Case Name: Lois McNEELY, Appellant, v. WEYERHAEUSER COMPANY, Oregon Physicians' Service and Klamath Medical Service Bureau, Respondents
Court: Oregon Court of Appeals
Jurisdiction: Oregon
Decision Date: 1992-09-16
Citations: 115 Or. App. 184
Docket Number: 88-213 CV; CA A63235
Parties: Lois McNEELY, Appellant, v. WEYERHAEUSER COMPANY, Oregon Physicians’ Service and Klamath Medical Service Bureau, Respondents.
Judges: Before Richardson, Presiding Judge, and Deits and Durham, Judges.
Reporter: Oregon Reports, Court of Appeals
Volume: 115
Pages: 184–194

Head Matter:
Argued and submitted December 9,1991,
affirmed September 16,
reconsideration denied November 25,1992,
petition for review denied January 26, 1993 (315 Or 312)
Lois McNEELY, Appellant, v. WEYERHAEUSER COMPANY, Oregon Physicians’ Service and Klamath Medical Service Bureau, Respondents.
(88-213 CV; CA A63235)
837 P2d 546
William H. Ferguson, Medford, argued the cause and filed the briefs for appellant.
Larry B. Workman, Medford, argued the cause for respondents. With him on the brief was Frohnmayer, Deatherage, Pratt, Jamieson & Turner, P.C., Medford.
Before Richardson, Presiding Judge, and Deits and Durham, Judges.
RICHARDSON, P. J.
Durham, J., dissenting.

Opinion:
RICHARDSON, P. J.
Plaintiff brought this action against defendants for negligence and negligent and intentional misrepresentations concerning medical insurance coverage. The trial court concluded that the action was barred by the two-year Statute of Limitations, ORS 12.110(1), and granted a summary judgment for defendants. Plaintiff appeals, and we affirm.
Plaintiff alleged that, on November 15,1980, she and her husband, an employee of defendant Weyerhaeuser Company (Weyerhaeuser), dissolved their marriage. The dissolution judgment required the husband to continue medical insurance coverage for her through his employer. Defendant Oregon Physicians' Service and its agent, defendant Klamath Medical Service Bureau (KMSB), provided Weyerhaeuser's group medical plan, which allows the spouse of a covered employee to retain coverage for six months after the dissolution of a marriage. Despite having notice of the dissolution, defendants paid several of plaintiffs claims after the coverage period had expired.
On July 12, 1985, defendants refused to pay the expenses for two knee surgeries that were performed on plaintiff in February, 1985. Plaintiff contends that, before each surgery, she received verbal assurance from Weyerhaeuser or KMSB that she was covered under the group plan.
On January 14, 1986, plaintiffs attorney wrote to Weyerhaeuser's plan trustee and asserted, inter alia, that it was estopped to deny coverage. In May, 1986, plaintiff filed an action against defendants and others in state court for breach of contract and claiming an estoppel. Defendants removed the action to federal court, asserting that it arose under the Employee Retirement Income Security Act (ERISA). 29 USC § 1001 et seq. On May 10, 1988, the federal court entered a judgment against plaintiff, holding that she did not have standing to sue under ERISA.
On July 18,1988, plaintiff filed this action, contending that she was entitled to coverage on the theories that defendants were negligent and made negligent or intentional misrepresentations concerning her eligibility. Defendants again removed the action to federal court and claimed that ERISA preempted it. The federal court disagreed, holding that plaintiffs negligence and misrepresentation claims arose after she ceased to be an ERISA plan participant or beneficiary, and remanded the action to state court. The circuit court held the action time-barred, because plaintiffs claims had accrued by January, 1986, when plaintiffs attorney had demanded coverage on the basis of estoppel. That predated the filing of the 1988 lawsuit by more than two years.
On appeal, plaintiff argues that the trial court erred because (1) she did not know and could not have discovered that defendant's assurances of coverage were false until the federal court entered a judgment of dismissal in the first action on May 10,1988, and (2), because she filed this action within one year after the federal court's dismissal, she is entitled to the extension of the Statute of Limitations provided by ORS 12.220.
The court did not err in holding that plaintiffs claims accrued in January, 1986, rather than in May, 1988. The attorney's letter demonstrates that plaintiff and her attorney had knowledge or reason to know that plaintiff had a claim against defendants by the 1986 date. Duyck v. Tualatin Valley Irrigation Dist., 304 Or 151, 742 P2d 1176 (1987).
We turn to plaintiffs second argument. ORS 12.220 provides:
"Except as otherwise provided in ORS 72.7250, if an action is commenced within the time prescribed therefor and the action is dismissed upon the trial thereof, or upon appeal, after the time limited for bringing a new action, the plaintiff, or if the plaintiff dies and any cause of action in the favor of the plaintiff survives, the heirs or personal representatives of the plaintiff, may commence a new action upon such cause of action within one year after the dismissal or reversal on appeal; however, all defenses that would have been available against the action, if brought within the time limited for the bringing of the action, shall be available against the new action when brought under this section."
The purpose of the statute is
"to avoid the bar of the statute of limitations for a diligent plaintiff whose timely action has been dismissed over his objection without a determination on the merits." Hatley v. Truck Insurance Exchange, 261 Or 606, 614, 494 P2d 426, 495 P2d 1196 (1972).
Hatley construed the term "dismissal" to include
"a dismissal for want of jurisdiction of the cause, whether requiring a determination of issues of law alone or of issues of both law and fact." 261 Or at 615.
Defendants argue that ORS 12.220 does not apply here and that, "where plaintiff previously filed an action based upon breach of contract or estoppel, plaintiffs current action based upon negligence and misrepresentation is not saved by ORS 12.220." Although defendants rely in large part on the theory that the second action is barred by res judicata arising from the earlier action, that misses the point. Plaintiffs present claims are barred for a more fundamental reason. ORS 12.220 can extend the limitation period only for a "new action upon [a] cause of action" that was previously "commenced within the time prescribed therefor." It does not operate to allow a new "cause of action" to be asserted after the time for bringing it has run simply because the plaintiff brought an earlier action that asserted different claims. The clear purpose of ORS 12.220 is to preserve only pre-existing claims, not to create a one-year grace period for bringing untimely actions on claims that had never been stated before.
We conclude that plaintiffs new action is not on the same cause or causes of action as her first one and that it is time-barred.
Affirmed.
ORS 12.110(1) provides:
"An action for assault, battery, false imprisonment, or for any injury to the person or rights of another, not arising on contract, and not especially enumerated in this chapter, shall be commenced within two years; provided, that in an action at law based upon fraud or deceit, the limitation shall be. deemed to commence only from the discovery of the fraud or deceit."
ORS 12.220 was briefed and argued by the parties on appeal, but defendants argue that we should not address it, because it was not cited to the trial court. We disagree. The record indicates that the court was aware of the underlying federal action and considered whether ORS 12.220 was applicable.
We are not called on in this case to decide.whether the doctrine of relation back has any bearing on the claims that can come within ORS 12.220. See Evans v. Salem Hospital, 83 Or App 23, 730 P2d 562 (1986), rev den 303 Or 331 (1987).