Week of September 24-30

In Venture v. Preferred Mutual Insurance Company, decided on Tuesday, the First Department addressed the extent to which claim files are discoverable where an attorney became involved in an investigation, and the results are contained in the claim file. The dispute arose from a property damage matter involving a fire. The carrier’s attorney conducted some form of investigation. The defendant insurance company argued that its claims file was immune from discovery under the attorney client privilege.

The court held that the case should be remanded for a hearing “in which counsel for plaintiffs and defendant will be permitted to probe the issue of whether Peter Dodge, Esq. served as an investigator, solely as an attorney, or in some type of hybrid role, including examining Dodge under oath, and for the court to make a determination as to Dodge's role,” and the lower court should reconsider plaintiff’s motion to disqualify defense counsel.

The court noted that “reports of insurance investigators or adjusters, prepared during the processing of a claim, are discoverable as made in the regular course of the insurance company's business … Furthermore, attorney work product applies only to documents prepared by counsel acting as such, and to materials uniquely the product of a lawyer's learning and professional skills, such as those reflecting an attorney's legal research, analysis, conclusions, legal theory or strategy … Documents prepared in the ordinary course of an insurance company's investigation to determine whether to accept or reject coverage and to evaluate the extent of a claimant's loss are not privileged and are, therefore, discoverable. In addition, such documents do not become privileged merely because an investigation was conducted by an attorney."

A takeaway from this case might be that claims files are not immune from discovery even if they contain your communications, unless they are strictly legal in character, in which case they should be immune from discovery under the attorney client privilege, but an in camera inspection may occur. Keep in mind that if you investigate a matter, those results may be discoverable and not immune under the attorney client privilege.