Oregon Personal Injury Lawyer Blog

Yesterday, ANOTHER parent called me, "My child was walking his bike in the crosswalk and was hit by a car." Once again, the insurance company for the driver did not offer to pay the child's medical bills under the Personal Injury Protection (PIP) part of the automobile insurance policy. Most Oregonians do not realize that the coverage exists. This post covers what to do if a motor vehicle hits your child as he or she is walking.

First, here's a primer on PIP law. Every automobile insurance policy in Oregon must include Personal Injury Protection of at least $15,000. It is a no-fault provision. Drivers and passengers use PIP to pay doctor bills from injuries. Later, after the insurance companies determine who caused the accident, one insurance company will reimburse the other insurance company. The point of the law is to make sure people get the medical care they need, now.

But what if it is car versus pedestrian? Oregon Law (ORS 742.520) controls what must be in insurance policies. PIP policies must cover "pedestrians struck by the insured motor vehicle." This is separate coverage from the "liability" party of the policy, which pays for losses if the injured person proves that the driver caused the collision. So, for example, if a car runs over a child, the insurance available includes the liability part, (say, $100,000) PLUS the PIP (at least $15,000).

What else should you do if you are in a car accident? At least the following:

Get necessary medical care. Do your best to recover. The best news an attorney can give you is, "Your injuries are not worth suing about, because the cost of the lawsuit might be more than a jury award."

Preserve the physical evidence. Take photos of the scene, damage to cars, bicycles, and people. If clothing were damaged, save it. At some point, you might need to tell your story to 12 strangers. An illustrated story is easier to follow and remember.

Preserve the economic evidence. Keep receipts for everything. Keep all papers and E-mails.

Preserve the noneconomic evidence. Part of your claim will be what the injured person went through, emotionally. The injured person and family members should consider keeping a journal of the ups and downs of the recovery. Otherwise, when you testify a year later, you will forget details.

Don't get trapped. Insurance companies try to minimize payouts. They do this by trying to develop evidence to use against you. Sometimes it is by pretending to be your friend while asking you questions that they can use against you later. Sometimes it is by trying to get you to sign a release before you fully appreciate the extent of your loss. Sometimes, they send you to one of "their" "doctors," who usually just say, "It's time to cut off benefits because. . . ."

A Oregon attorney who represents people injured by car and truck accidents can (1) help guide you through the process, (2) make sure you understand your rights, and (3) maximize the monetary recovery for your losses. Please feel free to call me. I can help.

Jeff Merrick, Oregon Trial Attorney
Injury & Employment Law
503-665-4234

The above is not legal advice. I cannot give you sound advice without knowing more information. It is intended to raise some issues for you to discuss with your own lawyer.

Yesterday, the Oregon Court of Appeals upheld an award of attorney fees against Allstate Insurance Company. The case, Sara Marie Zimmerman v. Allstate, highlights important information for every Oregon driver who gets hurt in a car accident caused by another driver who does not have enough insurance.

Sara suffered personal injury in a motor vehicle collision, and the person who hit her did not have enough insurance. Sara, like all of us in Oregon, has Underinsured Motorist Coverage (UIM). You may not know it, but if you have motor vehicle insurance in Oregon, then you have UIM coverage. She submitted information on the accident and her injuries to her own insurance company. Allstate did not pay the claim or accept coverage and consent to binding arbitration within six months. The six months is a critical deadline. When insurance companies miss it, then, the insurer must pay attorney fees to the injured person if it loses the arbitration or trial. (The statute is ORS 742.061.)

Sara beat Allstate at trial, but Allstate did not want to pay the attorney fees awarded by the trial court. Allstate appealed, arguing that Sara should have provided it more information before the six month clock starts, including information that we usually cannot get (before filing a lawsuit): The amount of insurance the other driver has. Oregon's Court of Appeals did not get sucked into that way around the statute, and it said: "Pay your customer."

Knowing these quirks of law, like how to set up the insurance company to pay your attorney fees with a timely proof of loss, is another reason to hire an attorney and not try to settle on your own. As this case shows, even your own insurance company will fight you if it thinks it can save money. So, feel free to call me if you were hurt in a car or truck accident and want representation.

