Court Opinion

ID: 5138668
Source: CourtListenerOpinion
Date Created: 2021-12-21 15:11:48.5438+00
Date Added: 2024-06-11T08:24:10.505555
License: Public Domain

2018 UT App 138

               THE UTAH COURT OF APPEALS

        JAMES KRAHENBUHL, KAYLEEN KRAHENBUHL,
            AND ESTATE OF TANNER KRAHENBUHL,
                        Appellants,
                            v.
     THE COTTLE FIRM, ROBERT W. COTTLE, MAINOR EGLET
    COTTLE LLP, MILLER TOONE PC, AND P. MATTHEW MUIR,
                        Appellees.

                             Opinion
                        No. 20160977-CA
                        Filed July 12, 2018

           Third District Court, Salt Lake Department
                 The Honorable Robert P. Faust
                          No. 150906163

         Karra J. Porter, Kristen C. Kiburtz, and Bruce M.
                Pritchett, Attorneys for Appellants
         Matthew N. Evans, Attorney for Appellees The
         Cottle Firm, Robert W. Cottle, and Mainor Eglet
                           Cottle LLP
        Gregory J. Sanders and Sarah C. Vaughn, Attorneys
       for Appellees Miller Toone PC and P. Matthew Muir

JUDGE GREGORY K. ORME authored this Opinion, in which JUDGES
       KATE A. TOOMEY and DIANA HAGEN concurred.

ORME, Judge:

¶1      This case involves alleged legal malpractice on the part of
the Appellees—two attorneys and the firms for which they
worked during the pendency of the underlying case
(collectively, Prior Counsel)—for failure to timely file several
product liability claims after Tanner Krahenbuhl was killed in a
motor home accident. James Krahenbuhl, Kayleen Krahenbuhl,
                  Krahenbuhl v. The Cottle Firm

and the Estate of Tanner Krahenbuhl (collectively, the
Krahenbuhls) appeal from the district court’s interlocutory order
denying their objection to Prior Counsel’s subpoena duces
tecum. 1 The Krahenbuhls assert that the district court erred in
denying their objection because the subpoena violates the
attorney-client privilege. We agree and therefore reverse.

                        BACKGROUND

¶2     In August 2009, Tanner Krahenbuhl was killed while
riding in a motor home that was traveling down a steep
mountain road near Powder Mountain Resort. Several witnesses
stated that the motor home was traveling at a high rate of speed
down the road and that its brakes were smoking before it
crashed. The Krahenbuhls hired Prior Counsel to pursue several
claims, including a negligence claim against Powder Mountain
on a theory of premises liability as well as product liability
claims against the manufacturer of the motor home’s brakes.

¶3     Two years and one day after Tanner’s death, Prior
Counsel filed a one-count complaint for negligence against
Powder Mountain. Powder Mountain’s answer asserted that the
two-year statute of limitations barred the claim because it was
filed one day late. In November 2012, over a year after the
complaint was filed, Prior Counsel withdrew from the case. In
December 2012, the Krahenbuhls retained a new attorney
(Successor Counsel). Thereafter, Powder Mountain moved for
summary judgment, arguing that the claim against it should be
dismissed because it was not timely filed. The district court
granted the motion.

1. Appeals from interlocutory orders are discretionary. We
granted the Krahenbuhls permission to appeal pursuant to rule
5(a) of the Utah Rules of Appellate Procedure.

20160977-CA                    2                  2018 UT App 138
                   Krahenbuhl v. The Cottle Firm

¶4      In August 2015, the Krahenbuhls, through Successor
Counsel, filed a legal malpractice action against Prior Counsel
for failing to timely file the lawsuit against Powder Mountain
and for failing to file any claims against the brake manufacturer.
In their answer, Prior Counsel asserted the affirmative defense of
comparative negligence, contending that the Krahenbuhls and
Successor Counsel were at least in part responsible for the
untimely filing of the Krahenbuhls’ claims. After Prior Counsel
moved for summary judgment, the parties stipulated to
dismissing the Krahenbuhls’ claims as to Prior Counsel’s failure
to timely file the negligence claim against Powder Mountain,
because the district court had determined in a subrogation
lawsuit that Powder Mountain did not owe a duty to the
Krahenbuhls.

