Should You Sue A Party Who You Have A Good Faith and Reasonable Believing Is Not Liable?

By Susan K. Eggum

In Uruo v. Clackamas County, 166 Or App 133, 997 P2d 269 (2000), the Oregon Court of Appeals affirmed the trial court's grant of summary judgment in favor of defendant Oregon City on its statute of limitations defense. The case is noteworthy because it departs from several recent Supreme Court cases holding that a dispute as to when a claim was or reasonably should have been discovered for statute of limitations purposes generally presents a factual question for the jury. Here, the Court of Appeals resolved that factual dispute as a matter of law.

Careful practitioners will want to take note of the Uruo decision in balancing their certification obligations under ORCP 17 with their obligation to ensure that their clients' potential claims are timely filed. On the one hand, ORCP 17 provides that an attorney who signs a pleading certifies that the claims asserted in the pleading are warranted by existing law or a good faith obligation for the extension, modification or reversal of existing law or the establishment of new law, ORCP 17C(3), and that "the allegations and other factual assertions in the pleading . . . are supported by the evidence" or "that the attorney . . . reasonably believes that an [specifically identified] allegation or factual assertion so identified will be supported by evidence after further investigation and discovery." ORCP 17C(4). On the other hand, Uruo suggests that, even when an attorney has not yet discovered the facts upon which a claim is based and has not yet determined that such facts are likely to be developed through discovery or investigation, he or she may need to bring a claim against any parties who have any potential involvement in order to avoid the bar of the statute of limitations.

The claims asserted in Uruo arose from a June 7, 1995 police pursuit of a vehicle driven by Trisha Storm. 166 Or App at 136. Officers from the Clackamas County Sheriff's Office, the Oregon State Police and the Oregon City Police were involved in the pursuit. Id. Twice during the pursuit, the officers attempted a "boxing" maneuver to stop Storm's vehicle. Id. A "box" is a maneuver in which police attempt to stop a vehicle by positioning police vehicles in front, behind, and on each side of the suspect vehicle and then gradually slowing down to bring the suspect vehicle to a stop. Id. at n. 1. The first boxing maneuver failed after Storm rammed one of the police cars. Id. The second was aborted after Oregon City Police Chief Bruce Jenness ordered Oregon City police officers to withdraw. Id. Jenness gave this command over the radio, and was monitoring the pursuit by radio; he was not on the scene. Id. at n. 2. There was evidence that this type of command should have been made by an officer on the scene. Id. The Oregon City officers then dropped out of the pursuit. Id. at 136.

After Oregon City dropped out, officers from the Oregon State Police and Clackamas County Sheriff's Office continued the pursuit. Id. One of the Clackamas County officers shot one of Storm's tires out, slowing her down, but she nonetheless continued to elude officers. Id. at 137. She crossed the I-205 bridge, made a u-turn and began driving south in the northbound lanes of I-205. Id. Her car hit the plaintiffs' car, seriously and permanently injuring them. Id.

After the accident, plaintiffs retained counsel, who sent tort claim notices to all of the agencies involved on November 5, 1995. Id. The notices stated that "each of the agencies participating in the pursuit conducted the pursuit in a negligent manner, which was a cause of each of the claimant's injuries and damages." Id. Plaintiffs' counsel then conducted an investigation into the incident, obtaining the police reports in November 1995 and a transcript of the radio transmissions on January 4, 1996. Id. These documents revealed that Jenness had ordered the Oregon City officers to withdraw from the second boxing maneuver. Id. As part of their investigation, plaintiffs also consulted experts and corresponded with Oregon City's insurer. Id. After doing so, plaintiffs concluded that Jenness' decision to order the Oregon City officers to withdraw from the boxing maneuver either was not negligent or did not cause their injuries. Id. Plaintiffs and their experts reached this conclusion for two reasons. First, they determined from the police reports that Storm had been driving at a high rate of speed when officers attempted the second boxing maneuver. Second, they determined that because a boxing maneuver is neither safe nor likely to succeed at high rates of speed, they had no claim against Oregon City. Id.

