Knopick, N. v. Boyle, D. and Boyle Litigation , 189 A.3d 432 ( 2018 )

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2018 PA Super 140NICHOLAS KNOPICK : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
Appellee :
v. :
:
DENNIS BOYLE AND BOYLE :
LITIGATION :
:
Appellant : No. 99 MDA 2017
Appeal from the Order Entered December 29, 2016
In the Court of Common Pleas of Cumberland County
Civil Division at No(s): 2014-06697
BEFORE: GANTMAN, P.J., PANELLA, J., and FORD ELLIOTT, P.J.E.
OPINION BY GANTMAN, P.J.: FILED MAY 30, 2018
Dennis Boyle and Boyle Litigation (collectively “Appellant”), appeal
from an interlocutory discovery order, entered in the Cumberland County
Court of Common Pleas Civil Division, which granted Appellee’s motion to
compel disclosure of certain electronic documents, over Appellant’s objection
that the documents are protected by the attorney-client privilege. For the
reasons that follow, we affirm.
The relevant facts and procedural history of this appeal are as follows.
Appellee sued Appellant in 2014 for legal malpractice sounding in breach of
contract, negligence, fraud, and conversion, based on allegations that
Appellant comingled trust account funds with operating funds to pay firm
expenses. During discovery in the present malpractice case, Appellee sent
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notice to a non-party, Donald Sherman, for a videotape deposition, along
with a subpoena for certain documents from his personal email account.
[Mr.] Sherman is a former non-attorney employee of
[Appellant]. One of his duties was to reconcile the
attorney trust account. Sometime in November of 2012,
Mr. Sherman became concerned about possible issues with
the account. As a result, he created a list of those
concerns and emailed them to himself. He used his
personal email account to both send and receive the list.
He eventually met with an attorney, who was not of Boyle
Litigation. He also met with a second lawyer, who was
employed by Boyle Litigation, on a later occasion.
During the deposition of Mr. Sherman, [Appellee] sought
the November 2012 email memorializing the concerns
regarding the trust account. [Appellant’s] Attorney
represented Mr. Sherman at the deposition. He took the
position that the email was subject to attorney-client
privilege. Thereafter, [Appellee] filed a Motion to Compel.
After hearing argument, [the trial court was] satisfied that
the email was not subject to attorney-client privilege.
Consequently, [the trial court] ordered [Appellant] [on
December 29, 2016,] to produce it.[1]
[Appellant]’s concise statement of [errors] complained of
on appeal alleges that [the trial court] erred in 1) holding
that the email in question is not subject to the attorney-
client privilege; 2) failing to perform an in-camera
inspection of the email; and 3) ordering the production of
a document that is the property of a non-party.
(Trial Court Opinion, filed March 22, 2017, at 1-2) (internal citations
omitted).
Appellant raises the following issues for our review:
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1 Appellant filed a notice of appeal on January 12, 2017. Both Appellant and
the trial court have complied with Pa.R.A.P. 1925.
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DID THE TRIAL COURT ERR AND INCORRECTLY
INTERPRET/APPLY THE ATTORNEY-CLIENT PRIVILEGE BY
ORDERING THE PRODUCTION OF NOTES THAT WERE
PREPARED BY A CLIENT IN ANTICIPATION OF A MEETING
WITH HIS ATTORNEY, CONTAINING THE ISSUES THE
CLIENT WISHED TO DISCUSS WITH HIS ATTORNEY, SO
THE CLIENT COULD RECOLLECT AND CONVEY THOSE
ISSUES TO HIS ATTORNEY DURING THE ATTORNEY-
CLIENT MEETING?
DID THE TRIAL COURT ERR BY HOLDING THAT THE NOTES
IN QUESTION WERE NOT SUBJECT TO THE ATTORNEY-
CLIENT PRIVILEGE WITHOUT FIRST ORDERING OR
PERFORMING ANY INSPECTION OF THE NOTES, DESPITE A
PARTY’S REQUEST FOR IN CAMERA INSPECTION OF THE
NOTES?
DID THE TRIAL COURT ERR BY ORDERING THE
PRODUCTION OF THE NOTES IN QUESTION DESPITE THE
FACT THAT (A) [APPELLEE’S] MOTION TO COMPEL WAS
DIRECTED TO AND SOUGHT RELIEF FROM ONLY
[APPELLANTS], RATHER THAN NON-PARTY DONALD
SHERMAN, AND (B) THE NOTES IN QUESTION WERE THE
PROPERTY OF ONLY NON-PARTY SHERMAN?
(Appellant’s Brief at 4).
As a prefatory matter, Appellee has filed a motion to quash this appeal
as interlocutory and unappealable. Specifically, Appellee contends (a)
Appellant failed to make a colorable claim of attorney-client privilege, (b)
Appellant does not own the privilege asserted, and (c) the subject ruling
does not qualify for review under the collateral order doctrine. For these
reasons, Appellee concludes this Court should quash the appeal. We
disagree.
In this regard, “[T]he appealability of an order directly implicates the
jurisdiction of the court asked to review the order.” In re Estate of
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Considine v. Wachovia Bank, 966 A.2d 1148, 1151 (Pa.Super. 2009).
“Accordingly, this Court has the power to inquire at any time, sua sponte,
whether an order is appealable.” Id.; Stanton v. Lackawanna Energy,
Ltd., 915 A.2d 668, 673 (Pa.Super. 2007). As a general rule:
[T]his Court will not provide interim supervision of
discovery proceedings conducted in connection with
litigation pending in the several trial courts. In the
absence of unusual circumstances, we will not review
discovery or sanction orders prior to a final judgment in
the main action.
Robec, Inc. v. Poul, 681 A.2d 809, 811 (Pa.Super. 1996) (quoting
McManus v. Chubb Group of Ins. Companies, 493 A.2d 84, 87
(Pa.Super. 1985)). See, e.g., Harrison v. Hayes, 870 A.2d 326 (Pa.Super.
2005), appeal denied, 584 Pa. 708, 885 A.2d 42 (2005) (quashing appeals
of three interlocutory orders because (a) orders involved did not seek
private information; they sought only general information about common
policies, procedures, and practices involved in credentialing physicians at
defendant hospital; information sought was important only to parties to
litigation and did not concern issues of public policy or seek disclosure of
privileged information; and (b) defendant hospital had no standing to object
to subpoena directed to non-party hospital on ground of privilege because
only non-party hospital could assert any alleged privilege) .
Nevertheless, “A non-final order may be reviewed if it is separable
from and collateral to the main cause of action, the right involved is too
important to be denied review and the question presented is such that if
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review is postponed until final judgment in the case, the claim will be
irreparably lost.” Leber v. Stretton, 928 A.2d 262, 265 (Pa.Super. 2007),
appeal denied, 596 Pa. 733, 945 A.2d 172 (2008) (citing Pa.R.A.P. 313
(governing collateral orders)). See, e.g., Ben v. Schwartz, 556 Pa. 475,
729 A.2d 547 (1999) (allowing appeal from discovery order compelling
production of putatively privileged documents, where resolution of issue of
whether documents were subject to executive or statutory privilege
implicated rights rooted in public policy and affected individuals other than
those involved in particular litigation; in weighing competing consideration of
costs of piecemeal review against costs of delay, public interests expressed
in form of statutory privileges tips balance in favor of immediate appellate
review; order permitting discovery of investigative files was of such nature
that if review were postponed until final judgment in case, then claim would
be irreparably lost, as disclosure of documents could not be undone).
Rule 313 of the appellate rules defines a collateral order as:
Rule 313. Collateral Orders
(a) General rule. An appeal may be taken as of right
from a collateral order of an administrative agency or
lower court.
(b) Definition. A collateral order is an order separable
from and collateral to the main cause of action where the
right involved is too important to be denied review and the
question presented is such that if review is postponed until
final judgment in the case, the claim will be irreparably
lost.
Pa.R.A.P. 313. Rule 313 is jurisdictional in nature. Rae v. Pennsylvania
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Funeral Directors Association, 602 Pa. 65, 71-72, 977 A.2d 1121, 1125
(2009) (reiterating Rule 313 is subject to narrow construction and each
prong must be satisfied to allow appellate review under this rule). If the
discovery order requires the appealing party to produce materials which “the
appealing party has asserted are privileged, [Rule 313] applies, and we
accept jurisdiction.” BouSamra v. Excela Health, 167 A.3d 728, 734
(Pa.Super. 2017), appeal granted on other grounds, 2018 WL 620417 (Pa.
January 30, 2018). See also Ben, supra; Estate of Paterno v. National
Collegiate Athletic Association (NCAA), 168 A.3d 187, 201 (Pa.Super.