Jeff Merrick, Oregon Trial Attorney
Injury & Employment Law
503-665-4234

The above is not legal advice. I cannot give you sound advice without knowing more information. It is intended to raise some issues for you to discuss with your own lawyer.

I found the classic book, Getting to Yes: Negotiating Agreement Without Giving In, on my bookshelf last week, and I read it again. Considering less than 1% of civil lawsuits in Multnomah County, Oregon result in a trial by jury, every trial attorney needs to negotiate effectively. I have the second edition, written by Fisher, Ury and Patton of the Harvard Negotiation Project. This post highlights the key concepts in their approach.

The authors urge negotiators to reject bargaining over "positions." A "position" refers to a statement such as "I will take no less than $100." If that is true and if the buyer cannot pay $100, then there is no point in negotiating. On the other hand, if the person - secretly - would take $60, then staking out the position of no less than $100 could prevent a favorable settlement, especially if the other person is prepared to pay up to $95.

But if price seems to be the only thing over which to bargain, then what can negotiators do other than toss out numbers and try to bluff the other side as to the price they'd actually pay or accept? The authors set forth a four-part process.

First, separate the people from the problem. We need to deal with both. The above "problem" to be solved could be stated as follows: "I'd like to sell this item, and you desire to buy it. How can we come up with an acceptable price." However, If a negotiator stakes out a position such as "no less than $100," then we need to deal with the issue of him defending his position and his integrity. In my law practice, we often need to address the real emotions of my clients for which there is no dollar value. The failure to address "people" and "problem" as real and separate issues can confuse the process and lead to failure or less-satisfactory results.

Second, one needs to identify interests. At first glance, there seems to be nothing to discuss other than price: I want to pay less and you want to receive more. But further discussions might reveal other interests. For example, the buyer might not have more than $50 now, but will receive some money after he sells something. The seller might want to delay receipt of income until January 1. The buyer might need to spend money on shipping. The Seller might have regular delivery routes.

By identifying interests, negotiators then move into the third phase of the method: invent options for mutual gain. In this example, the options become apparent: consider payments over time and discounted or free delivery. Nevertheless, there is still the issue of price.

Here is where the authors insist on developing and using objective criteria instead of just talking tough. If the seller says, "It was my grandfathers, I cannot sell it for less than $100," The buyer must refocus to, "I understand, but let's determine what is a fair price for non-related people." [I've used my own examples in this post, not the authors'.] Bargain over the process: how one can we determine a fair market value that we each might be able to accept. Try to get commitments on process. This avoids taking a position and then defending it. Agreeing on an objective process does not, necessarily, bind the parties to the result of the process, although that is a possible solution, too. The authors point out that the more negotiators can separate ego and feelings from an objective process, the better the chance of agreement.

The authors acknowledge that not everyone wants to "play" their game of negotiating over principles instead of positions. They discuss the concept of hard and soft negotiation and offer suggestions on how to deal with different situations.

I'm glad I re-read the book. It is a good reminder of how to move negotiations forward when things bog down. Attorneys who represent people need to be especially well versed in negotiation tactics because most people have only negotiated car purchases. By contrast, insurance company claims adjusters negotiate all the time. Insurance companies know the tricks. Consequently, to achieve fair value for a claim, people need to make sure their own attorney is skilled at preparing for settlement discussions and negotiating.

Jeff Merrick, Oregon Trial Attorney
Injury & Employment Law
503-665-4234

The above is not legal advice. I cannot give you sound advice without knowing more information. It is intended to raise some issues for you to discuss with your own lawyer.

Last week, Oregon's Court of Appeals confirmed that Geico must pay personal injury protection (PIP) insurance benefits to the son who borrowed his mom's car and was injured in a car accident. Geico tried to weasel out of payment by arguing that the son did not reside with mom at the time. In Brandon Sheptow v. Geico General Insurance Co., the court said, in effect, "phooey." Oregon Revised Statute (ORS) 806.080(1)(b) specifically requires that any motor vehicle policy sold in this state covers "all persons who, with the consent of the named insured, use the motor vehicle[.]"

Personal injury protection benefits provide no-fault benefits to people injured in car accidents. (In this case, Brandon was not at fault; the other driver caused the car collision.) PIP covers medical bills, lost wages, and certain other losses up to the amount the limitations of the insurance policy. Regardless of what the insurance contract says, the coverage applies. Under Oregon law, the statutes provide a coverage "floor." An insurance policy may provide more benefits, but it cannot provide fewer benefits.

