S055403, Opinion — Parks v. Farmers Ins. Co.

374
Argued and submitted September 30, decision of Court of Appeals reversed;
judgment of circuit court affirmed December 24, 2009
Eric PARKS
and Yolanda Parks,
Petitioners on Review,
v.
FARMERS INSURANCE COMPANY
OF OREGON,
Respondent on Review.
(CC 0306-06214; CAA127316; SC 8055403)
227P3d1127
CJS, Insurance§ 1586.

Cite as 347 Or 374 (2009) 	375
En Banc
On review from the Court of Appeals.*
Kathryn H. Clarke, Portland, argued the cause and filed
the brief for petitioners on review. With her on the brief was
Robert E. L. Bonaparte, of Shenker & Bonaparte, LLP,
Portland.
Beth Cupani, of Bullivant Houser Bailey PC, Portland,
argued the cause and filed the brief for respondent on review.
GILLETTE, J.
The decision of the Court of Appeals is reversed. The judg-
ment of the circuit court is affirmed.
* On appeal from Multnomah County Circuit Court, Dale Koch, Judge. 214 Or
App 1, 162 P3d 1088 (2007).

Parks v. Farmers Ins. Co.
GILLE'ITE, J.
This attorney fee dispute arises under ORS 742.061,
which requires an insurer to pay an insured's reasonable
attorney fees if (1) the insurer fails to settle the insured's
claim within six months of the date that the insured files a
"proof of loss," and (2) the insured brings an action against
the insurer and recovers more than any tender that the
insurer has made. The trial court awarded attorney fees to
plaintiffs (the insureds) under that statute, based in part on
its conclusion that certain telephone conversations between
plaintiffs and their insurance agent constituted the requisite
"proof of loss." The Court of Appeals reversed the award,
holding that the telephone conversations could not amount
to a "proof of loss" for purposes of ORS 742.061. Parks v.
Farmers Ins. Co., 214 Or App 1, 6-11, 162 P3d 1088 (2007).
We allowed plaintiffs' petition for review, and now reverse
the decision of the Court of Appeals.
Plaintiffs Eric and Yolanda Parks owned a rental
property-a house-that was insured under a "Landlord
Protector Package" policy issued by defendant Farmers
Insurance Company of Oregon. In 2003, while the policy was
in force, plaintiffs received notice that police had discovered a
methamphetamine lab in the house, had seized the house
and placed it under quarantine. Ms. Parks hired a decontam-
ination contractor to evaluate the problem and deal with any
damage to the house.
The contractor told Ms. Parks that insurance com-
panies sometimes help with losses in such cases. On April 14,
2003, Ms. Parks called a Farmers agent, Pascone, whose
business was in the town where the property was located,
and asked if Farmers could "help [her] with [her] loss." There
are some factual disputes about the content of that conver-
sation, but it is undisputed that Ms. Parks told Pascone
about the seizure of the methamphetamine lab and subse-
quent quarantine 	of the house, 	and 	that she 	provided
Pascone with the address of the house and the name and
telephone 	number 	of 	the 	decontamination 	contractor.
Depending on whose testimony is credited, either Ms. Parks
or Pascone suggested that there might not be coverage in the

