Attorney-Client Privilege – Waiver – Discovery of Work Product Materials
Jackson v. Greger, (2006) 110 Ohio St.3d 488:
In the case of Jackson v. Greger, the Ohio Supreme Court reviewed two issues including attorney-client privilege and work product. As it pertains to the former, this issue does arise in the insurance industry inasmuch as the question as to how much information is discoverable in a bad faith claim often involves issues possibly invasive of the attorney-client privilege. Accordingly, any case dealing with the attorney-client privilege is significant to review and discuss especially for practitioners involved in the litigation of bad faith claims.
Ms. Jackson had been involved in an altercation with the police and, on the advice of her attorney, pled guilty to resisting arrest. She, however, subsequently sued the police department who successfully had a motion for summary judgment granted based upon her guilty plea. She thereafter filed a legal malpractice action against her former attorney for negligent advice in the criminal case. During discovery, her criminal attorney sought all attorney-client communications and documents pertaining to her lawsuit against the city. The request was denied and a motion to compel was granted.
The Ohio Supreme Court began its analysis by noting that the attorney-client privilege is governed by statute (R.C. 2317.02(A)) and, in cases not addressed by that statutory section, is governed by common law. A reading of the statute did not give rise to a finding that the attorney-client privilege had been waived and, therefore, the proponents were basically requesting the court to judicially create an exception to the attorney-client privilege or to expand the scope of the waiver of attorney-client privilege. The Ohio Supreme Court declined this invitation and stated in paragraphs 12 – 13 of its finding the following:
“In the instant case, as in McDermott, ‘we decline to add a judicially created waiver to the statutorily created privilege.’ (Citation omitted). R.C. 2317.02(A) clearly enumerates the means by which a client may waive the statutory attorney-client privilege: by express consent or by voluntarily testifying on the same subject. The facts of this case do not demonstrate that Jackson waived the privilege by either of those means.
In reaching this holding, we are aware that several Ohio courts of appeals have applied the Hearn test. We are nevertheless guided by the significant body of law from this court that has consistently rejected the adoption of judicially created waivers, exceptions, and limitations for testimonial privilege statutes.”
The case is positive inasmuch as the court refused to expand the area of waiver by virtue of judicial legislation. The court thereafter turned its attention to the request for the discovery of all file materials (in the lawsuit against the city) of Ms. Jackson’s attorney which was denied by Ms. Jackson’s attorney based upon the work product doctrine.
The court stated in paragraphs 14 – 16, the following:
“In support, Greger (the attorney that was sued) maintains that the file materials are not protected work product. Civ.R. 26(B)(3) governs the discovery of work product. It provides:
‘Subject to the provisions of subdivision (B)(4) of this rule, a party may obtain discovery of documents and tangible things prepared in anticipation of litigation or for trial by or for another party or by or for that other party's representative (including his attorney, consultant, surety, indemnitor, insurer, or agent) only upon a showing of good cause therefor.’
We hold that a showing of good cause under Civ.R. 26(B)(3) requires demonstration of need for the materials-i.e., a showing that the materials, or the information they contain, are relevant and otherwise unavailable. The purpose of the work-product rule is ‘(1) to preserve the right of attorneys to prepare cases for trial with that degree of privacy necessary to encourage them to prepare their cases thoroughly and to investigate not only the favorable but the unfavorable aspects of such cases and (2) to prevent an attorney from taking undue advantage of his adversary's industry or efforts.’ Civ.R. 26(A). To that end, Civ.R. 26(B)(3) places a burden on the party seeking discovery to demonstrate good cause for the sought-after materials.”
