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Oral Argument Before the Hawaii Supreme Court

No. SCWC-30557, Thursday, June 25, 2015, 10 a.m.

LLOYD R. ANASTASI, Petitioner and Respondent/Plaintiff-Appellant, vs. FIDELITY NATIONAL TITLE INSURANCE COMPANY, Respondent and Petitioner/Defendant-Appellee.

The above-captioned case has been set for argument on the merits at:

Supreme Court Courtroom
Ali`iolani Hale, 2nd Floor
417 South King Street
Honolulu, HI 96813

Attorneys for Petitioner and Respondent Anastasi:

Philip J. Leas, Jacqueline B. Kido, John P. Duchemin, and Trisha H.S.T. Akagi

Attorneys for Respondent and Petitioner Fidelity:

Carol A. Eblen, Edmund K. Saffery, Thomas Benedict, William K. Tanaka, and Dawn T. Sugihara

NOTE: Order accepting Application for Writ of Certiorari, filed 05/22/15.

COURT: MER, CJ; PAN, SSM, RWP, and MDW, JJ.

[ Listen to the entire audio recording in mp3 format ]

Brief Description:

Both Plaintiff-Appellant Lloyd R. Anastasi (Anastasi) and Defendant-Appellee Fidelity National Title Insurance Company (Fidelity) applied for a writ of certiorari from the Intermediate Court of Appeals’s (ICA) February 6, 2015 Judgment on Appeal filed pursuant to its December 30, 2014 Published Opinion. The ICA vacated the judgment of the Circuit Court of the First Circuit (circuit court), which was entered in favor of Fidelity.

Anastasi filed a bad faith and breach of contract claim against Fidelity after Fidelity allegedly delayed in making payments to Anastasi under a title insurance policy. Anastasi had loaned $2.4 million to a third party in exchange for a mortgage on a property that was supposedly owned by that third party. Fidelity insured that the third party had good title, but it was soon discovered that the warranty deed purporting to give title to the third party was forged. When Anastasi was sued by the true owners of the property, Fidelity accepted tender of the claim under a reservation of rights and retained an attorney to represent Anastasi.

Anastasi argued that Fidelity committed bad faith because Fidelity knew early on in the underlying litigation that the deed was forged but continued to litigate the lawsuit. Anastasi asserted that the lawsuit was used by Fidelity to delay paying him under the policy. The circuit court granted summary judgment in favor of Fidelity on this issue.

On appeal, Anastasi argued that there were genuine issues of material fact as to whether Fidelity committed bad faith. Anastasi also challenged a circuit court order that allowed Fidelity to withhold certain documents that Anastasi requested during discovery under attorney-client privilege and work product doctrine. The ICA remanded the discovery order to the circuit court and vacated part of the circuit court’s order granting summary judgment.

In Anastasi’s application, he presented the following questions:

1. Did the ICA gravely err by failing to hold Fidelity to an enhanced standard of good faith in analyzing Fidelity’s interactions with insurance-defense counsel?

2. Did the ICA gravely err in its published opinion by viewing the evidence unfavorably to Anastasi, the summary judgment non-movant, to exclude from trial a material portion of Anastasi’s insurance bad-faith claim showing inducement of unethical conduct by insurance defense counsel?

In Fidelity’s application, it presented the following questions:

 1. Whether the ICA grievously erred in holding that Fidelity could be found to have acted unreasonably by exercising its contractual right to defend its insured’s property interest.

2. Whether the ICA grievously erred in holding that Fidelity’s obligation to pay benefits to its insured should be judged under the “heightened duty of good faith” standard developed to protect insureds from uncovered risks in third-party litigation.

3. Whether the ICA grievously erred when it created a presumption that documents prepared by insurers prior to their final coverage decision are not work product.