Thursday, November 10, 2011

Attorney-Client Privilege In Bad Faith Actions

The Florida Supreme Court issued a revised opinion in Genovese v. Provident Life and Accident Insurance Company (SC06-2508). For whatever reason I had not included the original opinion on this blog so am doing so now. In the opinion, the Florida Supreme Court addressed the following question certified to it by the Fourth District:
Does the Florida Supreme Court's Holding in Allstate Indemnity Co. v. Ruiz, 899 So. 2d 1121 (Fla. 2005), relating to discovery of work product in first-party bad faith actions brought pursuant to section 624.155, Florida Statutes, also apply to attorney-client communications in the same circumstances?
The court described the facts as follows: "Peter Genovese brought a statutory first-party bad faith action against Provident Life and Accident Insurance Company (“Provident”) after Provident terminated the monthly payments under Genovese’s disability income policy.  Following commencement of the bad faith suit, Genovese requested production of Provident’s entire litigation file, including all correspondence and communications made between the attorneys representing Provident and Provident’s agents regarding Genovese’s claims for benefits.  The trial court issued an order compelling production of the documents." After the trial court entered the order compelling production, Provident filed a petition for certiorari which the Fourth District granted.

The court's analysis began:
The certified question asks whether our holding in Allstate Indemnity Co. v. Ruiz, 899 So. 2d 1121 (Fla. 2005), permitting the discovery of work product in first-party bad faith actions brought pursuant to section 624.155, Florida Statutes (2010), also applies to attorney-client privileged communications in the first-party bad faith context. Because of the uniqueness of the attorney-client privilege, we answer the certified question in the negative and hold that attorney-client privileged communications are not discoverable in a first-party action.
The court stated: "In Ruiz, we held that in first-party bad faith actions brought pursuant to section 624.155, work product materials were discoverable.  At the outset, the first sentence of our opinion in Ruiz makes it clear that the only issue involved in that case was the work product doctrine....based on a reading of our language in Ruiz, it is clear that the only issue being decided in Ruiz was the discovery of work product pertaining to the underlying claim in first-party bad faith actions.  However, Genovese suggests that although the facts of Ruiz only concerned the work product doctrine, we held broadly that both attorney-client communications and work product should be discoverable in first-party bad faith claims against insurers.  Contrary to Genovese’s suggestion, our holding in Ruiz does not apply to attorney-client privileged communications in first-party bad faith actions."

The court explained the attorney-client privilege as follows:
The attorney-client privilege and work product doctrine are two distinct concepts. The attorney-client privilege is provided for in section 90.502, Florida Statutes (2010), which states that “[a] client has a privilege to refuse to disclose, and to prevent any other person from disclosing, the contents of confidential communications when such other person learned of the communications because they were made in the rendition of legal services to the client.” § 90.502(2), Fla. Stat. (2010). “The purpose of the [attorney-client] privilege is to encourage clients to make full disclosure to their attorneys.” Fisher v. United States, 425 U.S. 391, 403 (1976). However, the privilege “protects only those disclosures necessary to obtain informed legal advice.”  Id.  “[I]f a communication with a lawyer is not made with him in his professional capacity as a lawyer, no privilege attaches.” State v. Branham, 952 So. 2d 618, 621 (Fla. 2d DCA 2007) (quoting Skorman v. Hovnanian of Fla., Inc., 382 So. 2d 1376, 1378 (Fla. 4th DCA 1980)).
The work product doctrine was described as follows:
On the other hand, the work product doctrine is outlined in Florida Rule of Civil Procedure 1.280(b)(3), which states that  
a party may obtain discovery of documents and tangible things otherwise discoverable under subdivision (b)(1) of this rule and prepared in anticipation of litigation or for trial by or for another party or by or for that party’s representative, including that party’s attorney, consultant, surety, indemnitor, insurer, or agent, only upon a showing that the party seeking discovery has need of the materials in the preparation of the case and is unable without undue hardship to obtain the substantial equivalent of the materials by other means. In ordering discovery of the materials when the required showing has been made, the court shall protect against disclosure of the mental impressions, conclusions, opinions, or legal theories of an attorney or other representative of a party concerning the litigation.  
Part of the purpose of discovery is to “provide each party with all available sources of proof as early as possible to facilitate trial preparation.” Dodson v. Persell, 390 So. 2d 704, 706 (Fla. 1980).  
Unlike the work product doctrine, "the attorney-client privilege, unlike the work-product doctrine, is not concerned with the litigation needs of the opposing party."...."Instead, the purpose of the privilege is to 'encourage full and frank communication' between the attorney and the client." ... "Therefore, although we held in Ruiz that attorney work product in first-party bad faith actions was discoverable, this holding does not extend to attorney-client privileged communications. Consequently, when an insured party brings a bad faith claim against its insurer, the insured may not discover those privileged communications that occurred between the insurer and its counsel during the underlying action." (emphasis supplied).

Chief Justice Canady, Justice Pariente, Justice Quince, Justice Polston, Justice Labarga, and Justice Perry concurred with the court's per curium opinion. Justice Pariente specially concurred with an opinion in which Justice Lewis, Justice Labarga and Justice Perry joined. Justice Lewis concurred in result only.

The Fourth District's now affirmed opinion can be viewed at the following link. Provident Life & Accident Insurance Co. v. Genovese, 943 So. 2d 321 (Fla. 4th DCA 2006). The oral argument and the briefs filed in the Florida Supreme Court can be viewed at the links below:


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