The situation
A plaintiff makes a within-policy demand. The insurer refuses. The case proceeds toward trial with a verdict expectation above the policy limits. From that point on, the insured is carrying a risk the insurer created. If the verdict comes in above limits, the insurer is on the hook to its own insured for the difference — bad faith failure to settle, in the shorthand. If the verdict comes in below limits, the case resolves and no one talks about it again. Either way, the insurer's posture has shifted the downside risk onto the insured.
The structural mismatch is what gives rise to the future bad-faith case. The insured has every reason to want the case settled within reasonable bounds and out of an excess-verdict zone. The insurer has its own incentives, sometimes including a willingness to roll the dice with someone else's house. Defense counsel, paid by the insurer, sits in the middle — professional duty to the insured, fee from the insurer. When defense counsel's choices favor the insurer's interest at the expense of the insured's, defense counsel's exposure sits beside the insurer's.
The point of the letters: evidence for a later case
The temptation, while the underlying case is still live, is to think of the correspondence as a settlement tool. It is not, primarily. It is evidence preservation. The bad-faith case — and any malpractice case that ripens — will be tried after the underlying case is over. By then, witnesses have moved on, memories have shifted, and the only sources of contemporaneous fact are the documents that already exist.
If the basic facts of the bad-faith case have to be reconstructed later from a patchwork of emails, deposition snippets, and post-hoc testimony, the case is harder to plead, harder to try, and easier for the insurer to muddy. If the basic facts are plain on the face of summary letters that the plaintiff's counsel wrote at the time, the case is easy.
That is the goal. Each letter is written to be read by two audiences. The first is opposing counsel today. The second is a future judge or jury reading the letter cold, sometimes years later, in a case the writer is no longer involved in. The first audience knows the file and reads in shorthand. The second audience does not know the file and needs the basic facts spelled out. When those needs pull in different directions, the letter resolves them in favor of the second audience. Date the letter. State the demand. Quote the refusal. Cite the contemporaneous evidence. Lay out the analysis. Make the letter self-contained.
The letter that meets that standard does double duty. It tells opposing counsel what the analysis is in real time, which sometimes moves the underlying case toward a sound resolution. And it preserves the basic facts in clean summary form, which makes the future case easy to bring if the underlying case proceeds to an excess verdict.
Two distinct exposures to document
A within-limits-refusal posture puts two distinct exposures in play. Both are legitimate legal interests of the insured. Both are proper subjects of communication between counsel. Both should be documented in their own right.
The insurer's bad-faith exposure for an excess verdict
When the plaintiff has demanded the policy limits (or less) and the insurer has refused, an excess verdict puts the insurer on the hook to its own insured for the difference. The exposure is concrete. It is not theoretical. The insurer's coverage counsel knows it. So does any monitoring or excess counsel the insurer has retained.
Plaintiff's counsel can write to coverage counsel and document the basic facts: the demand, the date, the amount; the refusal, the date, the author; the verdict expectation and how it is grounded; any prior within-limits opportunity the insurer passed up; any contemporaneous evidence that bears on the reasonableness of the refusal. The letter's audience is the lawyer, not the insured. The letter's subject is the lawyer's client's exposure to its own insured. Coverage counsel will then make their own choices about how to advise the insurer and whether, when, and how to inform the insured.
Defense counsel's exposure for legal malpractice
Defense counsel paid by an insurer have a divided incentive. The fee comes from the insurer. The professional duty runs to the insured. When defense counsel's choices favor the insurer's interest at the expense of the insured's, defense counsel are exposed to a legal-malpractice claim by the insured.
The exposure can take many forms. Failure to disclose a within-limits settlement opportunity. Failure to disclose a coverage-defense letter that affects the insured's personal exposure. Failure to disclose facts about the insurer's bad-faith conduct. Failure to advise the insured to retain independent counsel when the conflict has crystallized. In each, defense counsel have made a choice that benefits the payer over the client.
Plaintiff's counsel can write to defense counsel and document the basic facts: what defense counsel knows, what defense counsel has done or failed to do, and what the resulting exposure to the insured looks like. As above, the letter's audience is the lawyer, not the party.
Why writing to the lawyers about their own exposure does not violate Rule 4.2
Defense counsel sometimes treat letters of this kind as a Rule 4.2 problem — communication with a represented party. The Rule does not reach the technique.
