©2001 Connell Foley LLP

The year 2001 has already brought several big changes with regard to whether recorded statements must be produced to an adversary and the manner in which they may be used by opposing counsel. Two cases were decided this year both of which discuss the attorney/client privilege and the work product rule and whether they protect statements made to an insurer from discovery by the opposing party.

In January, 2001 the Appellate Division decided the case of Pfender v. Torres, et al. (A-85-99T2) (App. Div. 2001).

In the Pfender case, Ms. Pfender was purchasing cigarettes at the island of a gas station. As she began to walk away, she was struck by defendant, Torres as his right front tire drove over her left foot.

At trial, there was a dispute as to the speed that Torres was driving as he entered the gas station. There was also a dispute as to whether or not Mr. Torres was speaking on his mobile telephone and there was dispute as to where the plaintiff was when he first saw her.

Plaintiffs filed a pre-trial motion for discovery of the defendant driver’s statements which he had made to his insurer describing the event. The tape recorded statements had been given by defendant, Torres to an insurance investigator who introduced himself as the agent for the insurer of Torres’ employer as Torres was driving a company car at the time of the accident. In the recorded statement, the defendant had given information that was quite different from his trial testimony on the question of when and where he first saw the plaintiff. He also gave inconsistent statements as to the description of his speed when comparing the recorded statement to his trial testimony.

Defendant opposed the pre-trial motion claiming that the statements were protected from discovery by the attorney/client privilege and the work product rule. The trial court denied the pre-trial motion and ordered that the defendant need not turn over the recorded statements to the plaintiff.

The case went to trial and the defendant prevailed. Plaintiffs appealed the issue of the discoverability of the recorded statement and the jury verdict.

The Appellate Division reversed the trial court’s ruling and remanded for a new trial. It was the Appellate Division’s opinion that the statements are discoverable and that they would reveal information that may very well have led the jury to a different result.

The court continued its previously stated view that there should be no blanket privilege with respect to communications between an insured and his adjuster under the guise of attorney/client privilege. The court stated that the privilege should only be held to shield communications between the insured and the adjuster if the communications were made to the adjuster for the dominant purpose of the defense of the insured by the attorney and where confidentiality was the reasonable expectation of the insured. The court advised its considerations would be: whether the statement was made at the direction of an attorney; whether there was anything indicating the insured was seeking legal advice; whether there was pending litigation; and whether the insurance company might have interests other than protecting the insured’s rights.

Since the court felt that these statements are ordinarily used by the insurer to determine whether and on what basis adjustment of the claim can be attempted, then the primary purpose for taking this statement is not necessarily for the defense of the insured by an attorney. The court found it key in its denial of the claim of attorney/client privilege that the statement was not taken at the specific direction of the insured’s attorney.

The court then considered the defendant’s claim that the discovery of the statements was inappropriate under the qualified privilege provided by the work product rule, Rule 4:10-2(c).

As is established in this state, in order to overcome an assertion of the work product privilege, the moving party must establish (1) that he has substantial need of the requested documents, and (2) that he is unable, without undue hardship, to obtain the substantial equivalent of the material by other means.

The court advised that the first prong of that test is always satisfied when a party seeks discovery of statements of another party or of a witness. The real issue is whether the party seeking discovery can satisfy the second prong. The court had ruled in other cases that before turning over the requested statement, the person who gave the statement can be deposed and that a deposition may constitute the substantial equivalent of the prior statement. The court felt that after a deposition is taken the court is better able to determine whether the second prong has been satisfied.

This court feels that the statement of a party to his insurer is not protected from discovery at least to the extent that it consists of statements describing the accident. It is this court’s view that there is no equivalent to a witness’ inconsistent prior statement and that discovery should be provided before the party or the witness is interrogated at a pre-trial deposition.

In the second case decided this year -- Michele Miller v. J.B. Hunt Transport, Inc., et al., (A-4463-99T1) (App. Div. 2001), the court again considered the applicability of the work product privilege to a truck driver’s recorded statement taken by the trucking company’s litigation attorney shortly after the driver was involved in an accident resulting in personal injuries to the other driver.

Immediately following an accident with the plaintiff’s vehicle, the defendant truck driver notified his employer of the accident. That same day the plaintiff’s employer retained a New Jersey attorney to represent the truck driver and his employer in connection with the accident. The attorney then took a statement from the truck driver that was recorded by a court reporter.

The plaintiff demanded production of this statement once it had been disclosed in defendant’s answers to interrogatories. The defendant’s moved for a protective order relying upon the work product privilege.

The trial court denied the defendant’s motion and ruled that the work product privilege should not attach to the truck driver’s statement.

The Appellate Division reversed the trial court’s ruling and concluded that the truck driver’s statement was prepared in anticipation of litigation and was protected by the work product privilege. The court held that the trucking company’s dominant purpose in taking this statement was to prepare for potential litigation and the company had an objectively reasonable basis for anticipating that suit would be brought by the other driver.

The court stated that this case was distinguishable from Pfender because the truck driver statement was made directly to his attorney to enable that attorney to prepare for anticipated litigation. This was, of course, different from the statement in Pfender which was taken by an insurance adjuster and not at the specific direction of the insured’s attorney.

The court did not consider whether the statement was protected by the attorney/client privilege as it had already concluded the statement to be protected by the work product privilege.

Both Pfender v. Torres, et al. (A-85-99T2) (App. Div. 2001)and Michele Miller v. J.B. Hunt Transport, Inc., et al., (A-4463-99T1) (App. Div. 2001) are attached to these materials.