Scott v. Peterson

• Decision Date: 22 November 2005
• Docket Number: No. 101,869.,101,869.
• Citation: 2005 OK 84,126 P.3d 1232
• Parties: Martin SCOTT and Cynthia Scott, Petitioners, v. The Honorable David L. PETERSON, Judge of the District Court of Tulsa County, Fourteenth Judicial District, State of Oklahoma, Respondent.
• Court: Oklahoma Supreme Court

Page 1232

126 P.3d 1232

2005 OK 84

Martin SCOTT and Cynthia Scott, Petitioners, v. The Honorable David L. PETERSON, Judge of the District Court of Tulsa County, Fourteenth Judicial District, State of Oklahoma, Respondent.

No. 101,869.

Supreme Court of Oklahoma.

November 22, 2005.

Application for Extraordinary Relief.

¶ 0 Homeowners brought an action against their roofer for damage to their home. Homeowners sought discovery of the claims file of the roofer's liability insurer, and they filed a motion to compel production of the file. The roofer and insurer objected to discovery

and sought a protective order. The Honorable David L. Peterson, District Judge for the District Court of Tulsa County, denied the homeowners' motion to compel production of the file and granted the insurer's and roofer's motion for a protective order. Homeowners sought an extraordinary writ from this Court.

ORIGINAL JURISDICTION ASSUMED AND WRIT OF PROHIBITION GRANTED WITH INSTRUCTIONS.

Matthew B. Free, Angela L. Smoot, Best & Sharp, Tulsa, OK, for Petitioners.

Gregory D. Nellis, Marthanda J. Beckworth, Galen Brittingham, Atkinson, Haskins, Nellis, Brittingham, Gladd & Carwile, Tulsa, OK, for Real Party in Interest.

EDMONDSON, J.

¶ 1 One party to this discovery dispute claims that an insurer's claim file is discoverable by a third party and the other party claims a privilege and exemption from discovery. We assume original jurisdiction. We explain that the party objecting to discovery did not satisfy its burden to show a privilege or exemption from discovery, and upon that party's failure to present facts sufficient to adjudicate the privilege and exemption, the District Court was required to order that party to file a privilege log and the documents under seal. We direct the District Court to vacate its orders denying production of the claims file, and we direct that court to require the party to file a privilege log and the documents under seal before adjudicating the claimed privilege and exemption from discovery.

¶ 2 The Scotts contracted with Perfection Roofing, Inc., (Perfection) to replace the roof on their home. Their home suffered water damage during the roofing process, and in 2001 Perfection notified its liability insurer National American Insurance Company (NAICO) of the damage. In 2003 the Scotts filed an action in the District Court of Tulsa County against Perfection for alleged negligence in protecting the residence from damage during the roofing process. The Scotts served a subpoena duces tecum on NAICO to obtain the file maintained by NAICO on Perfection's 2001 claim for payment to the Scotts.

¶ 3 Perfection and NAICO sought a protective order and argued that the NAICO file was prepared in anticipation of litigation or for trial, and that the Scotts were required to show that they had a substantial need for the file and that they were otherwise unable to obtain the information without undue hardship.¹ Perfection also argued that NAICO's status as an indemnitor made the claims file not discoverable until the Scotts performed the § 3226(B)(2) showing.

¶ 4 Perfection also used the fact that the Scotts were non-parties to the insurance contract between NAICO and Perfection. The essence of its work-product argument was that when a stranger to an insurance contract seeks the insurer's claim file all the information therein necessarily changes from ordinary-course-of-business information (usually discoverable) to prepared-in-anticipation-of-litigation information (discoverable upon a required showing by the party seeking discovery).² Perfection also argued that the file was not discoverable because of the nature of the relationship between Perfection and NAICO. Specifically, it is asserted that NAICO's status as Perfection's liability insurance carrier, requiring it to provide Perfection with a defense in the event that Perfection was sued, made the information not discoverable.

¶ 5 The Scotts filed an objection to the motion for a protective order and argued that the initial procedural burden is upon the person resisting discovery to show that the information or items sought are protected from discovery. The Scotts argued that Perfection must provide some evidentiary support for its argument that the claims file, or matters contained therein, are privileged, and that Perfection had failed to satisfy this burden. The Scotts also filed a motion to compel Perfection/NAICO to produce the claims file. The District Court denied the Scotts' motion to compel and granted Perfection/NAICO's motion for a protective order. The Scotts sought an extraordinary writ from this Court to direct the District Court to require production of the claims file.