In this case, the Geico denied coverage based on an old case that predated the key provision in ORS 806.080. However, every law school teaches every law student law that a later law enacted by the legislature trumps an earlier law, and, especially, an earlier interpretation of the law by a court. The trial court did not fall for Geico's, and neither did the court of appeals.

So, yes, when an Oregon mom lends her car to her son, mom's insurance covers him as if she were driving, whether the son lives with her or is just visiting.

The moral of the story: Beware of the jocular gecko lizard who is happy to accept your money but transmutes into a weasel when it comes time to pay money to you or your loved ones. Instead, hire an Oregon attorney when you are involved in a car or truck accident.

Jeff Merrick, Oregon Trial Attorney
Injury & Employment Law
503-665-4234

The above is not legal advice. I cannot give you sound advice without knowing more information. It is intended to raise some issues for you to discuss with your own lawyer.

Last week, Oregon's Court of Appeals enforced an arbitration clause in a case where a homebuilder sued the married couple who hired him. We've seen a number of cases and laws involving arbitration recently. In Gemstone Builders, Inc. v. Jeff & Jennifer Stutz, the court emphasized that it will enforce arbitration clauses in contracts, even when the agreement is brief and ambiguous. Although, as discussed below, the outcome may have differed if the lawyers had pursued a different approach in the trial court.

The home-building contract told the parties to submit disputes over "repair or replacement" to arbitration "prior to" a lawsuit. Another part of the contract said "if there is cause for suit, dispute or action" to "enforce any provision" then the parties must arbitrate. Yet another sentence declared that the arbitration decision will be binding. The parties disagreed over (a) whether the contract required some or all claims to be arbitrated and (b) whether the arbitration was binding or just a first step before filing a lawsuit, if one side did not like the outcome.

The builder sued without arbitrating first. He argued that the contract was too indefinite as to the process. However, the court brushed aside that argument, noting the Oregon's Uniform Arbitration Act fills in any gaps. Consequently, the bigger issues were whether the contract covered all claims and was final.

Here's where the lawyering at the trial court level might have made a difference. When a contract is ambiguous, then the court may consider evidence outside of what is written in the contract. However, all the court of appeals had to work with was the language of the contract itself. The parties did not offer any evidence of (1) who wrote the contract or (2) what the parties intended or meant by the words in the contract. For example, if there were evidence that the homebuilder had written the contract, then the ambiguities might have been construed against him. In baseball, a tie goes to the runner. In contract law, an ambiguity is construed against the drafter.

Without any factual evidence to place the contract words in context, the court must decide based upon an established checklist, or rules of construction. Using those rules, the court held the contract required arbitration that was binding on the parties - no second chance in court.

The lesson for people: you are bound by contracts, even if they are not written well. The lesson for attorneys: present evidence and create a record in the trial court.

Jeff Merrick, Oregon Trial Attorney
Injury & Employment Law
503-665-4234

The above is not legal advice. I cannot give you sound advice without knowing more information. It is intended to raise some issues for you to discuss with your own lawyer.

Oregon attorneys are generally very helpful to other lawyers. Both sides of the civil bar have listservs, where attorneys post questions, comments, etc. It's very helpful. It's like having hundreds of co-workers down the hallway to whom we may ask questions and share concerns. Sometimes the best answer we can provide a colleague is to refer the case to a lawyer who has more experience.

Case in point: An attorney said he was providing "pro bono" (or free) representation to a client with a "slip and fall" case. He asked about the role of medical testimony in the case and how to prove causation (that the fall caused the injury). I was not the only attorney to think, "Uh oh!" Two colleagues wrote that he needed to refer the case to some other attorney. Here are the "red flags" from that posting.

First, attorneys who represent injured people call these "premises liability" cases, not "slip and fall'' cases. "Premises liability" focuses on the legal obligations of the landowners toward customers or visitors; the other term focuses attention on the injured person.

Second, premises liability cases are not easy. Attorneys who are not familiar with personal injury cases might think they are easy, but they are not. There are many issues including: (1) What is the legal duty of the property owner? (2) How obvious was the problem with the area? (3) Was there any fault on the part of the injured person? (4) How does one develop the medical evidence and limit the potential damage from defense medical examinations?

