Court Opinion

ID: 9792148
Source: CourtListenerOpinion
Date Created: 2023-08-31 02:24:07.437344+00
Date Added: 2024-06-11T07:37:39.461907
License: Public Domain

WARREN, P. J.,
dissenting.
The majority errs in affirming the summary judgment for PGE. PGE neither pleaded nor attempted to prove that it had any actual or potential liability to decedent’s estate. It therefore failed to establish that it had any reasonable basis to pay. Accordingly, it paid as a volunteer, and the trial court’s legal conclusion to the contrary is unsupported by any evidence. Defendant was entitled to prevail on summary judgment as a matter of law.
The majority’s premise is that under ORS 757.805(2), PGE is relieved of any obligation to prove its own potential liability as a condition to its right to indemnity. The premise is not supported by a fair reading of the text of the statute and is inconsistent with the context in which the statute was enacted. It is also demonstrably inconsistent with legislative intent and would be an anomaly in a system of law that historically has required parties seeking indemnity to prove that payment was made under threat of liability. When a statute is susceptible of more than one reasonable meaning an analysis of its meaning under the PGE v. Bureau of Labor and Industries, 317 Or 606, 610, 859 P2d 1143 (1993), format is appropriate.
When legislation is enacted which affects an existing body of substantive law, it is presumed that that substantive law forms part of the context in which the legislature has *796operated. Owens v. Maass, 323 Or 430, 438, 918 P2d 808 (1996). It follows that when common-law remedies are codified and made statutory remedies, the legislature may be presumed to have intended common-law understanding about the remedy to continue in the absence of express language to the contrary. The common-law background is, in effect, part of the context in which the text of the statute must be reviewed. 323 Or at 439-40.
A brief review of the common law of indemnity provides a useful background for an examination of ORS 757.805(2). The common-law right of indemnity was described by the Supreme Court in Savelich Logging v. Preston Mill Co., 265 Or 456, 460, 509 P2d 1179 (1973), as containing the following elements:
“ ‘[T]he claimant must plead and prove that (1) he has discharged a legal obligation owed to a third party; (2) the defendant was also liable to the third party; and (3) as between the claimant and the defendant, the obligation ought to be discharged by the latter.’ ” (Quoting Fulton Ins. v. White Motor Corp., 261 Or 206, 210, 493 P2d 138 (1972).)
These elements were also explained in State Dept. of Trans. v. Scott, 59 Or App 25, 29, 650 P2d 158 (1982). In Scott, we stated that the party seeking indemnity for a case it settled with a third party must plead and prove that:
“1) a third party made a claim against him; 2) he reasonably incurred costs in defending or satisfying the claim; and 3) as between the plaintiff and the defendant, the costs incurred ought to be borne by the latter.” (Citing PGE v. Const. Consult. Assoc., 57 Or App 116, 643 P2d 1334 (1982).)
See also Martin v. Cahill, 90 Or App 332, 336, 752 P2d 857 (1988). Accordingly, the basic tenets of common-law indemnity actions are that the party seeking indemnity must demonstrate that it incurred costs because it was exposed to some risk of liability, that the costs it incurred were reasonable, and that the other party should pay. Scott, 59 Or App at 29. Here, PGE asserts on appeal that it was free from any liability. Because nothing in the text or the context of ORS *797757.805(2) indicates to the contrary, the precepts of common-law indemnity are applicable to the statutory indemnity in this case and PGE’s claim fads.
ORS 757.805(2) provides, in part:
“[T]he person or business entity violating subsection (1) of this section or rules adopted pursuant to ORS chapter 654 is liable to the utility operating the high voltage overhead lines for all damages to its facilities and all costs and expenses, including damages to any third persons, incurred by the utility as a result of the accident. However, any person or business entity that has given advance notice of the function, activity or work to the utility operating the high voltage overhead line, and has otherwise substantially complied with rules adopted pursuant to ORS chapter 654, shall only be liable for such damages in proportion to that person or business entity’s comparative fault in causing or contributing to the accident.”
