In Ex parte Ferrari, 2015 Ala. LEXIS 13 (Ala. Feb.
6, 2015), Ferrari was employed by DR Horton as a land-acquisition manager for
its Gulf Coast division. DR Horton began to suspect that Ferrari was
supplying confidential information to third parties and was receiving, through
his wife and/or LLCs created by the couple, monetary compensation. DR
Horton conducted interviews of Ferrari and a third party which conferred what
was suspected. Instead of immediately suing Ferrari, DR Horton filed a
petition pursuant to Rule 27(a) of the Alabama Rules of Civil Procedure seeking
to depose Ferrari and his wife, to propound written interrogatories and to
request production of documents, including tax returns. DR Horton
acknowledged that it had justification to commence a lawsuit but needed the
requested discovery in order to determine all of the causes of action which
might be asserted.
In the opinion, the Alabama Supreme Court held that a trial
court must conduct a hearing before permitting any pre-suit discovery and that
Rule 27(a) did not permit the propounding of written interrogatories.
Instead, the rule allows for depositions, independent medical examinations and
production of documents.
More significantly, the Alabama Supreme Court overruled the
holding in Ex parte Anderson, 644 So. 2d 961 (Ala. 1994), that
Alabama’s Rule 27(a) does not limit pre-action discovery to perpetuating
evidence. This overruling “returns” Alabama law to the law in other
jurisdictions. The purpose of Rule 27(a) is to preserve or perpetuate
testimony or evidence which might be lost before a lawsuit may be commenced,
for example, when a party or witness is near death, requiring the conducting of
a deposition prior to such death, or when there is a “real” fear that documents
or physical things might be destroyed. Rule 27(a) should not be used as an
“investigative” tool to determine (or verify) if there is a viable cause of
action or a device to help determine what causes of actions to assert. As
noted in the opinion: “DR Horton did not offer in its petition, and it
does not attempt to offer in response to the Ferrari defendants’ mandamus
petition, any reason to perpetuate the testimony of the Ferrari
defendants. Instead, DR Horton openly stated in its Rule 27(a) petition
and at the March 25, 2014, hearing that it sought preaction discovery to
determine what other causes of action it may have against the Ferrari defendants
besides breach of fiduciary duty against Peter Ferrari.”
The Alabama Supreme Court gave no significance to DR Horton’s
suggestion that allowing such discovery would save time and resources in a
litigation. Obviously, the Alabama Supreme Court determined that Rule
27(a) has a very specific purpose, namely, perpetuating testimony or evidence
which is in real danger of being lost, and that Rule 27(a). Rule 27(a)
was never intended as a device by which a party may obtain information in order
to decide whether to institute a lawsuit.
What the opinion leaves as unclear, however, is if Rule 27 can be
used to issue a subpoena to obtain documents that may only be obtained via
subpoena. For example, a law enforcement agency will not produce a traffic
homicide report without a subpoena and the Alabama Department of Forensic
Sciences will not release an autopsy without a subpoena. Rule 27 subpoenas are
oftentimes a vital tool in helping to determine, unlike in Ex Parte Ferrari where the party wanted to know how many causes of
action they could claim in their Complaint, but if there is even a cause of
action.