Cite as 347 Or 	377
policy for methamphetamine lab contamination. It 	undis-
puted, however, that Pascone told Ms. Parks that "other
things * * * might be covered," and that Ms. Parks should call
her if she got any more information. Ms. Parks did not call
Pascone again.
However, Mr. Parks called Pascone about a month
later, on May 19, 2003. Mr. Parks told Pascone that a meth-
amphetamine lab had been ''busted" at his rental property at
the end of April, that his wife already had called Pascone
about the matter, and that, to date, he had paid $6,710 for
cleaning up the property and had been quoted a figure of
$2,000 to $3,000 to get the property in shape to rent.
Mr. Parks testified that he asked Pascone to "reconsider the
denial of the claim," and that Pascone told him that there was
no coverage for the cleanup because the policy contained an
exclusion for "pollution." Although Mr. Parks initially testi-
fied at deposition that he told Pascone that some of the dam-
age to the property had been caused by vandalism, he later
acknowledged that "all [he] told * * * Pascone about damage
to the rental was the methamphetamine contamination."
Pascone's 	memory 	of 	the 	conversation 	with
Mr. 	Parks 	was 	somewhat 	different. 	According 	to 	her,
Mr. Parks told her that he and his wife did not want to file a
claim because they felt that there was no coverage for the
methamphetamine 	contamination 	and 	that 	the 	cost 	of
repairing the other damage that he had described to her-
two broken windows-would be less than the insurance pol-
icy's deductible. In any event, Pascone did not send any
paperwork to Mr. Parks, did not refer him to Farmers' claims
hotline, and did not otherwise tell him how to file a claim.
Plaintiffs had no further contact with Farmers or its agents
until June 11, 2003. On that date, plaintiffs brought an
action against Farmers for, among other things, breach of
Farmers' duties to them under the insurance policy. 1
1 Plaintiffs also alleged intentional interference with economic relations (specif-
ically, that by failing to pay for the damage to the rental property, Farmers had inter-
fered with plaintiffs' business relationships with their tenants and vendors that
serviced the property) 	and negligent misrepresentation (specifically, that
Farmers had negligently and erroneously represented to plaintiffs that the policy
they were offering to them would cover any and all damage to the rental property,
and that plaintiffs had relied upon that representation when they purchased the
policy).

378 	Parks v. Farmers Ins. Co.
In 	their 	complaint, 	plaintiffs alleged 	that their
rental property was insured by Farmers, that the property
had suffered unspecified "accidental physical damage," that
the losses suffered as a result of that damage were within the
coverage of the policy, that Farmers had breached the insur-
ance contract by denying coverage for those losses, and that,
as a result of that breach of contract, plaintiffs had been dam-
aged in the amount of $75,000-$70,000 in damage to the
dwelling and $5,000 in loss of the property's rental value.
Farmers filed an answer that raised, among other things,
an 	affirmative 	defense 	that 	referred 	to 	policy wording
that excluded coverage for "release, discharge or dispersal
of contaminants, pollutants, * * * or hazardous gases or
chemicals."
On October 16, 2003, plaintiffs sent a written settle-
ment demand to Farmers seeking (among other things)
$10,338 for vandalism damage, $10,000 for diminution in the
value of the rental property, $12,000 for attorney fees, and
$6,800 for methamphetamine cleanup costs. On November 19,
Farmers sent a letter to plaintiffs that questioned some and
outright 	rejected 	other 	aspects 	of plaintiffs' 	settlement
demand. In that letter, Farmers stated that the "pollution
exclusion at issue has previously been upheld by the Circuit
Court of Multnomah County."
On December 10, 2003, Farmers made a settlement
offer of its own-it offered "to allow entry of judgment against
it and in favor of plaintiffs on all claims alleged in this matter
in the total amount of $22,021.31," exclusive of any legally
recoverable costs and attorney fees. Plaintiffs immediately
accepted the offer and, on January 22, 2004, the circuit court
entered judgment in accordance with the offer. Plaintiffs
thereafter filed 	a petition for attorney fees under ORS
742.061, which provides, in part:
"[l]f settlement is not made within six months from the date
proof ofloss is filed with an insurer and an action is brought
in any court of this state upon any policy ofinsurance of any
kind or nature, and the plaintiff's recovery exceeds the
amount of any tender made by the defendant in such action,
a reasonable amount to be fixed by the court as attorney
fees shall be taxed as part of the costs of the action and any
appeal thereon."

