Federal Judge Orders Deposition of Attorney in Insurance Bad Faith Case

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The Plaintiff’s filed suit against the insurer and through the course of discovery were forced to ask the court to use its judicial powers to order the deposition of the lawyer that was assigned to investigate the association’s property damage and who drafted the insurer’s letter denying coverage.

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The attorney in question objected to the plaintiff’s notice of deposition on the grounds of privilege and work-product doctrine.

Plaintiff’s Motion to Compel

The association argued, that the attorney was a central witness in the mishandling of the claim, and subsequent litigation to determine whether the insurer’s denial was in “bad faith.”

The Court’s Rational for Its Ruling

In his order, Judge Robart noted that under Cedell v. Farmers Insurance Co. Of Washington, 176 Wn.2d 686, 295 P.3d 239 (2013), an attorney handling the insurance claim adjustment process is assisting the insurer in carrying out its quasi-fiduciary responsibility to fairly consider claims submitted by its insureds.

In the Cedell case, the Washington Supreme Court found that there is ordinarily no attorney-client privilege between the insured and the carrier in the claims adjustment process. Therefore, the insured is generally entitled to the carrier’s claim file and related discovery, which would include materials, that in other settings, may fall within the scope of privilege or work product protection.