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For years, the plaintiff’s bar has taken the position that there is no “claims file privilege.” This mantra is repeated without any explanation regarding why this phrase is somehow sufficient to compel production of documents held within an underwriting or claims file. The plaintiff’s bar cites to Homeowners Choice Property and Casualty Insurance Company v. Avila, 248 So. 3d 180 (Fla. 3d DCA 2018). In Avila, the Third District did explain that there is no such privilege that can be characterized as a “claims file privilege.”[1] This writer agrees that there is no such privilege characterized as a “claims file privilege.” With that said, the Third District in Avila, nevertheless, quashed the trial court’s order compelling production of documents that were contained in the underwriting and claims file, even after the trial court had conducted an individualized in-camera inspection of the disputed documents.
If there is no “claims file privilege,” then on what basis did the Third District quash the trial court’s order? The answer is Florida Rule of Civil Procedure 1.280(b).
Most recently, the Third District decided Avatar Prop. & Cas. Ins. Co. v. Mitchell, 314 So. 3d 640 (Fla. 3d DCA 2021). In Mitchell, like in Avila, the trial court ordered production of a “report” and “unredacted photos” after conducting an in-camera inspection of the disputed documents. Mitchell, like in Avila, reversed the trial court finding that the “report” and “unredacted photos” from the Avatar claims file were indeed protected “work product.” The characterization of these documents as protected “work product” is the result of Mitchell’s conclusion that the protection afforded these documents arises from Rule 1.280(b).
In Mitchell, the Third District held:[2]
Mitchell explained: “The work product doctrine is a creation of the common law, first identified by the United States Supreme Court [citation omitted] and adopted by the Florida Supreme Court [citation omitted].” See Mitchell 314 So. 3d at 642. “[O]ur highest court held that work-product is immune from discovery disclosure.” Id. “In Florida, the work-product privilege is codified within the Florida Rules of Civil Procedure.” Id. Accordingly, any document that receives protection under Rule 1.280(b) is considered “work product.”
Florida Rule of Civil Procedure 1.280(b)(1) reads in relevant part:
Subsection (b)(4) reads in relevant part:
The threshold inquiry under Rule 1.280(b)(1) is whether the document in dispute is “relevant.” “[T]he baseline test for discovery is always relevance to the disputed issues of the underlying action.” See Mitchell at 643. In determining whether discovery is relevant, “. . . the issue turns on what type of action . . . [the Plaintiff] has brought.” See Nationwide Insurance Company of Florida v. Demmo, 57 So. 3d 982, 984 (Fla. 2d DCA 2011) cited favorably by Homeowners Choice Property and Casualty Insurance Company v. Avila, 248 So. 3d 180, 183 (Fla. 3d DCA 2018)(“This court has followed and cited approvingly to Demmo on several occasions.”) and favorably by Castle Key Ins. Co. v. Benetiz, 124 So. 3d 379, 380 (Fla. 3d DCA 2013)(“In considering objections to discovery requests for claims file materials, the ‘determinative issue’ is ‘what type of action’ the insured has brought.”)
If the subject matter of the pending action is a breach of contract, then the documents contained in the underwriting and claims file are deemed “irrelevant.” See Avila, 248 So. 3d 180 (Fla. 3d DCA 2018) citing favorably to Demmo, 57 So. 3d 982, 983 (Fla. 2d DCA 2011)(“Where, as here, the insured is not pursuing a bad-faith claim, but rather seeks relief for breach of contract, [a] trial court departs from the essential requirements of the law in compelling disclosure of the contents of an insurer’s claim file when the issue of coverage is in dispute and has not been resolved.”). See also Castle Key, 124 So. 3d 379, 380 (Fla. 3d DCA 2013)(“Because the trial court order at issue directed the production of Castle Key’s ‘claims file’ when the issue of coverage was still in dispute, the order departs from the essential requirements of the law.”)
Mitchell relied on the plain wording of Rule 1.280(b)(1) and (b)(4) to conclude that documents contained in the underwriting and claims file are deemed “irrelevant,” so long the pending lawsuit is a first party property breach of contract action and coverage is in dispute. Because the documents are deemed “irrelevant,” the inquiry ends there. The documents are protected against discovery under Rule 1.280(b).
Consistent with the foregoing, when the lawsuit is based on bad faith, then the documents in the underwriting and claims file would be deemed “relevant” to the subject matter of the pending action. If the documents are deemed “relevant,” then the trial court can move to the next issue under Rule 1.280(b)(4) regarding whether the documents at issue were “prepared in anticipation of litigation.”[3] It is at this point that an in camera inspection would be appropriate.[4] If the documents meet this “prepared in anticipation of litigation” test, then the trial court can determine if the movant can meet the “necessity” test (i.e. the movant has a need of the material and is unable without undue hardship to obtain the equivalent materials from another source.)
