531 (September 6, 2006), the Oregon Court of Appeals affirmed the trial court’s decision denying plaintiff his petition for attorney fees under ORS 742.061 after he prevailed in an action against his insurer for payment of personal injury protection (PIP) benefits. ORS 742.061 allows plaintiff to recover attorney fees in PIP actions unless the insurer has accepted coverage and the only issue is the amount of benefits due the insured. Here, plaintiff was injured in a rear-end accident. He filed proof of loss for payment of medical expenses under the PIP provisions of his automobile liability insurance policy with Progressive. Progressive wrote to plaintiff stating PIP coverage would pay for reasonable and necessary medical expenses directly related to the accident and that Progressive would consent to submitting any dispute as to the amount of benefits to binding arbitration. Progressive paid plaintiff for time loss and medical bills, but refused to pay plaintiff’s chiropractic bills of $4,042 on the basis that they were not related to the accident. Plaintiff sued seeking the full amount of chiropractic bills and attorney fees. The case went to mandatory arbitration where the arbitrator ruled in Progressive’s favor, followed by plaintiff requesting a trial de novo. At trial, the jury determined that plaintiff’s need for chiropractic treatment was caused by the accident and judgment was entered in plaintiff’s favor. Plaintiff then petitioned for attorney fees of $49,626, which was rejected by the trial court. On appeal, the court discussed the difference between “coverage” and “the amount of benefits due” and concluded that plaintiff’s dispute was only about the amount of benefits due instead of whether there is coverage, therefore excepting it from the attorney fee provision of ORS 742.061(1).

In Bell v. Morales, 207 Or App 326, 142 P3d 76 (August 16, 2006), the court of appeals reversed the trial court’s judgment on attorney fees and remanded with instructions to reinstate the arbitrator’s award. Plaintiff and defendant were in a minor auto accident. Plaintiff received PIP benefits from her carrier. Plaintiff sent a demand under ORS 20.080 to defendant seeking $5,500 for damages sustained in the collision. Defendant did not respond within the ten days allowed, so plaintiff filed suit. Thereafter, defendant served an offer of judgment in the amount of $2,584 which plaintiff rejected. The case went to arbitration. Plaintiff received an award of $1,200. Plaintiff sought attorney fees of $4,650 but the arbitrator only awarded $1,500 on the basis that the offer of judgment had cut off entitlement to post-offer attorney fees. Plaintiff challenged the award contending he was entitled to recover his full attorney fees, plus fees incurred to litigate the challenge. The trial court agreed with plaintiff, entering judgment amending the arbitration decision to award plaintiff’s full $5,400 request and defendant appealed. The appellate court agreed with defendant, holding that offers of judgment under ORCP 54E apply to an attorney fee award under ORS 20.080(1). In this case, plaintiff did not improve on defendant’s offer to allow judgment. The arbitrator’s award of partial attorney fees was reinstated.

In Farrell v. Tri-Met, No. CV 04-296-PA (D Or July 7, 2006), plaintiff received a jury verdict of $1,110 on his Family Medical Leave Act claim. The award was doubled by law to $2,220. Plaintiff then petitioned for attorney fees of $81,110 and costs of $5,773. The court granted plaintiff’s petition but reduced the amount awarded to $42,163 in fees
and $3,257.06 in costs.

ACTUAL, PRESENT INJURY IS NECESSARY ELEMENT OF NEGLIGENCE CLAIM
The Oregon Court of Appeals addressed an interesting issue in Lowe v. Philip Morris USA, Inc., et al, 207 Or App 532, __ P3d __ (September 6, 2006). There, plaintiff, a long time cigarette smoker, filed a complaint for negligence against the defendant cigarette manufacturers. However, plaintiff alleged no current injury. Instead, she alleged that her accumulated exposure to cigarette smoke increased her risk of contracting lung cancer in the future. She went on to allege that such a risk created a current need for medical monitoring and smoking cessation treatment which defendants should provide. The defendants moved to dismiss the complaint on the ground that plaintiff did not allege a present physical injury which is a necessary element of a negligence claim. The trial court agreed and dismissed the complaint. On appeal, the court affirmed the trial court’s decision. After a lengthy analysis, the court found that without an allegation of actual, present - even nonphysical - injury, plaintiff’s claim was insufficient to establish the harm that is required to establish liability in negligence under Oregon law.