Cite as 34 7 Or 37 4 (2009) 	379
Plaintiffs' theory was that, for purposes of the stat-
ute, they had filed "proof ofloss" by their April 14, 2003, and
May 19, 2003, telephone calls to Pascone, and that Farmers
had failed to tender its settlement offer within six months of
those calls. Farmers denied that the telephone calls qualified
as proof of loss and argued that, at best, plaintiffs had trig-
gered the six-month period provided in ORS 742.061 when
they filed their complaint on June 11, 2003. The trial court
ultimately concluded that the Parks's telephone calls to
Pascone and, particularly, Mr. Parks's May 19, 2003, call,
constituted a sufficient proof of loss and entered a supple-
mental judgment awarding plaintiffs $50,000 in attorney
fees. In explaining its decision, the court explicitly rejected
Farmers' contention that, because those telephone calls per-
tained to methamphetamine contamination, they could not
serve as "proof of loss" with respect to the losses that were at
the heart of plaintiffs' action (and which Farmers character-
ized as vandalism losses). The court concluded that plaintiffs'
claim for "accidental physical damage" included a claim for
damage caused by methamphetamine contamination and
that Farmers had not "knock[ed] out" that part of the claim
prior to settlement.
Farmers appealed, arguing that plaintiffs' telephone
calls to Pascone were not "proof ofloss" within the meaning of
ORS 742.061 for two reasons: (1) a "proof ofloss" must be in
writing; and (2) a "proof of loss" must allow an insurer to
ascertain its liabilities, and plaintiffs' conversations with
Pascone about methamphetamine contamination did not
provide Farmers with any information that would have
allowed it to ascertain its liabilities with respect to the only
potentially covered loss that plaintiffs could claim-a claim
for vandalism. The Court of Appeals essentially accepted the
second reason, holding that the Parks's telephone calls did
not and could not have served the essential purpose of a proof
of loss, viz., to allow the insurer to ascertain its liabilities,
taking into account the insurer's obligation to investigate and
clarify claims that are uncertain:
"Here, there was no objective reason for [Farmers] to inves-
tigate before this action was filed because, until then, the
only claim that plaintiffs had asserted was excluded under

380 	Parks v. Farmers Ins. Co.
the policy, and plaintiffs did not ask [Farmers] to investi-
gate a claim for any other damages. Thus, there was no
'uncertain 	claim' 	that 	triggered 	[Farmers'] 	duty 	to
investigate."
Parks, 214 Or App at 11.
Before this court, plaintiffs argue that the Court of
Appeals erred in assuming that the issue of coverage for
methamphetamine contamination could not be considered
"uncertain" and that a conversation that focused on that sort
of damage would not provide any reason for an insurer to
investigate further. They also continue to maintain that, con-
trary to Farmers' view, ORS 742.061 does not require that
"proof of loss" be in writing. They insist, in short, that their
telephone conversations with Pascone could and did consti-
tute "proof of loss" and that, because Farmers' settlement
offer, which they accepted, came more than six months after
those conversations, the statute requires Farmers to pay
their attorney fees. 2
This is not the first time that this court has consid-
ered what ORS 742.061 requires by way of a "proofofloss." In
Dockins v. State Farm Ins. Co., 329 Or 20, 985 P2d 796
(1999), this court examined the statute and concluded that,
when the legislature used that term, it intended something
more than the particular form or submission an insurance
policy might specify. Id. at 26-27. Based on prior cases deal-
ing with the term, this court held that, in the context of ORS
742.061, "proof ofloss" has a functional meaning-that is, it
pertains to any "event or submission" that accomplishes the
purpose of a proof of loss. That purpose, the court concluded,
is " ' "to afford the insurer an adequate opportunity for inves-
tigation, to prevent fraud and imposition upon it, and to ena-
ble it to form an intelligent estimate of its rights and liabili-
ties before it is obliged to pay."'" Dockins, 329 Or at 28
(quoting Sutton v. Fire Insurance Exch., 265 Or 322, 325, 509
P2d 418 (1973) (quoting 14 Couch, Cyclopedia of Insurance
' Plaintiffs also contend that, even using their complaint as the "proof of loss"
trigger, Farmers did not meet the six-month deadline in ORS 742.061 because its
settlement offer did not qualify as a "tender" for purposes of that statute. Because
we conclude that plaintiffs' telephone calls did constitute proof ofloss, we need not
consider that alternative argument.

