lawskills
Loading
Did you know you can download our entire database for free?


Resources
[more] 

Georgia Caselaw:
Browse
Greatest Hits

Georgia Code: Browse

(external) Findlaw Georgia Law Resources


This site exists because of donors like you.

Thanks!


Lawskills.com Georgia Caselaw
BROWN v. SEABOARD LUMBER & SUPPLY COMPANY, INC. et al.
22922.
Equitable petition. Fulton Superior Court. Before Judge Pharr.
QUILLIAN, Justice.
The plaintiff, endeavoring to set aside a release obtained by her insurer in 1961, failed to allege sufficient facts in the petition to except her from the rule pronounced by this court in Aetna Cas. &c. Co. v. Brooks, 218 Ga. 593 (129 SE2d 798).
Lula Belle Brown brought this equitable action against Seaboard Lumber & Supply Company, Inc., Virgil Hill and Northern Insurance Company of New York (hereinafter referred to as Seaboard, Hill and Northern respectively) in the Fulton Superior Court. Briefly stated, the pertinent allegations of the petition were: that the plaintiff was insured by Northern under a standard automobile liability policy which contained a provision--"the company may make such investigation and settlement of any claim or suit as it deems expedient"; that the plaintiff was injured in an automobile collision by Hill, an employee of Seaboard; that the plaintiff sued Hill and Seaboard who filed a motion for summary judgment based on a purported release whereby Seaboard released the plaintiff from all liability resulting from the collision; that Northern obtained the release which Seaboard executed to the plaintiff for $80.86 consideration; that, in making the settlement, Northern did not contact or inform the plaintiff and acted without the plaintiff's knowledge; that up to the time of the settlement (10 days after the accident) Seaboard had not made any claim for damages against the plaintiff but that Northern sought out Seaboard; that Northern's acts in obtaining a release and settlement were for its own benefit and were the result of disloyal and fraudulent acts of Northern which failed to exercise loyalty towards its principal, the plaintiff, as required by law; that Hill and Seaboard knew that the plaintiff had no knowledge of the settlement "for the reason that plaintiff was transported from the scene of the collision in an ambulance to the hospital and said defendants were well aware of that fact"; that, because of the concurrent and conspiring acts of the defendants the plaintiff has been deprived of her cause of action against Hill and Seaboard; that Northern's acts in securing the release were beyond the scope of its agency and have never been ratified by the plaintiff; that after the accident the plaintiff notified the defendant Northern as required by the policy but never directed or authorized Northern to settle any alleged claim of Seaboard.
The prayers were: that Hill and Seaboard be enjoined from prosecuting their motion for summary judgment pending a final adjudication of the instant action; that the release be declared null and void and not binding on the plaintiff; that, if for any reason the release cannot be declared null and void, the plaintiff have judgment against Northern for $75,000.
Attached as exhibits to the petition were: (1) a copy of the insurance policy between Northern, the insurer, and the plaintiff, the insured, which contained the provision--"the company may make such investigation and settlement of any claim or suit as it deems expedient"; (2) the petition of the plaintiff against Hill and Seaboard alleging negligence on the defendant's part resulting in a collision and damages to the plaintiff amounting to $75,000; (3) a styled "corporation release" dated June 8, 1961, whereby Seaboard for a consideration of $80.86 released the plaintiff, "its successors and assigns, and/or his, her or their associates, heirs, executors and administrators, and all other persons, firms or corporations of and from any and every claim, demand, right or cause of action, of whatsoever kind or nature, and especially in connection with or as the result of a certain accident happening on or about the 29th day of May, 1961, in the City of Atlanta, State of Georgia."
To the petition Seaboard filed its general demurrer, Northern filed its general and special demurrers, and Thomas A. Veitch, administrator of the estate of Hill, now deceased, made an oral motion, in the nature of a general demurrer. The trial judge sustained the demurrers of Seaboard and Northern and the oral motion of Veitch, as Hill's administrator. The plaintiff excepted and brings this case here for review.
In Aetna Cas. &c. Co. v. Brooks, 218 Ga. 593 (129 SE2d 798), it was held that under a provision in an automobile liability insurance policy which authorized the insurer to "make such investigation and settlement of any claim or suit as it deems expedient" the insured gives express authority to the insurer and constitutes it the insured's agent for the purpose of effecting settlement of claims and that a settlement so obtained by the insurer was binding upon the insured without regard to whether the insured had knowledge of the settlement, consented to it or subsequently ratified it. While the effect of this ruling has been abrogated by statute, Ga. L. 1963, p. 643, the release in question was executed on June 8, 1961, and it is conceded by the parties at interest that the Brooks case is applicable.
Here the insured in an action against the insurer and alleged third party tortfeasors attempts to set aside such a release. The basis of her contention is that, conceding the insurer was her agent under express authority of the contract (as held in Allstate Ins. Co. v. Hill, 215 Ga. 430, 128 SE2d 321, and the Brooks case, supra): (1) the insurer acted fraudulently and for its own benefit; (2) the insurer and the other defendants conspired together in making the settlement. While it is generally alleged that the settlement was the result of the disloyal and fraudulent acts of Northern and that because of the concurrent and conspiring acts of the defendants the plaintiff was deprived of her right of action against him and Seaboard, the specific allegations failed to show fraud or conspiracy. Thus, the rule is applicable: "No cause of error is stated in a petition which states were legal conclusions of conspiracy, collusion and fraud with no facts alleged upon which to base them except general and loose allegations consisting of statements without facts upon which the conclusions are based." Budget Charge Accounts v. Peters, 213 Ga. 17 (2) (96 SE2d 887); Johnson v. Ellington, 196 Ga. 846 (28 SE2d 114).
Furthermore, the insurer is not shown to have acted in bad faith, as contended by plaintiff's counsel in his brief to this court, merely by settling the claim which resulted in the insured being bound, since the rule of law pronounced by our appellate courts at that time (1961) was that the insured would not be bound by such settlement. Foremost Dairies v. Campbell Coal Co., 57 Ga. App. 500 (196 SE 279); Cochran v. Bell, 102 Ga. App. 617 (117 SE2d 645). Under former Code 56-706 (now Code 56-1206; Ga. L. 1960, pp. 289, 502, Ga. L. 1962, p. 712), this court has consistently held that no "bad faith" exists where there is a doubtful question of law involved. Northeastern Mut. Life Ins. Co. v. Ross, 63 Ga. 199, 200; Equitable Life Assurance Society v. Gillam, 195 Ga. 797 (2) (25 SE2d 686, 147 ALR 1008).
Judgment affirmed. All the Justices concur, except Quillian, J., who dissents.
Long, Weinberg & Ansley, Ben Weinberg, Jr., Hurt, Hill & Richardson, James C. Hill, Arnold Wright, Jr., contra.
Robert A. Carpenter, A. Tate Conyers, for plaintiff in error.
ARGUED APRIL 13, 1965 -- DECIDED MAY 7, 1965.
Friday May 22 20:47 EDT


This site exists because of donors like you.

Thanks!


Valid HTML 4.0!

Valid CSS!





Home - Tour - Disclaimer - Privacy - Contact Us
Copyright © 2000,2002,2004 Lawskills.com