Procedural Posture

Procedural Posture

Petitioner insured sued real-party-in-interest title insurer for bad faith relating to undisclosed exceptions. The insurer admitted bad faith, but issues remained as to damages. Respondent, the Superior Court of San Diego County (California), accepted a referee’s recommendation that the attorney-client privilege applied and therefore denied motions to compel deposition testimony and to produce documents. The insured sought a writ of mandate.

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Overview

Insurer asserted that insured was not entitled to its confidential communications with in-house claims adjusters, who were also attorneys. Court concluded that trial court erred in failing to review each deposition question and document. That review was necessary to determine which materials constituted factual investigation, which was subject to discovery, versus privileged attorney-client communications or protected work product. Only those communications reflecting the requesting of, or rendering of, legal advice were protected by the attorney-client privilege, and only the attorney’s legal impressions, conclusions, opinions, or legal research or theories were subject to the attorney work product privilege. To the extent that insurer defended the punitive damages claim based on the investigators’ state of mind, the privileges may have been waived. The court observed that the claims adjuster primarily responsible for the claim was engaged in work that could be done by an individual not licensed to practice law. A brief review of materials at issue demonstrated that at least some information concerned factual claims investigation, not legal advice.

Outcome

The court ordered that a peremptory writ of mandate issue directing the superior court to vacate its order denying the motion to compel a response to deposition questions and production of documents. The court directed that the trial court conduct a particularized review of the deposition questions and documents at issue to determine which were protected by privilege. Petitioner was to recover its costs on the writ proceeding.