Cite as 347 Or 374
Law § 49:373, p 15 (2nd ed))). This court further concluded
(again, based on prior case law), that insurers operate under
a duty of inquiry and that, "even if a submission is insuffi-
cient to allow the insurer to estimate its obligations, it will be
deemed sufficient if the insurer could accomplish that pur-
pose through reasonable investigation." Dockins, 329 Or at
28. Synthesizing those ideas into a single definition, this
court announced that "[a]ny event or submission that would
permit an insurer to estimate its obligations (taking into
account the insurer's obligation to investigate and clarify
uncertain claims) qualifies as 'proof of loss' for purposes of
[ORS 742.061]." Id. at 29.
More recently, in Scott v. State Farm Mutual Auto.
Ins., 345 Or 146, 190 P3d 372 (2008), the court applied the
functional definition of "proof ofloss" that it had announced
in Dockins in the context of an uninsured motorist (UM)
insurance claim. The plaintiff in Scott was injured in a car
accident and, after discussing her coverage with one of her
automobile insurer's claim representatives and providing a
statement about the accident, submitted a claim for personal
injury protection (PIP) on a form entitled "application for
benefits" that the claim representative provided. The insurer
processed the form for purposes of a PIP claim but did not for-
ward it to the insurer's UM insurance department. About a
month later, the plaintiff indicated to the claim representa-
tive that she might pursue a UM claim, and the claim repre-
sentative instructed the plaintiff to sign and return a medical
authorization form, which plaintiff did. The plaintiff later
brought an action against the insurer, alleging that it had not
paid UM benefits owed to the plaintiff and seeking attorney
fees under ORS 742.061. Plaintiff asserted that her submis-
sion of an "application for benefits" on a form provided by the
insurer constituted proof of loss for purposes of that statute.
The Court of Appeals rejected that assertion, holding that, to
constitute proof ofloss with respect to a UM claim, the plain-
tiff was required to submit a written claim specifically stat-
ing her intention to pursue a UM claim, and that the "appli-
cation for benefits," which had been submitted for purposes of
a PIP claim, did not qualify. Scott v. State Farm Mutual Auto.
Ins., 213 Or App 351, 161 P3d 944 (2007). This court, how-
ever, relied on the functional meaning of the term "proof of

382 	Parks v. Farmers Ins. Co.
loss" that it had announced in Dockins and concluded that
the plaintiff had provided "proof of loss" when she submitted
the application for PIP benefits. Scott, 345 Or at 152-56. The
court noted that the plaintiff would not have been aware of
the insurer's practice of separately processing PIP and UM
claims, that the insurer was aware that the plaintiff might
want UM benefits, and that the insurer was in the best posi-
tion to know to which coverage plaintiff was entitled. Id. at
156.
Plaintiffs in the present case have argued that their
telephone calls to Pascone constituted "proof of loss" under
the foregoing definition from Dockins and Scott-i.e., that the
information that plaintiffs supplied in those calls and that
Farmers could have obtained in a reasonable investigation
triggered by those calls was sufficient to permit Farmers to
estimate its obligations vis-a-vis plaintiffs' obvious and/or
uncertain claims. Farmers contends, however, that, even if
the content of the telephone conversations was sufficient in
that regard (and they deny that it was), the fact that the
information was conveyed orally, and not in writing, is
incompatible with a conclusion that it constituted a "proof of
loss." Farmers contends that it is clear from the text and con-
text of ORS 742.061 that, for purposes of triggering the
six-month period in that statute, a "proof of loss" must be in
writing.
In support of that argument, Farmers first points to
the use of the term "filed" in conjunction with the phrase
"proof of loss" ("if settlement is not made within six months
from the date proof of loss is filed with an insurer"). Farmers
suggests that the term "filed" strongly implies a writing. But
while that may be true with respect to court filings, we are
not persuaded that the term carries that same connotation in
the world of insurance and beyond. Certainly, car and unem-
ployment insurance claims often are "filed" orally by tele-
phone, as are newspaper stories and ordinary complaints to
businesses and government agencies. By itself, the use of the
term "filed" is not persuasive.
Farmers also contends that "proof of loss," as it is
used in ORS 742.061, involves a writing because that is how
the term is used in other statutes in ORS chapter 742.