NONECONOMIC DAMAGES DO NOT HAVE TO BE AWARED IN INJURY SUIT
In Fatehi v. Johnson, 207 Or App 719, __ P3d ___ (September 20, 2006), plaintiff was involved in an auto accident. Ten days later, he sought medical treatment from the chiropractor to whom his attorney referred him. The chiropractor treated plaintiff for soft tissue injuries. Plaintiff then sued seeking to recover economic damages (his medical bills) and non-economic damages (his pain and suffering). At trial, the jury returned a verdict in favor of plaintiff and awarded him $10,000 in medical bills and nothing for noneconomic damages. Plaintiff appealed arguing that he was entitled to an award of noneconomic damages as a matter of law. The court of appeals affirmed indicating that even though defendant admitted that plaintiff incurred “some minor physical injury”, the mere existence of an injury is not sufficient to require an award of noneconomic damages. Rather, the plaintiff must have suffered a substantial, as opposed to minor, injury before he is necessarily entitled to recover for pain and suffering. On the facts of this case, a verdict that awarded only economic damages was valid.

LIMITS ON DAMAGES IN MEDICAL MALPRACTICE CASES AGAINST OHSU
In Clarke v. Oregon Health Sciences University, et al, 206 Or App 610, 38 P3d 900, (July 5, 2006), the Oregon Court of Appeals reversed the trial court’s judgment and remanded with instructions to reinstate judgment against OHSU in the amount of $200,000 and to reinstate claims against the individual defendants. The background facts in this matter surround plaintiff’s birth at OHSU in February 1998 with a congenital heart defect. The heart defect was diagnosed prior to birth and plaintiff was readmitted later for surgical repair of the defect. Surgery was performed and the defect was successfully repaired. Plaintiff was then placed in a surgical intensive care unit where he suffered prolonged oxygen deprivation causing permanent and profound brain damage. Initially, plaintiff brought claims against OHSU and the individuals who treated him. The trial court granted OHSU’s motion to substitute itself in as the sole defendant under ORS 30.265(1).

OHSU admitted in its answer that it was negligent in one or more of the particulars alleged by plaintiff resulting in permanent injury to him. OHSU further admitted plaintiff incurred damages. At the same time it filed its answer, OHSU filed a motion for judgment on the pleadings arguing that because it had admitted negligence, as well as its maximum liability under the Oregon Tort Claims Act (OTCA), all matters should be resolved on the pleadings. The trial court agreed and entered judgment in favor of plaintiff in the amount of $200,000, the maximum award under the limits of the OTCA. Plaintiff appealed arguing that the trial court denied him the right to a remedy under the Oregon Constitution. The court disagreed, affirming the trial court’s judgment against OHSU concluding that OHSU’s liability was properly limited by the damages cap of the OTCA. However, the court concluded that if plaintiff had suffered the damages he alleged, he was denied a substantial substitute remedy in violation of the Oregon Constitution. Accordingly, the court reversed and remanded with instructions to reinstate the claims against the individual defendants.

UPDATE ON WILLIAMS v. PHILIP MORRIS, INC.
In our last issue, we reported that the United States Supreme Court granted certiorari in the Williams v. Philip Morris, Inc., 340 Or 35 (2006) decision from the Oregon Supreme Court. Oral argument on that matter is scheduled before the United States Supreme Court on October 31, 2006.

