249 Conn. 36 | Conn. | 1999
Opinion
This is an interlocutory appeal by the plaintiff, Metropolitan Life Insurance Company, from the discovery order of the trial court requiring the plaintiff to disclose certain documents in an insurance coverage dispute between the plaintiff and the defendants,
In addition to these 200,000 cases, new asbestos tort actions are being brought against the plaintiff at the rate of approximately 20,000 per year. To date, the plaintiff has taken only two such asbestos tort actions to verdict. The plaintiff settled or is in the process of settling almost all of these claims for a nominal value of approximately $2000 per claim, but because of the vast number of asbestos tort actions that have been and continue to be filed, it is estimated that costs of settling these claims could be as much as one billion dollars. During the years for which the plaintiff is claiming second level excess insurance coverage by the defendants, it also had primary, umbrella and first level excess general liability coverage from The Travelers
As the aggregate cost of the settlements became increasingly enormous, the plaintiff began to look to the defendants, its second level excess liability insurers, for coverage of the asbestos tort actions. The defendants, however, failed to participate in the defense of these claims by either denying coverage or reserving their rights to deny it in the future.
As a part of a joint effort to manage the large volume of discovery documents in this complex litigation, the plaintiff prepared and produced a log covering the documents requested by the defendants that it claimed were privileged (privilege log). This two page categorical privilege log lists fifteen categories of documents and covers more than 100 boxes of documents that relate to the defense and settlement of the asbestos tort actions. The plaintiff specifically claims that these documents are protected by the attorney-client privilege.
On September 16,1998, the plaintiff applied for certification to appeal, pursuant to General Statutes § 52-265a (a), which provides generally that interlocutory orders and decisions of the trial court may be appealed to this court upon certification by the chief justice when the appeal “involves a matter of substantial public interest and . . . delay may work a substantial injustice
On appeal, the plaintiff claims that the trial court discovery order is an appealable final judgment, pursuant to § 52-263, as set forth in State v. Curcio, 191 Conn. 27, 31, 463 A.2d 566 (1983). In the alternative, the plaintiff asserts that its appeal should be allowed pursuant to § 52-265a.
Beyond the issue of jurisdiction, the plaintiff argues on the merits that the trial court improperly ordered disclosure in violation of the attorney-client privilege. The defendants claim that the documents are discoverable because: (1) the “at issue” exception to the attorney-client privilege applies; (2) the cooperation
I
We first must address the issue of this court’s jurisdiction over the present case. It is well established that the subject matter jurisdiction of the Appellate Court and of this court is governed by § 52-263, which provides that an aggrieved party “may appeal to the court having jurisdiction from the final judgment of the court . . . ,”
We previously have determined that certain interlocutory orders have the attributes of a final judgment and consequently are appealable under § 52-263. In State v. Curcio, supra, 191 Conn. 31, we explicated two situations in which aparty can appeal an otherwise interlocutory order: “(1) where the order or action terminates a separate and distinct proceeding, or (2) where the order or action so concludes the rights of the parties that further proceedings cannot affect them.” The plaintiff claims that its appeal meets the second prong of the Curcio test for finality because, if the privileged information in question were disclosed, even under a protective order, the plaintiff’s right to confidentiality in the asbestos tort actions would be immediately and permanently compromised. Although we recognize that the plaintiffs confidentiality in the relevant documents could be compromised in foreign jurisdictions because Connecticut’s protective order does not extend beyond its borders, this is true for any discovery order with a protective order. Moreover, further proceedings can affect the rights of the parties in the present case because the plaintiff, if aggrieved by the trial court’s final decision, could appeal this discovery order after the final disposition of this case as it would any other nonfinal interlocutory order. Consequently, we hold that this court has no jurisdiction over the present appeal pursuant to § 52-263.