¶5     Discovery continued on the issue of whether Prior
Counsel committed legal malpractice for failing to assert the
product liability claims in an action filed before the expiration of
the statute of limitations. Prior Counsel filed a notice of issuance
of a subpoena duces tecum (the Subpoena), requesting all
documents in Successor Counsel’s file that related to the
underlying lawsuit. The Krahenbuhls objected, arguing that the
Subpoena sought materials protected by the attorney-client
privilege. In response, Prior Counsel filed a statement of
discovery issues, seeking an order requiring the Krahenbuhls to
comply with the Subpoena. Prior Counsel argued that the
Krahenbuhls waived the attorney-client privilege as to
communications between themselves and Successor Counsel
because the privileged communications were “at issue.” First,
citing a number of cases from other jurisdictions, Prior Counsel
argued that “suing one attorney for malpractice amounts to a
waiver of the privilege as to all attorneys involved in the
underlying litigation.” Second, they argued that Successor
Counsel was at fault because he “could have amended the
complaint to add the claims he now argues [Prior Counsel]
should have brought.” The district court agreed, without

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                  Krahenbuhl v. The Cottle Firm

explanation, and ordered the Krahenbuhls to comply with the
Subpoena. This interlocutory appeal followed.

             ISSUE AND STANDARD OF REVIEW

¶6     The Krahenbuhls contend that the district court erred by
determining that they had waived the attorney-client privilege
as to communications between them and Successor Counsel and
by ordering them to comply with the Subpoena. 2 “Whether a
party has waived the attorney-client privilege is an issue of law,
which we review for correctness[.]” Terry v. Bacon, 2011 UT App
432, ¶ 9, 269 P.3d 188 (quotation simplified).

                           ANALYSIS

¶7     The Krahenbuhls assert that, under Doe v. Maret, 1999 UT
74, 984 P.2d 980, overruled on other grounds by Munson v.
Chamberlain, 2007 UT 91, 173 P.3d 848, and Terry v. Bacon, 2011
UT App 432, 269 P.3d 188, they did not waive the attorney-client
privilege with respect to communications with Successor
Counsel simply by retaining Successor Counsel in the
underlying lawsuit and filing this legal malpractice action. We
agree.

¶8     The attorney-client privilege, recognized in rule 504(b) of
the Utah Rules of Evidence and Utah Code section 78B-1-137(2),
“is intended to encourage candor between attorney and client
and promote the best possible representation of the client.”

2. The Krahenbuhls also contend, as they did below, that the
court erred in determining that they waived the attorney work
product privilege. Because we agree that the district court erred
in determining that they waived the attorney-client privilege, we
need not address this second issue.

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                   Krahenbuhl v. The Cottle Firm

Maret, 1999 UT 74, ¶ 7 (quotation simplified). “Although the
legislature and courts have carefully guarded the integrity of the
privilege, we have long held that it can be waived by a client.”
Id. As hereafter explained, one such instance of waiver is the “at
issue” waiver. 3

¶9     Under Utah law, the “at issue” waiver is triggered when
the party seeking application of the attorney-client privilege
places “‘attorney-client communications at the heart of a case.’” 4

3. The general exception to the attorney-client privilege that
applies in legal malpractice cases, see Utah R. Evid. 504(d)(3), is
not at issue in this appeal, because the dispute here concerns the
communications between the Krahenbuhls and Successor
Counsel, not the communications between the Krahenbuhls and
Prior Counsel, the defendants to this legal malpractice action.

