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COA reverses motion allowing for release of documents

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The Indiana Court of Appeals today reversed an order from Lake Superior Court that granted a motion to compel the production of documents from the appellant-defendant Allstate Insurance Company. The trial court found that by raising an advice of counsel defense, the insurance company had waived the attorney-client privilege, and therefore the documents could be produced.

In Allstate Insurance Company v. Timothy Clancy, et al., No. 45A03-0910-CV-498, regarding a May 27, 2002, accident between a truck and a motorcycle, an attorney for Allstate had offered a $100,000 policy-limit settlement to Dianna Goad, who was hit by driver Tim Clancy, who was insured by Allstate.

She refused the settlement because her husband, who was driving a separate motorcycle and witnessed the accident and resulting injury, was not also offered a $100,000 policy-limit settlement for his emotional distress claim.

At trial in 2005, a jury found that the Goads should receive $11 million - $10 million for Dianna’s personal injury claim and $1 million for her husband’s emotional distress claim. The Indiana Court of Appeals affirmed that decision in 2006.

“Following the jury verdict, Clancy assigned his claims against Allstate to the Goads who, on May 30, 2007, filed a complaint alleging, among other things, that Allstate’s decision not to offer a $100,000 policy limit to Mr. Goad in addition to $100,000 for Mrs. Goad was made in bad faith. In its answer, Allstate stated the following affirmative defense: [t]he emotional distress claim(s) of Robert Goad in cause No. 45D11-0209-CT-200 and whether insurance coverage existed for such claims is fairly debatable. Appellant’s App. at 76,” Judge James S. Kirsch wrote in today’s opinion.

During discovery, Allstate withheld 44 pages of communication between the company and the attorney who was hired to seek declaratory relief in District Court regarding the meaning of the per-person limit language contained in the policy held by Clancy.

Because Allstate counsel said the emotional distress claim was “fairly debatable,” which Allstate used in its affirmative defense, the Goads claimed Allstate therefore waived its attorney-client privilege. The trial court agreed, but the Court of Appeals disagreed.

“We hold that the ‘fairly debatable’ defense, absent any other connection to reliance upon advice of counsel, is tantamount to a good faith defense and insufficient in and of itself to waive attorney-client privilege. Accordingly, we reverse the trial court’s order compelling discovery of the challenged documents,” Judge Kirsch wrote.

However, Judge Margret G. Robb wrote in her dissent that “when an insurer asserts that a claim is ‘fairly debatable’ refers to a legal issue, it necessarily relies on advice of counsel and waives the attorney-client privilege.”

“… Insurers might more clearly indicate when they have relied on an attorney’s legal conclusion to deny coverage – and therefore put an attorney’s advice at issue to waive the attorney-client privilege – and alternatively when they have not relied on the advice of counsel but determined that the facts of a particular case led to denial of coverage. In future cases this application of the law might clarify the substantive issues in dispute and when the attorney-client privilege is waived,” she added.
 

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  1. On a related note, I offered the ICLU my cases against the BLE repeatedly, and sought their amici aid repeatedly as well. Crickets. Usually not even a response. I am guessing they do not do allegations of anti-Christian bias? No matter how glaring? I have posted on other links the amicus brief that did get filed (search this ezine, e.g., Kansas attorney), read the Thomas More Society brief to note what the ACLU ran from like vampires from garlic. An Examiner pledged to advance diversity and inclusion came right out on the record and demanded that I choose Man's law or God's law. I wonder, had I been asked to swear off Allah ... what result then, ICLU? Had I been found of bad character and fitness for advocating sexual deviance, what result then ICLU? Had I been lifetime banned for posting left of center statements denigrating the US Constitution, what result ICLU? Hey, we all know don't we? Rather Biased.

  2. It was mentioned in the article that there have been numerous CLE events to train attorneys on e-filing. I would like someone to provide a list of those events, because I have not seen any such events in east central Indiana, and since Hamilton County is one of the counties where e-filing is mandatory, one would expect some instruction in this area. Come on, people, give some instruction, not just applause!

  3. This law is troubling in two respects: First, why wasn't the law reviewed "with the intention of getting all the facts surrounding the legislation and its actual impact on the marketplace" BEFORE it was passed and signed? Seems a bit backwards to me (even acknowledging that this is the Indiana state legislature we're talking about. Second, what is it with the laws in this state that seem to create artificial monopolies in various industries? Besides this one, the other law that comes to mind is the legislation that governed the granting of licenses to firms that wanted to set up craft distilleries. The licensing was limited to only those entities that were already in the craft beer brewing business. Republicans in this state talk a big game when it comes to being "business friendly". They're friendly alright . . . to certain businesses.

  4. Gretchen, Asia, Roberto, Tonia, Shannon, Cheri, Nicholas, Sondra, Carey, Laura ... my heart breaks for you, reaching out in a forum in which you are ignored by a professional suffering through both compassion fatigue and the love of filthy lucre. Most if not all of you seek a warm blooded Hoosier attorney unafraid to take on the government and plead that government officials have acted unconstitutionally to try to save a family and/or rescue children in need and/or press individual rights against the Leviathan state. I know an attorney from Kansas who has taken such cases across the country, arguing before half of the federal courts of appeal and presenting cases to the US S.Ct. numerous times seeking cert. Unfortunately, due to his zeal for the constitutional rights of peasants and willingness to confront powerful government bureaucrats seemingly violating the same ... he was denied character and fitness certification to join the Indiana bar, even after he was cleared to sit for, and passed, both the bar exam and ethics exam. And was even admitted to the Indiana federal bar! NOW KNOW THIS .... you will face headwinds and difficulties in locating a zealously motivated Hoosier attorney to face off against powerful government agents who violate the constitution, for those who do so tend to end up as marginalized as Paul Odgen, who was driven from the profession. So beware, many are mere expensive lapdogs, the kind of breed who will gladly take a large retainer, but then fail to press against the status quo and powers that be when told to heel to. It is a common belief among some in Indiana that those attorneys who truly fight the power and rigorously confront corruption often end up, actually or metaphorically, in real life or at least as to their careers, as dead as the late, great Gary Welch. All of that said, I wish you the very best in finding a Hoosier attorney with a fighting spirit to press your rights as far as you can, for you do have rights against government actors, no matter what said actors may tell you otherwise. Attorneys outside the elitist camp are often better fighters that those owing the powers that be for their salaries, corner offices and end of year bonuses. So do not be afraid to retain a green horn or unconnected lawyer, many of them are fine men and woman who are yet untainted by the "unique" Hoosier system.

  5. I am not the John below. He is a journalist and talk show host who knows me through my years working in Kansas government. I did no ask John to post the note below ...

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