Adams v. Atlanta Cas. Co.
| Decision Date | 14 March 1997 |
| Docket Number | No. A96A2330,A96A2330 |
| Citation | 484 S.E.2d 302,225 Ga.App. 482 |
| Parties | , 97 FCDR 1559 ADAMS et al. v. ATLANTA CASUALTY COMPANY. |
| Court | Georgia Court of Appeals |
Clark & Clark, Fred S. Clark, Savannah, for appellants.
Brennan, Harris & Rominger, Richard A. Rominger, Edward R. Stabell, III, Gabrielle M. Mann, Savannah, for appellee.
Willie A. Adams, Sr., Willie A. Adams, Jr., and General Accident Insurance Company of America appeal the grant of summary judgment to Atlanta Casualty Company in Atlanta Casualty's declaratory judgment action. Appellants contend the trial court erred by finding that a "Named Driver Exclusion" in the Atlanta Casualty policy of automobile insurance issued to Willie A. Adams, Sr., excluded liability coverage for Willie A. Adams, Jr., and also erred by granting summary judgment before appellants could depose certain Atlanta Casualty officials.
It is not disputed that with her husband's express authorization, Theresa Adams secured an Atlanta Casualty automobile insurance policy from an independent insurance agent to cover their cars. In the process of doing so, Mrs. Adams decided to exclude their son and daughter, Willie A. Adams, Jr., and Theresa Adams, from the coverage of the policy so they could secure less expensive premiums. Although Mrs. Adams told her daughter Theresa that she was no longer covered, she did not tell Willie Adams, Jr., that he was not covered. Thereafter, Willie Adams, Jr., while driving a covered car with the permission of his father, was involved in an auto accident with Adonia Earl McDaniel on July 21, 1992. After McDaniel filed suit, the Adamses claimed coverage under the Atlanta Casualty policy.
The record shows that on receiving the request for coverage from the Adamses, Atlanta Casualty, on August 4, 1992, advised the Adamses that because Willie Adams, Jr., was driving the car, it was investigating to determine whether there was coverage. Thereafter, by letter of August 13, 1992, Atlanta Casualty informed the Adamses that as the investigation showed that Willie Adams, Jr., who was an excluded driver under the policy, was operating the vehicle, "in accordance with the Named Driver Exclusion Agreement, there is no coverage afforded by this policy for this loss." Then on August 14 1992, Atlanta Casualty advised the Adamses that coverage was denied because false and misleading information was provided in the application for insurance. Nevertheless, on August 26, 1992, Atlanta Casualty informed the Adamses that the letter dated August 14, 1992, was sent in error and that a letter dated August 13, 1992, was the proper disclaimer of insurance. The action by McDaniel against the Adamses proceeded toward trial with General Accident involved as the uninsured motorist carrier, but with no involvement by Atlanta Casualty.
In June 1994, however, Atlanta Casualty wrote the Adamses advising them that Atlanta Casualty had assigned the defense of the case to a law firm and that Atlanta Casualty would pay the attorney fees and cost of defense unless the Adamses were notified to the contrary. For whatever reason, however, these attorneys did not enter an appearance on the Adamses' behalf and did not participate in the trial.
Then on September 12, 1994, Atlanta Casualty filed this petition for a declaratory judgment. Although the petition for a declaratory judgment sought an injunction staying the proceedings between McDaniel and the Adamses, no stay injunction was issued.
All the defendants in the declaratory judgment action filed answers and counterclaimed against Atlanta Casualty. These defendants also initiated discovery against Atlanta Casualty regarding the policy provisions in question and the premiums charged the Adamses. Atlanta Casualty objected to this discovery and also moved for a protective order.
Thereafter, a verdict in favor of McDaniel for $1,105.18 was returned on January 25, 1995, and judgment was entered for that amount on January 30, 1995. General Accident paid that judgment and has paid the expenses of defending the action.
Finally, almost a year after the judgment was entered, Atlanta Casualty moved for summary judgment in the declaratory judgment action. The motion contended that no coverage and no duty to defend existed, as a matter of law, because of the named driver exclusion. The defendants initially did not respond to the motion for summary judgment directly, but instead sought an extension of time in which to answer and a motion to compel Atlanta Casualty to answer the discovery directing that certain company officials sit for deposition. Although the defendants may have responded to the motion for summary judgment, no such pleading appears in the record.
On May 9, 1996, the trial court granted the defendants' motion to compel, and directed Atlanta Casualty to produce designated witnesses to be deposed. This order also reserved ruling on Atlanta Casualty's motion for summary judgment. The same day and without explanation, however, the trial court granted Atlanta Casualty's motion for summary judgment. This appeal followed. Held:
1. Pretermitting the other issues asserted by appellants, our initial consideration is whether this was an appropriate case for a declaratory judgment. See Dept. of Corrections v. Brown, 198 Ga.App. 862, 403 S.E.2d 452. Appellants contend Atlanta Casualty waived its right to seek a declaratory judgment because it earlier had denied coverage under the policy and was in no need of judicial guidance. We agree.
A declaratory judgment is available when "interested parties are asserting adverse claims upon a state of facts wherein a legal judgment is sought that would control or direct future action." Darnell v. Tate, 206 Ga. 576, 580, 58 S.E.2d 160. Although a question about an insurance company's duty to defend its insured is ripe for judicial determination when an action has been filed against the insured (Atlanta Cas. Co. v. Fountain, 262 Ga. 16, 18, 413 S.E.2d 450), that does not mean that Atlanta Casualty is entitled to a declaratory judgment under these facts. When a declaratory judgment cannot guide and protect the petitioner regarding a future act, no declaratory judgment is authorized. Mayor, etc., of Athens v. Gerdine, 202 Ga. 197, 42 S.E.2d 567. This case is different from Atlanta Cas. Co....
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