An Insurance Working Example - Self-Induced Loss - Part II
If litigation does subsequently take place, after the close of pleadings each party must disclose all documents relevant to the issues in question
. There are various exceptions to that rule, particularly relating to privilege. The involvement of the solicitor is imperative as, first, all communications between the insurer and his solicitor will be privileged provided they are confidential and they are written to or by the solicitor in his professional capacity and that they have been made for the purposes of obtaining legal advice or assistance (Wheelerv. LeMarchant (1881) 17 Ch 675).
Secondly and more importantly, the reports of the experts as third parties will be privileged providing they have been brought into existence in contemplation of pending or anticipated litigation and provided the sole or dominant purpose of the communication was to prepare for litigation (Guinness Peat Properties v. Fitzroy Robinson Partnership [1987] 1 WLR 1027.
Difficulties in establishing privilege may arise in the early stages of the investigation of the claim because it is quite possible for the court to hold that the dominant purpose of the loss adjuster's report (or even the forensic scientist's report) is to investigate the claim generally and not for the purposes of litigation. In Melik v. Norwich Union [1980] 1 Lloyd's Rep 523 the court said that:
"Assessing the facts of this particular case as best I can on the evidence ... the dominant purpose of the assessors in making their report was to enable the insurers to ascertain the facts in order to come to a decision as to whether or not they should rely upon the clause of the policy in order to repudiate liability. That was the primary purpose for which the report was obtained. A secondary purpose was to obtain advice of the solicitors on the facts in the event of deciding to repudiate ... There is no legal professional privilege.**
An Insurance Working Example - Self-Induced Loss - Part II