Under ORS §742.061 insurance companies are required to pay their insured's attorneys fees if, in the insured's lawsuit against the insurer, the insured obtains a "recovery" that exceeds the amount of any tender made by the insured within six months from the date that the insured first filed a proof of loss. In Long v. Farmers Insurance Company of Oregon, 360 Or. 791, 388 P.3d 312 (2017), the Oregon Supreme Court held that when an insured files an action against an insurer to recover sums owing on the insurance policy and the insurer subsequently pays the insured more than the amount of any tender made within six months from the insured's proof of loss, the insured obtains a "recovery" that entitles the insured to an award of reasonable attorney's fees notwithstanding the voluntary nature of the insurance company's payment. In essence, the court found that the term "recovery" included any kind of restoration of the loss, including a voluntary payment of a claim made after an action on the insurance policy had been filed. In determining whether a qualifying "recovery" has taken place for purposes of ORS §742.061, all that matters is that, after filing an action on an insurance policy, the insured obtains more from the insurer-irrespective of whether through judgment, settlement, voluntary payment or some other means-than the insurer tendered in the first six months after proof of loss, an award of attorney's fees is appropriate under the statute. The Court found that in the context of the statute, "recovery" was not limited to a money judgment rendered in the action in which attorney's fees were sought. The insured was not required to obtain a money judgment that exceeded any tender within the first six months after the insured submitted the proof of loss.
The Idaho Supreme Court in Gearhart v. Mutual of Enumclaw Ins. Co., 160 Idaho 666, 378 P.3d 454 (Idaho 2016), found that a UIM anti-stacking provision was ambiguous and, therefore, unenforceable. In Gearhart, the Court considered a UIM policy's anti-stacking clause which stated that the maximum limit of liability under all of the policies that were issued was the highest applicable limit under any one policy. However, the Court found this clause to be ambiguous and, therefore, did not preclude a passenger from recovering the total cumulative UIM benefits under each policy issued to the insured's parents. The majority opinion concluded that the anti-stacking clause in question was ambiguous because it could be construed to "mean that one aggregates all of the applicable policy limits and then the total of the limits constitutes the highest limit of any one policy." The dissent characterized the majority's conclusion as "nonsensical." The dissent would have found the anti-stacking clause to be neither ambiguous nor complex.
The Wyoming Supreme Court in Century Surety Co. v. Jim Hipner, LLC, 2016 WY 81, 377 P.3d 784 (2016), engaged in a jurisprudential review of the enforceability of non-prejudicial notice requirements in insurance policies and why courts have moved away from the traditional rule by adopting the modern view which is commonly called the notice-prejudice rule. The case provides an excellent expose of the rationales supporting the notice-prejudice rule and is a must read.
The Montana Supreme Court in Parker v. Safeco Ins. Co. of America, 384 Mont. 125, 2016 MT 173, 376 P.3d 114 (2016), held that an earth movement exclusion was not limited solely to damages caused by soil movement. The Court found that earth movement included damage caused by a falling boulder. The Court noted that the insurance policy in question included as examples of earth movement both landslides and lava flows but did not mention soil; the policy did not provide a basis for separating rock and soil when construing the exclusion. The Court found that nothing in the language of the earth movement exclusion indicated that there was any basis for separating rock from soil when considering earth movement. A common understanding of the term landslide in the context of the exclusion could include a large boulder that came down the hill and crashed into the insured's cabin. Because a common understanding of the term landslide in the context of the exclusion would include the large boulder that came down the hill and crashed into the insured's cabin, the policy excluded coverage for the loss.