State v. Bloom

• Decision Date: 10 April 2014
• Docket Number: No. 13–1172.,13–1172.
• Citation: 233 W.Va. 258,757 S.E.2d 788
• Parties: STATE of West Virginia ex rel. MONTPELIER U.S. INSURANCE COMPANY and Charlston, Revich & Wollitz LLP, Petitioners v. Honorable Louis H. BLOOM, Judge of the Circuit Court of Kanawha County, West Virginia; James M. Buckland; B & B Transit, Inc.; B & D Salvage, Inc.; and Tim's Salvage, Inc., Respondents.
• Court: West Virginia Supreme Court

233 W.Va. 258

757 S.E.2d 788

STATE of West Virginia ex rel. MONTPELIER U.S. INSURANCE COMPANY and Charlston, Revich & Wollitz LLP, Petitioners

v.Honorable Louis H. BLOOM, Judge of the Circuit Court of Kanawha County, West Virginia; James M. Buckland; B & B Transit, Inc.; B & D Salvage, Inc.; and Tim's Salvage, Inc., Respondents.

No. 13–1172.

Supreme Court of Appeals of

West Virginia.

Submitted March 5, 2014.

Decided April 10, 2014.

Syllabus by the Court

1. “In order to assert an attorney-client privilege, three main elements must be present: (1) both parties must contemplate that the attorney-client relationship does or will exist; (2) the advice must be sought by the client from the attorney in his capacity as a legal advisor; (3) the communication between the attorney and client must be intended to be confidential.” Syllabus point 2, State v. Burton, 163 W.Va. 40, 254 S.E.2d 129 (1979).

2. “The burden of establishing the attorney-client privilege or the work product exception, in all their elements, always rests upon the person asserting it.” Syllabus point. 4, State ex rel. U.S. Fidelity and Guaranty Co. v. Canady, 194 W.Va. 431, 460 S.E.2d 677 (1995).

3. “To determine whether a document was prepared in anticipation of litigation and, is therefore, protected from disclosure under the work product doctrine, the primary motivating purpose behind the creation of the document must have been to assist in pending or probable future litigation.” Syllabus point 7, State ex rel. United Hospital Center, Inc. v. Bedell, 199 W.Va. 316, 484 S.E.2d 199 (1997).

4. “Rule 26(b)(3) of the West Virginia Rules of Civil Procedure makes a distinction between factual and opinion work product with regard to the level of necessity that has to be shown to obtain their discovery.” Syllabus point 7, In re Markle, 174 W.Va. 550, 328 S.E.2d 157 (1984).

5. “The question of the relevancy of the information sought through discovery essentially involves a determination of how substantively the information requested bears on the issues to be tried. However, under Rule 26(b)(1) of the West Virginia Rules of Civil Procedure, discovery is not limited only to admissible evidence, but applies to information reasonably calculated to lead to the discovery of admissible evidence.” Syllabus point 4, State Farm Mutual Automobile Insurance Co. v. Stephens, 188 W.Va. 622, 425 S.E.2d 577 (1992).

Lee Murray Hall, Sarah A. Walling, Jason D. Bowles, Jenkins Fenstermaker, PLLC, Huntington, WV, Attorneys for Petitioner, Montpelier Insurance Company.

Ancil G. Ramey, Charles F. Johns, Mark Jeffries, Steptoe & Johnson PLLC, Bridgeport, WV, Attorneys for Petitioner, Charlston, Revich & Wollitz.

Guy R. Bucci, Bucci, Bailey & Javins, L.C, Charleston, WV, F. Alfred Sines, Jr., Victoria L. Casey, Charleston, WV, Attorneys for Respondents, James M. Buckland, B & B Transit, Inc., B & D Salvage, Inc., and Tim's Salvage, Inc.

PER CURIAM:

This case was brought under the original jurisdiction of this Court by Montpelier U.S. Insurance Company and Charlston, Revich & Wollitz LLP (collectively “Petitioners”), seeking a writ of prohibition to prevent enforcement of a discovery order of the Circuit Court of Kanawha County. ¹ The circuit court's order required the Petitioners to disclose allegedly privileged documents to the plaintiffs below: James M. Buckland's B & B Transit, Inc.; B & D Salvage, Inc.; and Tim's Salvage, Inc. (collectively “Respondents”).² In this proceeding, the Petitioners contend that the documents in question are protected by the attorney-client privilege and the work product doctrine, and that they were not relevant to any issue in the case. Upon consideration of the parties' briefs and argument, the submitted appendix, and the pertinent authorities, the writ of prohibition is hereby granted as moulded.

