247 P.3d 319
Or. Ct. App.2010Background
- Plaintiff Kay Bell is a retired PERS member who relied on inflated retirement benefit estimates provided by PERB.
- Bell retired in July 2005 at age 59 based on those estimates, contending she suffered economic losses as a result.
- PERB later informed Bell that the estimates were erroneous and sought overpayment reimbursement under ORS 238.715.
- Bell amended her complaint to claim negligent misrepresentation and damages of $200,707; PERB admitted negligence but contested reliance.
- The trial court granted partial summary judgment, the jury awarded Bell $200,707, and post-trial, the court reduced the award to $100,000 under OTCA’s cap; post-judgment interest was denied.
- On appeal and cross-appeal, the court ultimately held Bell’s claim was barred by the economic loss rule, rendering moot the cross-appeal challenges.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does the economic loss rule bar Bell's negligent misrepresentation claim? | Bell argues the misrepresentation claim survives due to a statutory/special-relationship duty. | PERB argues the economic loss rule bars purely economic torts absent a special relationship or statutory duty. | Yes; economic loss rule bars the claim. |
| Did PERB owe Bell a heightened duty of care (a special relationship) in providing benefit estimates? | Bell contends a fiduciary/trust-like special relationship created a heightened duty to provide accurate estimates. | PERB contends there is no such special relationship for this duty and statutory framework governs estimates. | No heightened duty; no special relationship. |
| Are ORS 238.455(6) and related statutory provisions controlling liability or damages in this context? | Bell asserts statutory provisions do not immunize PERB from liability for negligent misrepresentation. | PERB relies on ORS 238.455(6) to bar entitlement to estimated benefits and limit liability. | Statutory framework does not create liability for misrepresentation; the issue is subsumed by the economic loss rule. |
| Is the appeal reviewable given the cross-appeal on summary judgment rulings and damages? | Bell asserts appellate review is appropriate for the cross-appeal issues. | PERB contends the specific summary judgment rulings are not reviewable via the cross-appeal. | The appeal is reviewable; the cross-appeal is dispositive and leads to reversal on the merits. |
| Should the OTCA damage cap and post-judgment interest be considered given the dispositive ruling on the economic loss rule? | Bell seeks full damages and post-judgment interest consistent with the jury award. | PERB argues the OTCA cap applies and post-judgment interest may be denied. | moot; reversed on the economic loss rule, rendering other damage-related challenges moot. |
Key Cases Cited
- Hale v. Groce, 304 Or. 281 (Or. 1987) (economic loss rule: need a duty outside common law)
- Onita Pacific Corp. v. Trustees of Bronson, 315 Or. 149 (Or. 1992) (heightened duty arising from special relationship allows economic loss recovery)
- Scovill v. City of Astoria, 324 Or. 159 (Or. 1996) (statutory creation of duty; not all statutes create tort liability)
- Conway v. Pacific University, 324 Or. 231 (Or. 1996) (special relationship includes exclusive reliance and independent judgment)
- SFG Income Fund, LP v. May, 189 Or. App. 269 (Or. App. 2003) (evaluates whether statute creates a duty and potential tort liability for economic harm)
- Wild Rose Ranch Enterprises v. Benton County, 210 Or. App. 166 (Or. App. 2006) (statutory or contractual relationships required for heightened duty)
- Loosli v. City of Salem, 215 Or. App. 502 (Or. App. 2007) (absence of special relationship between government entity and private plaintiffs)