Appeal from Butler Circuit Court. (CV-92-67). William R. King, Trial Judge
As Amended. Second Amendment. Released for Publication December 2, 1994.
Maddox, Houston, Steagall, and Ingram, JJ., concur. Cook, J., concurs in the result. Hornsby, C.j., and Almon, Shores, JJ, Dissent.
The opinion of the court was delivered by: Maddox
Lewis Crenshaw sought a judgment declaring that his father, F.W. Crenshaw (the decedent), did not make a valid inter vivos gift of certain personal property to the defendant, Fred W. Crenshaw. The trial court entered such a judgment. Fred W. Crenshaw appealed. The appeal presents three issues: (1) whether the testimony of the decedent's attorney and the attorney's secretary was properly excluded as subject to the attorney-client privilege; (2) whether the testimony of witness Betty Crenshaw Hendricks was inadmissible under the Dead Man's Statute or was privileged under the attorney-client privilege; and, if the trial court did not err in regard to those first two issues, then (3) whether the evidence was sufficient to support the trial court's judgment declaring that the decedent had made no valid inter vivos gift to the defendant.
F.W. Crenshaw died on June 30, 1989, leaving three children: Fred Crenshaw, Lewis Crenshaw, and Betty Crenshaw Hendricks. *fn1 On June 8, 1989, he was a patient at L.V. Stabler Memorial Hospital in Greenville, Alabama, when his attorney, Elisha C. Poole, and Poole's secretary, Barbara Ellison, came by to execute three real estate deeds. Fred and Betty were also present in the decedent's hospital room at that time. The decedent executed three deeds, granting each of his three children a portion of his real estate. The defendant, Fred Crenshaw, alleges that, when the father executed the deeds, the father made a statement giving Fred the father's house and all of the personal property located in the house. The father had built an annex onto his house in 1937. Fred had lived in the main part of his father's house until Fred married in 1952, at which time he moved into the annex of the house. The deed to Fred granted him the real property on which the house was located. The decedent's will named Lewis and Fred as co-executors and devised his personal property to his three children in equal parts. Lewis, as co-executor, sought to divide the personal property in the house according to the father's will; Fred contended, however, that all of the personal property in the house had been given to him by the father at the time the father conveyed the house to him. Lewis brought this declaratory judgment action to determine his rights.
The case was tried without a jury. Before the trial, Lewis filed a motion in limine to exclude the testimony of Elisha Poole, Barbara Ellison, Betty Crenshaw Hendricks, and Fred Crenshaw. The court granted the motion in part, disallowing the testimony of Attorney Poole and his secretary because of the attorney-client privilege. The court also excluded some of Fred's testimony under the provisions of the Dead Man's Statute.
Fred contends that the trial court erred in excluding the testimony of Attorney Poole and his secretary, Barbara Ellison, arguing that the attorney-client privilege does not apply to communications between the attorney and the client made in the presence of third persons and that Attorney Poole was only representing the father, not Fred or Betty, at the time the statement was allegedly made and while Fred and Betty were present. Lewis contends that the attorney-client privilege was not waived by the presence of Betty and Fred, because Bertarelli v. State, 585 So. 2d 212, 217-18 (Ala.Cr.App. 1991), holds that the attorney-client privilege "applies to third persons who are present and are represented by the same attorney or have an interest in the proceedings."
We recognize that the attorney-client privilege "does not exist when . . . client to attorney communications are made in the presence of a third party whose presence is not necessary for the successful communication between the attorney and the client." Branch v. Greene County Bd. of Educ., 533 So. 2d 248, 255 (Ala. Civ. App. 1988) (citing Charles W. Gamble, McElroy's Alabama Evidence, § 392.01 (3d ed. 1977)). The decedent is alleged to have made a statement to the effect that he wanted Fred to have the house and everything in it. This statement was allegedly made not only in the presence of his attorney and his attorney's secretary but also in the presence of Fred and Betty. Attorney Poole was the attorney for the decedent. Betty testified that he did not represent her, and there is no indication that he represented Fred. In International Bhd. of Teamsters, Chauffeurs, Warehousemen & Helpers v. Hatas, 287 Ala. 344, 366-67, 252 So. 2d 7, 27 (1971), this Court said:
"The rationale behind [the rule that statements between an attorney and client in the presence of a third party constitute a waiver of the privilege] is that since a third person is not involved in the relationship between the attorney and his client, the presence of such third party defeats the confidential nature of the conference and thereby the privilege. See Wigmore on Evidence, McNaughton Revision, Vol. VIII, § 2311, p. 599.
"Neither that rationale nor the rule which it supports applies when the third person is also a client as to the subject matter discussed in the conference or has a common interest in the matters discussed. The majority rule applicable where such a relationship existed at the time of the conference is stated thusly in 141 A.L.R. at p. 562:
"'Where two or more persons employ an attorney as their common attorney their communications to him in the presence of each other are regarded as confidential so far as strangers to the conference are concerned, and are privileged as to them. Likewise, where two or more persons interested in the same subject matter are present at a conference with an attorney who represents only one of those present, it has been held that matters discussed at such conference are confidential as to strangers to the conference and accordingly they constitute privileged communications as to such strangers. . . .'"
(Emphasis in original.) We conclude that Betty and Fred did not have a sufficient common legal interest in the subject matter discussed in the decedent's hospital room to make the attorney-client privilege applicable. In fact, the interests of Betty and Fred could be considered adverse to each other, or to those of the decedent.
In Bertarelli, the attorney-client privilege was held to apply because when the communications at issue took place "the four officers involved in the incident were conferring with an attorney who, at the time, represented all four officers." 585 So. 2d at 217. The third parties in this case, Betty and Fred, do not have common interests similar to those found in Bertarelli and in Hatas, *fn2 where the privilege was also held to apply. We hold, therefore, that the attorney-client privilege was waived in this case, because third parties who did not have common interests in the subject matter discussed were present when the statements at issue were alleged to have been made. Consequently, the trial court ...