Our conclusion is supported by our decision in Melia v. Hartford Fire Ins. Co., 202 Conn. 252, 520 A.2d 605 (1987). In Melia, which also involved an appeal from a trial court order to produce files protected by the attorney-client privilege within an insurance coverage dispute, we found that the appellants failed to meet the
Nevertheless, we allowed an appeal from a discovery order in Lougee v. Grinnell, 216 Conn. 483, 487, 582 A.2d 456 (1990). In Lougee, we distinguished our holding from Melia and concluded that the trial court’s denial of the nonparty witness’ motion to quash a subpoena to appear at a deposition in Connecticut regarding a lawsuit in Texas satisfied Curdo’s first prong and, therefore, constituted a final judgment that merited an immediate appeal. Id. Unlike Melia and the present case, in Lougee the outcome of the Connecticut proceeding could not result in a later judgment from which the petitioner could then appeal, because “the sole judicial proceeding instituted in Connecticut concerned the propriety of [the] deposition subpoena . ...” Id. Accordingly, we find that, unlike Lougee, this appeal does not fall within Curdo’s test.
Thus, it must now be determined whether this appeal should be allowed pursuant to § 52-265a. Although the plaintiffs § 52-265a application was denied originally, it was denied without prejudice.
This determination is based upon the following. The disclosure ordered by the trial court directly involves the attorney-client privilege, the importance of which we have recently reaffirmed. Shew v. Freedom of Information Commission, 245 Conn. 149, 162-63, 714 A.2d 664 (1998) (attorney-client privilege invoked when confidential communication between client and attorney is inextricably linked to giving of legal advice). Connecticut has a long-standing, strong public policy of protecting attorney-client communications. See, e.g., Doyle v. Reeves, 112 Conn. 521, 523, 152 A. 882 (1931) (quoting common-law rule embodied in 5 J. Wigmore, Evidence [2d Ed. 1923] § 2292). This privilege was designed, in large part, to encourage full disclosure by a client to his or her attorney so as to facilitate effective legal representation. State v. Cascone, 195 Conn. 183, 188, 487 A.2d 186 (1985). It is important not to weaken the privilege with various exceptions because, as the United States Supreme Court has explained, even the threat of disclosure would have a detrimental effect on attorneys’ ability to advocate for their clients while preserving their ethical duty of confidentiality. Hickman v. Taylor,
In order to understand the significance of this appeal, one must also place it within the context of the thousands of ongoing asbestos tort actions that have been commenced in at least thirty other jurisdictions throughout the country. If the appeal were dismissed and the relevant documents were disclosed in the present case, the claimants in asbestos tort actions brought in foreign jurisdictions would be likely to seek discovery orders forcing the plaintiff to disclose the documents it had disclosed to the defendants in the present coverage dispute. The court’s protective order over the privileged documents governs only cases within Connecticut. Consequently, it is possible that a foreign court could indeed require the plaintiff to disclose the documents, based on their disclosure in the present case. See Baker v. General Motors Corp., 522 U.S. 222, 118 S. Ct. 657, 139 L. Ed. 2d 580 (1998) (full faith and credit given to Michigan decision did not bar testimony in Missouri, even though Michigan court enjoined such testimony). Although the plaintiff could try to invoke the attorney-client privilege in ongoing or future asbestos tort actions, that defense would, at the very least, be undermined as a result of the disclosure of the documents to its adversaries in the present case, despite the fact that it was disclosed pursuant to a protective order. Thus, before the propriety of the discovery order in the present case could be the subject of an appeal, these privileged documents detailing, among other things, the plaintiffs legal strategy regarding the asbestos tort
Furthermore, the plaintiff would be prejudiced regarding its handling of ongoing and future asbestos tort actions because it would be forced to communicate with its attorneys in that context knowing that their communications might not be kept confidential if later requested by the defendants. Disclosure would also prejudice the plaintiff in the present case because the documents include opinions and mental impressions of the plaintiffs attorneys regarding issues that are being litigated in both the present case and the asbestos tort actions.
