Opinion
2245N
November 18, 2003.
Order, Supreme Court, New York County (Marcy Friedman, J.), entered April 28, 2003, which granted plaintiffs' motion to compel defendant law firm and nonparty appellants Professional Indemnity Agency, Inc. (PIA) and Legion Insurance Company to produce documents, subject to in camera review of those documents listed in appellants' respective privilege logs, and directed defendant law firm to serve answers to plaintiff's interrogatories to which objection had been raised based upon the attorney-client privilege, unanimously affirmed, without costs.
Peter L. Altieri, for plaintiffs-respondents.
Richard E. Lerner, for defendants-appellants.
Elizabeth Treubert Simon, for nonparty appellants.
Before: Nardelli, J.P., Tom, Mazzarelli, Marlow, JJ.
The complaint alleges that defendant law firm assisted nonparty appellants "in a scheme to convert Ulico trustee and fiduciary liability insurance policyholders to Legion coverage" for appellants' mutual benefit. Conflict of interest is asserted during the firm's representation of plaintiffs as the result of its advice and assistance to PIA "(a) in establishing its relationship with Legion and (b) in breaching its duties to Ulico."
The attorney-client privilege (CPLR 4503[a]; 3101[b], [c]) "may give way to strong public policy considerations" (Spectrum Sys. Intl. Corp. v. Chemical Bank, 78 N.Y.2d 371, 380, citing Matter of Priest v. Hennessy, 51 N.Y.2d 62, 67-68), and may not be invoked where it involves client communications that may have been in furtherance of a fraudulent scheme, an alleged breach of fiduciary duty or an accusation of some other wrongful conduct (see Surgical Design Corp. v. Correa, 284 A.D.2d 528, 529; Woodson v. American Tr. Ins. Co., 280 A.D.2d 328;see also In re John Doe, Inc., 13 F.3d 633, 636 [2nd Cir]; Madanes v. Madanes, 199 F.R.D. 135, 145-146 [SDNY]). Furthermore, a trial court is vested with broad discretion to supervise the discovery process, and its determinations in that respect will not be disturbed in the absence of demonstrated abuse (see United Airlines v. Ogden New York Servs., 305 A.D.2d 239, 240; Cho v. 401-403 57thSt. Realty Corp., 300 A.D.2d 174, 176). Testimony regarding conversations between principals of nonparty appellants and a member of the firm as well as the settlement of a related federal action brought by Ulico against PIA and Legion support the IAS court's conclusion that probable cause exists that a "fraud was attempted or committed and that the communications were in furtherance thereof," warranting an exception to the attorney-client privilege in favor of disclosure.
THIS CONSTITUTES THE DECISION AND ORDER OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT.