Court Opinion

ID: 9613138
Source: CourtListenerOpinion
Date Created: 2023-08-22 04:14:28.712135+00
Date Added: 2024-06-11T18:03:25.647057
License: Public Domain

TANZER, J.,
dissenting.
I regret that I cannot join in the majority opinion. The rule of law which it propounds is unrealistic: a group insurer can be legally bound by the statements of the employer if it is possible that the employer will answer questions about coverage. Also, the majority evades the task of statutory construction by letting the jury do it.
I
First, the opinion identifies the applicable law as a dichotomy composed of so-called “insurer-administered” and “employer-administered” group insurance plans, cites cases involving each, and summarizes the law as this:
“* * * [W]hen the plan is exclusively administered by the insurer, as a matter of law no agency relationship exists between the insurer and the employer. But if the employer performs all of the administration of the policy, an agency relationship exists between the insurer and the employer, as a matter of law. * * *” 292 Or at 44.
This seems to be a satisfactory legal rationale upon which insurers, employers and employees can conduct their affairs and, for purposes of this dissent, I do not dispute it. The opinion also sets out the facts of this case which parallel in all significant respects those in the “insurer-administered” cases it cites. It then concludes, inexplicably, *66that the plan in this case can be found to be an “employer-administered” plan. The only reason it offers is that the insurer might have expected the employer to answer questions about deadlines, but that inference is equally possible in each of the very cases which the majority cites as “insurer-administered” cases. One need not be first in the class to see the fallacy. Hence, I disagree with the agency analysis.
II
The discussion of ORS 744.165 is inconclusive. On these facts, the employer is either an agent under the statute or it is not, depending on the meaning of the statute. Statutory construction is a process of law, not fact-finding. Whether a particular kind of situation falls within or without the meaning of a statute is a definitional determination of law to be made by courts. When the words of a statute are clear, that legal task is simple. Where the words are not clear, the task is not so simple, but courts customarily look to the context of the words, the legislative history, rules of construction or other extrinsic aids to determine the underlying legislative intent. The majority goes through those motions, but does not follow through to a conclusion. Instead, it shucks the question to the jury.
Our function as an appellate court goes beyond individual case decision. Our responsibility regarding ORS 744.165 is to clarify its meaning so that insurers and others affected by it can conduct their affairs knowing the rules which apply. In this way, lawyers can understand the scope of the statute and advise clients accurately. If we perform our responsibility of statutory construction, people can come to secure, predictable business arrangements, thus avoiding needless disputes. When disputes arise, they can more often be settled without litigation if the law is clear. If we fail to clarify the meaning and application of the statute, as the majority does, and instead send the problem to the jury without clarifying instructions, business arrangements become speculative, the law becomes a matter of jury prediction, and people affected by the statute never know their rights and liabilities until a verdict is obtained. This philosophy of judicial function is fundamental, but the majority seems not to acknowledge it.
*67ORS 744.165 should be construed to achieve its purpose. The majority has gone to the work of determining the purpose of the statute, but then fails unaccountably to apply the conclusion it draws from the statutory history. The majority states:
“* * * Whether this provision can create an agency relationship that was not already officially established through the licensing process is a more difficult question. When the predecessor statute to ORS 744.165 was enacted in 1917, little or no group insurance was in effect. The goal the statute aimed to achieve was to bind insurers for the acts of those persons who were involved in the insurance business, including but not limited to licensed agents, as regards the soliciting and procuring of applications for insurance policies. * * *” (Second emphasis supplied; 292 Or at 60.)
The majority goes on to hold that an agency may or may not be created according to how the jury decides, not by legal operation of the statute.
The facts of the conversation between plaintiff and Largent do not call the statutory purpose into play. The conversation occurred prior to plaintiffs employment, “when I was first talking to Mr. Largent about going to work there.” The record is clear that: At the time of the meeting the conversation was incident to possible employment of the plaintiff by Largent. Plaintiff had not yet made the decision to go to work for Largent. Plaintiff had not yet made the decision to apply for coverage. There was no delivery of any application. There was no discussion concerning any application. The application was obtained months later from “someone there at the company.” At the time of the conversation Largent was not advised whether plaintiff intended to apply for coverage, and there is no evidence that Largent cared, one way or the other, whether plaintiff applied for coverage.
Given that statutory purpose and those facts, the majority refuses to face up to the conclusion that ORS 744.165 does not apply (or, for that matter, does apply). We should decide whether the employer’s conduct was procuring or solicitation of an application for insurance within the meaning of ORS 744.165 or was not. Instead, the majority concludes inconclusively by sending the issue to the jury.
*68Ill
I conclude that ORS 744.165 embodies some basic agency principles, but under the rationale of Bowes v. Lakeside Industries, Inc., 297 Minn 86, 209 NW2d 900 (1973), and Elfstrom v. New York Life Ins. Co., 67 Cal 2d 503, 63 Cal Rptr 35, 432 P2d 731 (1967), this is an insurer-administered plan and the employer (policyholder) does not have authority as agent to bind the insurer by making statements at variance with the policy. Petitioner may have a claim against the employer for misrepresentation, or perhaps breach of contract, but not against the insurer based on the agency of the employer.