Argued and Submitted: August 15, 2013.
Marion County Circuit Court 10C15934. Vance D. Day, Judge.
Andrew D. Glascock argued the cause for appellant-cross-respondent. With him on the briefs was Hiefield Foster & Glascock, LLP.
J. Michael Alexander argued the cause for respondent-cross-appellant. With him on the briefs were Travis S. Prestwich and Swanson, Lathen, Alexander, McCann & Prestwich, P.C.
Before Duncan, Presiding
Judge, and Wollheim, Judge, and Schuman, Senior Judge.
[264 Or.App. 237] SCHUMAN, S. J.
This is a personal injury case involving a claim by plaintiff against her insurer, defendant, after plaintiff was injured in an automobile accident by an uninsured motorist. After the jury returned a verdict in favor of plaintiff for $5,856.49 in damages, the court awarded plaintiff $25,182 in attorney fees. Defendant challenges plaintiff's entitlement to attorney fees and, in the alternative, the amount awarded. Plaintiff cross-appeals, arguing that the court erred in excluding certain evidence and that the court's error was prejudicial to her claim for damages. We conclude that the court's evidentiary ruling was erroneous and prejudicial, so we reverse and remand on plaintiff's cross-appeal. On defendant's appeal, we conclude that plaintiff was entitled to attorney fees, but we remand on the question of the amount of those fees.
The facts are undisputed. While driving on I-84 with her husband and children, defendant's car was hit from behind by a negligent, intoxicated, and uninsured motorist. As a result, plaintiff suffered a broken nose and other physical injuries, as well as pain, suffering, and emotional distress. Shortly thereafter, plaintiff submitted to defendant an " application for [uninsured motorist] benefits and proof of loss." Eight months then elapsed before defendant made its first attempt to settle the claim, offering $3,000. ORS 742.061. Subsequently, and
before plaintiff filed this action, defendant raised the offer to $6,000. Plaintiff, whose original demand was for $25,000 in uninsured motorist benefits (her policy limits), rejected the offer after her attorney conferred with his partners and two independent defense attorneys, and, based on their advice, estimated that the case was worth considerably more than the amount offered.
Court-annexed arbitration ensued. The arbitrator awarded plaintiff $11,826.99 in damages and $9,259 in attorney fees. Defendant, however, appealed the arbitration [264 Or.App. 238] award to the circuit court. At trial, the court did not allow plaintiff to submit evidence that, following the accident, she had continuing nightmares about it and fear of driving in the dark. The court reasoned that, because plaintiff's damages were limited by the insurance policy, her action sounded in contract and were, in turn, limited by statute to damages that " arise out of bodily injury." That phrase, the court held, ruled out compensation for plaintiff's fear and nightmares. Ultimately, the jury returned a verdict awarding plaintiff $856.49 in economic damages and $5,000 in noneconomic damages, for a total that was lower than the amount of defendant's final settlement offer. Plaintiff subsequently submitted a statement seeking attorney fees of $25,182, based on a rate of $300 per hour, which was 20 percent higher than her attorney's usual hourly rate because he took the case on a contingency basis. Over defendant's objection, the court entered an award for the full amount requested.
On appeal, defendant challenges plaintiff's entitlement to attorney fees and, in the alternative, the amount awarded. In a cross-appeal, plaintiff challenges the court's ruling that excluded evidence of continuing emotional distress and fear. We begin with plaintiff's cross-appeal.
At a pretrial hearing, defendant made a motion in limine seeking to preclude plaintiff from offering evidence of damages for emotional distress unless such damages resulted from bodily injury. The court granted the motion, and, at trial, allowed plaintiff to testify about her state of mind in the immediate aftermath of the accident, but excluded evidence of plaintiff's long-term nightmares about the incident and her continuing fear of driving in the dark--nightmares and fears that had not abated at the time of trial. The court apparently agreed with defendant's argument that the policy and statutory language limiting emotional distress damages precluded consideration of emotional distress beyond the immediate aftermath of the physical impact. Plaintiff argued, and argues again in her cross-appeal, that evidence of the continuing emotional distress should have been admitted because it was directly related to the physical, bodily injury that she experienced from the accident itself. She notes that the insurance contract, [264 Or.App. 239] as well as statutes to which the contract must conform, ORS 742.504, covered plaintiff for general damages resulting from bodily injury, and that her fears and nightmares clearly fell within that category. Defendant, not offering any response to that argument, appears to concede the error. We agree. Both ORS 742.504(1)(a) and defendant's policy allow recovery for " general * * * damages * * * because of bodily injury" caused by the accident. Subsequent emotional harm resulting from the accident occurs " because of" that accident. See, e.g., Porter v. Headings, 270 Or. 281, 283-84, 527 P.2d 403 (1974) (court erred in excluding the plaintiff's evidence that automobile accident caused subsequent fear that plaintiff's unborn child was injured); Fehely v. Senders, 170 Or. 457, 461, 464, 135 P.2d 283 (1943) (providing that emotional injuries following physical injury include " mental suffering * * * whether permanent or temporary" ).
Defendant, however, contends that the erroneous exclusion of the evidence does not constitute reversible error because it was not prejudicial. Or Const, Art VII (Amended), § 3 (judgment of trial court must be affirmed if error is harmless); ORS 19.415(2) (" No judgment shall be reversed or modified except for error substantially affecting the rights of a party." ); OEC 103(1) (evidentiary error not presumed to be prejudicial).
According to defendant, excluding evidence of lingering post-accident emotional distress was harmless because plaintiff was allowed to testify at some length about her emotional state at the time of the accident. The excluded testimony, in other words, would have been merely cumulative. We disagree. We will reverse based on evidentiary error if the excluded evidence had some likelihood of affecting the jury's verdict. Gritzbaugh Main Street Prop. v. Greyhound Lines, 205 Or.App. 640, 654, 135 P.3d 345, adh'd to on recons, 207 Or.App. 628, 142 P.3d 514 (2006), rev den, 342 Or. 299, 152 P.3d 902 (2007). That is the situation here. There is a significant difference between a contained, short period of emotional distress immediately following physical injury and persistent, lingering, and long-term emotional distress. The court erred in excluding plaintiff's testimony, and we cannot say that the error was harmless.
That being the case, we must reverse and remand. However, on remand, the question of attorney fees may arise. [264 Or.App. 240] We therefore address defendant's arguments on that question. Defendant first contends that the court erred in awarding ...