The plaintiff further maintains that by allowing this appeal and establishing rules for trial courts to follow in insurance coverage disputes, this court will serve a substantial public interest. We agree. There is a division among the trial courts with respect to that type of disclosure in an insurance coverage case,
Accordingly, we conclude that the plaintiffs appeal concerns a matter of substantial public interest in which
II
We next reach the substantive issue of whether the trial court properly ordered the disclosure of the documents. With respect to the appropriate standard of review, Practice Book § 13-14 (a) provides in relevant part that a trial court “may, on motion [to compel production], make such order as the ends of justice require.” Consequently, “the granting or denial of a discovery request rests in the sound discretion of the court”; Standard Tallow Corp. v. Jowdy, 190 Conn. 48, 57, 459 A.2d 503 (1983); and can be reversed only if such an order constitutes an abuse of that discretion. The ultimate issue in our review is, therefore, whether the trial court reasonably could have concluded as it did. Simmons v. Simmons, 244 Conn. 158, 175, 708 A.2d 949 (1998).
A
In order to determine whether the trial court properly ordered disclosure, we must for the first time set forth the contours of the “at issue” exception to the attorney-client privilege in Connecticut. We then must decide whether the trial court properly determined that the at issue exception to the attorney-client privilege applies to the present case.
In Connecticut, the attorney-client privilege protects both the confidential giving of professional advice by an attorney acting in the capacity of a legal advisor to those who can act on it, as well as the giving of information to the lawyer to enable counsel to give sound and informed advice. Shew v. Freedom of Information Commission, supra, 245 Conn. 157, citing Upjohn Co. v. United States, 449 U.S. 383, 390, 101 S. Ct. 677, 66 L.Ed. 2d 584 (1981). It is undisputed that the privilege was created “to encourage full and frank communication between attorneys and their clients and thereby promote broader public interests in the observation of law and administration of justice.” Upjohn Co. v. United States, supra, 389. Exceptions to the attorney-client privilege should be made only when the reason for disclosure outweighs the potential chilling of essential communications. “It is obvious that professional assistance would be of little or no avail to the client, unless his legal adviser were put in possession of all the facts relating to the subject matter of inquiry or htigation, which, in the indulgence of the fullest confidence, the client could communicate. And it is equally obvious that there would be an end to all confidence between the client and [the] attorney, if the latter was at liberty or compellable to disclose the facts of which he had thus obtained possession . . . .” Goddard v. Gardner, 28 Conn. 172, 174 (1859).
Because of the important public policy considerations that necessitated the creation of the attorney-client privilege, the “at issue,” or implied waiver, exception is invoked only when the contents of the legal
Merely because the communications are relevant does not place them at issue. Remington Arms Co. v. Liberty Mutual Ins. Co., supra, 142 F.R.D. 415 (finding no waiver regarding documents that relate to underlying actions and are protected by attorney-client privilege, because merely relevant in coverage action); see Rockwell International Corp. v. Superior Court, 26 Cal. App. 4th 1255, 1268, 32 Cal. Rptr. 2d 153 (1994) (finding at issue doctrine not invoked because coverage action turns on underlying facts, not insured’s rebanee on advice of counsel as defense). If admitting that one relied on legal advice in making a legal decision put the communications relating to the advice at issue, such advice would be at issue whenever the legal decision was btigated. If that were true, the at issue doctrine would severely erode the attomey-chent privilege and undermine the public pobey considerations upon which it is based.
In the present case, the plaintiff has not pleaded rebanee on any information or advice contained in the privileged documents. Although the plaintiffs compliance with the requirement in its pobey to make reasonable settlements is at issue, that fact does not place the privileged documents at issue. Compliance with contract terms is generaby an element in ab contractual actions, yet rebanee upon legal advice within the process of adhering to contract terms does not automatically place the actual legal advice at issue. See Rockwell International Corp. v. Superior Court, supra, 26 Cal. App. 4th 1268. Therefore, even though certain of the plaintiffs senior officials may have stated in depositions that advice of counsel was a significant motivating factor in the officials’ decisions to settle the asbestos tort actions, the privileged documents are not at issue because the plaintiff is not relying on the privileged
Where, as in the present case, an insured alleges that an insurer improperly has failed to defend and provide coverage for underlying claims that the insured has settled the insured has the burden of proving that the claims were within the policy’s coverage and that the settlements were reasonable. Black v. Goodwin, Loomis & Britton, Inc., 239 Conn. 144, 160, 681 A.2d 293 (1996), citing Alderman v. Hanover Ins. Group, 169 Conn. 603, 611, 363 A.2d 1102 (1975) (in order to be covered by insurer, settlement made by insured must have been reasonable and made in good faith). The reasonableness of the settlement, in turn, should be examined under an objective standard.
