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Catholic Mutual Relief Society v. Superior Court of the County of Los Angeles4/25/2005
ter, as well as of the existence, description, nature, custody, condition, and location of any document, tangible thing, or land or other property."
Evidence of a defendant's liability insurance is not admissible at trial. (Evid. Code, § 1155.) Nor does it relate to a party's claims or defenses at trial. (Laddon v. Superior Court (1959) 167 Cal.App.2d 391, 396 (Laddon).) Even so, section 2017(b) allows for limited discovery of such information. Under that section, the plaintiff is entitled to discover the "existence and contents of any agreement under which any insurance carrier may be liable to satisfy in whole or in part a judgment that may be entered in the action or to indemnify or reimburse for payments made to satisfy the judgment. This discovery may include the identity of the carrier and the nature and limits of the coverage. A party may also obtain discovery as to whether that insurance carrier is disputing the agreement's coverage of the claim involved in the action, but not as to the nature and substance of that dispute. . . ." (§ 2017(b).)
Plaintiffs seek several categories of documents all related to one topic: the financial condition of petitioners, which plaintiffs contend is discoverable under section 2017(b). Petitioners point out that section 2017(b) is restricted to the existence and contents of a defendant's insurance policy. They also note that although a defendant's financial condition may be discoverable in a case where punitive damages are sought, (Civ. Code, § 3295, subd. (c)), with the exception of the existence and contents of the defendant's liability insurance policy, it is not otherwise discoverable even though it might arguably encourage settlement. (Doak v. Superior Court (1968) 257 Cal.App.2d 825, 831-834 (Doak) [assuming that the information was relevant to the subject matter of the dispute, but impermissibly invaded the defendant's privacy rights in his confidential financial information].) They argue that more care must be taken to protect the rights of nonparties when discovery is sought by the parties to an action, especially when financial information is involved. (Schnabel v. Superior Court (1993) 5 Cal.4th 704, 711-713; Monarch Healthcare v. Superior Court (2000) 78 Cal.App.4th 1282, 1290.) Because petitioners are not parties to this action, they contend there is neither statutory nor decisional authority for the type of discovery proposed by plaintiffs.
As noted, plaintiffs tried to obtain different types of information, such as reserves, reinsurance agreements, available funds, the number of sex abuse claims made, and defense costs incurred for other sex abuse claims. While the parties devote a fair portion of their briefs to these discrete categories-most notably to reserves and reinsurance information-taken individually or collectively, each category's discoverability is based on the same underlying premise: that under section 2017(b), a personal injury plaintiff is entitled to discover the assets and financial health of the defendant's insurer in order to determine whether the insurer will be able to meet its coverage obligations and therefore conclude a settlement. Instead of discussing each separate category of information, we will address this overarching theme of plaintiffs' subpoenas.
Section 2017(b) states only that a plaintiff may discover "the existence and contents" of an insurance policy. Nothing in this language even remotely suggests that it was intended to authorize discovery by an injured plaintiff into the financial health of the defendant's insurer. Plaintiffs attempt to augment this plain language by reaching back to cases that predate section 2017(b).
Section 2017(b) was enacted as part of th
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