Cite as
Farmers notes, for example, that ORS 742.053 requires
insurers to furnish "forms of proof of loss" upon an insured's
written request. It also notes that ORS 742.230, a statute
that sets out certain provisions that must be included in fire
insurance policies, requires "written notice" to the insurer of
any loss and also requires that, "within 90 days after receipt
of proof of loss forms," an insured "shall render to [the
insurer] proof of loss, signed and sworn by the insured."
Farmers argues that if "proof of loss" so clearly refers to a
written instrument in those related statutes, it must have
the same meaning in ORS 742.061.
In our view, however, the statutes that Farmers
relies on do not support its point. Particularly in light of what
this court said in Dockins about substantial, as opposed to
formal, compliance with the "proof of loss" requirement in
ORS 742.061, the fact that a related statute requires insurers
to provide "proof ofloss forms" upon an insured's request can-
not mean that the only way to file "proof of loss" for purposes
of the attorney fee statute is by means of similar forms. Nei-
ther does the fact that a statute that dictates that a particu-
lar kind of insurance policy (fire insurance) includes a provi-
sion 	that 	imposes 	specific 	"proof of loss" 	requirements
(including that proof of loss be "signed") imply anything
about what the legislature intended by the term "proof of
loss" in an older and more broadly applicable statute like
ORS 742.061. 3 In short, the "context" that Farmers points to
is unhelpful.
Farmers argues, finally, that this court's own cases
indicate that "proof ofloss" must be in writing. In that regard,
Farmers observes that, although this court has assigned a
functional, rather than a formal, meaning to the term "proof
of loss" in the context of ORS 742.061, it never has held that
a telephone call, or any other "event or submission" that has
not been reduced to writing, qualifies as proof of loss.
Farmers points out that, even in Dockins, the "event or
3 As we explained in Scott, ORS 742.061 was originally enacted in 1919 as
General Laws of Oregon, chapter 110, sections 1 and 2, and, although it has been
renumbered and amended over the years, the term "proof ofloss" has remained the
same. 345 Or at 155.

384 	Parks v. Farmers Ins. Co.
submission" that this court identified as sufficient proof of
loss was a written document-a complaint.
But the fact that, in the handful of cases that have
considered the meaning of ORS 742.061, this court has
identified some written documents as sufficient "proof ofloss"
for purposes of the statute does not mean that we have con-
cluded that only a writing is sufficient; it simply reflects that,
heretofore, this court has had no reason to consider the issue.
And, as we consider it now, we conclude that a writing
requirement would be incompatible with a functional inter-
pretation of the statutory term. An oral contact with an
insurer can be just as effective as a writing in providing
insurers with information adequate to allow insurers to
make an intelligent estimate of their rights and liabilities. It
also can provide an adequate opportunity to investigate
before deciding whether to pay. We conclude that there is no
requirement in ORS 742.061 that "proof ofloss"bein writing.
That brings us to the ground upon which the Court of
Appeals decision for Farmers actually rests, viz., that the
information that the Parks conveyed to Pascone in their
telephone calls did not amount to "proof of loss" even under
the functional definition set out in Dockins. The Court of
Appeals correctly summarized that functional definition in
terms of whether the information provided is sufficient to
allow the insurer to estimate its obligations through a
reasonable investigation. Applying that standard to plain-
tiffs' claim, the court then concluded that, because the two
telephone calls to Pascone only addressed a type of loss that
the court believed was excluded from coverage under a policy
provision pertaining to damage caused by "pollutants,"4 those
calls could not qualify as "proof of loss." That was so, in the
court's view, because the information imparted in the tele-
phone calls would not permit Farmers to estimate its obliga-
tions with respect to any claim that in fact was covered by the
4 The court "assumed" that the exclusion for damage from pollutants applied in
the manner described, noting that (1) plaintiffs had not argued otherwise and
(2) plaintiffs had not sufficiently "developed" an argument made at trial that, in
light of the fact that the complaint alleged that all of plaintiffs' losses were covered
under the policy and that the parties had settled "on all claims alleged in this mat-
ter," the actual legal application of the exclusion was irrelevant. Parks, 214 Or App
at 8-9 n 6.

