Loosli v. City of Salem, 345 Or. 303

Summary

The Supreme Court of Oregon held that the City of Salem owed plaintiffs no statutory or other duty supporting a negligence claim for purely economic losses allegedly caused by an incorrect certification on a vehicle dealer application. Applying principles associated with Restatement (Second) of Torts section 552, the court concluded that the certification was provided to assist the DMV in coordinating regulatory requirements, not for plaintiffs' guidance or benefit. The court affirmed the Court of Appeals and the circuit court's judgment for the city.

Holdings

1. A claimant cannot recover purely economic losses in negligence based solely on foreseeability; the claim must rest on a source of duty outside the common law duty to exercise reasonable care to prevent foreseeable harm.
2. The City's certification under ORS 822.025(6) did not create a statutory or relationship-based duty to protect plaintiffs from economic loss because the certification served DMV's regulatory purposes and was not supplied for plaintiffs' guidance or benefit.

Questions Presented

1. Whether the City of Salem owed plaintiffs a statutory or other duty permitting recovery for purely economic losses allegedly caused by the City's negligent certification of a vehicle-dealer application.
2. Whether the City's regulatory relationship with plaintiffs, including accepting a fee and signing the DMV certification, created a special relationship or other duty to protect plaintiffs' economic interests.

Disposition

affirmed