Plaintiffs then filed their initial complaint on March 28, 1997, alleging liability on the part of the Oregon State Police and Clackamas County based on their alleged negligent failure to stop Storm after Oregon City dropped out of the chase. Id. at n. 4. In December, 1997, plaintiffs deposed two Oregon City police officers, and learned for the first time that the second attempted boxing maneuver had been a "textbook" or "perfect" box, that the maneuver had slowed Storm's vehicle to 5 to 10 miles per hour before Jenness ordered the Oregon City officers to withdraw and that the Oregon City officers' felt that the pursuit was basically over but for Jenness' order to withdraw. Id. at 138. Not a single police report from any agency involved ever disclosed that the second boxing maneuver had been a success, but aborted due to Jenness' order.

On January 16, 1998 (approximately two years and seven months after the accident) based upon these newly discovered facts, plaintiffs filed a third amended complaint asserting a negligence claim against Oregon City based on Jenness' order to withdraw from the second boxing maneuver. Id. Oregon City moved for summary judgment on the ground that plaintiffs' claim was time-barred. Plaintiffs opposed the motion, arguing that their claim was timely under the discovery rule.

The trial court granted the motion for summary judgment on the ground that, as a matter of law, the plaintiffs' action in giving tort claim notice to Oregon City had caused the statute of limitations to begin to run and the claim against Oregon City was, therefore, filed more than two years after that. Plaintiffs submitted an affidavit from their attorney who stated that he had sent the tort claim notices (including one to Oregon City) within 180 days of the accident as a precautionary measure but that, at that point, he had not yet conducted an investigation into plaintiffs' claims and had not yet made a judgment as to whether plaintiffs had a good faith legal and factual basis for filing a lawsuit against any of the potential defendants. Id. at 140. He also averred that, following an investigation, including consultations with police experts, he concluded that Oregon City had not been negligent and that he could not have learned otherwise until he deposed the Oregon City officers. Id.

Based upon these facts, the Court of Appeals held that the trial court erred in holding that, as a matter of law, the giving of tort claim notice meant that plaintiffs' claims had accrued for statute of limitations purposes. The appeals court held that "on this record, a fact finder reasonably could conclude that the fact that plaintiffs gave tort claim notice does not necessarily mean that they had sufficient information to say that their claim had accrued. Rather, plaintiffs' explanation creates a question of fact whether the statement in the tort claim notice should be taken at face value. On this record, the fact that plaintiffs gave tort claim notice does not provide a basis for granting Oregon City's motion for summary judgment." Id. at 140.

The court nonetheless concluded that Oregon City was entitled to summary judgment, on the ground that "[g]iven the police reports, plaintiffs should have been aware of a substantial possibility that they had a tort claim against Oregon City no later than January 6, 1996. The statute of limitations began to run from that date. Because plaintiffs did not file their amended complaint against Oregon City until January 16, 1998, their claims . . . are barred by the statute of limitations." Id. at 144.

The court based this holding on its analysis of the police reports. Plaintiffs had asserted that they concluded from the police reports that the second box was unlikely to have succeeded (and that Jenness' action in calling it off was therefore either not negligent or not the cause of plaintiffs' injuries) because of the high rate of speed at which they believed Storm to have been traveling at the time of the second box attempt, based upon the police reports. The Court of Appeals concluded that "[t]he police reports do not consistently support the factual premise of plaintiffs' argument. Although the police reports do not all point in the same direction, they raise a substantial possibility that Storm could have been going as slowly as 20 miles an hour when the officers attempted the second block." Id. at 140. The Court of Appeals acknowledges that the one officer who discusses the speed of the suspect in conjunction with the second box attempt indicates that Storm's speed was "70 to 75 MPH." Id. at 141. Two other reports which discuss the second box attempt are relied up by the court for its conclusion that Storm could have been going as slow as 20 MPH. One report states only that after Oregon City was ordered to drop out, "[t]he suspect vehicle continued its erratic driving and increased its speed again." Id. at 142 (emphasis in original). And, the other report discusses a variety of events during the chase, including the second box attempt, and states "[n]ot keeping a close watch on my speedometer my vehicle speed range was from about 20 mph to approx. 70 mph." Id.