TIPS FOR EMPLOYERS
The Oregon Bureau of Labor and Industries has a technical assistance program which provides a great resource for Oregon employers. BOLI offers informative seminars held around the state at a reasonable price. Log in to www.boli.state.or.us, and click on “Employer Seminars.” BOLI’s 22nd annual employment law conference is scheduled for December 6 & 7, 2006 at the Oregon Convention Center in Portland.

Most employers have policies and procedures on attendance, discipline and the like. Those policies should be updated from time to time. Employers should consider whether their policies, employment agreements, or other documents should contain a clause in the event of litigation, providing for the waiver of a jury at trial. Not all states will enforce a jury trial waiver but, depending upon the circumstances, many will. Courts look at several factors, but in general, courts who are called upon to enforce such a clause consider whether the language is clear, and whether the clause is conspicuous within the document. Also important is whether the parties had the ability to negotiate terms in the document, as well as the bargaining power and business acumen of each of the parties. Juries are often considered unpredictable in returning verdicts in employment related cases, so a jury trial waiver may provide some comfort to the employer when litigation is filed.

Similarly, in the past, many employers included mandatory arbitration clauses in their policies. When an employer is sued, it is important to take a minute to review its policies to determine whether there is an arbitration clause or jury trial waiver.

FIRM’S RECENT APPELLATE VICTORIES
The firm received two favorable opinions from Oregon appellate courts in the past two months.

The first is Palmrose v. Oregon Insurance Guaranty Association, 205 Or App 613, 135 P2d 370 (May 10, 2006). In Palmrose, an insurance coverage dispute, plaintiff filed a personal injury and wrongful death claim against an assisted living center. The center was covered by a general liability insurance policy issued by Reliance Insurance Company of Illinois, a “surplus lines insurer” (that is, an insurer that was not authorized to do business in Oregon, but that could nonetheless provide insurance in Oregon by a “surplus lines licensee”). Surplus lines insurers are not members of the Oregon Insurance Guaranty Association (“OIGA”). In this case, however, the surplus lines insurer merged into a different company, Reliance Insurance Company, that was authorized to do business in Oregon and was a member of the OIGA. Shortly after the merger, Reliance Insurance Company became insolvent. As a result, plaintiff’s claim was tendered to the OIGA. OIGA declined coverage on the ground that Reliance Insurance Company of Illinois was not a member when it issued the policy or when the event leading to the claim occurred. Plaintiff sued and OIGA moved for summary judgment. The trial court agreed with OIGA and granted judgment in its favor. On appeal, the Oregon Court of Appeals affirmed the trial court’s decision reasoning that the only policy in force at the time plaintiff’s decedent was injured was issued by Reliance Insurance Company of Illinois, which was a surplus lines insurer not subject to the protections afforded by the OIGA.

The second favorable opinion is Boothby v. D.R. Johnson Lumber Co., 341 Or 35 P3d (June 15, 2006). The Boothby case arose out of the death of plaintiff’s husband in a logging accident. Plaintiff asserted claims based on Oregon’s Employer’s Liability Law and common law negligence against Johnson Lumber, Rhine Equipment Company and Barko Hydraulics, LLC. Plaintiff’s decedent was employed by Intermountain Forest Management (“Intermountain”) who had been contracted by Johnson Lumber to harvest timber from a certain tract of land. A log loader operated by an Intermountain employee rolled over plaintiff’s decedent, causing his death. At trial, a jury returned a verdict for plaintiff on both claims. The Oregon Court of Appeals reversed, holding that no reasonable juror could find that Johnson Lumber was responsible under either claim for the acts or omissions that led to plaintiff’s husband’s death. The Oregon Supreme Court allowed plaintiff’s petition for review and affirmed the Court of Appeals’ decision. The court stated that the Employer’s Liability Law imposes a duty

on only those persons having charge of, or responsibility for work involving a risk or danger. In addition to direct employers, a duty is imposed on three categories of persons: (1) persons who actually exercise control over the work involving a risk or danger, (2) persons who retain the right to control that work, and (3) persons engaged in a common enterprise. The court held that based upon the evidence, primarily the logging agreement between Johnson Lumber and Intermountain, Johnson Lumber did not fall into any of those categories. Similarly, on the negligence claim, the court found that Johnson Lumber’s lack of control over the way that Intermountain operated the log loader precluded plaintiff from holding Johnson Lumber liable for Intermountain’s negligence.