It would be quite different if the plaintiff sought to prove reasonableness based upon the advice of counsel. In that instance, counsel’s advice would be at issue— but that is not the situation in the present case. Accordingly, although the reasonableness of the settlements is directly at issue, the exact communications between the plaintiff and its attorneys regarding the decision to settle, which would aid only in a subjective determination, are not at issue. In sum, the defendants in the present case can assess whether the settlements of the asbestos tort actions were reasonable by examining the facts of the asbestos tort actions — the same material that the plaintiff had available to it when making its decision — and by consulting experts, just as the plaintiff had the opportunity to do.
The trial court in the present case seems to have misconstrued the at issue exception by focusing on the defendants’ need for the documents.
Our understanding of the at issue doctrine is also supported by the fact that disclosure in the present case would have the undesirable effect of weakening significantly that privilege. Not only would compelling disclosure of the privileged documents risk disclosure in foreign jurisdictions, it would probably chill communications between policyholders and counsel for the asbestos tort actions out of fear of disclosure in future coverage litigation. It could also chill attorney-client communications on a wider scale because disclosure would call into question whether this court might find other exceptions to the privilege in different contexts. “The effect [of weakening the protection] on the legal profession would be demoralizing. And the interests of the clients and the cause of justice would be poorly served.” Hickman v. Taylor, supra, 329 U.S. 511.
B
We also must determine whether the trial court properly ordered the disclosure based on the cooperation clauses in the policies between the plaintiff and the defendants. We hold that the cooperation clauses do not justify disclosure.
The trial court decision, without any analysis except a statement that it was relying on Carrier Corp. v. Home
An example of the language typical of the cooperation clauses in the present case is as follows: “Assistance and Co-operation. The [Insurance] Company shall not be called upon to assume charge of the settlement or defense of any claim made or suit brought or proceeding instituted against the Insured but the Company shall have the right and shall be given the opportunity to associate with the Insured or the Insured’s underlying insurers, or both, in the defense and control of any claim, suit or proceeding . . . where the claim or suit involves or appears reasonably likely to involve the Company, in which event the Insured and the Company shall co-operate in all things in the defense of such claim, suit or proceeding.” (Emphasis added.) Home Ins. Co. Policy No. HEC 1 19 99 93. The cooperation clauses, according to the terms of the policies, are invoked only when the insurer exercises its right “to associate with the insured ... in the defense and control [a] claim . . . .” Id. Therefore, at most, disclosure pursuant to the cooperation clauses possibly could be required only if and when the insurance company participates “in the defense” of underlying cases.
Furthermore, the defendant insurers not only have failed to associate with the plaintiff in the defense of the asbestos tort actions, they have denied coverage or reserved their rights. “[E]ither the policy provides coverage, in which case the denial of coverage breaches the insurance contract and relieves [the policyholder] of the duty to cooperate, or there is no duty to cooperate because the damage is not [within the scope of the policy].”
The defendants, however, maintain that the privilege never attached to the documents because, at the time
C
We now consider whether the two alternative grounds for affirmance offered by the defendants merit disclosure of the relevant documents. We conclude that they do not.
First, the defendants assert that, although the trial court did not rely on the “common interest” exception to the attorney-client privilege in its discovery order, this court can affirm its decision on this ground. We
It is true that an insured and an insurer would have a common interest in defeating or minimizing claims against the insured if the insurer were to agree to cover the insured’s claims. Yet, as the amici curiae argue in their brief, we have long held that even when an insurer retains an attorney in order to defend a suit against an insured, the attorney’s only allegiance is to the client, the insured. Novella v. Hartford Accident & Indemnity Co., 163 Conn. 552, 573, 316 A.2d 394 (1972); see also Higgins v. Karp, 239 Conn. 802, 810, 687 A.2d 539 (1997) (“even when an attorney is compensated or expects to be compensated by a liability insurer, [his or] her duty of loyalty and representation nonetheless remains exclusively with the insured”), after remand, 243 Conn. 495, 706 A.2d 1 (1998). Such a rule recognizes that the insured’s and the insurer’s interests are not all common. See R. Jerry, Understanding Insurance Law (2d Ed. 1996) § 114, pp. 779-819 (extensive discussion of conflicts of interest between insureds and insurers). Furthermore, in a case such as the present one, where the
Moreover, an insured’s and an insurer’s interests immediately become conflicted as soon as the insurer declines to cover the claims. Thus, many courts have rejected the theory proposed by the defendants.
