Adams v. Atlanta Cas. Co.
| Decision Date | 30 October 1998 |
| Docket Number | No. A98A1660.,A98A1660. |
| Citation | 509 S.E.2d 66,235 Ga. App. 288 |
| Parties | ADAMS et al. v. ATLANTA CASUALTY COMPANY. |
| Court | Georgia Court of Appeals |
OPINION TEXT STARTS HERE
Clark & Clark, Fred S. Clark, Savannah, for appellants.
Brennan, Harris & Rominger, Edward R. Stabell III, Savannah, for appellee.
HAROLD R. BANKE, Senior Appellate Judge.
Atlanta Casualty Company ("Atlanta Casualty") filed a declaratory judgment action to ascertain whether it had any duty to defend or provide coverage for Willie Alvin Adams, Jr. After the trial court found in favor of Atlanta Casualty, Willie A. Adams, Sr., Willie A. Adams, Jr., and General Accident Insurance Company of America ("General Accident") commenced this appeal.
The underlying case arose after Theresa Adams, with the express authorization of Adams, Sr., completed an insurance application on his behalf which contained a "NAMED DRIVER EXCLUSION AGREEMENT" expressly "supersed[ing] and exclud[ing] from the policy any contrary provision[s]." In two separate places on the application, the names of Adams, Jr. and his sister appear as excluded drivers notwithstanding the fact that one line was left blank. Mrs. Adams admitted that it was her intent to exclude Adams, Jr. from coverage under the policy, and that it was her understanding that he had been excluded. By not including the children on the policy, Mrs. Adams was able to procure a policy from Atlanta Casualty at a reduced premium.
Shortly after Mrs. Adams submitted the application, Adams, Jr. became involved in an automobile accident involving a third party. Upon receiving a report of this accident, Atlanta Casualty notified its policyholder, Adams, Sr., that it would investigate under a complete reservation of rights. About ten days later, Atlanta Casualty sent notice to him that no coverage existed because of the named driver exclusion.
After a third party filed suit against Adams, Jr., that party's uninsured motorist carrier, General Accident, defended Adams, Jr. It is undisputed that Atlanta Casualty was not notified about the tort suit until over a year after it was filed. Nearly two years after denying coverage, while the applicability of the exclusion remained in dispute, Atlanta Casualty advised its policyholder that it had assigned the defense of Adams, Jr. to a specified law firm and that Atlanta Casualty would pay the attorney fees and expenses incurred. Later, Atlanta Casualty decided not to assume and conduct any defense because General Accident was doing so. General Accident paid the expenses of defending the action and paid the $1,105.18 judgment entered against Adams, Jr.
When Atlanta Casualty proceeded with its declaratory judgment action, General Accident, Adams, Sr. and Adams, Jr. counterclaimed seeking damages for Atlanta Casualty's failure to assume and conduct a defense for Adams, Jr. The trial court determined that the named driver exclusion was enforceable and that Atlanta Casualty had no duty to defend Adams, Jr. or to pay any judgment on his behalf. This court reversed, finding that no justiciable controversy existed to support the trial court's jurisdiction because Atlanta Casualty had denied coverage prior to filing suit. Adams v. Atlanta Cas. Co., 225 Ga.App. 482, 485(1), 484 S.E.2d 302 (1997). We held, however, that the coverage issues relating to the counterclaims were not moot. Id. at 485-486, 484 S.E.2d 302. Upon remand, the trial court found the named driver exclusion to be enforceable and rejected the arguments that Atlanta Casualty had waived or was estopped from asserting its coverage defense. Held:
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