The legislature’s choice of certain words and phrases, such as “incurred” and “damages to third parties” manifests particular meaning in the context of an indemnity statute, and in an analysis of the statutory text, we give words of common usage their ordinary and plain meaning. PGE, 317 Or at 611 (stating that we are to discern the intent of the legislature by beginning with its text and context). We also resort to well-established legal meanings for those terms. McIntire v. Forbes, 322 Or 426, 431, 909 P2d 846 (1996). As the majority states, “incur” generally means “to become liable or subject to,” 151 Or App at 793, “or it may mean ‘to cause, bring on, or occasion.’ ” Sager v. McClenden, 296 Or 33, 37, 672 P2d 697 (1983) (citing American Indemnity Co. v. Olesijuk, 353 SW2d 71 (Tex Civ App (1962)). “Subject to” typically means “hable, subordinate, subservient, inferior, obedient to; * * * answerable for.” Black’s Law Dictionary, 1425 (6th ed 1990).1 “Damages” commonly refers to “the aggregate harm suffered by a party, expressed as an amount of money.” Bauder v. Farmers Ins. Co., 301 Or 715, 719, 725 P2d 350 (1986). See also Sager, 296 Or at 37 (stating *798that “when used in the plural, ‘damages’ means ‘a compensation in money for a loss’ ” (citing Black’s Law Dictionary, 351 (5th ed 1979)).
One who pays as a volunteer has been subjected to, or liable for, no loss and can hardly claim to have been damaged. Contrary to the majority’s conclusion, use of the terms “for all damages to its facilities and all costs and expenses, including damages to any third persons, incurred by the utility as a result of the accident” in the first sentence of ORS 757.805(2) demonstrates the legislature’s intent to require the utility to plead or prove, as a condition of the right to indemnity, actual or potential legal liability. No damages, costs or expenses are incurred unless the party seeking reimbursement has paid them under an obligation to do so.
No Oregon case has interpreted ORS 757.805(2). However, in Houston Lighting, Etc. v. Eller Outdoor Adv., 635 SW2d 133 (1st Dist Tex App 1982), an analogous statute was interpreted. In that case, an employee of Eller Outdoor Advertising (Eller) was electrocuted when he came into contact with an overhead power line owned and operated by Houston Lighting & Power Company (HL&P), violating several sections of the Public Utilities Act. Tex Rev Civ Stat Ann art. 1436c § 7 (1980). The employee’s estate filed an action against the utility, and the utility settled. The utility then brought an action against Eller to recover the amount of the settlement, costs, and attorney fees. Id. at 133-34. HL&P claimed that, because of Eller’s violations, it was entitled to indemnification under § 7(b) of the Act. The statute provided:
“ ‘If a violation of this Act results in physical or electrical contact with any high voltage overhead line, the person, firm, corporation, or association violating the provisions of this Act shall be liable to the owner or operator of such high voltage line for all damage to such facilities and for all liability incurred by such owner or operator as a result of any such contact.’ ” Id. at 134 (quoting Tex Rev Civ Stat Ann art. 1436c § 7(b) (1980)).
Eller did not dispute that the violation occurred but argued that relevant workers’ compensation laws barred indemnification. The court agreed with HL&P that the utility could *799bring an indemnification action but concluded that its right to indemnification was not absolute:
“Because the case has not been fully developed on the summary judgment proceedings, the court cannot determine whether the employee had any cause of action against HL&P, giving the latter a right of indemnification under the Public Utilities Act, or whether HL&P’s settlement of the employee’s claim was reasonable. HL&P must establish both to prove its right to indemnification by the employer.” Id. at 135 (citation omitted).
Although the Texas statute refers to “liability incurred” by the utility, as stated earlier, “damages incurred” similarly involves the connotation of responsibility to pay imposed by law, not amounts paid voluntarily.
Here, as in Houston Lighting, there was no evidence on the summary judgment record that decedent had any viable claim against PGE justifying PGE’s payment. Without pleading and proof that it paid to avoid a reasonable threat of liability, PGE incurred no damages and is not entitled to indemnity. From all that appears on the summary judgment record, PGE had no actual or potential liability to decedent’s estate. A party required to defend due to its improvident joinder by an injured party is not entitled to indemnity from a negligent party. Kamyr, Inc. v. Boise Cascade Corp., 268 Or 130,137, 519 P2d 1031 (1974).2 The trial court erred in granting summary judgment for PGE. Defendant was entitled to judgment as a matter of law.
I dissent.

 “Subject” has also been defined as being “under authority” or “being under control or dominion.” Webster’s Third New International Dictionary, 2275 (unabridged ed 1993).

 1 agree with the majority’s position of the second question. See St. Paul Fire & Marine v. Crosetti Bros., 256 Or 576,475 P2d 69 (1970).