2017) (citing Berkeyheiser v. A–Plus Investigations, Inc., 936 A.2d
1117, 1123-24 (Pa.Super. 2007) (stating generally that discovery orders
compelling disclosure of potentially confidential and privileged materials
are immediately appealable as collateral to principal action)).
Instantly, the order before us on appeal directs Appellant to disclose
Mr. Sherman’s email, which Appellant claims is protected by the statutory
attorney-client privilege. As presented, Appellant’s claim appears to fall
within the narrow exception set forth in Ben, supra and BouSamra, supra
(allowing appeal by defendant party, under collateral order doctrine, from
interlocutory discovery order directing defendant party to disclose email
from that party’s outside counsel to that party’s in-house counsel and certain
emails generated in response to that initial email, where email chain
included three members of independent public relations firm hired by
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defendant party). Compare Harrison, supra (quashing appeal of
defendant hospital from interlocutory discovery order that permitted patient-
plaintiff to subpoena discovery materials from different, non-party hospital,
because defendant hospital had no standing to appeal order directed to non-
party hospital, on ground of privilege, where alleged privilege belonged to
non-party hospital). Here, Appellant’s “standing” to assert the attorney-
client privilege concerning Mr. Sherman’s email is an inquiry distinct from
Appellant’s standing to appeal the disclosure order directed to Appellant.
See Pa.R.A.P. 501 (stating: “Except where the right of appeal is enlarged by
statute, any party who is aggrieved by an appealable order, or a fiduciary
whose estate or trust is so aggrieved, may appeal therefrom. Note:
Whether…a party is aggrieved by the action below is a substantive question
determined by the effect of the action on the party, etc.”). Appellant is
aggrieved by the order directing Appellant to disclose the email, which gives
Appellant standing to appeal the disclosure order. Contrary to Appellee’s
contention, Appellant’s status as “aggrieved” by the disclosure order does
not necessarily defeat the collateral order doctrine. Otherwise, no party
ordered to disclose arguably protected material would be able to appeal the
disclosure order, which is simply not collateral order doctrine law. Keeping
in mind the significant distinction between Appellant’s standing to appeal
and Appellant’s standing to assert a statutory privilege, we will accept
appellate jurisdiction in this case and deny Appellee’s motion to quash on
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the grounds asserted.
On appeal, Appellant first argues the email Mr. Sherman sent to
himself is subject to the attorney-client privilege because the email
contained notes Mr. Sherman had made in preparation for a meeting with an
outside attorney for personal legal advice. Appellant concedes Pennsylvania
has no controlling law to cover this particular situation, but Appellant
analogizes to the generally-accepted view in this jurisdiction that the
attorney-client privilege covers notes taken during a meeting with an
attorney. Appellant asserts the same protection should extend to the notes
an individual makes in anticipation of meeting with an attorney because this
expansion of the privilege advances the public policy reasons behind the
attorney-client privilege. Appellant emphasizes that the overall purpose of
this privilege is to encourage open and honest communication between client
and attorney so the attorney can provide the best legal advice based on all
applicable information. Appellant submits the attorney-client privilege
should preclude any disclosure of Mr. Sherman’s email to himself in
preparation for a meeting with outside counsel.
Next, Appellant claims Mr. Sherman’s email meets the four
requirements of attorney-client privilege, as stated in 42 Pa.C.S.A. § 5916.
Specifically, Appellant maintains Mr. Sherman wrote the email with the
intent to become the client of a licensed bar member; he created the email
with the intent to convey the information contained in the email to an
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attorney during the course of receiving that attorney’s legal advice; Mr.
Sherman gave the email only to his attorney; and Mr. Sherman did not
waive his attorney-client privilege. As a practical matter, Appellant’s counsel
asserted the privilege at Mr. Sherman’s deposition, purportedly on behalf of
Mr. Sherman, who is not a party to this litigation. Appellant reasons Mr.
Sherman’s email, containing his notes in preparation for consultation with an
attorney, passes the four-part test for attorney-client privilege.
Appellant predicts the trial court’s decision to authorize the release of
Mr. Sherman’s email, created in anticipation of meeting with an attorney,
will have far-reaching consequences and affect Mr. Sherman’s ability to
obtain sound legal advice. Appellant states generally that the disclosure
ruling in this context will have a ripple effect of putting any client at risk that
those notes can be later used against the client. Appellant then offers that
the subject email in this case is analogous to notes a client takes at the
behest of his attorney and gives to the attorney, which notes are undeniably
privileged. Appellant insists that whatever prompted the creation of the
notes is fundamentally immaterial, i.e., whether a suit was already
underway or simply anticipated. Appellant submits this Court should adopt
the standards held in other jurisdictions, which declare client notes are
privileged when a client prepares them in anticipation of a meeting with an
attorney to facilitate that meeting.
