 |
 |
to fill out a simple form to connect to Personal Injury Lawyers in your area.
|
|
|
|
|
Twin City Fire Insurance Company v. Burke2/18/2003
ion "that the mere filing of a bad faith action, the denial of bad faith, or the affirmative claim of good faith may be found to constitute an implied waiver of the privilege." Lee, 199 Ariz. at 62 , 13 P.3d at 1179 . We stated that a party does not waive the attorney-client privilege
unless it has asserted some claim or defense, such as the reasonableness of its evaluation of the law, which necessarily includes the information received from counsel. In that situation, the party claiming the privilege has interjected the issue of advice of counsel into the litigation to the extent that recognition of the privilege would deny the opposing party access to proof without which it would be impossible for the factfinder to fairly determine the very issue raised by that party. We believe such a point is reached when, as in the present case, the party asserting the privilege claims its conduct was proper and permitted by law and based in whole or in part on its evaluation of the state of the law. In that situation, the party's knowledge about the law is vital, and the advice of counsel is highly relevant to the legal significance of the client's conduct.
Add to that the fact that the truth cannot be found absent exploration of that issue, and the conditions of RESTATEMENT ยง 80 are met. Id.
In the present case, the determinative questions are quite similar to those in Lee: Would the application of the privilege deny General Star access to information vital to its defense? Would recognizing the privilege make it impossible for the factfinder to fairly determine the very issue raised by General Star? To resolve these questions, we apply the principles established in Lee.
RESOLUTION
Twin City insists that the mental state and conduct of its agents and counsel are not the issue in this bad faith action and that at no point has it interjected its own privileged communications into this suit. It contends the trial judge's order is the result of his misapplication of the principles we articulated in Lee. We agree.
The very nature of this bad faith action militates against a finding that Twin City's mental state or conduct was at issue. An excess insurer's right to bring an action forbad faith refusal to settle is premised on the notion that the "excess insurer should not have to pay a judgment if the primary insurer caused the excess judgment by a bad faith failure to settle within primary limits." Hartford Accident & Indem. Co. v. Aetna Cas. &Sur; Co., 164 Ariz. 286, 291, 792 P.2d 749, 754 (1990). The "excess carrier is subrogated to the rights of the insured and has a cause of action against the primary insurer for bad faith failure to settle within policy limits." Id. To prove a bad faith claim based on the failure to settle, a plaintiff must demonstrate "that in the investigation, evaluation, and processing of the claim, the insurer acted unreasonably and either knew or was conscious of the fact that its conduct was unreasonable." Zilisch i'. State Farm Mut. Auto. Ins. Co., 196 Ariz. 234, 238 22, 995 P.2d 276, 280 22 (2000). An insurer may defend those claims that can be characterized as "fairly debatable," but in doing so, it "must exercise reasonable care and good faith." Id. at 237 19, 995 P.2d at 279
19. An insurer owes its insured " some duties of a fiduciary nature,'including' qual consideration, fairness and honesty." Id. at 20 (quoting Rawlings v. Apodaca, 151 Ariz. 149,155,726 P.2d 565, 571 (1986)).
Thus, until the primary carrier's policy limit is exhausted, the excess carrier's conduct during the course of an underlying action against the insured is generally irrelevant to a determinat
Page 1 2 3 4 5 6 Arizona Personal Injury Attorneys
Personal Injury Lawyers
|
| |
to fill out a simple form to connect to Personal Injury Lawyers in your area.
|
|