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Masood v. Safeco Insurance Co. of Oregon

Court of Appeals of Oregon

March 22, 2017

Sohail MASOOD, Plaintiff-Appellant Cross-Respondent,
v.
SAFECO INSURANCE COMPANY OF OREGON, an Oregon Insurance Company; Defendant-Respondent Cross-Appellant, and OVERLAND SOLUTIONS, INC., Defendant-Respondent, and A. O. A. WEST, INC., an Oregon corporation, Defendant. Sohail MASOOD, Plaintiff-Appellant Cross-Respondent,
v.
SAFECO INSURANCE COMPANY OF OREGON, an Oregon Insurance Company, Defendant-Respondent Cross-Appellant, and A. O. A. WEST, INC., an Oregon corporation, Defendant.

         Clackamas County Circuit Court CV09070070, CV10060761; A149925 (Control), A149926, Susie L. Norby, Judge.

         On appellant-cross-respondent's cost bill fled February 29, 2016; respondent-cross-appellant's objection to cost bill fled March 11, 2016; appellant-cross-respondent's petition for attorney fees fled March 18, 2016; appellant-cross-respondent's reply to objection to cost bill fled March 25, 2016; respondent-cross-appellant's objection to petition for attorney fees fled May 27, 2016; and appellant-cross-respondent's reply in support of attorney fees fled June 24, 2016. Opinion fled December 9, 2015. 275 Or.App. 315, 365 P.3d 540.

          David W. Axelrod and Schwabe Williamson & Wyatt P.C., for petitions.

          David W. Axelrod, Sara Kobak, Jordan R. Silk, and Schwabe Williamson & Wyatt P.C., for replies.

          R. Daniel Lindahl, John A. Bennett, and Bullivant Houser Bailey PC, for responses.

          Before Armstrong, Presiding Judge, and Egan, Judge, and Nakamoto, Judge pro tempore.

         Petitions for attorney fees and costs allowed in the amount of $516, 977.77 in attorney fees and $46, 758.35 in costs.

         Case Summary: Plaintiff, who prevailed on appeal, petitions for an award of $624, 561.02 in attorney fees and $46, 758.35 in costs. Defendant raises four objections to plaintiff's petitions. First, defendant challenges plaintiff's entitlement to recover attorney fees under ORS 742.061(1). Second, defendant challenges $92, 583.25 in "deferred payment charges, " contending that the charges represent interest that plaintiff's attorneys charged plaintiff for failing to timely pay them for their work and, as such, they are not recoverable as attorney fees. Third, defendant objects that a $15, 000.00 fee charged by plaintiff's attorneys was a fee paid to an expert witness and not a fee that plaintiff can recover from defendant. Finally, defendant objects to approximately $32, 000 in transcript costs that represent the cost to produce daily transcripts at trial.

         Held: First, the Supreme Court has already rejected defendant's objection to plaintiff's entitlement to attorney fees under ORS 742.061(1). Second, the deferred payment charges-constituting interest charged by plaintiff's law from-are not recoverable from defendant as attorney fees. Third, plaintiff concedes that the $15, 000.00 fee charged was an expert witness fee and is not recoverable from defendant. Finally, because the parties agreed that the daily transcripts would be the record on appeal, plaintiff is entitled to recover the cost of those transcripts.

          ARMSTRONG, P. J.

         Plaintiff, who prevailed on appeal, petitions for an award of $624, 561.02 in attorney fees and $46, 758.35 in costs. Defendant Safeco Insurance Company of Oregon (defendant) raises four objections to plaintiff's petitions, contending that plaintiff is not entitled to an award of attorney fees and, in all events, that three components of his fee and cost requests should be denied. As explained below, we conclude that plaintiff is entitled to an award of attorney fees, but we agree with defendant on two of its attorney-fee objections and, accordingly, award fees in an amount $107, 583.25 less than plaintiff requested.

         We briefly summarize the facts of the case, which stem from a fire that destroyed plaintiffs house and damaged surrounding buildings. Plaintiff had purchased an insurance policy from defendant that included extended dwelling coverage for loss of the house due to fire. The parties disagreed on whether plaintiff was entitled to recover amounts due under the extended dwelling coverage before plaintiff replaced the house. According to plaintiff, defendant's adjuster orally agreed that defendant would pay the full replacement value of the house, including the extended dwelling coverage, without regard to whether the house had first been replaced. Defendant subsequently refused to pay the extended coverage, and plaintiff filed suit for breach of contract. Defendant counterclaimed for breach of contract, alleging that plaintiff had misrepresented the value of certain components of the house, that defendant had relied on those misrepresentations in paying plaintiff under the insurance policy, that the insurance policy was void as a result of the misrepresentations by plaintiff on which defendant had relied, and, as a result, that defendant was entitled to recover from plaintiff the money that it had paid plaintiff on the policy.

         Plaintiff moved for a directed verdict on defendant's counterclaim at the close of defendant's case on the ground that defendant had failed to introduce sufficient evidence to support a finding that it had reasonably relied on plaintiff's misrepresentations. The trial court denied plaintiff's directed-verdict motion. The jury returned a special verdict that found that plaintiff was entitled to the full amount of his damages from the fire, including the extended dwelling coverage, but that also found on defendant's counterclaim that plaintiff had misrepresented material facts to defendant on which defendant had detrimentally relied. Based on the verdict, the trial court entered a judgment in defendant's favor for the amount that defendant had paid plaintiff under the policy.

         Plaintiff appealed, contending, among other things, that the trial court had erred in denying his directed-verdict motion on defendant's counterclaim. We agreed with plaintiff and remanded the case to the trial court to enter a judgment in plaintiff's favor for the amount of damages awarded by the jury. Masood v. Safeco Ins. Co. ...


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