Finally, the defendants’ assertion that because the plaintiff gave Travelers access to certain privileged documents that are at issue in the present case,
The order of the trial court is reversed with respect to the discovery order pertaining to the seven document categories more specifically set forth in footnote 5 of this opinion and the case is remanded to the trial court for further proceedings not inconsistent with this opinion.
In this opinion the other justices concurred.
The following are the defendant insurers in the present case: Aetna Casualty and Surety Company, Allianz Insurance Company, Allianz Underwriters Insurance Company, American Centennial Insurance Company, Arkwright Boston Manufacturers Mutual Insurance Company, Century Indemnity Company, City Insurance Company, Commercial Union Insurance Company, CCI Insurance Company, Forum Insurance Company, Continental Insurance Company, Fireman’s Fund Insurance Company, Greenwich Insurance Company, Hartford Accident and Indemnity Company, Highlands Insurance Company, The Home Insurance Company, Insurance Company of North America, International Insurance Company, National Union Insurance Company of Pittsburgh, Pennsylvania, New England Insurance Company, New England Reinsurance Company, Pacific Employers Insurance Company and Royal Indemnity Company.
The parties disagree as t,o whether the defendants have denied coverage or reserved their rights to deny it in the future.
These issues include the allocation of coverage under the policies of the defendants where coverage extended over varying and limited times during a thirty year period.
The plaintiff also raises claims that the documents are protected by the work product doctrine, an issue we do not reach. See footnote 17 of this opinion.
On July 20, 1998, the trial court ordered disclosure, under seal, of the following document categories:
“(1) Communications among members of the [plaintiffs] Law Dept., or between the Law Dept, and other employees of [the plaintiff] relating to legal advice involving the [asbestos tort actions], coverage cases and/or their settlement . . .
“(5) Communications among underlying Asbestos Defense Counsel, [the plaintiffs] Law Dept, and/or [Travelers] relating to legal advice regarding defense and/or settlement of [asbestos tort actions];
“(6) Communications among [the plaintiffs] Law Dept, and/or [the plaintiff] and [Travelers] relating to legal advice regarding defense and/or settlement of [asbestos tort actions] . . .
“(8) Factual and Legal Research prepared by or for [the plaintiffs] Law Dept, relating to the [asbestos tort actions] . . .
“(10) Factual and Legal Research prepared by or for [the plaintiffs] Law Dept, regarding settlement of the [asbestos tort actions] . . .
“(12) Factual and Legal Research of underlying Asbestos Defense Counsel regarding the [asbestos tort actions];
“(13) Factual and Legal Research of underlying Asbestos Defense Counsel regarding the settlement of [asbestos tort actions] . . . .”
General Statutes § 52-265a provides: “Direct appeal on questions involving the public interest, (a) Notwithstanding the provisions of sections 52-264 and 52-265, any party to an action who is aggrieved by an order or decision of the Superior Court in an action which involves a matter of substantial public interest and in which delay may work a substantial injustice, may appeal under this section from the order or decision to the Supreme Court within two weeks from the date of the issuance of the order or decision. The appeal shall state the question of law on which it is based.
“(b) The Chief Justice shall, within one week of receipt of the appeal, rule whether the issue involves a substantial public interest and whether delay may work a substantial injustice.
“(c) Upon certification by the Chief Justice that a substantial public interest is involved and that delay may work a substantial injustice, the trial judge shall immediately transmit a certificate of his decision, together with a proper finding of fact, to the Chief Justice, who shall thereupon call a special session of the Supreme Court for the purpose of an immediate hearing upon the appeal.