Third, medical evidence is critical in every injury case. For cases seeking less than $50,000, medical reports might suffice to get through nonbinding arbitration. However, if the case is worth more or if one side requests a court trial, then one needs doctors to testify under oath. This is pretty basic stuff, which made many of us on the listserv cringe at the posting.

What happens if an injured client goes forward with a lawsuit? There are out-of-pocket costs, for which the client remains responsible. If there is a zero verdict, then the client must pay. Also, when the defendant wins, then it has a claim for some of its costs, too. If an attorney gets you into a lawsuit that does not make sense, then you might come out owing money.

So, the moral of the story is that, sometimes, free help is worth even less than the $0 you pay for it. It can cost you.

Jeff Merrick, Oregon Trial Attorney
Injury & Employment Law
503-665-4234

The above is not legal advice. I cannot give you sound advice without knowing more information. It is intended to raise some issues for you to discuss with your own lawyer.

Last week, Oregon's Court of Appeals told Allstate that it must pay attorney fees to its insured, who suffered personal injury in a car accident caused by an underinsured motorist. The law requires an insurance company to pay attorney fees to its insured if he or she provides "proof of loss" and if the insurance company fails to accept the claim and offer to arbitrate within six months. Allstate quibbled over what constitutes a "proof of loss," arguing that its insured needed to jump through another hoop or two. The Oregon court disagreed in the case of Joann Hall v. Taysia Speer and Allstate Insurance Co.

In September, 2006, a car accident injured Joann Hall. She told Allstate and applied for benefits under the Personal Injury Protection (PIP) provision. So, at that time, Allstate knew of the collision and injury. In February, 2007, Allstate sent Ms. Hall to one of its doctors, who confirmed that Ms. Hall suffered honest-to-God, significant injuries because of the collision. By May 2007, Ms. Hall decided she needed an attorney, who then informed Allstate that he was working for her.

Allstate did not accept coverage until 20 months later. But Allstate had two arguments that won the day. Allstate said that its Underinsured Motorist (UIM) adjuster did not know the extent of the injuries, plus, Allstate did not know that the at-fault driver did not have enough insurance until two months before Allstate accepted coverage.

The Court of Appeals flipped the responsibility and reversed the trial judge.

First, Allstate's right hand (UIM adjuster) is responsible to know what its left hand (PIP adjuster) knows. Allstate is Allstate. It is not the insured's responsibility to run the paperwork from one Allstate cubicle to another.

Second, Oregon precedents place the burden on insurance companies to clarify uncertainties and perform reasonable investigations. In this case, if Allstate did not know whether the at-fault driver had enough insurance, it should have asked someone, anyone. But, in fact, it did not ask Joann Hall, her lawyer, or the insurance company for the at-fault driver. Because it did not perform any investigation, the Court of Appeals held that it failed to meet it's "duty of inquiry, * * * even if the submission is insufficient to allow the insurer to estimate its obligations." More directly, the court reminded insurers that if they think that the "proof of loss [were] so uncertain. . .then defendant should have requested plaintiff to make her claim more definite and certain." (quoting, Parks v. Farmers Ins. Co.)

Insurance companies have an incentive to deny claims and to underpay. Shaving off what it owes on thousands of claims means millions of dollars to the insurers. Companies figure that the worst thing that will happen if they deny claims is that they will keep their money longer and pay the claim, later, if someone gets a lawyer. Only when insurance companies fear that they might have to pay MORE, later, will the money calculus change and incentivize the company to pay a fair amount first. That's why this ruling is important for people; it places the responsibility on sophisticated, experienced claims examiners to do their job and not require people dealing with their own injuries to become experts in insurance law just to get the benefits for which they have paid premiums for years.

Jeff Merrick, Oregon Trial Attorney
Injury & Employment Law
503-665-4234

The above is not legal advice. I cannot give you sound advice without knowing more information. It is intended to raise some issues for you to discuss with your own lawyer.

Members of the Oregon State Bar must have legal malpractice insurance through the Professional Liability Fund. The minimum coverage is $300,000. (Patent attorneys can practice with permission from the US Patent office, and need not be members of the Oregon State Bar, and they may or may not have insurance.) Although the attorney is responsible for the care of the client, sometimes it is someone in the office who screwed up. This post discusses when mistakes are covered by the Oregon attorney's malpractice insurance.

