Third District Quashes Orders Allowing Depositions of Apex Officials

Recently in the State of Florida, the Third District Court of Appeals overruled a trial court’s orders compelling the depositions of the CEO and former corporate secretary of an insurance company that was being sued by its insured for claims arising from windstorm damage after a hurricane in August 2004. General Star Indemnity Company v. Atlantic Hospitality of Florida, LLC, 3D10-3109, 2011 WL 798909 (Fla. 3d DCA March 9, 2011)

The insured argued that both officials’ signatures appeared on the insurance policy, and that the company’s president received and had knowledge of a loss assessment that was authored by a field level employee.
The insurance company sought a protective order and filed a supporting affidavit establishing that the senior officers had no role in the investigation or adjustment of the claims. The affidavit further established that the CEO’s pre-printed signature appears on every policy issued by the company in the State of Florida, and argued that if she was required to testify in every case involving claims for which she has no personal knowledge, she would be unable to perform her job.

The motion for protective order was denied and orders were entered compelling the depositions.

On appeal, the insurance company urged the Third District to apply the “apex doctrine” and require the insured to depose lower level employees before deposing its “apex officials”, but the Court acknowledged that it has never adopted the “apex doctrine.”

Nonetheless, the Court noted that,

“The job of the president of the company is to manage the company, not fly around the United States in depositions about policy-related claim disputes of which the president has no personal knowledge … If all claimants demand and obtain the same right, the chief executive officer manages his or her deposition schedule, not the company.”

The Court concluded that, “[d]iscovery is intended to be part of the ‘just, speedy, and inexpensive’ determination of disputes – not a device to get greater attention at an adversary’s headquarters”, and quashed the trial court’s orders.

While the Third District stopped short of adopting the “apex doctrine”, this decision clearly demonstrates the Court’s willingness to exercise its discretion in limiting discovery in order to prevent harassment, undue burden or expense.

Author: Albert M. Rodriguez

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