Next, Appellant maintains the trial court should have performed an in
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camera inspection of Mr. Sherman’s email before ordering its disclosure, as
Appellant had requested. Appellant insists an in camera review is often
necessary for a court to determine what a document says and whether it is
privileged. Appellant further suggests that if the court had performed an in
camera review of the email, then the court would have realized how
necessary the email was for Mr. Sherman’s anticipated meeting with counsel
and the privileged character of the email. Appellant contends the court
erred in refusing to examine the email under these circumstances before
ordering its disclosure.
Finally, Appellant complains the court should have compelled Mr.
Sherman, rather than Appellant, to disclose his email. Appellant emphasizes
there is no proof Appellant has or had a copy of the email and points to Mr.
Sherman’s deposition testimony that he shared his email only with his
attorneys.2 Appellant asserts that, even if Appellant had obtained a copy of
Mr. Sherman’s email, then the privilege would still be intact because Mr.
Sherman’s attorney also represented Appellant. Appellant concludes Mr.
____________________________________________
2 Appellant complains it is basically unable to comply with the disclosure
order as Appellant does not “possess” the “notes” in question. Assuming
Appellant is talking about the email, we frankly have no way to know
whether Appellant’s averments are true, especially if Mr. Sherman created
the email during his employment with Appellant and through Appellant’s
computer system. This matter can be sorted out as the case proceeds but it
does not affect the outcome of the present appeal on the question of
attorney-client privilege, which is the only issue that qualifies for immediate
review.
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Sherman’s email remains protected by the attorney-client privilege, and we
should reverse the order directing Appellant to disclose the email. We
cannot agree.
“Whether the attorney-client privilege…protects a communication from
disclosure is a question of law. Thus, our standard of review is de novo and
our scope of review is plenary.” BouSamra, supra at 734; Estate of
Paterno, supra. Pennsylvania law defines the attorney-client privilege by
statute as follows:
§ 5928. Confidential communications to attorney
In a civil matter counsel shall not be competent or
permitted to testify to confidential communications made
to him by his client, nor shall the client be compelled to
disclose the same, unless in either case this privilege is
waived upon the trial by the client.
42 Pa.C.S.A. § 5928. Attorney-client privilege is not automatic; it must be
invoked successfully by satisfaction of a four-element test:
Pennsylvania law imposes a shifting burden of proof in
disputes over disclosure of communications allegedly
protected by attorney-client privilege. The party invoking
a privilege must initially set forth facts showing that the
privilege has been properly invoked; then the burden shifts
to the party seeking disclosure to set forth facts showing
that disclosure will not violate the attorney-client privilege,
e.g., because the privilege has been waived or because
some exception applies. Accordingly, if the party asserting
the privilege does not produce sufficient facts to show that
the privilege was properly invoked, then the burden never
shifts to the other party, and the communication is not
protected under attorney-client privilege.
Four elements must be satisfied in order to invoke
successfully the protections of attorney-client privilege:
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1) The asserted holder of the privilege is or sought
to become a client.
2) The person to whom the communication was
made is a member of the bar of a court, or his
subordinate.
3) The communication relates to a fact of which the
attorney was informed by his client, without the
presence of strangers, for the purpose of securing
either an opinion of law, legal services or assistance
in a legal matter, and not for the purpose of
committing a crime or tort.
4) The privilege has been claimed and is not waived
by the client.
Custom Designs & Mfg. Co. v. Sherwin-Williams Co., 39 A.3d 372, 376
(Pa.Super. 2012), appeal denied, 618 Pa. 688, 57 A.3d 71 (2012) (internal
citations and quotation marks omitted). Additionally,
The party asserting privilege bears the burden of
producing facts establishing proper invocation of the
privilege. Once the invoking party has made the
appropriate proffer, then the burden shifts to the party
seeking disclosure to set forth facts showing that
disclosure should be compelled either because the privilege
has been waived or because an exception to the privilege
applies. Accordingly, [i]f the party asserting the privilege
does not produce sufficient facts to show that the privilege
was properly invoked, then the burden never shifts to the
other party, and the communication is not protected under
attorney-client privilege. The trial court determines
whether the facts support the asserted privilege.
Estate of Paterno, supra at 194 (internal citations and quotation marks
omitted).