Finally, the Fifth District decided Avatar Property & Casualty Ins. Co. v. Simmons, 298 So. 3d 1253 (Fla. 5th DCA 2020). In Simmons, the Fifth District affirmed the trial court’s decision to compel production of documents from the underwriting and claims file. Simmons was based on the failure of the insurance carrier to “explain” the basis for its objection of “work product.” Simmons writes:
Simmons cites favorably to Avila for the proposition that there is no such privilege characterized as a “claims file privilege.” Again, this writer agrees that there is no such privilege. With that said, what is clear from Mitchell, and the plethora of legal authority cited therein, is that the privilege against discovery which shields the documents contained in the underwriting and claims file arises out of Rule 1.280(b). This is not a claim file privilege. This is a work product privilege arising out of Rule 1.280(b). Accordingly, any documents that receive protection under Rule 1.280(b) are considered protected “work product.” This writer has coined the phrase “Relevance Work Product Privilege under Rule 1.280(b),” until such time that the Third District or other appellate Court attributes a name to this privilege.
This writer submits that if the Fifth District had been offered the legal analysis set forth above, or some facsimile thereof, the Fifth District may have quashed the trial court’s discovery order. With that said, Mitchell and its progeny remain the controlling case law for the Second, Third and Fourth Districts.
[1] “We do observe, however, that counsel for both parties in this case referred to a ‘claims file privilege’ during the hearing on . . . [the] motion for protective order. There is no such privilege by that designation in the cited cases or Florida Rules of Procedure or Evidence Code. Thus, a specifically articulated document request . . . may require either (a) production . . ., or (b) disclosure on a privilege log with a specifically-articulated bases for protection from discovery, even if those [documents] have been filed with other non-discoverable, claim-related documents in the insurer’s claims file and coverage remains in dispute.” Avila, at 184-185.
[2] In Mitchell, the Third District cites to the following cases in support of its decision to quash the trial Court’s order compelling discovery. See Scottsdale Ins. Co. v. Camara De Comercio Latino-Americana De Los E.U., 813 So. 2d 250 (Fla. 3d DCA 2002)(“When the issue of insurance coverage is unresolved and at issue in pending court proceedings, a trial court must not order an insurer to produce its claim files and other work product documents.”); General Star Indem. Co. v. Atl. Hospitality of Fla. LLC, 93 So. 3d 501 (Fla. 3d DCA 2012)(“Accordingly, we grant the petition, holding that the trial court’s order is a departure from the essential requirements of law causing irreparable harm for which there is no remedy on appeal.”); Owners Ins. Co. v. Armour, 303 So. 3d 263 (Fla. 2d DCA 2020) citing favorably to State Farm Fla. Ins. Co. Gallmon, 835 So. 2d 389, 390 (Fla. 2d DCA 2003)(“ . . . circuit court issued a wide ranging order . . . to produce its claim files, . . . [and] underwriting files, . . . . . . We quash the order in its entirety. These materials are either irrelevant to the first-party dispute that this case presents or are privileged work product.”); Homeowners Choice Prop. & Cas. Ins. Co. v. Mahady, 284 So. 3d 582, 583 (Fla. 4th DCA 2019)(“Because the issues of the Insurer’s liability for coverage and the amount of the policy’s owner’s damages have not been finally determined, the discovery order in the instant case is a departure from the essential requirements of the law which will result in irreparable harm. We therefore grant the petition and quash the trial court’s order allowing discovery of the claim files and underwriting file at this time.”); and III. Nat’l Ins. Co. v. Bolen, 997 So. 2d 1194 (Fla. 5th DCA 2009)(“It is well established that an insurer’s claim file constitutes work-product and is not subject to discovery until the insurer’s obligation to provide coverage and benefits is determined.”).
[3] “In this context, the phrase ‘in anticipation of litigation’ has been broadly construed to encompass those ‘investigative material if such materials were compiled in response to some event which foreseeably could be made the basis of a claim.” See Mitchell, 314 So. 3d 640, 642 (Fla. 3d DCA 2021).
[4] Avila recognized this limitation in addressing the “necessity/good cause exception to the work product doctrine as provided by Florida Rule of Civil Procedure 1.280(b).” See Avila, 248 So. 3d 180, 185 (Fla. 3d DCA 2018).
