Court Adopts a Broad View of the “At Issue” Doctrine

May 2, 2001

Common sense would indicate that a litigant claiming “advice of counsel” as a defense must disclose communications with the lawyer providing the advice. Many courts have expanded this basic concept to include any situation in which a litigant puts legal advice “at issue” in some way—by placing the litigant’s mental state at issue, pursuing a claim or raising a defense that necessarily involves legal advice, etc. Courts disagree about the exact extent of this “at issue” doctrine.

One decision recently took a broad view. In State Farm Mutual Automobile Insurance Co. v. Lee, 13 P.3d 1169, 1177 (Ariz. 2000), State Farm took the position in a coverage case that it had acted “after investigating the law and reaching a well-founded belief that the law permitted the action it took.” Although State Farm specifically disclaimed an “advice of counsel” defense, the court nevertheless found that State Farm had placed its legal advice “at issue” and must produce the relevant documents. As the court explained, “a litigant’s affirmative disavowal of express reliance on the privileged communication is not enough to prevent a finding of waiver [where the legal advice received from a lawyer is] inextricably intertwined with the court’s truth-seeking functions.”

Lawyers hoping to avoid disclosure of privilege materials should bear in mind that the assertion of any issue involving legal advice could trigger such disclosure, even if the lawyer explicitly disclaims reliance on the advice.