Returning to the bad faith arena, the work product doctrine would not bar a defense lawyer from making the argument that any testing that had been done (in the case of a property damage claim or an arson claim) can and should be discoverable by the defense if there is no other means to gather that information. Alternatively phrased, if a witness was retained by a plaintiff but not used by the plaintiff, this case clearly stands for the proposition that the work product rule is not an absolute bar to the defense’s ability to gather information from the plaintiff’s retained (but not used in the litigation) expert witness. The court went on to conclude that the attorney seeking the information could gather the information from other sources and, therefore, the materials were not ordered produced from Jackson’s attorney. This particular case may be of benefit in the defense of bad faith litigation and, therefore, is included and reviewed in this Newsletter.
Equitable Subrogation – Volunteer – Right of Recoupment Fom
Non-Participating Underinsured Motorist Carrier
Foremost Ins. Co. v. Motorists Mut. Ins. Co., 2006-Ohio-3022:
In Foremost, supra, the Eighth District Court of Appeals heard an interesting case which oftentimes arises as it pertains to two policies of insurance that may have application to a single loss. In this matter, Robert Krueger was operating his motorcycle and was injured by an underinsured motorist. At the time of the accident, the motorcycle Mr. Krueger was operating was insured with Foremost for $500,000 per accident and he also claimed coverage through his employer’s business auto policy with Motorists Insurance Group which carried $1,000,000 in uninsured/underinsured motorist coverage. Foremost only proceeded to settle the claim for underinsured motorist benefits with Mr. Krueger and Foremost thereafter filed a contribution lawsuit against Motorist.
The Motorists Insurance policy insured a 2000 Ford F-150 pick-up truck and a 1999 BMW as “covered automobiles” under the policy. However, on the day of the accident, the BMW listed under the Motorists policy, although owned by Mr. Krueger, was not drivable inasmuch as the battery was dead. Accordingly, from a review of the opinion, it appears that the lower court concluded that Mr. Krueger was using his motorcycle as a “temporary substitute” for the 1999 BMW on the day of the accident. Motorists’ policy included an exclusion which exempted from coverage any vehicle owned by an insured which is not listed as a covered auto. Therefore, on its face, the exclusion clearly would appear to take the motorcycle out of the realm of an insured vehicle and thus no insurance coverage would inure to the benefit of Mr. Krueger.
One of the preliminary arguments dealt with by the trial court, as well as the Court of Appeals, dealt with the issue of whether or not Foremost’s payment to Mr. Krueger rendered them a volunteer and hence preventing any subrogation claim. The court found that Foremost did not act as a volunteer and so indicated in paragraphs 23 – 24 of its opinion, the following:
“The court in Farm Bureau defined ‘volunteer’ as ‘one [who] with knowledge of the facts and without legal liability, makes a payment of money ...’ Id at paragraph six of the syllabus. Motorists argues that Foremost had knowledge of the facts and paid Krueger's claim although it had no legal liability to do so. In addition, Motorists asserts that Foremost made its payment to Krueger with the knowledge that Motorists had no intention of paying Krueger's claim. Motorists further contends that Foremost also paid the claim without giving any indication that it was preserving its right to pursue non-settling or late-settling insurers.
Foremost argues to the contrary that it had a legal obligation to pay Krueger's claim and did not knowingly pay a claim it was not liable for.”
The Eighth District Court of Appeals concluded that Foremost was obligated to pay the claim and, hence, could not be held to be a volunteer or, as here, they did have an obligation to make such as payment and, thus, did have “legal liability.” Accordingly, the application of the defense of volunteer is triggered by the payment of monies without legal liability.
A footnote appearing in the opinion indicates that Motorists and Krueger had entered into a settlement agreement with respect to the case. The court also concluded that Motorists was obligated to provide coverage to Mr. Krueger although the court did not really explain why it elected to enforce the temporary substitute portion of the policy but basically ignored the exclusionary portion of the policy and found that Motorists was obligated to provide coverage to Mr. Krueger.