I.FACTUAL AND PROCEDURAL HISTORY

This case has its origins in an action for property damage brought by Jason and Gina Corrick (the “Corricks”) against B & B Transit.³ The Corricks filed their lawsuit in Logan County in January 2012, alleging that B & B Transit “negligently and unlawfully caused a landslide” that damaged their home. B & B Transit filed a notice and coverage claim with its insurer, Montpelier U.S. Insurance Company (“Montpelier”). In February 2012, Montpelier's national coverage counsel, Charlston, Revich & Wollitz (“CRW”), notified B & B Transit that the policy it purchased from Montpelier did not provide coverage for the Corricks' claims. Specifically, CRW informed B & B Transit that the policy had a subsidence exclusion that did not cover property damage “arising out of or aggravated by the subsidence of land as a result of landslide.” In January 2013, the Corricks amended their complaint by taking out the language which alleged the damage was caused by a “landslide.” After the complaint was amended, Montpelier retained counsel for B & B Transit and provided a defense. Montpelier settled the case against B & B Transit in October 2013.

In November 2012, while the Corricks' original complaint was still pending, the Respondents filed a first-party bad faith claim ⁴ against the Petitioners.⁵ In February 2013, the Respondents filed an amended complaint.⁶ While the case was pending, the Respondents served discovery requests on the Petitioners.⁷ CRW opposed disclosure of certain requested documents based upon the attorney-client privilege, work product doctrine, and relevancy. The Respondents filed a motion to compel disclosure of the documents. The circuit court referred the matter to a discovery commissioner.

The discovery commissioner reviewed, in camera, the documents objected to by CRW and held a hearing on the matter. The discovery commissioner subsequently issued a recommended decision that required CRW to disclose (1) copies of any agreement or contract with Montpelier, including billing statements; ⁸ (2) copies of any commercial liability coverage opinion letters provided to Montpelier prior to the claim by the Corricks; ⁹ (3) copies of any coverage opinion letters provided to Montpelier finding coverage for an alleged claim; ¹⁰ and (4) copies of any seminar or training materials prepared for any insurer or industry group related to coverage interpretation or extra-contractual liability.¹¹ The Petitioners filed objections to the discovery commissioner's recommendation.¹² On November 12, 2013, the circuit court entered an order adopting the discovery commissioner's recommendation. The Petitioners thereafter filed the instant petition for a writ of prohibition.¹³

II.STANDARD OF REVIEW

In this proceeding, we are asked to review a discovery order by the circuit court that adopted recommendations of a discovery commissioner. We have established that “[a] writ of prohibition is available to correct a clear legal error resulting from a trial court's substantial abuse of its discretion in regard to discovery orders.” Syl. pt. 1, State Farm Mut. Auto. Ins. Co. v. Stephens, 188 W.Va. 622, 425 S.E.2d 577 (1992). Insofar as it is an extraordinary remedy, “[p]rohibition lies only to restrain inferior courts from proceeding in causes over which they have no jurisdiction, or, in which, having jurisdiction, they are exceeding their legitimate powers and may not be used as a substitute for writ of error, appeal or certiorari.” Syl. pt. 1, Crawford v. Taylor, 138 W.Va. 207, 75 S.E.2d 370 (1953). In cases where a trial court is alleged to have exceeded its authority, we apply the following standard of review:

In determining whether to entertain and issue the writ of prohibition for cases not involving an absence of jurisdiction but only where it is claimed that the lower tribunal exceeded its legitimate powers, this Court will examine five factors: (1) whether the party seeking the writ has no other adequate means, such as direct appeal, to obtain the desired relief; (2) whether the petitioner will be damaged or prejudiced in a way that is not correctable on appeal; (3) whether the lower tribunal's order is clearly erroneous as a matter of law; (4) whether the lower tribunal's order is an oft repeated error or manifests persistent disregard for either procedural or substantive law; and (5) whether the lower tribunal's order raises new and important problems or issues of law of first impression. These factors are general guidelines that serve as a useful starting point for determining whether a discretionary writ of prohibition should issue. Although all five factors need not be satisfied, it is clear that the third factor, the existence of clear error as a matter of law, should be given substantial weight.

Syl. pt. 4, State ex rel. Hoover v. Berger, 199 W.Va. 12, 483 S.E.2d 12 (1996). With the foregoing standards as our foundation, we now consider the merits of the Petitioners' request for a writ of prohibition.

III.DISCUSSION

The Petitioners have set out their arguments in three parts: (1) attorney-client privilege applied to three types of documents, (2) work product doctrine applied to all the documents, and (3) relevancy of the documents. We will examine the issues separately.¹⁴

A. Application of the Attorney–Client Privilege

The Petitioners argue that the attorney-client privilege prevented disclosure of (1) copies of any commercial liability coverage opinion letter provided to Montpelier prior to the claim by the Corricks; (2) copies of coverage opinion letters provided to Montpelier finding coverage for an alleged claim; and (3) copies of any seminar or training materials prepared for any insurer or industry group related to coverage interpretation or extra-contractual liability. We will examine the first two issues together and the third issue separately. However, before doing so, we will set out some general principles that will guide our analysis.

“Confidential communications made by a client or an attorney to one another are protected by the attorney-client privilege.” Franklin D. Cleckley, Robin J. Davis, & Louis J. Palmer, Jr., ...