“(d) The Chief Justice may make orders to expedite such appeals, including orders specifying the manner in which the record on appeal may be prepared.”
General Statutes § 52-263 provides: “Appeals from Superior Court. Exceptions. Upon the trial of all matters of fact in any cause or action in the Superior Court, whether to 1he court or jury, or before any judge thereof when the jurisdiction of any action or proceeding is vested in him, if either party is aggrieved by the decision of the court or judge upon any question or questions of law arising in the trial, including the denial of a motion to set aside a verdict, he may appeal to the court having jurisdiction from the final judgment of the court or of such judge, or from the decision of the court granting a motion to set aside a verdict, except in small claims cases, which shall not be appealable, and appeals as provided in sections 8-8 and 8-9.”
Although § 52~265a provides that the chief justice shall rule on such a certification, both Chief Justice Callahan and Justice Borden, who is the most senior associate justice, recused themselves from this case. Therefore, Justice Berdon, the next most senior justice, acted on the application for
Practice Book § 65-1 provides: “When, pursuant to General Statutes § 51-199 (c), the supreme court (1) transfers to itself a cause in the appellate court, or (2) transfers a cause or a class of causes from itself to the appellate court, the appellate clerk shall notify all parties and the clerk of the trial court that the appeal has been transferred. A case so transferred shall be entered upon the docket of the court to which it has been transferred. There shall be no fee on such transfer. The appellate clerk may require the parties to take such steps as may be necessary to make the appeal conform to the rules of the court to which it has been transferred, for example, supply the court with additional copies of the record and the briefs.”
General Statutes § 51-199 (c) provides in relevant part: “The Supreme Court may transfer to itself a cause in the Appellate Court. . . .”
See footnote 6 of this opinion for text of § 52-265a.
The defendants offer arguments three and four as alternative grounds for affirmance.
See footnote 7 of this opinion for the complete text of § 52-263.
The plaintiffs application, filed on September 16, 1998, was an appeal from the trial court’s September 2, 1998 reaffirmance of its order requiring disclosure. Thus, the application was filed within the two week time limit set by § 52-265a.
For example, the defendants claim that because the plaintiff failed to disclose information regarding the hazards of asbestos, the underlying harm in the asbestos tort actions was not unexpected or unintended. Such a claim may provide the defendants with a defense to coverage.
See, e.g., Remington Arms Co. v. Liberty Mutual Ins. Co., 142 F.R.D. 408, 418 (D. Del. 1992) (denying disclosure, according Connecticut law); Chenkus v. Dickson, Superior Court, judicial district of New Haven, Docket No. 282007 (September 7, 1990) (2 Conn. L. Rptr. 260, 261) (denying disclosure); contra Communication Satellite Corp. v. Aetna Casualty & Ins. Co., Docket No. 3:93CV1465 (D. Conn. April 6, 1995) (granting disclosure based on insured’s duty to cooperate and its duty of good faith, according to Connecticut and District of Columbia law); EDO Corp. v. Newark Ins. Co., 145 F.R.D. 18, 21 (D. Conn. 1992) (granting disclosure based on insured’s duty to cooperate, according to Connecticut law); Carrier Corp. v. Home Ins. Co., Superior Court, judicial district ofHartford-New Britain at Hartford, Docket No. 353283 (June 12, 1992) (7 C.S.C.R. 823) (granting disclosure based on cooperation clause, not “at issue” exception).
See footnote 6 of this opinion for text of § 52-265a (c).
The plaintiff also alleges that some of these documents are protected by the work product doctrine, a matter we decline to reach. Typically, the attorney work product doctrine encompasses work that is essentially the result of an attorney’s activities when those activities have been conducted
Liberal waiver rules have been criticized on the grounds that they supposedly “increase litigation costs and judicial time spent on discovery disputes, favor the wealthiest litigants, undermine the values served by the privilege rules, and vary according to the identity of the litigants and their purported need for privileged information.” Remington Arms Co. v. Liberty Mutual Ins. Co., 142 F.R.D. 408, 413 (D. Del. 1992).
