The Indiana Court of Appeals affirmed in part, reversed in part and remanded a discovery case after it found that all but one document in dispute were either protected or non-discoverable under the work-product doctrine and attorney client privileges.
During litigation after a settlement stemming from the death of high schooler Phillip Caler after he fell from an Indianapolis Circle Centre Mall escalator in 2009, a discovery dispute arose about whether Zurich American Insurance Company was required to produce documents it exchanged with Schindler Elevator Corporation during the Caler litigation.
In 2016, Circle Centre Mall and Simon Property Group moved to compel the production of any such documents, a motion Zurich and Schindler opposed, claiming that the documents were protected by the work-product doctrine and/or the attorney-client and/or insurer-insured privileges. It also moved for sanctions against Zurich for withholding two groups of documents the trial court had ordered it to produce.
The trial court entered default judgment against Zurich on both counts of the Simon Plaintiffs’ complaint and stayed further proceedings.
On appeal, Zurich and Schindler contended that the documents were covered by the work-product doctrine, attorney-client and/or insurer-insured privileges and were therefore, undiscoverable.
The appellate court determined that because the Group II Documents were covered by the work-product doctrine, the trial court erred in ordering that Zurich disclose them. Similarly, it found that the Group I documents were protected under the attorney-client privilege, with the exception of the ZURPRI 218 document.
In that exclusion, the appellate court found that Zurich failed to establish an abuse of discretion as to ZURPRI 218 when it was found unprotected by the insurer-insured privilege adopted in Richey v. Chappell, 594 N.E.2d 443 (Ind. 1992).
“Because the Simon Plaintiffs are not third-party claimants, the surer-insured privilege as defined by the Richey Court does not apply to ZURPRI 218, even though it was prepared by Zurich (the insurer) for Schindler (an insured),” Senior Judge Ezra Friedlander wrote.
Additionally, the appellate court found because only one document of nine was discoverable, it was “not at all confident that the trial court would have imposed the same harsh sanctions on Zurich based on the improper withholding of one document as it did on what it concluded was the improper withholding of nine.”It therefore vacated the trial court’s imposition of sanctions, declined to award attorney fees to Simon and remanded for further proceedings in Zurich American Insurance Company; Schindler Elevator Corporation; and KONE, Inc. v. Circle Centre Mall, LLC; Simon Property Group, Inc.; and XL Insurance America, Inc., 29A05-1710-PL-2223.