Saint Annes Development Co. v. Russ — 157 A.D.3d 919

Majority

p. 919

Saint Annes Development Company, as Assignee of Claims from Global Golf, Inc., Respondent, v Jay Edmund Russ et al., Appellants.

[66 NYS3d 913]

In an action to recover damages for legal malpractice, the defendants appeal from an order of the Supreme Court, Suffolk County (Garguilo, J.), dated December 14, 2015, which denied their motion to compel the production of certain documents.

Ordered that the order is affirmed, with costs.

The plaintiff objected to certain of the defendants’ discovery requests on the ground that the requested documents, which related to communications among the plaintiff, its attorney, and its assignors, were protected by the common-interest privilege. The defendants moved to compel the production of these documents, arguing that the common-interest privilege did not apply. Following an in camera review of the documents, the Supreme Court denied the defendants’ motion.

The common-interest privilege is an exception to the traditional rule that the presence of a third party waives the attorney-client privilege (see Hyatt v State of Cal. Franchise Tax Bd., 105 AD3d 186 , 205 [2013]; Aetna Cas. & Sur. Co. v Certain Underwriters at Lloyd’s, London, 176 Misc 2d 605 , 611 [Sup Ct, NY County 1998], affd 263 AD2d 367 [1999]; In re Quigley Co., 2009 WL 9034027 , *2-3, 2009 Bankr LEXIS 1352, *7-8 [SD NY, Apr. 24, 2009, No. 04-15739 (SMB)]). To fall within that exception, the privileged communication must be for the

p. 920

purpose of furthering a legal, as opposed to a commercial, interest common to the client and the third party (see Hyatt v State of Cal. Franchise Tax Bd., 105 AD3d at 205 ; Delta Fin. Corp. v Morrison, 69 AD3d 669 [2010]; U.S. Bank N.A. v APP Intl. Fin. Co., 33 AD3d 430 , 431 [2006]). “The legal interest that those parties have in common must be identical (or nearly identical), as opposed to merely similar” (Hyatt v State of Cal. Franchise Tax Bd., 105 AD3d at 205 ; see United States v Doe, 429 F3d 450 , 453 [3d Cir 2005]; F.D.I.C. v Ogden Corp., 202 F3d 454 , 461 [1st Cir 2000]). Moreover, the communication must “relate to litigation, either pending or anticipated, in order for the exception to apply” (Ambac Assur. Corp. v Countrywide Home Loans, Inc., 27 NY3d 616 , 620 [2016]; see Hyatt v State of Cal. Franchise Tax Bd., 105 AD3d at 205 ).

Here, the Supreme Court properly denied the defendants’ motion to compel the production of the subject documents, as these documents were protected by the common-interest privilege.

Mastro, J.P., Hall, Sgroi and Duffy, JJ., concur.

Cases cited

Hyatt v. California Franchise Tax Board 105 AD3d 186 N.Y. App. Div. 2013-03-13 at 205 p. 919
Aetna Casualty & Surety Co. v. Certain Underwriters at Lloyd's London 176 Misc 2d 605 N.Y. Sup. Ct. 1998-02-17 at 611 p. 919
Delta Financial Corp. v. Morrison 69 AD3d 669 N.Y. App. Div. 2010-01-12 p. 920
U.S. Bank National Ass'n v. APP International Finance Co. 33 AD3d 430 N.Y. App. Div. 2006-10-17 at 431 p. 920
Ambac Assurance Corp. v. Countrywide Home Loans, Inc. 27 NY3d 616 N.Y. 2016-06-09 at 620 p. 920