Are the documents relating to the latter "privileged" so that in the context of litigation they need not be produced to the contractors making claims?
The parties are
involved in a dispute over defects and delays in the construction of a
very large commercial project. The Owner of the project retained a
consulting firm under two different contracts to perform two different
services: (a) to provide construction management services, and (b) to
assist counsel by reviewing and analyzing claims submitted by various
contractors. Are the documents relating to the latter “privileged” so
that in the context of litigation they need not be produced to the
contractors making claims?
The two groups of documents were created by different
entities operating under different contracts and performing different
services. Documents created at the request of Owner’s counsel for claims
analysis and possible litigation position are protected under the
The Owner’s construction management contract with the consultant charged
the consultant with implementing and enforcing the Owner’s procedure
for the processing of Change Orders and analyzing and evaluating all
claims for contract time extension or cost adjustment and making
recommendations for resolution, approval, or disapproval.
The Owner’s claims analysis contract charges the "Claims Analysis Group"
to perform "claims analysis." The contract requires that the Claims
Group provide Owner with a preliminary claims analysis in order to
identify project delays and damage claims.
The work product doctrine, provides that a party may not discover
documents and tangible things that are prepared in anticipation of
litigation or for trial by or for another party or its representative
(including the other party's attorney, consultant, surety, indemnitor,
insurer, or agent) unless it can demonstrate a substantial need for the
materials to prepare its case and cannot, without undue hardship, obtain
their substantial equivalent by other means.
The most contested condition necessary for work product protection is
that the material at issue was prepared "in anticipation of litigation."
A document is prepared "in anticipation of litigation" if in light of
the nature of the document and the factual situation in the particular
case, the document can fairly be said to have been prepared or obtained
because of the prospect of litigation. Under the work product doctrine,
if a document is created because of the prospect of litigation,
analyzing the likely outcome of that litigation, it does not lose
protection merely because it is created in order to assist with a
business decision. However, there is no work product protection for
documents that are prepared in the ordinary course of business or that
would have been created in essentially similar form irrespective of the
litigation. Even if such documents might also help in preparation for
litigation, they do not qualify for protection because it could not
fairly be said that they were created "because of" actual or impending
Work product protection may be waived by the conduct of a party. Courts
applying this "fairness doctrine" have found, that for example, where a
party selectively discloses certain privileged or work product material,
but withholds similar (potentially less favorable) material, principles
of fairness may require a more complete disclosure.
The Consultant Claims Group and the Consultant Construction Management
Group performed different services. The ordinary review of contractor
payment requests performed by the Consultant Construction Management
Group involved contact with the contractors. By contrast, the claims
analysis performed by the Consultant Claims Group involved no
construction management work and no contact with contractors. Unlike
the Consultant Construction Management Group, the Consultant Claims
Analysis Group's analysis was provided directly to Owner’s general
counsel. The Consultant Construction Management Group performed services
that were ongoing for the duration of the construction project; by
contrast, the Consultant Claims Group's work involved a short-term
assignment. The documents at issue are the result of requests by
Owner's attorneys for claims analysis including a particular possible