Massachusetts’ highest court recently formally recognized joint defense agreements as an exception to waiver of the attorney-client privilege under the common interest doctrine. Hanover Ins. Co. v. Rapo & Jepsen Ins. Svcs., Inc., Docket No. SJC-09780 (August 3, 2007).
In the case, one insurer alleged that another insurer and two insurance services companies conspired to wrongfully transfer certain high-loss motor vehicle insurance business. Seeking evidence to support its claim, the plaintiff insurer sought discovery of the defendants’ communications with their attorneys and of all documents concerning the defendant insurer’s payment of the defendant insurance services company’s legal fees. The defendant insurer objected to the requests on the basis that documents created after the plaintiffs’ claims were asserted against the defendants, and after those defendants entered into a joint defense agreement, were protected from discovery by the joint defense privilege.
The trial court ordered production of the requested documents, ruling that “[a] joint defense privilege is not yet recognized in the Commonwealth . . . .” On interlocutory appeal, the Supreme Judicial Court vacated the trial court’s discovery order, held that Massachusetts recognizes a common interest privilege consistent with the principles articulated in Section 76(1) of the Restatement (Third) of the Law Governing Lawyers (2000), and remanded for further proceedings. In particular, the SJC found that the common interest doctrine in Massachusetts includes a broad joint defense privilege:
Where defendants allege a common interest that is no more than a joint effort to establish a common litigation defense strategy, the requisite common interest is among the easiest to establish. Such defendants need only prove that (1) the communications were made in the course of a joint defense effort, (2) the statements were designed to further that effort, and (3) the privilege has not been waived. (Quotations omitted).
The SJC also rejected several arguments made by the plaintiff that sought to place the case’s circumstances outside of the joint defense privilege, holding as follows: (a) a client need not know of or expressly consent to a joint defense agreement between counsel in order for the privilege to be created; (b) a joint defense agreement need not be in writing in order to create a privilege; (c) the defendants’ respective interests need not be identical to create a privilege, just a “sufficiently similar interest”; and (d) narrative portions of legal bills may contain privileged material protected by a joint defense agreement.
A full copy of the SJC’s opinion is available here.