Cone v. Culverhouse
1997 WL 30323, 687 So. 2d 888 (1997)
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Rule of Law:
The 'common interest' exception to lawyer-client and accountant-client privilege applies only to communications relevant to a distinct 'matter' where clients objectively shared common interests and lacked a reasonable basis to preserve confidentiality from each other, and where the professional was retained or consulted in common for that specific matter.
Facts:
- Joy and Hugh Culverhouse were married for over fifty years, and Stephen F. Story and Fred M. Cone, Jr. were long-time friends, lawyers, and advisors to the Culverhouse family and businesses.
- The Cone law firm and the accounting firm of Garrett, Wood & Co. provided legal and accounting services, respectively, to Mr. Culverhouse, Mrs. Culverhouse, their family, and businesses, sometimes in matters where Mr. and Mrs. Culverhouse appeared to have joint or common interests.
- In January 1993, the Cone law firm prepared a comprehensive estate plan for Mr. Culverhouse, including a will and the Hugh F. Culverhouse Trust Agreement, which established Marital Trust A and Marital Trust B; simultaneously, the firm prepared a post-marital property settlement agreement for Mrs. Culverhouse.
- Hugh Culverhouse died on August 25, 1994, after which Mr. Story, Mr. Cone, and Mr. Donlan served as directors of Tampa Bay Area NFL Football, Inc., trustees of the two trusts, personal representatives of Mr. Culverhouse's estate, and directors of the Culverhouse Family Foundation, Inc.
- After Mr. Culverhouse's death, the Cone law firm and the accounting firm continued to represent Mrs. Culverhouse, the personal representatives of the estate, the trustees, and the foundation.
- Before August 1995, Mr. Story, Mr. Cone, and Mr. Donlan, as directors of Tampa Bay Area Football, Inc., declared an $11.3 million dividend, which Mrs. Culverhouse alleged was not disclosed to her until December 1995.
- In August 1995, Thomas Purcell of the Cone law firm sent a letter to Mr. Cone, Mr. Story, Mr. Donlan, Mrs. Culverhouse, and Hugh F. Culverhouse, Jr., acknowledging actual and potential conflicts and requesting a waiver for the firm to continue providing services to Mrs. Culverhouse, the estate, trust, and trustees, which all recipients signed.
- Shortly after Mrs. Culverhouse asserted that the $11.3 million dividend was income rather than corpus, the Cone law firm withdrew from representing the trust, and the accounting firm withdrew from representing Mrs. Culverhouse.
Procedural Posture:
- Joy McCann Culverhouse filed a 'trust lawsuit' against Stephen F. Story, John M. Donlan, and Fred M. Cone, Jr., as trustees of two trusts, challenging their management, seeking their removal, and requesting an accounting.
- Joy McCann Culverhouse filed a separate 'malpractice action' against Fred M. Cone, Jr. and the law firm of Cone, Purcell & Flanagan, P.A., alleging legal malpractice.
- During discovery in both lawsuits, Mrs. Culverhouse sought documents containing lawyer-client and accountant-client communications between Mr. Culverhouse, his controlled corporations, his personal representatives, or the trustees, and the Cone law firm or the accounting firm of Garrett, Wood & Co.
- The defendants (the trustees and the Cone law firm) objected to the production of these documents, asserting lawyer-client and accountant-client privileges.
- In the trust lawsuit, the trial court held an evidentiary hearing and determined that both the law firm and the accounting firm were engaged in 'joint representation' of Mrs. Culverhouse, the trust, and the three trustees, concluding that no privilege existed prior to the commencement of the lawsuits and requiring broad disclosure, relying on an August 1995 waiver of conflict letter.
- Subsequently, the trial court in the malpractice action entered a similar discovery order, largely based on the ruling in the trust lawsuit.
- Fred M. Cone, Jr., individually and as trustee; Stephen F. Story and John M. Donlan, individually and as trustees; and Fred M. Cone, Jr., as a partner of Cone, Purcell & Flanagan, P.A., and Cone, Purcell & Flanagan, P.A., filed three consolidated petitions for writ of certiorari with the District Court of Appeal of Florida, Second District, seeking to quash these discovery orders.
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Issue:
Does the 'common interest' exception to professional privilege broadly apply to all communications between professionals and clients when there are multiple, potentially conflicting, client relationships, or is it limited to specific matters where clients objectively shared a common interest and expected no confidentiality from each other?
Opinions:
Majority - Altenbernd, Judge
No, the 'common interest' exception to professional privilege does not broadly apply to all communications across multiple client relationships, but rather is limited to specific 'matters' where clients objectively shared a common interest and expected no confidentiality from each other. The trial courts correctly decided that Mrs. Culverhouse is entitled to discover documents containing privileged communications in any matter where the professionals represented her in common with other persons or entities. However, the trial courts adopted an overly expansive interpretation of the 'common interest' exception found in sections 90.502 and 90.5055, Florida Statutes. The exception requires trial courts to examine communications involving a distinct 'matter' to determine whether the clients in that matter had such common interests that an objectively reasonable client involved in the communications lacked a reasonable basis to preserve their confidentiality from the other client. The fact that a professional represents two clients in common for one professional matter at a given time does not waive the professional communication privilege for other times and other matters. The court found that the trial courts erred by assuming the entire representation of all the Culverhouse family enterprises over an extended time constituted a single matter, and by relying on the August 1995 waiver of conflict letter as a basis to find an overall matter in common, when the letter actually signified conflicting interests. The court clarified that 'a matter' typically involves one 'transaction, event, or occurrence,' and that clients' interests must be sufficiently compatible such that a reasonable client would expect their communications concerning the matter to be accessible to the other client. Furthermore, the exception applies only to communications made to a professional 'retained or consulted in common' for the specific matter. The court granted the petitions to the extent that it directed the trial court on remand to order production only of documents currently agreed to contain communications in matters of common representation, and for other disputed documents, to conduct further evidentiary hearings and potentially in camera review to determine if they actually relate to a matter of joint representation.
Analysis:
This case significantly clarifies the scope and application of the 'common interest' exception to professional privileges in Florida, particularly in complex, multi-party representations common in estate planning and business matters. By emphasizing that the exception applies only to a distinct 'matter' of common interest and requiring an objective assessment of client expectations regarding confidentiality, the court prevents a blanket waiver of privilege simply because a professional has represented related parties at various times. This ruling protects client confidentiality in distinct legal matters, even when a single professional serves multiple clients, forcing lower courts to conduct more precise, fact-specific inquiries, often requiring in camera review, to determine the applicability of the exception. It underscores that a prior general conflict waiver does not automatically extinguish privilege for all past or future communications, thus impacting discovery practices in disputes involving closely-tied but separately-interested parties.