PUNITIVE DAMAGES CASES
On May 17, 2006, the Oregon Supreme Court handed down its decision in Schwarz v. Philip Morris Inc., 206 Or App 20, 135 P2d 409 (May 17, 2006). In this case, plaintiff alleged that plaintiff’s husband died from metastatic lung cancer that was caused by smoking cigarettes manufactured by Philip Morris Inc. The jury returned a verdict of $168,514.22 in compensatory damages and $150 million in punitive damages. The trial court reduced the jury’s punitive damages award from $150 million to $100 million. On appeal, the Oregon Supreme Court affirmed the portion of the judgment that found Philip Morris Inc. liable for compensatory damages, but vacated the judgment for punitive damages on all claims and remanded for a new trial on the amount of those damages. In reaching its conclusion, the court found that Philip Morris’ due process rights had been violated when the court refused to give the jury an instruction that Philip Morris cannot be punished in Oregon for conduct that occurred outside of Oregon. The court explained that under the Due Process Clause, a state can punish a defendant for in-state conduct that causes in-state harm, and that a state has an interest in punishing a defendant for its out-of-state conduct that causes in-state harm. However, a state may not punish a defendant for out-of-state conduct that causes out-of-state harm. Finally, whether a defendant can be punished for in-state conduct resulting in out-of-state harm depends on the evidentiary record.

On May 30, 2006, the United States Supreme Court granted the petition for writ of certiorari filed by Philip Morris in Williams v. Philip Morris Inc., which arose in Multnomah County, Oregon. The Supreme Court will review a $79.5 million punitive damages award. The Supreme Court granted certiorari on two issues raised in the petition: first, whether a finding that a defendant’s conduct was highly reprehensible overrides the constitutional requirement that punitive damages be reasonably related to the plaintiff’s harm, and second, whether due process permits a jury to punish a defendant for conduct that harms non-parties.

MEDICAL MARIJUANA QUESTION NOT ANSWERED
Many Oregon employers were awaiting the Oregon Supreme Court’s decision in Washburn v. Columbia Forest Products, Inc., 340 Or 469, 134 P2d 161 (May 4, 2006). In that case, a medical marijuana user was terminated from his employment for testing positive for marijuana. The employee filed suit against his employer alleging a violation of Oregon’s disability discrimination laws. The trial court granted summary judgment for the employer, holding in part that plaintiff was not “disabled” under the Oregon statutes. The Oregon Court of Appeals disagreed and held that the employer’s summary judgment motion should not have been granted. The Oregon Supreme Court allowed the employer’s petition for review, ultimately reversed the decision of the Court of Appeals and affirmed the judgment of the trial court.

Employers were waiting for this opinion with the hope that the court would resolve the issue of the use of medical marijuana in the workplace; however, because the court decided the case by finding that Mr. Washburn was not “disabled”, the court did not go on to address the medical marijuana issue. Rather, the court addressed a different but significant issue as to whether the existence of a disability is determined before or after mitigating circumstances. In making its decision, the court followed federal law, concluding that the definition of “disabled person” is to be construed in light of mitigating measures that counteract or ameliorate an individual’s impairment. In the Washburn case, plaintiff claimed he was disabled by virtue of his leg spasms, a condition that he contended substantially limited his ability to sleep. The evidence was undisputed that plaintiff could counteract the leg spasms and the sleep problems by using prescription medication. The court concluded that because plaintiff could counteract his physical impairment through mitigating measures, his impairment did not rise to the level of a substantial limitation on a major life activity. Justice Rives Kistler wrote a concurring opinion in which he addressed the medical marijuana issue and stated that in his view, because of the Controlled Substances Act, the employer in this case had no binding state obligation to accommodate plaintiff’s use of medical marijuana. Until a majority of the court addresses the issue, there is no definitive answer on whether an employer must allow an employee to use medical marijuana as a reasonable accommodation.

