From the desk of Cliff Wilson: The one constant in litigation is that the Plaintiff carries the burden to prove every element of their case. In complex scenarios, however, sometimes Plaintiffs will argue to push their burden on to the Defendant, particularly in cases involving insurance company defendants, like cases involving underinsured motorist claims (UIM). Recently, the Oregon Court of Appeals reminded Plaintiffs and trial judges that even in UIM cases, Plaintiffs carry the burden to prove their damages and the allocation of those damages, even in cases involving multiple accidents.
Claim Pointer: Oregon insurance practitioners are familiar with the assignment of the burden of proof in the context of claims under a UIM policy. The initial burden of proving coverage falls on the insured seeking coverage and the insurer carries the burden of proving whether any applicable policy exclusions might apply. In this case, the Oregon Court of Appeals was tasked with determining whether a per occurrence limit in a UIM policy was a grant of coverage under the policy or an exclusion for purposes of allocating the burden of proof of whether it was one “accident” or two “accidents”. As you are about to see, the Court of Appeals sided with the defense, finding that the determination of the number of accidents (and allocation of damages between multiple accidents) is more akin to an issue of coverage, therefore requiring the insured to carry the burden of proof. The net effect is that this makes it a bit harder for the Plaintiff to obtain multiple UIM policy limits for one injury.
Wright v. Turner, 303 Ore. App. 759 (April 29, 2020).
Plaintiff initiated the underlying lawsuit and sought UIM benefits following an incident where he was riding in a pickup truck that was hit in quick succession by two separate negligent drivers. Plaintiff sued both drivers and his UIM carrier. Following trial, a jury returned a $979,540.06 verdict for Plaintiff and the trial Court entered a judgment for that amount. Defendant UIM carrier appealed, arguing that the trial court erred in entering a judgment in that amount, as the applicable insurance policy contained a $500,000 “per accident” UIM limit and the parties had not been able to litigate how many accidents actually occurred. Defendant further argued that, as a matter of law, only one accident occurred. The Court of Appeals agreed, stating that the trial Court erred in precluding Defendant from litigating the actual number of accidents and that, as a matter of law, only one accident actually occurred.
On appeal, the Oregon Supreme Court reversed, based on its conclusion that the Oregon Legislature intended for the question of whether more than one “accident” occurred to be one of fact. On remand, the trial court held a new trial on all issues, making several pretrial rulings – including one which explicitly placed the burden of proof as to the number of accidents and allocation of damages between the accidents on Plaintiff – on the grounds that “it is Plaintiff’s burden to prove the availability of coverage.” However, the trial court also included an additional question to the jury which ultimately had the effect of shifting the burden of proof as to the amount of damages per accident back to Defendant. Specifically, the trial Court instructed the jury that it was to determine whether two accidents occurred, and if so, which percentage of Plaintiff’s damages were caused by each accident. If the jury did not feel Plaintiff’s injuries could be apportioned between the two accidents, then they were not required to allocate damages between them.
When the jury returned a finding that two accidents had occurred, but that it was unable to apportion the damages between each accident, the trial Court then entered a verdict for Plaintiff in the total amount of damages. Defendant carrier appealed again, arguing that by instructing the jury as it had, the trial Court erred by effectively placing the burden of proving apportionment between the two collisions on Defendant.
In light of the $500,000 per accident UIM policy limit, the core issue became which party had to prove how many accidents occurred, and which percentage of Plaintiff’s damages were caused by each (assuming the jury determined it was more than one). The Court of Appeals narrowed the issue down to one of whether a limit of liability provision that caps an insured’s recoverable damages, per occurrence, functions as a grant of coverage or an exclusion. This question became the dispositive one, as Oregon case law specifically places the burden of proving coverage on the insured and the burden of proving the applicability of any exclusion on the insurer.
Typically, insurance policies are interpreted according to contract law – that is – they are interpreted according to the language of the policy and the parties’ intentions and understandings. However, when the provision at issue is one that is required by statute (as is the case with UIM provisions in Oregon), they are interpreted according to the legislature’s intention in enacting that statute. With that framework, the Court of Appeals looked to the purpose underlying Oregon’s descriptions of UIM benefits (ORS 742.502 and ORS 742.504). The purpose, it concluded, is to provide coverage for recovery of damages sustained as a result of “any one accident.” Any liability limit applied to the coverage provided pursuant to the statutory requirement then “does not fundamentally change that those statutes are properly viewed as a grant of coverage.”
Accordingly, the Court of Appeals held that, because the relevant Oregon statutes describe UIM benefits as an entitlement to coverage, the insured bears the burden of proving that their accident (or accidents) fall within the purview of that coverage. Consequently, the Plaintiff should also bear the burden of proving how the damages (which they are required to prove are covered in the first place) should be apportioned in the event two or more accidents contributed to the total damages complained of.
Notably, the Oregon Supreme Court allowed petition for review of this case on August 27, 2020. We will provide another update once the Oregon Supreme Court issues an opinion.