A too-common error is serving a complaint late - missing the statute of limitations (or missing some other time deadline). Sometimes, it is a secretary or assistant who makes the mistake. Since the assistant messed up, is the attorney responsible? And is it covered by insurance? Yes. Yes.

The error is covered if committed by a person for whom the attorney is responsible and, at the time, the attorney was covered by insurance and the attorney's main law office was in Oregon. So, errors by secretaries and assistants are covered. But there is an exception.

What if the assistant is an attorney? Here's one situation. There are a lot of unemployed young law graduates who passed the Oregon State Bar. Some are serving as paralegals because they need the job and some attorneys need help that costs less than hiring someone as an associate attorney.

Another situation is when an attorney licensed in another state has a client with a matter in Oregon. Sometimes, the non-Oregon lawyer will associate with an Oregon lawyer for purposes of the one case only. What happens if the non-Oregon lawyer screws up the case?

Errors committed by the following are NOT covered by insurance provided by the Professional Liability Fund:

- Attorneys from another state, and
- Attorneys who claim that they are exempt from coverage by the PLF, such as an inactive member of the bar.

In conclusion, generally, if an Oregon lawyer handled your case and either the attorney caused you harm because of negligence, or if some assistant caused the mistake, then the mistake is probably insured and you should be able to recover.

Jeff Merrick, Oregon Trial Attorney
Injury & Employment Law
503-665-4234

The above is not legal advice. I cannot give you sound advice without knowing more information. It is intended to raise some issues for you to discuss with your own lawyer.

Recently, the Oregon Court of Appeals held that an insurance policy issued to a Vancouver, Washington driver provided different rights than if the driver had lived in Portland, Oregon. The case involved a car accident and the uninsured motorist provision of an auto insurance policy, but the ruling could apply to any insurance contract. In Carla Morgan v. Amex Assurance Company, the result was that the injured driver had to pay attorney fees out of her settlement instead of keeping her entire settlement and having her insurance company pay her lawyer.

For decades, Oregon law said if (1) a person submits a "proof of loss" to his or her own insurance company, (2) the insurance company does not settle the claim or accept coverage within six months, and (3) the insured sues the company and wins in court, then the insurance company must pay the attorney fees of the person. (ORS 742.061). It is a very useful tool, and every Oregon lawyer should submit a proof of loss before suing. This opportunity to win attorney fees is another reason to see a lawyer right away - so you have time to use the law.

Another law, enacted after the attorney fee law, is kind of an introduction to the entire chapter involving insurance law. ORS 742.001 says the chapter applies to "insurance policies delivered or issued for delivery in this state." The insurance company said that this law deprived Carla Morgan of a chance for attorney fees because Ms. Morgan had applied for insurance when she lived in Vancouver and the policy issued to her in Washington. Oregon's Court of Appeals agreed with the insurance company.

Jeff Merrick, Oregon Trial Attorney
Injury & Employment Law
503-665-4234

The above is not legal advice. I cannot give you sound advice without knowing more information. It is intended to raise some issues for you to discuss with your own lawyer.

Oregon's Professional Liability Fund insures all attorney members of the Oregon State Bar against legal malpractice. Recently, the PLF published its annual report. Here are some of the highlights:

In 2010, there were 938 new claims against Oregon attorneys. Cost per claim is rising, $19,500 is the average for the first half of 2011 compared to $19,000 for 2010. Speculation on the cause for the high rate of claims and the higher cost to settle them includes the fact that many recent graduates are starting practices and displaced attorneys, also, are starting their own practices. Some attorneys are probably stretching past their comfort zones, leading to mistakes, which leads to malpractice claims.

The top six areas of law leading to attorney malpractice claims are Personal injury (17%), Domestic relations / family law (16%), Bankruptcy (12%), Real Estate (11%), Estate Planning & Estate Tax (10%), and Business Transactions / Commercial law (9%).

What happens when a client makes a claim? From 2001 through 2010, claims resolved as follows:

• 19% of the time the PLF fixed or "repaired" the problem.

• 26% of the time the PLF settled before a lawsuit.

• 12% of the cases settled or were dismissed during litigation.

• 4% went to judgment.

• The remainder of the claims were abandoned (22%) or denied (17%).