STANDARD FOR SUMMARY JUDGMENT REITERATED
In Davis v. County of Clackamas, 205 Or App 387, 134 P3d 1090 (May 3, 2006), the Oregon Court of Appeals affirmed the trial court’s decision granting summary judgment in favor of the defendant and reiterated that the adverse party to a summary judgment motion “has the burden of producing evidence on any issue raised in the motion as to which the adverse party would have the burden of persuasion at trial.” In this case, plaintiff’s attempt to defeat defendant’s motion for summary judgment by impeaching defendant’s testimony was inadequate. Rather, plaintiff needed to offer substantive evidence to create a genuine issue of material fact.

DEADLINE TO FILE STRICTLY CONSTRUED
In Webster v. Harmon, 205 Or App 196, 134 P3d 1012 (April 26, 2006), the Oregon Court of Appeals reversed the trial court and remanded for further action. At issue was whether the defendant timely filed exceptions to an arbitrator’s award of attorney fees to plaintiff. The arbitrator filed an award on December 16. On December 29, defendant filed exceptions to the award. Defendant relied on ORCP 68C(4) which prescribes the procedure for objecting to an award of attorney fees in circumstances that are governed by the Oregon Rules of Civil Procedure. That rule allows objections to be filed 14 days after the prevailing party serves an attorney fee statement on the non-prevailing party. However, ORS 36.425(6) prescribes the procedure for objecting to attorney fee awards that are made by an arbitrator. That rule provides that a nonprevailing party must file exceptions to an attorney fee award made by an arbitrator within seven days after the arbitrator files the award in the trial court. The trial court upheld the defendant’s exceptions finding that defendant had not received a copy of the plaintiff’s attorney fee statement. The Oregon Court of Appeals reversed stating that whether or not the defendant timely received the attorney fee statement that plaintiff filed was beside the point. The arbitrator’s award itself included an award of attorney fees. As such, the defendant had the ability to except to the award within the appropriate timeline. The court calculated that, at a minimum, the seven-day period expired on December 26, and defendant filed his exceptions at least three days too late.

COUNTY MAY BE LIABLE FOR INDEPENDENT CRIMINAL ACT OF THIRD PARTY
In Bertram v. Malheur County, 204 Or App 129, 129 P3d 222 (February 8, 2006), the trial court granted Malheur County’s motion for summary judgment. On appeal, the Oregon Court of Appeals reversed and remanded to the trial court. In this case, plaintiffs were the conservators of the estates of two minor victims of sexual abuse in Malheur County. They filed suit against the County alleging that the County’s juvenile department was negligent in investigating and responding to sexual abuse allegations against another youth who was a known sexual abuser (the perpetrator). The alleged negligence was based upon a delay of eight months between the time the County assumed responsibility to pursue the perpetrator and the actual time he was brought before the juvenile court. During this delay, the perpetrator abused more victims. The County argued that neither the relationship between the County and the victims, nor the relationship between the County and the perpetrator supported liability against the County for the perpetrator’s independent criminal acts. The court agreed that there was no special relationship between the County and the victims, but found that under the principle of general foreseeability, the trier of fact could find that the County’s conduct was unreasonable in light of the reasonably foreseeable risk that, if unrestrained, the perpetrator would sexually abuse more children.