Sedco International, S.A. v. Cory, 683 F.2d 1201, 1206 (8th Cir.), cert. denied, 459 U.S. 1017, 103 S. Ct. 379, 74 L. Ed. 2d 512 (1982); see, e.g., Byers v. Burleson, 100 F.R.D. 436, 440 (D.D.C. 1983) (legal advice at issue in legal malpractice action); Handgards, Inc. v. Johnson & Johnson, Inc., 413 F. Sup. 926, 929 (N.D. Cal. 1976) (legal advice at issue when special defense of good faith in reliance on advice of counsel is argued); Kantaris v. Kantaris, 169 N.W.2d 824, 830 (Iowa 1969) (testimony concerning attorney-client communication waived privilege).
See, e.g., North River Ins. Co. v. Philadelphia Reinsurance Corp., 797 F. Sup. 363, 370 (D.N.J. 1992) (finding no exception to attorney-client privilege regarding underlying action in subsequent insurance coverage dispute); Rockwell International Corp. v. Superior Court, supra, 26 Cal. App. 4th 1268 (finding at issue doctrine not invoked in subsequent insurance coverage dispute, therefore, advice of counsel in underlying action was privileged); Home Ins. Co. v. Advance Machine Co., 443 So. 2d 165, 168 (Fla. App. 1983) (insurance companies did not place privileged materials at issue by filing action that required proof that settlement was reasonable); see generally Medtronic, Inc. v. Intermedics, Inc., 162 F.R.D. 133, 134-35 (D. Minn. 1995) (where interpretation and understanding of contract is based on contract itself, no extrinsic evidence needed); contra Waste Management, Inc. v. International Surplus Lines Ins. Co., 144 Ill. 2d 178, 191, 579 N.E.2d 322 (1991) (finding defense counsel’s litigation files in underlying cases were at issue in insurance coverage dispute).
See, e.g., Luria Bros. & Co. v. Alliance Assurance Co., Ltd., 780 F.2d 1082, 1091 (2d Cir. 1986) (examined objective facts known to plaintiff at time of settlement in order to determine its reasonableness); Black v. Goodwin, Loomis & Britton, Inc., supra, 239 Conn. 160-61 (examined objective facts known to plaintiff at time of settlement and expert testimony to determine reasonableness of settlement); United Services Automobile Assn. v. Morris, 154 Ariz. 113, 121, 741 P.2d 246 (1987) (“test as to whether the settlement was reasonable and prudent is what a reasonably prudent person in the insureds’ position would have settled for on the merits of the claimant’s case” [emphasis in original]); Alton M. Johnson Co. v. M.A.I. Co., 463 N.W.2d 277, 279 (Minn. 1990) (setting forth objective test to determine whether
Although Practice Book § 13-3 provides that certain documents prepared for litigation are discoverable if the moving party shows a substantial need, § 13-3, like its federal counterpart, rule 26 (b) (3) of the Federal Rules of Civil Procedure, encompasses only documents covered by the work product doctrine, not ones protected by the attorney-client privilege. See Upjohn Co. v. United States, supra, 449 U.S. 401. As stated in footnote 17 of this opinion, we do not reach the issue of protection pursuant to the work product doctrine.
See Admiral Ins. Co. v. United States District Court for the District of Arizona, 881 F.2d 1486, 1494 (9th Cir. 1989) (declining to make unavailability exception to attorney-client privilege); State ex rel. United States Fidelity & Guaranty Co. v. Montana Second Judicial District Court, 240 Mont. 5, 12, 783 P.2d 911 (1989) (adopting rule in Admiral Ins. Co.).
The trial court in Carrier Corp. v. Home Ins. Co., supra, 7 C.S.C.R. 827, held that the existence of the cooperation clause made it unreasonable for the insured to expect confidentiality in its attorney-client communications and work product documents, and, consequently, that no privilege existed as to the insurer.
We note that if the documents were never privileged because of the cooperation clauses in the relevant insurance policies, the at issue exception to the attorney-client privilege would have no privilege from which to create an exception.
