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A failure to cooperate?

HOT SPRINGS–Defense lawyers take divergent views on whether to divulge a defendant’s lack of cooperation to facilitate a settlement.

Under established principles, a lawyer defending a civil claim cannot jeopardize his client’s coverage by telling his insurance adjuster that the client is failing to cooperate in the defense. But members of the Virginia Association of Defense Attorneys disagreed about whether it’s a good idea to give the opposing lawyer a heads up about a potential coverage problem in order to encourage quick settlement.

Some attorneys said they have effectively “leaked” word to plaintiff’s lawyers that insurance coverage could disappear if the case drags on, resulting in settlements that both protected the unhelpful client and potentially saved money for the insurance company.

Keep your mouth shut, urged Harrisonburg’s Daniel L. Fitch. Telling the plaintiff’s counsel that your client won’t return your calls is “playing with fire,” he said. If the strategy doesn’t work, and the client loses coverage because of the disclosure, the lawyer is “really in hot water.”

The Homestead is playing host to 183 VADA members through Friday.

By Peter Vieth

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