WASHINGTON NOTES
The Washington legislature passed House Bill 2661 recently expanding Washington’s Law Against Discrimination to prohibit discrimination based on a person’s sexual orientation. In this context, “sexual orientation” is defined as heterosexuality, homosexuality, bisexuality, and gender expression or identity. “Gender expression or identity” is defined as having or being perceived as having a gender identity, self-image, appearance, behavior, or expression, whether or not that gender identity, self-image, appearance, behavior, or expression is different from that traditionally associated with the sex assigned to that person at birth. Washington’s Law Against Discrimination establishes that it is a civil right to be free from discrimination based on race, color, creed, national origin, sex, the presence of any sensory, mental or physical disability, or the use of a trained dog guide or service animal. This right applies to employment; places of public resort, accommodation, or amusement; commerce; and real estate, credit and insurance transactions. There are some exemptions from this law. The new law was signed by Governor Gregoire on January 31, 2006, and became effective June 7, 2006.

New Oregon Court Decisions:
T.R. v. Boy Scouts of America, 205 Or App 135, (April 19, 2006)
Plaintiff was sexually abused by a police officer while participating in an Explorer program designed to introduce young adults to police work. Plaintiff sued, among others, the officer’s employer, the city of The Dalles, more than 6 years after the abuse, alleging a common law negligence claim. Plaintiff added a federal civil rights claim under 42 USC section 1983 against the city the following year. Following judgment in favor of the plaintiff, the city appealed, contending that the trial court should have dismissed the section 1983 claim on the ground that the statute of limitations had run.

On appeal the parties agreed that the claim had to be brought within two years of when it accrued. (Neither party argued that ORS 12.117, dealing with actions based on child abuse, applied, so the court did not decide that issue.) Plaintiff argued that his claim did not accrue until he knew that the city, at least potentially, had caused his injury. The Oregon Court of Appeals disagreed and held that plaintiff had a duty of inquiry as to potential defendants. The court said: “More than two years before he filed this action, plaintiff knew sufficient facts to trigger the duty to discover the parties that caused his injury. He knew that he was injured; he knew that sexual abuse inflicted by [the police officer] was the physical cause of his injury; he knew that at least some of the abuse occurred while [the officer] was on duty; and he knew that [the officer] was a city employee. A reasonable person would have acted on those facts by seeking advice in the medical and legal community.” The Court of Appeals held that plaintiff’s claim was time-barred.

In Hughes v. Peace Health, 204 Or App 614 (2006), the Oregon Court of Appeals upheld the cap on non-economic damages in a death case, in spite of what it perceived as potentially conflicting reasoning from two Oregon Supreme Court opinions. The Court of Appeals also held that the reduced interest rate on judgments for medical malpractice (ORS 82.010(2)(f)) applied to the money award against Peace Health, even though Peace Health was only vicariously liable for the negligence of three physicians. The court noted that, according to the plain language of the statute, the reduced interest rate is triggered by who is negligent, not by who is liable for that negligence.

 

New Washington Court Decisions:
In Farmers v. Waxman Industries, Inc., 130 P3d 874 (Wn App 2006), a home insured by Farmers suffered major water damage from a leaky pipe. Defendant Waxman Industries’ name was on the pipe. Farmers paid for repairs and lost rental costs, and then sought reimbursement from Waxman. The complaint alleged that Waxman was strictly liable as the “manufacturer” of the defective line because Waxman either constructed it or sold it under the Waxman trade name.When Waxman failed to respond to the complaint, Farmers obtained a default judgment. Waxman eventually moved to set it aside. On the merits of the claim, Waxman's motion stated that defects in pipes “often” can be attributed to component parts manufactured by some other entity. Waxman opined that alleged defects could have been the result of improper maintenance. Waxman said it needed further discovery to “fully explore these defenses.” Waxman also submitted a declaration by its employee who said that some other unknown entity manufactured the pipe, and Waxman's only role was to distribute it. The trial court set aside the judgment and Farmers appealed.

On appeal, the Washington Court of Appeals noted that a motion to vacate a default must present a prima facie defense to the claims. This, held the court, Waxman failed to do. Even if some other entity actually manufactured the pipe, Waxman would still be liable. Any product seller has the same liability as a manufacturer under Washington law if the product was marketed under a trade name of the product seller. The court also ruled that contribution or indemnity claims against other entities did not provide a “defense” for Waxman so as to justify setting the default judgment aside.