And the bad news for me: the premiums for legal malpractice insurance are going up.

Jeff Merrick, Oregon Trial Attorney
Injury & Employment Law
503-665-4234

Last week, Oregon's Court of Appeals affirmed a $362,000 judgment for a grocery shopper hurt by product that fell from a defective shelf. The case is interesting for a couple of reasons, including the way it distinguishes a slip and fall situation from a defective shelf and falling merchandise.

In Jacqueline Hammer v. Fred Meyer Stores, Inc., Ms. Hammer suffered personal injury and significant medical expenses when half-gallon lemonade cartons fell from a tipsy shelf. Fred Meyer controlled the set up the shelves, how to secure the shelves, and how to stock the cartons on the shelves. When Ms. Hammer got her product, the shelf tipped forward and dumped other cartons out onto her. When a bystander tried to help, the shelf failed on him, too.

The attorney for the store argued that this situation should be treated like a slip-and-fall case when there is stuff on the floor. In those cases, the attorney for the shopper must prove that either (1) the store was responsible for placing the foreign substance on the floor, or (2) the store should have known it was there and should have warned about it or cleaned it up before a customer fell.

The trial court and Oregon Court of Appeals disagreed with the defense attorney. Here, the store controlled the shelf and the stocking of the shelf. That differs from a produce section, where many people are in the area and any of them could have dropped some slippery grapes just moments before a fall. In the Fred Myer case, there was no evidence that any third person did anything to the shelving or products that caused the boxes to fall onto its customer-shopper.

In this case, the courts held responsible the corporation that was, in fact, responsible for the injury to the shopper.

Jeff Merrick, Oregon Trial Attorney
503-665-4234

Oregon's Court of Appeals ruled that there are circumstances when a doctor does not have a right to participate, or "intervene," in a lawsuit alleging he malpracticed. In Dixie Taylor v. Portland Adventist Medical Center, a woman went to the emergency room, was sent home, and died. Her loved ones sued the hospital for medical malpractice, not the two doctors involved in the decision to send her home.

The doctors and hospital were in a bit of a pickle. The doctors were employees of the hospital. But, if the hospital has to pay a judgment because of the doctors' malpractice, then the hospital had a right to reimbursement from the doctors. (This right is called "indemnity.") The hospital could have sued the doctors in the same lawsuit, but decided not to. Certainly, the hospital did not want the jury to witness the family AND the hospital arguing that the doctors screwed up.

The doctors said they wanted to be in court to defend their professional reputations, even though they were not named as defendants.

Oregon's Court of Appeals held that Oregon's rules provide two paths to intervene in a lawsuit. One is as a matter of right: when the jury will make a decision that legally binds you. The other is permissive intervention, when the person has some good reasons to be in the lawsuit, but the there are good reasons to exclude the person. All agreed that this was a permissive intervention situation because even if the jury finds for the family of the woman who died, that decision does not bind the doctors who are not parties to the lawsuit. In other words, if the family wins and the hospital later sues the doctors for reimbursement, then the doctors can still argue that they were not negligent, despite what the first jury ruled.

The court found that the doctors had good reasons to participate in the lawsuit. Nevertheless, it upheld the trial judge's decision to exclude them for the following reasons:

• The hospital was highly motivated to win the lawsuit. If it wins, then the doctors have nothing to worry about.
• Whatever the outcome, the verdict would not prejudice the case between the doctors and the hospital.
• Under our system, the family gets to decide whom to sue.
• If there were three defendants in the case, with three defense lawyers and many more expert witnesses, then the family would suffer at trial. Three defense lawyer would give opening statements; three defense lawyers would cross-examine witnesses; three defense lawyers would deliver closing arguments. The case would become much more complicated, more confusing for the jury, AND much more expensive.

Although it may sound harsh that the doctors could not participate, one wonders if they really wanted to be in the courtroom. Instead, I suspect that the insurance company for the hospital wanted to have all three defense lawyers there to try to overwhelm the lawyer for the family.

Jeff Merrick, Oregon Trial Attorney
Injury & Employment Law
503-665-4234

Today, the Oregon Supreme Court ruled that homeowners may sue the contractor who built their home for negligence; they did not need to rely only on a breach of contract claim. In Abraham v. T. Henry Construction, the distinction was important because, by the time the homeowners discovered the construction defects, the time had expired for a breach of contract lawsuit.