Cite as 347 Or 374 	385
policy, and neither would it leave Farmers with a degree of
uncertainty about its obligations that would trigger a duty to
investigate further. Parks, 214 Or App at 8-11.
Before this court, plaintiffs argue that the Court of
Appeals' analysis of the "uncertainty" of their claims is erro-
neous-that is, that, contrary to that court's position, the
issue of coverage for methamphetamine lab cleanup costs
under the policy at issue is far from "certain." They cite a
number of cases in which the Court of Appeals has held that
methamphetamine cleanup costs were not excluded under
policy provisions that purported to exclude "contamination."
They also note that the issue of coverage for methampheta-
mine contamination was never litigated in this case, either
by a summary judgment motion, or otherwise. Plaintiffs con-
clude that a claim for methamphetamine contamination had
not been foreclosed as a matter oflaw, and they argue that, in
light of that fact, their telephone calls to Pascone, and, partic-
ularly, Mr. Parks's statements about the amount that he had
paid and expected to pay in the future to clean up the damage
from the lab, provided Farmers with enough information
that it should have triggered an investigation into a contam-
ination claim.
Farmers responds to that argument on two fronts. It
contends, 	first, 	that 	plaintiffs' 	reliance 	on 	Mr. 	Parks's
cleanup cost estimates is misguided, because the claim plain-
tiffs ultimately took to court did not involve a claim for meth-
amphetamine contamination but, instead, was based on a
claim for vandalism damage. Farmers argues that nothing in
the Parks's telephone calls would have put it on notice of a
potential claim for that sort of damage. 5 However, as plain-
tiffs point out, there is no support in the record for Farmers'
supposition that the claims that plaintiffs brought and that
both parties settled were only about vandalism damage. In
fact, plaintiffs couched their complaint in very broad terms,
simply alleging that their rental property had suffered "acci-
dental physical damage" while it was covered by a policy
5 Farmers notes that, in fact, Mr. Parks acknowledged in his deposition t€sti-
mony that he was not concerned with vandalism damage at the time of the call, but
was focused only on the methamphetamine cleanup costs.

386 	Parks v. Farmers Ins. Co.
issued by Farmers. Although the content and scope of "acci-
dental physical damage" is not immediately obvious, it is
clear that the term could refer to methamphetamine contam-
ination just as easily as it could to vandalism damage. More-
over, it would appear from the depositions, correspondence,
and filings in the record that Farmers had every reason to
suspect that plaintiffs were including contamination damage
in their claim. Still, Farmers made no attempt to remove that
aspect of the claim from the case through a summary judg-
ment motion, a motion to make more definite and certain, or
other motion, before it settled "all claims alleged in this mat-
ter" with plaintiffs. Accordingly, we cannot accept Farmers'
contention that plaintiffs' telephone calls to Pascone could
not trigger a duty to investigate a potential claim.
Farmers argues that, even if there is some correla-
tion between Mr. Parks's description of his damages in the
May 19, 2003, telephone call and the damage that plaintiffs
ultimately claimed in their legal action, the fact remains that
those particular damages were excluded from coverage as a
matter oflaw and, as such, could not trigger an obligation to
investigate. Farmers relies, in that regard, on what it asserts
to be the "plain" wording of the policy exclusion (which is
quoted above, 34 7 Or at 378) and a single Court of Appeals
case that purports to interpret substantially similar wording
and that was reversed by this court on other grounds. 6
We reject that line of reasoning because we do not
accept its premise. Quite simply, we cannot say that the law
surrounding this type of exclusion is so clear, and that the
exclusion was so clearly applicable to the facts that Mr. Parks
reported to Farmers' agent, that Farmers was relieved of any
obligation to investigate further or, in the alternative, to liti-
gate the matter before settling "all claims alleged in this
matter."
In a related vein, Farmers contends that the Court of
Appeals correctly "assumed" that plaintiffs' policy excluded
coverage for methamphetamine contamination. Parks, 214
i; Farmers refers to Fleming u. United Services Automobile Assn., 144 Or App 1,
925 P2d 140 (1996), rev'd on other grounds, 329 Or 449, 988 P2d 378 (1999).
Fleming involved an exclusion for "discharge, dispersal, seepage, migration,
release or escape of pollutants.''