The Rule's text reaches direct contact with the party
Rule 4.2 says: "A lawyer who is representing a client in a matter shall not communicate about the subject of the representation with a person the lawyer knows to be represented by another lawyer in the matter, unless the lawyer has the consent of the other lawyer or is authorized to do so by law or court order." The prohibited act is communicating with the person. Writing to the person's lawyer is not communicating with the person. If the lawyer chooses to forward the letter to the party, that is the lawyer's own choice, made of the lawyer's free will, with the lawyer's consent. By definition that is not contact "without the consent of the other lawyer."
Formal Advisory Opinion 86-4 authorizes letters to opposing counsel containing information for the party
In 1987, the State Bar issued Formal Advisory Opinion 86-4. The Opinion considered whether a lawyer may write to opposing counsel with information meant to be conveyed to opposing counsel's client. The answer is yes. Whatever question existed before 1987 was settled then. A defense counsel who treats a letter to counsel as a Rule 4.2 violation is contradicting the Opinion the State Bar published nearly forty years ago.
The purposes of the Rule, stated in Comment 7, are served by routing through counsel
Comment 7 to Rule 4.2 states the purposes of the Rule:
- protecting against misuse of the imbalance of legal skill between a lawyer and a layperson;
- safeguarding the client-lawyer relationship from interference by adverse counsel;
- ensuring that all valid claims and defenses are raised in response to inquiry from adverse counsel;
- reducing the likelihood that clients will disclose privileged or other information that might harm their interests; and
- maintaining the lawyer's ability to monitor the case and effectively represent the client.
Each purpose is served by writing to opposing counsel rather than to the party. The lawyer who receives the letter can advise the client with full context. The lawyer can decide what to communicate, when, and how. The lawyer can shape any response. The party is protected by being represented by counsel — which is exactly the relationship the Rule contemplates. Comment 7 says nothing about a duty to insulate the party from the existence of the plaintiff's analysis. It says the opposite.
Persona: writing for credibility with the future reader
The letters will be read later — by a bad-faith judge, a bad-faith jury, a malpractice-claim factfinder — long after the events they describe. The future reader will assess the writer's credibility from the document itself. Persona is not who the writer is. It is how the document reads.
The persona that survives the future read is objective. Objectivity, on the page, breaks down into three qualities the writer can control directly.
Direct. Say what is actually true, in summary form. The insurer refused a within-limits demand on a specific date. Defense counsel did or did not disclose a specific fact. The verdict expectation is X. The exposure is Y. The conclusion is stated, not implied. The letter does not bury the operative point or hedge it into ambiguity. A reader picking up the letter cold should be able to identify the legal exposure from the first paragraph.
Factual. Anchor each statement to a piece of contemporaneous evidence the future reader can verify. Cite the demand letter by date. Identify the refusal by date and author. Reproduce the operative quoted language when it matters. Attach the cited documents or reference them by name. The letter should read as a record of facts, not as a set of conclusions floating above unstated premises.
Not heated. Do not editorialize. Do not characterize conduct in moral terms. Do not amplify. Do not warn. The letter does not say "your client has acted disgracefully." It says "your client refused a within-limits demand on [date]; under Georgia law, that exposes your client to bad-faith liability for any excess verdict; the relevant analysis is below." The same logic applies to letters about defense counsel's malpractice exposure. The letter does not say "you are betraying your client." It says "the conflicts in your representation have produced choices that expose you to a malpractice claim by the insured; the relevant facts are below."
The reason this persona pays is structural. The first reader of the letter — opposing counsel today — discounts emotion as posturing. The second reader — a judge or jury later — reads the letter cold and assesses the writer through the prose. A flat letter signals that the writer is reliable and that the analysis is the work product of a careful lawyer. A heated letter signals the opposite. The flat letter persuades the first reader by force of analysis; it serves the second reader by reading as a record rather than an argument.
This is not a stylistic preference. It is a piece of evidentiary engineering. The letter is being created today as a document that may be admitted later. Its value as evidence depends on its reading as a record — and a record of a credible writer. Heat in the letter degrades it as evidence. The discipline is to keep the heat out even when, at the moment of writing, the conduct described would justify it.
How defense counsel handle the correspondence is on defense counsel
If defense counsel give the insured copies of the letters — wholly or in part — that is a choice defense counsel make. Plaintiff's counsel does not direct it and does not consent to it.
The reason matters. Rule 1.4(a)(3) requires a lawyer to keep the client "reasonably informed about the status of the matter." The Rule is silent on the manner of communication. The lawyer can summarize, paraphrase, or pass along the letter. The lawyer can do all three or none. The Rule prescribes the substance of what must reach the client; it does not prescribe the medium. Even Comment 2 to Rule 1.4, addressing settlement offers, requires only that the "substance" of the offer be communicated — not any accompanying discussion or argument.
