Legal Updates

Parks v. Farmers, Ins. Co.

ORS 742.061 provides in part that "[I]f settlement is not made within six months from the date proof of loss is filed with an insurer and an action is brought … upon any policy of insurance …, and the plaintiff's recover exceeds the amount of any tender" by the insurer, then the plaintiff shall be entitled to attorneys' fees against the insurer defendant. In Parks, the plaintiff filed litigation, and settled with the insurer (excluding fees and costs). The plaintiff then moved the court for an award of attorneys' fees under the statute. The insurer vigorously argued that the statute did not apply because the statute requires a written proof of loss, and that the plaintiff's only notified the carrier of their claim via telephone. The Oregon Supreme Court explained that "any event or submission that would permit an insurer to estimate its obligations, taking into account the insurer's obligation to investigate and clarify uncertain claims, qualifies as a proof of loss for purposes of ORS 742.061." The Supreme Court held that ORS 742.061 does not require a written proof of loss to accomplish this "functional" definition. It further held that the plaintiff's telephone calls to the insurer were sufficient to constitute a "proof of loss" under the statute.