Equilon Enterprises, LLC v. Great American Alliance Ins. Co., 2006 WL 1064156 (Unreported Wn App, 2006)
Sixteen-year-old Said Aba Sheikh was severely beaten by several youths who had been loitering in the parking lot of South Seattle Market. The attack occurred, at least in part, on adjoining premises operated as a Shell gas station. Aba Sheik sued Market and Shell under several theories, including the theory that the gas station owners negligently maintained the premises and were apparent agents of Shell.

Defendant’s insured, Powell-Christensen, contracted with gas stations to brand the outlets as Shell stations and delivered fuel to them. Powell-Christensen added Shell as an additional insured on its CGL policy, but “only with respect to liability arising out of [Powell-Christensen’s] operations.” Shell tendered the Aba Sheikh complaint, which defendant refused to defend, because the Aba Sheikh complaint did not “mention Powell-Christensen, refer to Powell-Christensen’s operations or premises, or make allegations arising out of Powell-Christensen’s operations or premises.” After settling with Aba Sheikh, Shell brought a declaratory judgment suit against defendant American. Following summary judgment for defendant, Shell appealed.

On appeal, Shell argued that Powell-Christensen’s operations included licensing gas stations to display Shell signs and logos. Shell further contended that Aba Sheikh’s agency claims against Shell were based on the presence of the Shell signs at Market. Therefore, Shell argued, its liability arose out of the presence of the Shell signs there. Defendant, however, argued that Shell wrongly focused on Aba Sheikh’s legal theories rather than the facts underlying the complaint. According to defendant, Shell failed to show that Aba Sheikh’s claims arose out of Powell-Christensen’s operations.

The Washington Court of Appeals sided with Shell. As noted by the court, the additional insured endorsement did not insure Shell solely for injuries arising out of Powell-Christensen’s operations, but for liability arising out of those operations. The presence of the Shell signs “could lead to liability” and placement of the Shell signs was an aspect of Powell-Christensen’s operations. Defendant Great American had the duty to defend Shell. The court also ruled that defendant had the duty to indemnify Shell for the amount paid in settlement. Noting that the duty to indemnify “generally arises when the plaintiff in the underlying action prevails on facts which fall within the policy’s coverage,” the court held that “Aba Sheikh prevailed because Shell settled the claim for $300,000.”

Warner v. Regent Assisted Living, 130 P3d 865 (Wn App, 2006)
Warner lived at one of defendant’s assisted living facilities. He had dementia and was wheelchair bound. His children sued on his behalf under the Vulnerable Adult Statute (“VAS”), alleging that he was neglected as that term is defined in the statute. In response to defendant’s motion for summary judgment, Warner’s daughters testified that defendant failed to provide basic housekeeping and hygiene necessities as specified in their declarations. Warner's daughters also stated that defendant did not give necessary medication after surgery was performed on Warner to remove a cancerous growth. The trial court granted summary judgment for defendant, ruling that these statements were only “generic allegations” and did not “establish the tort of negligence.” The court also held that Warner had to provide expert medical testimony to show that the failure to timely provide medication resulted in harm and damages. Warner appealed.

On appeal, the Washington Court of Appeals ruled first that the trial court should not have applied common law negligence standards to Warner's VAS claim. This was in error because the VAS establishes a new and separate cause of action with its own standards of proof–standards which are different from common law negligence. All Warner needed to show to state a claim was that defendant neglected him as that term is defined in the statute. RCW 74.34.020 (9). Further, the VAS does not require expert testimony to establish “neglect”, “pain and suffering,” or resulting damages. The court held that Warner’s daughters' statements that they routinely found him wearing wet incontinence pads and one time found him covered in feces, combined with the failure to provide his medication, created a genuine issue of material fact about whether the facility “neglected” Warner.