The performance of the adjuster at the deposition is proportionately
related to the time and effort spent preparing him or her for the
deposition. If the appropriate amount of time and effort is spent, generally
the deposition will go well, and the case can be defended. On the other
hand, if an insufficient amount of time is spent preparing the witness, in
most cases, the deposition will not go well, and the case cannot be
defended.
Bad faith cases are generally won or lost at the deposition stage. There
is a corollary to this rule, which is that the file will serve as a template
for taking and defending the adjuster's deposition. The better the file is
documented, the easier the deposition is to defend. The poorer the file is
documented, the more difficult the deposition is to defend.
Knowledge of the File
The first step in preparing an adjuster for a deposition or in taking an
adjuster's deposition is knowledge of the file. The attorneys preparing the
adjuster must have not only a working knowledge of the documents but also an
intimate knowledge of them. They must know where the problems are in the
file. They should have created a timeline to know what was happening when
another event in the case was occurring and must recognize whether the
adjuster takes inconsistent positions in the file.
This must be fully explored prior to preparing or taking the deposition.
Then, if the attorney is preparing the adjuster for the deposition, this
knowledge must be imparted to the adjuster. The adjuster must also have an
intimate knowledge of the file and the implications of everything that has
been written in the file. There can and should be no surprises based on what
is contained in the file. There is no excuse for the adjuster to be caught
off guard.
In many circumstances, several hands may touch the file. The adjuster
must also be familiar with what others in the company have written in order
to be prepared for questions regarding their conduct. If the supervisor or
other adjuster has written notes that are inconsistent, then the adjuster
must be prepared to specifically address those inconsistencies.
Mental Status
Part of the role of the attorney in preparing an adjuster for deposition
or in taking the deposition of an adjuster is to play the role of
psychiatrist. The defense attorney must have an accurate assessment of the
mental status of the adjuster. The relative psyches with which defense
counsel must deal run the gamut. At one end of the spectrum is the adjuster
who thinks he or she knows it all and is anxious to give his or her
deposition. These are the most dangerous because they tend to think they are
smarter than anyone else is and are unwilling to listen to advice, and it is
very easy to lead them into a trap based on their own vanity.
How do you deal with this situation? Sometimes you cannot. Such
self-important adjusters are so set in their ways they will not respond to
any type of advice. Others are more pliable, and the job of defense counsel
is to show them how they can be led down the primrose path and made to say
things they do not want to say. Once they come to this realization, then
generally they will be responsive to the advice that is being offered.
On the other end of the spectrum is the adjuster who is terrified of
depositions and wants to be any place other than in the deposition. If you
are the lawyer who is taking the deposition of the adjuster, it is
beneficial early on to perform some psychoanalysis to determine the mental
psyche of your witness and to conduct your deposition in a manner that takes
advantage of that mental psyche.
Legal Context
It is impossible to anticipate every question that may be asked during a
deposition. Therefore, in preparing an adjuster for deposition, it is
critically necessary to be intimate with the legal context in which the case
is going to be tried. For example, if the case is a first-party bad faith
case for breach of the duty of good faith and fair dealing, the standard is
failing to pay a claim in which an insurer's liability has become reasonably
clear. (See Universe Life Ins. Co. v. Giles,
950 S.W.2d 48 (Tex. 1997).) That is the question for the case. The insurer
does not have to be correct in its determination; in fact, it may be wrong.
However, that does not result in liability.
The focus of the adjuster in the preparation and in answering the
questions is this—at the time the decision was made on the claim, was the
insurer's liability reasonably clear? Was there information requested that
had not been provided? Was there conflicting evidence? Were there other
policy defenses that were still in play? All of these issues would prevent
the insurer's liability from being reasonably clear. The adjuster does not
have to establish that his or her decision was correct, only that he or she
had a reasonable basis for taking the position that he or she did. If this
is accomplished, there is no bad faith or breach of the duty of good faith
and fair dealing. This is the legal context he or she must keep in mind when
answering the questions from counsel.
The same is true for the coverage deposition. It is critical that
adjusters be intimate with the legal standard governing the coverage issue
and how the evidence impacts it. They must be able to filter the questions
that will be asked through the legal standard counsel has given them that
will determine the coverage issue to appropriately answer the questions that
will be presented. The questions to the adjuster must also be in the
appropriate legal context. Counsel for the insured must be intimate with the
appropriate legal standard. If this is so, the information obtained in the
deposition may be case dispositive. This is particularly true if the
adjuster has been designated as a corporate representative. On the other
hand, if the attorney is not familiar, he or she may be asking questions
that are not binding on the insurer and are irrelevant at trial because the
wrong standard was used.
Factual Context
Just as adjusters must be aware of the appropriate legal context when
answering the questions, they must also be aware of the factual context in
which they are answering the questions. They must be familiar with the prior
testimony in the case—particularly with respect to prior testimony of the
insurer. One of the worst things that can happen in a case is for two
witnesses from the same company to testify inconsistently regarding their
understanding of material facts in the case. It gives the appearance of
incompetence and that the left hand does not know what the right hand is
doing. If the appearance can be created for a jury that one part of the
company is unaware of what is happening in another part of the company, it
is not a far reach for the jury to conclude that the company does not have
proper policies and procedures in place for the handling of claims and that
bad faith has been committed.
Sometimes it is impossible to avoid inconsistencies in testimony.
However, these should be few and far between. Also, if the witness is aware
that he or she will be testifying inconsistently with another witness, it
will not come as a surprise during the deposition, and a logical and cogent
explanation can be prepared for the inconsistency.
Conclusion
These four tips address the first part of the preparation of the adjuster
for the deposition or the preparation of the attorney who is going to take
the deposition of the adjuster.
Part 3 addresses the remaining steps to be taken to prepare for the
deposition of the adjuster.
Part 4 covers the appearance of the adjuster, as well as objections and
privileges that can be asserted at the deposition.