4. In general, jurisdictions employ one of three variations of the
“at issue” waiver. We outlined each of these in Terry v. Bacon,
2011 UT App 432, 269 P.3d 188:
       The first of these general approaches is the
       “automatic waiver” rule, which provides that a
       litigant automatically waives the privilege upon
       assertion of a claim, counterclaim, or affirmative
       defense that raises as an issue a matter to which
       otherwise privileged material is relevant. The
       second set of generalized approaches provides that
       the privilege is waived only when the material to
       be discovered is both relevant to the issues raised
       in the case and either vital or necessary to the
       opposing party’s defense of the case. Finally,
       several courts have recently concluded that a
       litigant waives the attorney-client privilege if, and
       only if, the litigant directly puts the attorney’s
       advice at issue in the litigation.
                                                    (continued…)

20160977-CA                     5                  2018 UT App 138
                  Krahenbuhl v. The Cottle Firm

Terry, 2011 UT App 432, ¶ 15 (quoting Maret, 1999 UT 74, ¶ 9).
More specifically, “[c]ommunications between the attorney and
client are ‘placed in issue where the client asserts a claim or
defense, and attempts to prove that claim or defense by
disclosing or describing an attorney client communication.’” Id.
¶ 16 (emphasis added) (quoting Rhone–Poulenc Rorer Inc. v. Home
Indem. Co., 32 F.3d 851, 863 (3d Cir. 1994)).

¶10 Here, Prior Counsel assert a defense to which the
communications between the Krahenbuhls and Successor
Counsel are allegedly relevant. Because the Krahenbuhls, the
holder of the privilege, are not the party placing the privileged
communications at issue, they have not waived the privilege.
Notwithstanding, Prior Counsel assert that, pursuant to Lyon

(…continued)
Id. ¶ 16 n.1 (quotation simplified). In Terry, after outlining the
three different tests, we stated that, because we believed the
attorney-client privilege had been waived under each of the
tests, we did not need to decide when a matter is placed “at
issue.” Id.
       Upon reflection, we conclude that our Supreme Court
already decided this question in Doe v. Maret, 1999 UT 74, 984
P.2d 980. There, the Court explained that “the fact that a lawyer
may have credible and important information gained through
communication with a client does not itself justify the setting
aside of the privilege (even when the lawyer is the only
non-party who may have that information).” Id. ¶ 10. Rather, a
party waives the attorney-client privilege when it places
attorney-client communications “at the heart of a case.” Id. ¶ 9.
In our view, the test that our Supreme Court articulated in Maret
is consistent with the third test described in Terry, which is
sometimes referred to as the Rhone–Poulenc test. See
Rhone–Poulenc Rorer Inc. v. Home Indem. Co., 32 F.3d 851, 863
(3d Cir. 1994).

20160977-CA                     6                 2018 UT App 138
                   Krahenbuhl v. The Cottle Firm

Financial Services, Inc. v. Vogler Law Firm, PC, No. 10-cv-565, 2011
WL 3880948 (S.D. Ill. Sept. 2, 2011), an unreported federal district
court case that applied the Rhone–Poulenc test to a dispute in a
legal malpractice case, the factual backdrop of the underlying
case here requires the conclusion that simply by bringing the
malpractice action the Krahenbuhls put their communications
with Successor Counsel at issue.

¶11 In Lyon, the initial attorneys the plaintiff hired in the
underlying case allegedly committed misconduct during
discovery. Id. at *1. The plaintiff fired its initial attorneys and
hired successor counsel to handle the trial. Id. At trial, the jury
returned a large verdict against the plaintiff. Id. The plaintiff
then sued its initial attorneys for malpractice, id., and in doing
so, sought damages in the amount of the adverse verdict, id.
at *3. The initial attorneys subsequently filed a third-party
complaint against successor counsel, seeking contribution, and
sought the production of privileged communications between
the plaintiff and successor counsel. Id. at *1. The district court
concluded that the plaintiff waived the privilege because the
plaintiff sought damages that occurred after it hired successor
counsel, and it was unclear whether the initial attorneys or
successor counsel were responsible for the plaintiff’s losses. Id.
at *3.