Generally, when someone breaches a contract, it does not matter whether the breach is intentional or negligent. If you do not live up to your bargain, then you must pay the other person for the monetary loss caused by your breach. Often, the person hurt by the breach may only sue for breach of contract, but there are exceptions.

The first exception is when a "special relationship" exists between the parties. The lawyer-client relationship, for example is considered a special relationship of trust. That's why a client may sue his or her attorney for legal malpractice, not just breach of contract. Other special relationships include those between people and their doctors, architects, engineers, and trustees.

Another exception to the general rule that one may sue the other side of a contract only for breach of contract is when there is some standard of care or conduct independent of the contract. Here, Mr. and Mrs. Abraham alleged that both (1) common law negligence established an independent duty of care and (2) Oregon's building code sets a standard independent from the contract. They alleged that the contractor failed to meet either standard, and that failure caused water damage to their house. Oregon's Court of Appeals relied on the building code to find an independent standard to support a negligence claim.

Oregon's Supreme Court agreed that Mr. and Mrs. Abraham could sue in negligence, but not just because of the building code. The court reminded us that when a builder's negligence causes property damage, then even people who did not contract with the builder may sue. Just because you hired the builder does not mean you lose your right to sue for negligence. The homeowner might have both a claim for breach of contract and for negligence.

When applying the law to the facts in this case, the court said the homeowners could proceed with their negligence suit under the general common law claim that their contractor failed to exercise reasonable care to avoid foreseeable property damage.

Jeff Merrick, Oregon Trial Attorney
Injury & Employment Law
503-665-4234

Last week, Oregon's Court of Appeals affirmed a jury award against the City of Milwaukie, which inadvertently pumped sewage into a home when it was cleaning the sewer pipes. In Sharon Dunn v. City of Milwaukie, the homeowner relied upon the legal theory of "inverse condemnation" against the city.

Condemnation is when a governmental agency takes private property for a public purpose. If the homeowner does not like the price offered, then it goes to court. "Inverse condemnation" applies when the government makes no offer to buy, but takes property anyway. Then, the homeowner must sue the government to be paid. One of the questions in Milwaukie case was whether blowing sewage into a house added up to a "taking." Certainly, the homeowner still owned the home.

"Taking" includes more than just dispossessing the homeowner. A "substantial interference with the use and enjoyment of the property is sufficient." The evidence included that Ms. Dunn could not use her furnace for a time, so she had to close off rooms and use space heaters. Hardwood floors might need to be removed and replaced. The sewage damaged the sheet rock in parts of the house, and an appraiser testified that the home lost approximately $100,000 in value. The court held that such evidence is enough for a jury to find a "substantial interference" to require compensation.

Jeff Merrick, Oregon Trial Attorney
Injury & Employment Law
503-665-4234

The above is not legal advice. I cannot give you sound advice without knowing more information. It is intended to raise some issues for you to discuss with your own lawyer.

Oregonians enjoy great winter recreation areas. Forest roads and paths become snowmobile and cross-country ski trails when the snow flies. As with car crashes, snowmobile accidents can lead to serious injuries. Last week's news from Washington, DC, identified a risk of crash because of defective snowmobiles manufactured by Arctic Cat.

Arctic Cat recalled several models 2010 snowmobiles because suspension arms cracked, according to reports. When that happens, it can mean the driver loses control, posing a risk of injury or death.

So, what to do if you have one of those models?

If you have not been involved in a crash, then stop using it, report it to the dealer, and have them fix it.

If you were involved in a crash and you are considering a lawsuit, then DO NOT have the dealership fix it. The most important evidence in a product liability lawsuit is the product itself. An expert must examine the machine to determine whether the snowmobile had the defect. An attorney should be involved to negotiate the terms of the inspection. So, if you think you were hurt because of a defective snowmobile, carefully preserve the snowmobile, preferably in a garage, until you hire an attorney to help you evaluate the pros and cons of a lawsuit and to counsel you on what to do with the critical evidence.

Jeff Merrick, Oregon Trial Attorney
Injury & Employment Law
503-665-4234

The above is not legal advice. I cannot give you sound advice without knowing more information. It is intended to raise some issues for you to discuss with your own lawyer.