In Lender Processing Services, Inc. v. Arch Insurance Co., 183 So. 3d 1052 (Fla. 1st DCA 2015), Lender Processing Services was a policyholder and a plaintiff which sued its liability carriers for alleged defense coverage for a class action against it, among other things. Lender Processing Services was described by the court as "a provider at the time of mortgage processing, loan servicing, and default management services to the mortgage lending industry".
At least one of its carriers settled the "coverage" case with Lender Processing Services. After that part of the case settled, the settling carrier filed a motion to enforce the settlement based on an EMail exchange with Lender Processing Service's in-house counsel.
Lender Processing Services opposed the motion, at least in part. It contended that its in-house counsel did not have settlement authority on behalf of its officers and directors. The settling carrier replied that having settled through its in-house counsel as outlined in the submitted E-Mails, Lender Processing Services did not have the legal right in good faith to alter the terms of the settlement with the carrier.
After injecting the issue of its in-house counsel's settlement authority or lack thereof on behalf of its officers and directors, Lender Processing Services claimed that the carrier's questions about the in-house counsel's authority were protected from revelation by the attorney-client privilege.
Both the Florida trial court and the Florida appellate court disagreed. Both courts held that Lender Processing Services waived any attorney-client privilege by putting its communications with counsel at issue. Lender Processing Services, Inc. v. Arch Insurance Co., 183 So. 3d 1052, 1062 (Fla. 1st DCA 2015).
Please Read The Disclaimer. ©2016 by Dennis J. Wall, author of Litigation and Prevention of Insurer Bad Faith (3d ed. Thomson Reuters West in 2 Volumes, with Supplements). The issues addressed by the Florida courts in Lender Processing Services are addressed in particular in Volume 1, § 8:14, "Considerations applicable to discovery by insurers" including questions of attorney-client privilege. All rights reserved.
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