The nuances associated with multiple policies and their application in the employment context often is the subject matter of inquiry to Curtin & Associates and, therefore, this opinion is included in our Newsletter. At the minimum, the case clearly stands for the proposition that if an insurance company makes a payment (in this case under the underinsured motorist portion of its policy, but presumably liability portions of the policy would be covered by the same logic), it can pursue equitable subrogation rights as against the other insurance carrier if in fact there is valid policy language to bring the operated automobile within the definition of a “covered auto” and the paying insurance carrier can avoid the argument of volunteer if there is a “legal liability” to make the payment.
Two Year Statute of Limitation Upheld in Uninsured Motorist Context
Reeser v. City of Dayton (2006), 167 Ohio App.3d 41:
Plaintiff Reeser was involved in a motor vehicle accident with a City of Dayton employee. He filed a negligence suit against the employee, the city and later amended the complaint to include Erie Insurance Company for uninsured motorist coverage. However, the lawsuit against Erie was not filed until more than two years following the date of the accident.
The trial court had determined that this was not a “normal UIM claim” where one can ascertain whether or not the driver did have insurance due to the fact that the city did not have insurance but instead paid any judgment from an operating fund. The court reviewed the policy considerations articulated by the Ohio Supreme Court that a two-year limitation of action clause in an uninsured motorist policy is perfectly reasonable and, in finding that the action was time barred, stated in paragraph 11 of its opinion, the following:
“Although ascertaining the insurance status of a city may be more difficult than determining the insurance status of a tortfeasor who produces an insurance card at the scene, we nevertheless conclude, as we did in Marsh, that two years from the date of the accident was ample time for Reeser to investigate the issue and to file an uninsured-motorist action against Erie. The time problem here stems not from an unreasonably short contractual limitation period, but from the fact that Reeser waited until two years after the accident before he took any action.”
Based upon the foregoing analysis, the court found that the two-year limitation of action provision was reasonable and did not base its decision on the issue of whether or not the city was self-insured but, instead, concluded that Erie Insurance was entitled to summary judgment because the claims were time barred.
The information contained in this newsletter is not a legal opinion and is for informational purposes only. Specific questions should be directed to an attorney for a legal opinion.
Attorney-Client Privilege – Waiver – Discovery of Work Product Materials
Jackson v. Greger, (2006) 110 Ohio St.3d 488:
In the case of Jackson v. Greger, the Ohio Supreme Court reviewed two issues including attorney-client privilege and work product. As it pertains to the former, this issue does arise in the insurance industry inasmuch as the question as to how much information is discoverable in a bad faith claim often involves issues possibly invasive of the attorney-client privilege. Accordingly, any case dealing with the attorney-client privilege is significant to review and discuss especially for practitioners involved in the litigation of bad faith claims.
Ms. Jackson had been involved in an altercation with the police and, on the advice of her attorney, pled guilty to resisting arrest. She, however, subsequently sued the police department who successfully had a motion for summary judgment granted based upon her guilty plea. She thereafter filed a legal malpractice action against her former attorney for negligent advice in the criminal case. During discovery, her criminal attorney sought all attorney-client communications and documents pertaining to her lawsuit against the city. The request was denied and a motion to compel was granted.
The Ohio Supreme Court began its analysis by noting that the attorney-client privilege is governed by statute (R.C. 2317.02(A)) and, in cases not addressed by that statutory section, is governed by common law. A reading of the statute did not give rise to a finding that the attorney-client privilege had been waived and, therefore, the proponents were basically requesting the court to judicially create an exception to the attorney-client privilege or to expand the scope of the waiver of attorney-client privilege. The Ohio Supreme Court declined this invitation and stated in paragraphs 12 – 13 of its finding the following:
“In the instant case, as in McDermott, ‘we decline to add a judicially created waiver to the statutorily created privilege.’ (Citation omitted). R.C. 2317.02(A) clearly enumerates the means by which a client may waive the statutory attorney-client privilege: by express consent or by voluntarily testifying on the same subject. The facts of this case do not demonstrate that Jackson waived the privilege by either of those means.
