State ex rel. Great American Insurance Co. v. Smith

DONNELLY, Judge.

This is an original action in prohibition.

On December 24, 1973, a restaurant and night club owned by Cannova Enterprises, Inc., was destroyed by fire. Relators had insurance in effect on the contents, leasehold improvements and for business interruption. Cannova and the loss-payee on the policies notified relators of the fire loss and furnished proofs of loss. Relators employed General Adjustment Bureau to investigate the origin of the loss. Attorney John C. Risjord was also employed to investigate the origin of the loss.

On May 31, 1974, relators denied the claim stating that the loss was of an incendiary origin. Prior to May 31, 1974, attorney Risjord wrote three letters to relators.

On August 9,1974, Cannova and the loss-payee filed suit in the Circuit Court of Jackson County alleging that relators’ refusal to pay is “vexatious and without reasonable cause * *

The controversy in this case involves an attempt by plaintiffs in the trial court to discover the contents of the three letters written by Risjord to relators.

On April 21,1977, respondent judge made the following order:

*63“Plaintiffs having made oral motion to require Raymond Schurkamp, George Freeseman and William L. Mathiesen and their respective insurance companies to produce certain described documents on the taking of their depositions, and the Court having given full consideration to same,
“IT IS HEREBY ORDERED that each of aforementioned witnesses produce at the taking of his deposition, subject to the condition hereinafter stated, all documents, described in his subpoenae, that are dated May 31,1974 and earlier, but is not required to produce those documents bearing a date subsequent to May 31, 1974.
“IT IS FURTHER ORDERED that, at the option of defendants’ counsel, any of aforementioned documents required to be produced, may first be presented to this Court for viewing by this Judge, who reserves the right to exclude from presentation at deposition any portions of said documents with respect to which interests of justice require exclusion.
“The Court believes that aforementioned documents, required to be produced, are reasonably calculated to lead to the discovery of admissible evidence as related to the issue of defendants’ vexatious refusal to pay and that plaintiffs have shown they have a substantial need of the materials in the preparation of their case and that they are unable without undue hardship to obtain the substantial equivalent of the materials by other means. Interests of justice require the documents to be produced notwithstanding claim of lawyer-client privilege except for any portions the Court deems should be excluded following inspection of the documents.”

Relators applied for prohibition and we ordered the issuance of our preliminary rule.

Plaintiffs below assert they are entitled to discovery under Rule 56.01(b). Relators rely on the attorney-client privilege. The applicable law is as follows:

(1) In State ex rel. Cain v. Barker, 540 S.W.2d 50, 52 (Mo. banc 1976), this Court stated:
“The language of rule 56.01(b)(1) authorizes discovery of matters not privileged. This necessarily means that privileged matters, such as communications between attorney and client, are not discoverable unless the privilege is waived by the client.”
(2) Section 491.060, RSMo 1969, reads in part as follows:
“The following persons shall be incompetent to testify:
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“(3) An attorney, concerning any communications made to him by his client in that relation, or his advice thereon, without the consent of such client;
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(3) In 8 Wigmore on Evidence, § 2320 (McNaughton rev. 1961) it is stated:
“§ 2320. Communications by the attorney to the client. That the attorney’s communications to the client are also within the privilege was always assumed in the earlier cases and has seldom been brought into question. The reason for it is not any design of securing the attorney’s freedom of expression, but the necessity of preventing the use of his statements as admissions of the client * *, or as leading to inferences of the tenor of the client’s communications * *
(4) In 8 Wigmore on Evidence, § 2322 (McNaughton rev. 1961) it is stated:
“§ 2322. Inference from claim of privilege; Judge to determine privilege. If a client party claims the privilege, the prevailing view — although there is a sharp split of opinion — is that no inference should be drawn against him as to the unfavorable nature of the information sought.
“The claim of privilege being made, the trial judge determines whether the facts justify the allowance of the claim. This follows from the general principle of the judicial function * *

*64We conclude from the above that, even in a case involving alleged vexatious refusal to pay, the attorney-client privilege protects a letter written by an attorney to his client from discovery when the letter: (1) “concerns any communication made to him by his client” in the attorney-client relation; or (2) contains “his advice thereon”; or (3) could lead to “the use of his statements as admissions of the client”; or (4) could lead “to inferences of the tenor of the client’s communications.”

We note that on May 11, 1977, respondent judge stated to counsel that he was willing “that the three letters in question be produced so that the Court can inspect them in in camera." We believe this procedure should be followed. We have no reason to believe respondent judge will ignore the law set forth above in examining the letters and in determining whether the letters should be produced for examination by plaintiffs.

Accordingly, the preliminary rule in prohibition is quashed and the petition dismissed.

NORWIN D. HOUSER, Special Judge, concurs in separate concurring opinion filed. HENLEY and SEILER, JJ., concur and concur in separate concurring opinion of NORWIN D. HOUSER, Special Judge. FINCH, J., dissents in separate dissenting opinion filed. BARDGETT and RENDLEN, JJ., dissent and concur in separate dissenting opinion of FINCH, J. MORGAN, C. J., not sitting.