Cite as 347 Or 374 	387
Or App at 8. The Court of Appeals explained that assumption
as arising from the fact that plaintiffs had never challenged
the applicability of the methamphetamine exclusion, and did
not argue that the policy provided coverage for methamphet-
amine claims. Id. The court acknowledged that plaintiffs did
assert, at the attorney fee hearing, that, in light of the fact
that their complaint alleged that all of their losses were cov-
ered under the policy and that Farmers had not moved to
require more specificity, Farmers' settlement of "all claims
alleged in this matter" encompassed decontamination dam-
ages. The court asserted, however, that plaintiffs had not
"developed" that argument and, therefore, the court declined
to address it, "except to observe that [Farmers] consistently
rejected plaintiffs' assertion that the methamphetamine
cleanup costs were covered under the policy, and there was
no evidence that [Farmers] actually intended to compensate
plaintiffs for those costs in making its offer of judgment." Id.
at 8-9 n 6.
As we read the record of the attorney fee hearing,
however, the latter statement is inapposite. The trial court
explicitly stated its reasoning for granting the attorney fee
request in the following terms:
"The insurance company is contending that they had
the ability to knock out the methamphetamine part of the
claim, but they * * * didn't file a Rule 21, which they had
time to do within the six months and get a ruling on it with
our expedited courts[. I]f they [had] come in and said: Hey,
we've got this six-month thing, we've got to get a hearing[,]
Judge Baldwin would have found a judge. He did that to me
last week. I got it done. They got a ruling. He then ruled in
favor of the defense incidentally. Then they settled the case
that day. So that's the way our system can work if people
act quickly.
"Now you've mentioned*** you guys didn't think***
to confer and ask [plaintiffs' attorney, ']You send us a letter
at least telling us in detail what you are claiming, or we're
going to file a motion to make more definite and certain at
the least[.' S]o I'm going to rule in favor of the plaintiff on
this."
From the foregoing ruling, it is clear that the trial
court intended to compensate plaintiffs for attorney fees

388 	Parks v. Farmers Ins. Co.
associated with their claim for methamphetamine decontam-
ination costs-not because it believed that those costs actu-
ally were covered by the policy in question (that issue never
was litigated), but because Farmers had not taken appropri-
ate steps to formally and legally remove them from the case
before settling on "all claims alleged in this matter." Plain-
tiffs cannot be faulted for failing to "develop" the very argu-
ment that the trial court adopted to explain its ruling. The
Court of Appeals was wrong to use that supposed failure as a
basis for treating the exclusion of plaintiffs' decontamination
costs as an established legal fact.
We hold that plaintiffs' telephone calls to Farmers'
agent, and particularly, Mr. Parks's May 19, 2003, call recit-
ing the amounts that he had paid and expected to pay to
clean up the contamination caused by the methamphetamine
lab, conveyed sufficient information to allow Farmers to
ascertain its obligations vis-a-vis a possible claim for meth-
amphetamine damage, taking into account Farmers' duty to
investigate and clarify uncertain claims. That telephone call
qualified as "proof of loss" for purposes of such a claim. Plain-
tiffs' action against Farmers for breach of an insurance policy
included an allegation that Farmers was obligated, but
refused, to pay a claim for methamphetamine damage, and
that, in making a tender and ultimately settling "all claims
alleged in this matter" without first removing that part of the
claim from the case, Farmers settled the methamphetamine
damage claim. It follows that plaintiffs provided "proof of
loss" within the meaning of ORS 742.061 for their claim more
than six months before December 10, 2003, when Farmers
made the tender that settled the claim. Plaintiffs therefore
are entitled to attorney fees under the statute.
The decision of the Court of Appeals is reversed. The
judgment of the circuit court is affirmed.