365 N.C. 94
N.C.2011Background
- Raymond sues SSPBA, NCPBA, and Midgette over alleged maintenance and champerty regarding federal lawsuit defending Foxx; Foxx, SSPBA, and Lovins formed communications for legal representation; SSPBA funded legal services and required reimbursement; trial court ordered production subject to privilege and ordered in camera review; Court of Appeals affirmed on different grounds and did not address waiver; Supreme Court reverses and remands for in camera Murvin-factor analysis.
- Foxx, Fletcher, and Lovins facilitated initial grievance and federal suit, with SSPBA paying up to $100/hour and Foxx responsible for excess fees; communications intended to form or were part of an attorney-client relationship; trial court failed to detail the tripartite relationship or common-interest consent issues.
- Court recognizes a tripartite attorney-client relationship can arise where a common interest exists and the insurer/association defends an insured, creating joint representation and privilege.
- Court adopts five-factor Murvin test for privilege applicability: (1) attorney-client relation existed; (2) confidence in the communication; (3) relates to legal advice; (4) made to seek/provide legal advice for proper purpose; (5) no waiver by client.
- Remands for trial court to conduct in camera review applying Murvin test to determine privilege scope; address common-interest waiver concerns and findings of fact.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is there a tripartite attorney-client relationship? | Raymond asserts no tripartite relationship. | SSPBA/NCPBA contend a common-interest arrangement exists. | Yes; tripartite relationship exists. |
| Do communications among Foxx, SSPBA, and Lovins fall within privilege? | Raymond argues communications are discoverable. | Defendants contend communications are privileged. | Communications satisfying Murvin are privileged. |
| Is in camera review proper to assess privilege applicability? | In camera review not necessary if privilege waived. | In camera review appropriate to preserve confidentiality. | In camera review appropriate and required. |
| Has any waiver occurred due to defendants' answer statements? | Waiver may have occurred through admission of fee arrangements. | Waiver not established; requires consent of all parties sharing privilege. | Waiver issue to be resolved on remand. |
| What should the remand scope be? | Remand for limited discovery. | Remand for full in camera evaluation. | Remand to determine privilege scope via in camera Murvin analysis. |
Key Cases Cited
- In re Miller, 357 N.C. 316 (N.C. 2003) (adopts five-factor test and supports in camera review for privilege)
- State v. McIntosh, 336 N.C. 517 (N.C. 1994) (identifies attorney-client relationship existence test)
- State v. Murvin, 304 N.C. 523 (N.C. 1981) (five-factor framework for privilege application)
- Bourlon, 172 N.C.App. 595 (N.C. App. 2005) (tripartite representation in insurance defense context)
- In re Grand Jury Subpoenas, 902 F.2d 244 (4th Cir. 1990) (protects free flow of information among joint clients and attorney)
- Jones v. Nantahala Marble & Talc Co., 137 N.C. 237 (N.C. 1904) (communications between party attorneys are privileged)
- Duke Energy Corp., 214 F.R.D. 383 (M.D.N.C. 2003) (common-interest doctrine applicability in complex litigation)