The phrase "spoliation of evidence" invokes thoughts of discarded pipes and compromised fire scenes. Even the greenest of first party adjusters and subrogation professionals are quick to ask an insured if the physical artifacts related to a loss are still available. Given that most documents and communications are now transmitted and stored electronically, the potential for spoliation of evidence exists not only with physical artifacts, but also with the preservation of documents and electronically stored information ("ESI"). In order to prevent a claim or defense alleging the spoliation of evidence, adjusters and subrogation professionals should be implementing litigation holds for all claims where subrogation is pursued.

What is a litigation hold?

A litigation hold is a directive that relevant documents and electronically stored information be preserved so that the documents and ESI remain available should they be needed during future litigation. The hold is intended to prevent the unintentional or intentional destruction of information. Often times, litigation hold directives are sent to adverse parties to ensure that they do not destroy potentially relevant information. However, the duty to preserve is mutual and subrogation professionals should be mindful of the duty to preserve all relevant documents and ESI as soon as a subrogation claim is anticipated.