¶ 6 Parties may obtain discovery of any matter not privileged, which is relevant to the subject matter involved in a pending action, whether it relates to a claim or defense of the party seeking discovery. 12 O.S.2001 § 3226(A). The Scotts seek discovery of the claims file of non-party NAICO. Perfection claims that the entire claims file is privileged because NAICO is its liability insurer with a duty to defend Perfection. This is a claim of attorney-client privilege. See, e.g., Annot. "Insured-Insurer Communications as Privileged," 55 A.L.R.4th 336, 1987 WL 419548 (1987), 3 Leo H. Whinery, Oklahoma Evidence, Commentary on the Law of Evidence, 54-59, §§ 36.05-36.07 (2nd ed.2000).

¶ 7 Generally, the mere status of an attorney-client relationship does not make every communication between attorney and client protected by the privilege. See, e.g., Hurt v. State, 1956 OK CR 88, 303 P.2d 476, 481 (when only a part of a communication between attorney and client is privileged and if the privileged and unprivileged parts may be safely separated, then the privileged matter only will be excluded). Assuming, but not deciding, that the Perfection-NAICO relationship is an attorney-client relationship for certain purposes, Perfection's blanket assertion of the privilege for the entire claims file is not supported by either facts or authority showing that the communications in the file are of such nature that all would qualify as privileged pursuant to 12 O.S.Supp.2002 § 2502.³ Consequently, Perfection must show that particular documents in the claims file are privileged, and this it did not do.

¶ 8 Perfection claimed exemption from discovery invoking the work product doctrine. This claim requires distinguishing between (1) communications and things prepared in anticipation of litigation or for trial by or for another party or by or for the representative of that other party, etc., that may be discoverable and (2) the mental impressions, conclusions, opinions or legal theories of an attorney or other representative of a party concerning the litigation, of which a court shall protect against disclosure. 12 O.S.2001 § 3226(B)(2). Ordinary work product prepared in anticipation of litigation or trial is discoverable if the party seeking the materials makes the required showing, but opinion work product prepared in anticipation of litigation or for trial is not discoverable except in extraordinary circumstances. Ellison v. Gray, 1985 OK 35, 702 P.2d 360, 363; 12 O.S.2001 § 3226(B)(2).

¶ 9 Perfection bears the initial burden of showing that the specific communications in the claims file, either individually, or as a class, are (1) prepared in anticipation of litigation or for trial, etc. or (2) not discoverable as the mental impressions, conclusions, opinions or legal theories of an attorney or other representative of a party concerning the litigation. 12 O.S.2001 § 3226(B)(4).⁴ Accord Hurt v. State, 1956 OK CR 88, 303 P.2d 476, 481 (burden is upon the party asserting the privilege to show the relationship of attorney and client and other facts to bring the evidence within the terms of the statute pertaining to privileged communications).

¶ 10 Perfection did not show by either fact or law, that a claims file, as a particular class of communications, documents, or things, must necessarily contain only items that are prepared in anticipation of litigation or for trial and that this particular claims file is either factually, or as a conclusion of law, a member of that class. Perfection did not show that particular documents were prepared in anticipation of litigation or for trial. Alternatively, Perfection did not show that the entire claims file, by fact or law, contains only the mental impressions, conclusions, opinions or legal theories of an attorney or other representative of a party concerning the litigation.

¶ 11 If Perfection shows that specific material was "prepared in anticipation of litigation or for trial" etc., the Scotts have the opportunity of showing that they have substantial need of the materials in the preparation of their case and that they are unable, without undue hardship, to obtain the substantial equivalent of the materials by other means. 12 O.S.2001 § 3226(B)(2).⁵ Perfection's claim that the Scotts did not make a § 3226(B)(2) showing of "substantial need" is not proper for review in advance of Perfection making its antecedent showing that § 3226(B)(2) applies to any document or class of documents.

¶ 12 This Court does not serve as a pretrial reviewing panel for trial court orders adjudicating discovery matters, and we supervise a trial court's discovery orders only in rare circumstances. Heffron v. District Court Oklahoma County, 2003 OK 75, ¶ 3, 77 P.3d 1069, 1073. This Court may use extraordinary writs when a District Court adjudicating a discovery dispute exceeds its authority or issues an order that is an abuse of discretion. Farmers Ins. Co., Inc. v. Peterson, 2003 OK 99, ¶ 8, 81 P.3d 659, 661; Hall v. Goodwin, 1989 OK 88, 775 P.2d 291, 292. An abuse of discretion occurs when a court bases its decision on an erroneous conclusion of law or where there is no rational basis in evidence for the ruling. Christian v. Gray, 2003 OK 10, ¶¶ 43-44, 65 P.3d 591, 608-609....