If, however, the defendants had retained counsel for and in defense of the plaintiff in the asbestos tort actions, the defendants’ argument still would run counter to our well settled law. As we point out in part II C of this
See also Bituminous Casualty Corp. v. Tonka Corp., 140 F.R.D. 381, 386 (D. Minn. 1992) (rejecting theory that cooperation clause negates any expectation of confidentiality by insured as “fundamentally unsound”); North River Ins. Co. v. Philadelphia Reinsurance Corp., 797 F. Sup. 363, 369 (D.N.J. 1992) (cooperation clause does not prevent insured’s expectation of confidentiality); Rockwell International Corp. v. Superior Court, supra, 26 Cal. App. 4th 1260 (rejecting theory that cooperation clause negates any expectation of confidentiality by insured as “fanciful”); State v. Hydrite Chemical Co., supra, 220 Wis. 2d 75 (cooperation clause does not supersede attorney-client privilege); contra Waste Management, Inc. v. International Surplus Lines Ins. Co., 144 Ill.2d 178, 192-93, 579 N.E.2d 322 (1991) (cooperation clause negates any expectation of confidentiality by insured).
We need not, and therefore decline to, decide whether disclosure of any or all of the relevant documents would be warranted under the cooperation clauses even if the defendants had agreed to cover the claims and had participated in the plaintiffs defense against them.
The following parties have submitted a joint amici curiae brief in the present case: Lone Star Industries, Inc., BIC Corporation, United Technologies Corporation, Otis Elevator Company, Carrier Corporation and Fortune Brands, Inc.
The defendants are unclear whether this argument entails a common interest exception to the attorney-client privilege ora situation that prevents the creation of the formation of the attorney-client privilege, as they allege regarding the “cooperation clauses.” Because we find that both “common interest” theories are unsound, we decline to speculate on this distinction.
“The common interest doctrine subsumes a number of principles that are sometimes characterized as separate rules and at other times conflated into a single axiom.” North River Ins. Co. v. Columbia, Casualty Co., No. 90 CIV 2518, 1995 U.S. Dist. LEXIS 53, at *4 (S.D.N.Y. January 5, 1995); see id. (common interest doctrine considered related to or even identical to “common defense rule,” “community of interest rule” and “joint defense privilege”).
For example, the characterization of a tort as intentional or negligent could determine insurance coverage, or the settlement of a claim could have negative implications for the insured, but not for the insurer.
See, e.g., Remington Arms Co. v. Liberty Mutual Ins. Co., supra, 142 F.R.D. 418 (common interest doctrine not invoked in insurance coverage case); Bituminous Casualty Corp. v. Tonka Corp., 140 F.R.D. 381, 387 (common interest doctrine not applicable when attorney never represented insurer, who sought privileged materials); North River Ins. Co. v. Philadelphia Reinsurance Corp., 797 F. Sup. 363, 367 (D.N.J. 1992) (common interest doctrine “completely unlashed from its moorings” where no dual representation); Rockwell International Corp. v. Aetna Casualty & Surety Co., supra, 26 Cal. App. 4th 1266 (common interest doctrine inapplicable in insurance coverage case); State v. Hydrite Chemical Co., supra, 220 Wis. 2d 76 (rejecting common interest exception to attorney-client privilege); contra Waste Management, Inc. v. International Surplus Lines Ins. Co., 144 Ill. 2d 178, 193-95, 579 N.E.2d 322 (1991) (in insurance coverage disputes, common interest doctrine aHows discovery of documents otherwise covered by attorney-client privilege).
The defendants claim specifically that the plaintiff revealed documents to Travelers in categories five and six of the logged documents at issue. See footnote 5 of this opinion for a description of those categories.
We note that the present relationship between the plaintiff and Travelers is the precise situation to which the aforementioned cooperation clauses apply.
We recognize that some of the documents within the seven categories listed in footnote 5 of this opinion, withheld by the plaintiff based upon an assertion of the attorney-client privilege, may be discoverable under theories different than those addressed in this opinion. On remand, the trial court may consider those theories to the extent that they are raised. Likewise, the trial court, to the extent raised by the plaintiff, may consider that certain items in the seven categories are not discoverable because of the work product doctrine or otherwise. See footnote 17 of this opinion.