What that means for plaintiff's counsel: how defense counsel handle the correspondence is not plaintiff's counsel's problem. Defense counsel may decide to share the letters, summarize them, or never discuss them at all. The choice is theirs and so is the responsibility. Whatever defense counsel decide, the contemporaneous record is being created either way.
The "driving a wedge" objection
Defense counsel sometimes accuse the plaintiff's counsel of trying to "drive a wedge" between the insured and her counsel or her insurer. The accusation is not a Rule 4.2 violation. It should not be treated as one.
A "wedge" between the insured and her lawyer, if one exists, exists because the lawyer's interests have actually diverged from the insured's. That is not a fact plaintiff's counsel created. It is a fact plaintiff's counsel may have observed. Pointing out a divergence that already exists is not creating it.
When the wedge accusation comes in writing, the response is a two-step. First, observe that no wedge has actually been driven — the insured is not, in fact, pulling away from her counsel. Second, observe that any insulation of the insured from the relevant facts comes from defense counsel's own handling of the correspondence, not from plaintiff's counsel's drafting of it. Both observations are accurate descriptions of what is happening, both are doctrinally clean, and both should be set down in the same flat persona that governs the rest of the correspondence. The response letter is itself part of the contemporaneous record.
Rule 4.2 does not prohibit advocacy that creates friction inside the defense team. It prohibits direct contact with the represented party. The wedge accusation is a complaint about advocacy, not a violation of the Rule.
The "scare them into settling" objection
A related objection is that the technique is calculated to "scare" the insurer or the insured into settling. The complaint does not survive its first sentence.
Pressing the other side toward a sound settlement is the basic motion of nearly every plaintiff's-counsel communication in serious litigation. A criminal prosecutor informs defense counsel that the State will seek the death penalty. A plaintiff's counsel informs defense counsel that the case is worth more than the policy limits. A coverage lawyer informs an insurer that the verdict expectation is above the reserve. None of those is improper. Communicating adverse facts that bear on settlement value is not coercion. It is the litigation system functioning.
The In re Jefferson principle is the right anchor for the response. "Trial judges must be on guard against confusing offenses to their sensibilities with obstruction to the administration of justice." 283 Ga. 216, 221 (2008). The principle is broader than the contempt context in which Jefferson arose. Plain talk about painful facts is not improper just because the facts are painful.
For the practitioner
Several practical points fall out of the framework.
- Write each letter as evidence first. The letter is a contemporaneous document that may be admitted in a later bad-faith or malpractice case. Write each one to read as a record years later — when the writer is no longer available, the file has moved on, and the letter has to speak for itself.
- Make each letter self-contained. Date it. State the demand. Quote the refusal. Cite the contemporaneous evidence. State the legal exposure in summary form in the first paragraph. The future reader picking up the letter cold should not have to reconstruct the basics from a separate file.
- Write to the lawyers, not to the party. Every letter goes to coverage counsel, defense counsel, or both. Never to the insured directly. The Rule reaches direct contact; the technique never makes direct contact.
- Persona: objective — direct, factual, not heated. The future reader assesses credibility from the document. The flat letter survives the future read; the heated letter does not. Treat heat in the prose as a defect in the letter, not as conviction.
- Document the lawyers' exposure, not the party's emotion. The bad-faith exposure runs to the insurer; document it. The malpractice exposure runs to the insured against defense counsel; document it. The insured's feelings about the conduct are not what the future case will turn on. Keep the analysis on the lawyers' shoes.
- Do not depend on forwarding. Defense counsel may or may not share the letters. The technique works either way. The contemporaneous record is created at the moment the letter is sent. Whether the insured reads the letter today is a separate question from whether a future jury reads it three years from now.
- Be ready for the standard objections. "Driving a wedge" and "trying to scare them into settling" are the two recurring complaints. Both are misreadings of Rule 4.2. The response is the same in each: the Rule's text reaches direct contact; FAO 86-4 authorizes letters to counsel; and Comment 7's stated purposes are served — not undermined — by routing through counsel. Set the response down in the same flat persona that governs the rest of the correspondence.
The technique is not novel. It has been part of plaintiff's-counsel practice for decades. The Rule, the Advisory Opinion, and Comment 7 all support it. Done carefully — written to the lawyers, not the party; documenting the basic facts in summary form; in the persona of a careful lawyer rather than a partisan — it produces a document set that does work in two cases at once. It can move the underlying case toward a sound resolution where one is available. And, where the insurer's posture holds and a verdict comes in above limits, it leaves a contemporaneous record that makes the bad-faith case easy to plead and easy to try.