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“[I]n Pennsylvania, the attorney-client privilege operates in a two-way
fashion to protect confidential client-to-attorney or attorney-to-client
communications made for the purpose of obtaining or providing professional
legal advice.” Gillard v. AIG Ins. Co., 609 Pa. 65, 88-89, 15 A.3d 44, 59
(2011). In reaching this holding, the Gillard Court began by restating the
historically acknowledged purpose of the privilege, i.e., to encourage free
and open communications between counsel and client that will lead to a
trusting and candid discourse. Id. at 75-76, 15 A.3d at 51.
Nevertheless, established Pennsylvania law also makes clear that it is
the client who owns this privilege: “The purpose of the attorney-client
privilege is to benefit the client, and accordingly, the client is the holder of
the privilege.” Maleski v. Corporate Life Ins. Co., 646 A.2d 1, 4
(Pa.Cmwlth. 1994). Additionally, “the right to assert the privilege is that of
the client.” Commonwealth v. McKenna, 213 A.2d 223, 226 (Pa.Super.
1965) (citing Appeal of McNulty, 135 Pa. 210, 19 A. 936 (1890)). The
traditional canon remains intact, i.e., the client holds the attorney-client
privilege; Gillard elaborated only on the scope of the privilege. See
Gillard, supra.In the present case, the trial court reasoned:
[Appellant] assert[s] that the attorney-client privilege is
applicable to Mr. Sherman’s personal email from himself to
himself. [Appellant] contended that the privilege applied
because Mr. Sherman spoke with several attorneys about
things that were referenced in the email. As the party
asserting the attorney-client privilege, [Appellant] had the
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initial burden to prove that the privilege had been properly
invoked. Mr. Sherman’s email clearly was not a
confidential communication to an attorney. The email was
a communication from Mr. Sherman to himself. It was
done to document his concerns prior to his having made
any contact with an attorney. It therefore was not a
communication that otherwise would not have been made
but for the protection of the attorney-client privilege.
Under these circumstances, an in-camera review was
unnecessary.
As to the alleged violation of Mr. Sherman’s rights, we did
not direct Mr. Sherman to produce the email. The order
directed [Appellant] to produce their copy. Assuming
arguendo that the e-mail fell within the scope of the
attorney-client privilege, the fact that [Appellant] obtained
a copy vitiates that privilege.
(Trial Court Opinion at 3) (internal citation omitted).
Here, Appellant casts its position on the attorney-client privilege
largely in generic terms, as if Mr. Sherman and Appellant are one
entity/client, which is grossly misleading. First, Mr. Sherman created the
email before consulting an attorney and sent the email to himself. Mr.
Sherman’s email was not created as a confidential communication to an
attorney for the purpose of securing legal advice or created upon directive of
counsel. Further, Mr. Sherman is the proper owner of any privilege that
might attach to the email he created. Moreover, Mr. Sherman is not a party
to the present litigation and is not asserting the privilege.
Appellant cites no law to support its contention that it can invoke Mr.
Sherman’s privilege or that the privilege somehow transferred to Appellant
or that Appellant absorbed it by osmosis, simply because Appellant’s counsel
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once assumed he could assert the privilege on Mr. Sherman’s behalf at a
deposition in the present case. No one disputes the order at issue directed
only Appellant to produce the email, and Appellant shares no attorney-client
relationship with Mr. Sherman. Thus, as the party raising the attorney-client
privilege, Appellant failed to satisfy the burden of production to invoke
protection under the privilege. See Estate of Paterno, supra; Custom
Designs & Mfg. Co., supra. Therefore, the court had no reason to conduct
an in camera inspection of the email before ordering Appellant to disclose it
in this case.
Based upon the foregoing, we hold the order before us is immediately
appealable as a collateral order, under prevailing law, and Appellant has
standing to seek review of the court’s ruling because Appellant is a party to
the present case and the court’s order directed Appellant to disclose the
email. See Ben, supra; BouSamra, supra. See also Pa.R.A.P. 313 and
501. Nevertheless, Appellant lacks standing to assert that the ordered
disclosure is privileged, because the attorney-client privilege belongs to Mr.
Sherman, not to Appellant. See McKenna, supra. Thus, Appellant failed to
satisfy the four-element test to invoke protection under the attorney-client
privilege with respect to Mr. Sherman’s email. See Custom Designs &
Mfg. Co., supra. Accordingly, we affirm.
Order affirmed.
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Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date:05/30/18
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