In reaching this holding, we are aware that several Ohio courts of appeals have applied the Hearn test. We are nevertheless guided by the significant body of law from this court that has consistently rejected the adoption of judicially created waivers, exceptions, and limitations for testimonial privilege statutes.”
The case is positive inasmuch as the court refused to expand the area of waiver by virtue of judicial legislation. The court thereafter turned its attention to the request for the discovery of all file materials (in the lawsuit against the city) of Ms. Jackson’s attorney which was denied by Ms. Jackson’s attorney based upon the work product doctrine.
The court stated in paragraphs 14 – 16, the following:
“In support, Greger (the attorney that was sued) maintains that the file materials are not protected work product. Civ.R. 26(B)(3) governs the discovery of work product. It provides:
‘Subject to the provisions of subdivision (B)(4) of this rule, a party may obtain discovery of documents and tangible things prepared in anticipation of litigation or for trial by or for another party or by or for that other party's representative (including his attorney, consultant, surety, indemnitor, insurer, or agent) only upon a showing of good cause therefor.’
We hold that a showing of good cause under Civ.R. 26(B)(3) requires demonstration of need for the materials-i.e., a showing that the materials, or the information they contain, are relevant and otherwise unavailable. The purpose of the work-product rule is ‘(1) to preserve the right of attorneys to prepare cases for trial with that degree of privacy necessary to encourage them to prepare their cases thoroughly and to investigate not only the favorable but the unfavorable aspects of such cases and (2) to prevent an attorney from taking undue advantage of his adversary's industry or efforts.’ Civ.R. 26(A). To that end, Civ.R. 26(B)(3) places a burden on the party seeking discovery to demonstrate good cause for the sought-after materials.”
Returning to the bad faith arena, the work product doctrine would not bar a defense lawyer from making the argument that any testing that had been done (in the case of a property damage claim or an arson claim) can and should be discoverable by the defense if there is no other means to gather that information. Alternatively phrased, if a witness was retained by a plaintiff but not used by the plaintiff, this case clearly stands for the proposition that the work product rule is not an absolute bar to the defense’s ability to gather information from the plaintiff’s retained (but not used in the litigation) expert witness. The court went on to conclude that the attorney seeking the information could gather the information from other sources and, therefore, the materials were not ordered produced from Jackson’s attorney. This particular case may be of benefit in the defense of bad faith litigation and, therefore, is included and reviewed in this Newsletter.
Equitable Subrogation – Volunteer – Right of Recoupment Fom
Non-Participating Underinsured Motorist Carrier
Foremost Ins. Co. v. Motorists Mut. Ins. Co., 2006-Ohio-3022:
In Foremost, supra, the Eighth District Court of Appeals heard an interesting case which oftentimes arises as it pertains to two policies of insurance that may have application to a single loss. In this matter, Robert Krueger was operating his motorcycle and was injured by an underinsured motorist. At the time of the accident, the motorcycle Mr. Krueger was operating was insured with Foremost for $500,000 per accident and he also claimed coverage through his employer’s business auto policy with Motorists Insurance Group which carried $1,000,000 in uninsured/underinsured motorist coverage. Foremost only proceeded to settle the claim for underinsured motorist benefits with Mr. Krueger and Foremost thereafter filed a contribution lawsuit against Motorist.
The Motorists Insurance policy insured a 2000 Ford F-150 pick-up truck and a 1999 BMW as “covered automobiles” under the policy. However, on the day of the accident, the BMW listed under the Motorists policy, although owned by Mr. Krueger, was not drivable inasmuch as the battery was dead. Accordingly, from a review of the opinion, it appears that the lower court concluded that Mr. Krueger was using his motorcycle as a “temporary substitute” for the 1999 BMW on the day of the accident. Motorists’ policy included an exclusion which exempted from coverage any vehicle owned by an insured which is not listed as a covered auto. Therefore, on its face, the exclusion clearly would appear to take the motorcycle out of the realm of an insured vehicle and thus no insurance coverage would inure to the benefit of Mr. Krueger.
