Only a Breach of Contract was claimed, not Bad Faith.
In a recent Florida appellate decision, an appellate court exercised certiorari review of a "trial court's order which allows discovery of activity log notes, emails, and photographs contained in the insurer's claim file." State Farm Fla. Ins. Co. v. Aloni, 2012 WL 2913291 *1 (Fla. 4th DCA July 18, 2012), Download State Farm Florida Ins. Co. v. Aloni (Fla. 4th DCA D11-4798.op.pdf, Opinion Filed July 18, 2012) PUBLIC ACCESS.
The trial court's Order was entered in a breach of contract action against a Property Insurance Company. The lawsuit was filed following roof damage claims after Hurricane Wilma, which was reported "years after the hurricane," following which the Insurance Company promptly issued a letter that it would investigate the claim under a Reservation of Rights. State Farm Fla. Ins. Co. v. Aloni, 2012 WL 2913291 *1 (Fla. 4th DCA July 18, 2012).
The parties argued long and hard about when and whether Work Product Immunity and Attorney-Client Privilege should attach to the documents which the Policyholder's representative requested from the Claims File. The Florida appellate court held that this focus was misplaced. The parties should instead focus on the nature of the claim brought against the Property Insurance Company. That alone will determine the outcome, the Florida appellate court held:
However, the determinative issue here is the type of action that the insured's representative has brought -- a breach of contract action, rather than a bad faith claim....
In this case, because the coverage issue is in dispute and has not been resolved, the trial court departed from the essential requirements of law in compelling disclosure of State Farm's claim file materials. Such disclosure would result in irreparable harm that cannot be adequately addressed on appeal. Accordingly, we grant the petition and quash the discovery order.
State Farm Fla. Ins. Co. v. Aloni, 2012 WL 2913291 *3 (Fla. 4th DCA July 18, 2012).
Counsel and their clients should be aware of the rules prevailing in the particular jurisdiction in which their case is pending, of course. For example, a June 22, 2012 post on Nevada Claims and Bad Faith Law blog, here, points out that under Nevada law, an insured may allege a Bad Faith claim against her, his or its insurance company once the insured establishes “legal entitlement” and unreasonable conduct by the insurer concerning its obligations to the insureds. The post points out that what constitutes "legal entitlement" is being defined as Nevada case law develops the definition in each case. However, discovery often proceeds simultaneously on Bad Faith claims and on Breach of Contract claims in Nevada: "Not only is the [insurance] company forced to litigate the value of the injury claim, it must also simultaneously conduct discovery on its claims practices and do its best to justify its claims decisions."
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