915 2nd Pub Inc. d/b/a Thady Con’s Bar & Restaurant, et al. v. QBE Insurance Corporation, 2013 NY Slip Op 04748 (1st Dep’t 2013)

A single notation in a claim file that an expert’s report was sent to plaintiffs’ prior counsel is insufficient to show waiver of privilege over an appraisal report prepared by an expert at defense counsel’s direction as an aid in litigation, said a unanimous Appellate Division.

The case concerns damages to an insured building as a result of construction work being performed on an adjacent property. The insured sought insurance proceeds for damage to the building and loss of business income. In anticipation of litigation, counsel for the insurer engaged a real estate appraiser to estimate the retroactive valuation of plaintiff’s property as of the date the building was damaged. The real estate appraiser performed the retroactive valuation and submitted his findings to the insurer’s counsel.

In the ensuing litigation, counsel for the insured sought a copy of the real estate appraiser’s findings. Counsel for the insured did not dispute that the findings were protected from disclosure by the law as privileged in nature as attorney work product, but he argued that a reference in the insurer’s claim file constituted a waiver of any attached privilege. On plaintiff’s motion to compel, the lower court issued an Order directing production of the real estate appraiser’s findings citing the courts liberal nature towards discovery.

On appeal, the insurer cited a plethora of case law establishing non-waiver and distinguishing a mere reference to privileged materials from an outright disclosure of privileged materials.

Abrams Gorelick partner Chris Christofides argued the appeal, associate Graig Russo with him on the brief.