One of the preliminary arguments dealt with by the trial court, as well as the Court of Appeals, dealt with the issue of whether or not Foremost’s payment to Mr. Krueger rendered them a volunteer and hence preventing any subrogation claim. The court found that Foremost did not act as a volunteer and so indicated in paragraphs 23 – 24 of its opinion, the following:
“The court in Farm Bureau defined ‘volunteer’ as ‘one [who] with knowledge of the facts and without legal liability, makes a payment of money ...’ Id at paragraph six of the syllabus. Motorists argues that Foremost had knowledge of the facts and paid Krueger's claim although it had no legal liability to do so. In addition, Motorists asserts that Foremost made its payment to Krueger with the knowledge that Motorists had no intention of paying Krueger's claim. Motorists further contends that Foremost also paid the claim without giving any indication that it was preserving its right to pursue non-settling or late-settling insurers.
Foremost argues to the contrary that it had a legal obligation to pay Krueger's claim and did not knowingly pay a claim it was not liable for.”
The Eighth District Court of Appeals concluded that Foremost was obligated to pay the claim and, hence, could not be held to be a volunteer or, as here, they did have an obligation to make such as payment and, thus, did have “legal liability.” Accordingly, the application of the defense of volunteer is triggered by the payment of monies without legal liability.
A footnote appearing in the opinion indicates that Motorists and Krueger had entered into a settlement agreement with respect to the case. The court also concluded that Motorists was obligated to provide coverage to Mr. Krueger although the court did not really explain why it elected to enforce the temporary substitute portion of the policy but basically ignored the exclusionary portion of the policy and found that Motorists was obligated to provide coverage to Mr. Krueger.
The nuances associated with multiple policies and their application in the employment context often is the subject matter of inquiry to Curtin & Associates and, therefore, this opinion is included in our Newsletter. At the minimum, the case clearly stands for the proposition that if an insurance company makes a payment (in this case under the underinsured motorist portion of its policy, but presumably liability portions of the policy would be covered by the same logic), it can pursue equitable subrogation rights as against the other insurance carrier if in fact there is valid policy language to bring the operated automobile within the definition of a “covered auto” and the paying insurance carrier can avoid the argument of volunteer if there is a “legal liability” to make the payment.
Two Year Statute of Limitation Upheld in Uninsured Motorist Context
Reeser v. City of Dayton (2006), 167 Ohio App.3d 41:
Plaintiff Reeser was involved in a motor vehicle accident with a City of Dayton employee. He filed a negligence suit against the employee, the city and later amended the complaint to include Erie Insurance Company for uninsured motorist coverage. However, the lawsuit against Erie was not filed until more than two years following the date of the accident.
The trial court had determined that this was not a “normal UIM claim” where one can ascertain whether or not the driver did have insurance due to the fact that the city did not have insurance but instead paid any judgment from an operating fund. The court reviewed the policy considerations articulated by the Ohio Supreme Court that a two-year limitation of action clause in an uninsured motorist policy is perfectly reasonable and, in finding that the action was time barred, stated in paragraph 11 of its opinion, the following:
“Although ascertaining the insurance status of a city may be more difficult than determining the insurance status of a tortfeasor who produces an insurance card at the scene, we nevertheless conclude, as we did in Marsh, that two years from the date of the accident was ample time for Reeser to investigate the issue and to file an uninsured-motorist action against Erie. The time problem here stems not from an unreasonably short contractual limitation period, but from the fact that Reeser waited until two years after the accident before he took any action.”
Based upon the foregoing analysis, the court found that the two-year limitation of action provision was reasonable and did not base its decision on the issue of whether or not the city was self-insured but, instead, concluded that Erie Insurance was entitled to summary judgment because the claims were time barred.
The information contained in this newsletter is not a legal opinion and is for informational purposes only. Specific questions should be directed to an attorney for a legal opinion.