¶12 In addition to being nonbinding, Lyon is inapposite, and
we decline to follow it here. The Krahenbuhls are not seeking
damages that occurred outside of Prior Counsel’s representation
and therefore have not placed at issue their communications
with Successor Counsel.

¶13 Prior Counsel also assert that Successor Counsel is at fault
for the preclusion of the Krahenbuhls’ product liability claims.
According to Prior Counsel, Successor Counsel could have
brought the claims by amending the complaint and alleging that
the discovery rule tolled the statute of limitations. Prior Counsel

20160977-CA                     7                  2018 UT App 138
                   Krahenbuhl v. The Cottle Firm

assert that “Successor Counsel’s underlying representation of the
Krahenbuhls was likely an intervening cause of the
Krahenbuhls’ alleged injury” because Successor Counsel failed
to argue that Powder Mountain did not specifically plead its
statute of limitations defense. According to Prior Counsel, a
determination that the Krahenbuhls did not waive the
attorney-client privilege would allow them to use the privilege
both as a sword and a shield, which we have said a party cannot
do. See Terry v. Bacon, 2011 UT App 432, ¶ 17, 269 P.3d 188. But
the Krahenbuhls have not attempted to rely on any privileged
communications. Only the client can waive the attorney-client
privilege, see Moler v. CW Mgmt. Corp., 2008 UT 46, ¶ 17, 190 P.3d
1250, including under the at-issue rationale, and here it is Prior
Counsel, not the Krahenbuhls, who have attempted to place the
Krahenbuhls’ privileged communications with Successor
Counsel at issue.

¶14 Prior Counsel additionally argue that a plaintiff filing a
legal malpractice claim against one attorney in an underlying
lawsuit waives the attorney-client privilege as to all the
attorneys who represented the plaintiff in the underlying
lawsuit. We find this argument unavailing. In support of their
assertion, Prior Counsel cite cases in which courts have required
the production of the successor counsel’s files. Typical of these—
and the case upon which Prior Counsel primarily relies—is
Pappas v. Holloway, 787 P.2d 30 (Wash. 1990) (en banc). But in
Pappas, the court applied the second variation, supra note 4, of
the at-issue waiver, see 787 P.2d at 36 (stating that it was
applying the second variation of the at-issue waiver, also known
as the Hearn test), which presents a lower bar for parties seeking
the production of privileged communications. We cannot adopt
the wide-sweeping rule that Prior Counsel advocates, because it
is at odds with the rule our Supreme Court articulated in Maret.
See 1999 UT 74, ¶ 9 (stating that a party waives the
attorney-client     privilege    “by    placing     attorney-client
communications at the heart of a case”).

20160977-CA                     8                  2018 UT App 138
                  Krahenbuhl v. The Cottle Firm

¶15 In sum, we conclude that requiring the Krahenbuhls to
comply with the Subpoena is inconsistent with the principles
outlined in Maret and Terry, and therefore the court erred in
determining that the Krahenbuhls waived the attorney-client
privilege. 5

                         CONCLUSION

¶16 We conclude that the district court erred in determining
that the Krahenbuhls waived the attorney-client privilege as to
communications between them and Successor Counsel and by
ordering them to comply with the Subpoena. We therefore
reverse the order denying the Krahenbuhls’ objection to the
Subpoena and remand for such further proceedings, consistent
with this opinion, as may now be in order.

5. Prior Counsel’s brief includes the following request: “Should
this court find no waiver exists, defendant should be permitted
to re-argue waiver, pending additional discovery.” They also
assert that “the Krahenbuhls should be required to produce a
privilege log to allow [Prior Counsel] to evaluate [the
Krahenbuhls’] privilege claims.” We do not address these
matters because the district court is in the better position to do
so, and their resolution is unnecessary to this appeal. See Summit
Water Distrib. Co. v. Summit County, 2005 UT 73, ¶ 50, 123 P.3d
437 (“Our settled policy is to avoid giving advisory opinions in
regard to issues unnecessary to the resolution of the claims
before us.”).

20160977-CA                     9                 2018 UT App 138