In Phoenix Insurance Co v. Trans World Forwarding, Inc., ____ So.3d ____ (Fla. 3rd DCA September 23, 2009), the insured filed a first-party breach of contract case against its insurer. As part of that case, the insured sought discovery directed to the "insurer’s business practices and alleged statutory bad faith." The trial court ordered the production, and the insurer sought certiorari review.
The 3rd DCA held that the discovery requests which were not geared toward "claim, the circumstances of alleged loss, and the policies at issue," were "premature ‘unless there has been a determination of liability and extent of damages owed the insured under the first-party insurance policy.’" quoting, Government Employees Ins. Co. v. Rodriquez, 960 So.2d 794, 795 (Fla. 3d DCA 2007).
However, the 3rd DCA did reiterate that that while the insurer need not produce materials that were privileged, it "must, however, prepare and serve a privilege log to preserve any such claims." The Court then advised the trial court that on remand the trial court "shall consider the items sought to be discovered and shall enter an order permitting, and prohibiting discovery in accordance with this opinion."
Thus, the 3rd DCA confirmed the process that must be followed in all cases where the insured requests information that the insurer claims to be privileged. In those circumstances, the insurer must prepare and serve a privilege log describing the materials it claims are privileged. The insured can then review the privilege log and then ask the trial court to perform an in camera inspection of any materials which the insured believes may fall outside the privilege. The insurer cannot simply refuse to turn over the documents, and also refuse to provide a privilege log; likewise, the trial court cannot simply order that the documents be turned over without performing an in camera inspection of materials which the insurer feels are privileged. If the trial court orders production of materials which the insurer still believes to be privileged, the court must then give the insurer time to seek certiorari review of the order compelling production.