Tuesday, January 2, 2018
The Tennessee Court of Appeals affirmed an order compelling disclosure of privileged communications on an implied waiver theory.
This interlocutory appeal arises out of an action in which two companies brought suit against their former attorney for legal malpractice. The attorney moved for summary judgment as to one client’s claim, contending that the claim was barred by the statute of limitations; the client responded that it learned of its cause of action within one year of the assertion of the claim. The attorney then sought through discovery to have the former client produce communications from the client’s new counsel; the client declined to produce the communications, taking the position that they were protected by the attorney client privilege. The attorney moved the trial court to compel the client to produce the communications, and the court granted the motion, holding that the client impliedly waived attorney-client privilege in asserting that the client discovered the cause of action within the year preceding the assertion of the claim. Discerning no error, we affirm the trial court’s holding.
On implied waiver
Relative to the three conditions for determining whether BNL impliedly waived the attorney-client privilege, the trial court held:
This Court concludes Plaintiffs’ assertion of the discovery rule ultimately led to Plaintiffs’ assertion that the relevant documents are protected by attorney-client privilege. Although statute of limitations is an affirmative defense under Tennessee law, and Defendants bear the burden of proof, it was Plaintiffs’ assertion of the discovery rule in response that ultimately put Plaintiffs’ knowledge, and thereby Plaintiffs’ privileged communications, at issue in the current dispute.
The Court concludes that Plaintiffs put their privileged information at issue by pleading the discovery rule. . . . by pleading ignorance of its cause of action against Defendants, Plaintiffs have made “what Plaintiffs knew and when Plaintiffs knew it” the dispositive issue of this case.
In addition, Defendants have no other way to obtain information vital to its defense. Defendants assert Plaintiffs claim was time-barred, because Plaintiffs complaint was filed more than one year after Plaintiffs became aware of Defendants behavior giving rise to the cause of action. Plaintiffs’ assertion of the discovery rule—Plaintiffs did not know and could not have reasonably known its cause of action against Defendants—makes Plaintiffs’ actual or constructive knowledge vital to Defendants’ argument that Plaintiffs did know of its claim more than a year in advance of Plaintiffs’ filing.
Upon our review, we do not discern any error in the portion of trial court’s holding that “Plaintiffs’ actual or constructive knowledge [is] vital to Defendants’ argument that Plaintiffs did know of its claim more than a year in advance of Plaintiffs’ filing.”