From this, the court concludes that, as a matter of law, "[a]t a minimum, the reports should have put plaintiffs on notice that they needed to inquire further." Id. at 144. Of course, as noted above, plaintiffs had submitted evidence that their attorney had consulted with and had the police reports reviewed by experts who did not see anything in them suggesting a possible basis for liability against Oregon City. For the court to resolve this issue of whether the inconclusive evidence in the police reports was enough to start the statute running as a matter of law is at odds with recent Supreme Court cases.

For example, in Gaston v. Parsons, 318 Or 247, 256, 864 P2d 1319 (1994), the Oregon Supreme Court held that "the statute of limitations begins to run when the plaintiff knows or in the exercise of reasonable care should have known facts which would make a reasonable person aware of a substantial possibility that each of the three elements (harm, causation, and tortious conduct) exists. . . . Whether a reasonable person of ordinary prudence would be aware of a substantial possibility of tortious conduct is a question of fact. . . ."

The Supreme Court has been extremely reluctant to have the courts usurp the role of the fact-finder in making this determination. For example, in Stephens v. Bohlman, 314 Or 344, 351, 838 P2d 600 (1992) the plaintiff's decedent died after the breathing tube in her trachea was dislodged and incorrectly replaced in the esophagus. The plaintiff subsequently received an autopsy report stating that "[plaintiff's decedent] coughed out her nasotracheal tube. . . . The nasotracheal tube was replaced by a nurse and the cuff inflated. Within two minutes of the time the tube had been coughed up, the patient had marked increase in anxiety, became pale and then 'gray.' One minute later, the patient was nonresponsive to verbal command, touch or painful stimuli and a Code 99 was called. . . Ultimately a nurse anesthetist arrived in response to the code and found the nasotracheal tube in the esophagus." 314 Or at 347. The defendant had moved for summary judgment, arguing that when plaintiff received the report, she was aware of her claim or on notice of it. The trial court granted summary judgment, the Court of Appeals reversed and the Supreme Court affirmed the reversal. It held that: "Defendant's argument is that a reasonable person would have inferred from the fact that the breathing tube was found in [decedent's] esophagus that the nurse had negligently placed it there. Some persons might so infer, but we are not convinced that a reasonable person must so infer. Thus, we cannot say as a matter of law what a reasonable person would conclude from reading the report." 314 Or at 351.

Of course, that is exactly what the Court of Appeals did in Uruo. It concluded as a matter of law that receipt of the police reports (which the court itself acknowledged "d[id] not all point in the same direction" and which "d[id] not establish definitively how fast Storm was going" started the statute running. 166 Or App at 144. Interestingly, the court also bases its determination on the date plaintiffs gained a duty to inquire ("[a]t a minimum, the reports should have put plaintiffs on notice that they needed to inquire further") but nonetheless held that the statute ran on the date plaintiffs received the reports, not on some date by which it was unreasonable for them not to have done so. In other words, the court held that the statute began to run on the date plaintiff was on inquiry notice, and not on the date on which plaintiffs discovered or should have discovered their claims. Id.

In any event, in light of the holding in Uruo, the careful practitioner will want to err on the side of bringing claims against all potential defendants within the statutory period, whether or not an investigation has revealed facts to support those claims. In order to comply with the good faith pleading requirements, it may be necessary to make allegations or factual assertions which are not supported by evidence but which an attorney can certify that the attorney "reasonably believes . . . will be supported by evidence after further investigation and discovery." ORCP 17C(4). The regrettable effect of the Uruo decision is to require the cautious attorney to bring claims even prior to discovering the facts supporting them, in order to avoid the potential pitfall of the statute of limitations.

**Susan K. Eggum gratefully acknowledges Tracy P. Reeve's contribution to this article.