Cimarron Ins. Co. v. Pace

• Decision Date: 13 June 1956
• Docket Number: No. 19342,19342
• Parties: CIMARRON INSURANCE COMPANY, Incorporated, v. M. L. PACE et al.
• Court: Georgia Supreme Court

Page 593

93 S.E.2d 593

212 Ga. 427

CIMARRON INSURANCE COMPANY, Incorporated, v. M. L. PACE et al.

No. 19342.

Supreme Court of Georgia.

June 13, 1956.

Syllabus by the Court.

1. The allegations of the petition, respecting damages and attorney's fees which may be recovered by a policy holder under Code, § 56-706, when an insurance company in bad faith refuses to pay an insured loss within sixty days after demand therefor, were, as against an oral motion to strike them sufficient to carry the question of damages and attorneys' fees to the jury for determination. Hence, the motion to strike them from the petition in the instant case was properly denied.

2. Under an act which the legislature passed in 1946, counsel whose duty it is to prepare a brief of evidence must give the opposite party or his counsel written notice of the time and place of its presentation for approval or secure from such opposite party or his counsel a written waiver of such notice; and without such notice or waiver, the trial judge is not permitted to approve a brief of evidence on presentation therefor. In this case counsel for the movant complied with the statute by giving the notice required.

3, 4. When, as here, the question is duly presented by writ of error, the Supreme Court can affirm or reverse an order approving or refusing to approve a stenographic report of the trial with immaterial questions and answers and parts thereof eliminated, which is presented for approval in lieu of a brief of the evidence. And where, as in this case, the trial judge erroneously refuses to approve such a stenographic report of the trial, subsequent action taken by him on a motion for new trial is nugatory.

Jones & Douglas, Dublin, for plaintiff in error.

Nelson & Nelson, Carl K. Nelson, R. M. Daley, Dublin, for defendant in error.

CANDLER, Justice.

On March 23, 1955, M. L. Pace and the Citizens & Southern Bank of Dublin filed a suit against Cimarron Insurance Company, Inc., and Georgia Insurance & Loan Company, a partnership composed of T. B. Perry and J. M. Fincher. The petition in substance alleged: The defendant Cimarron Insurance Company, Inc., is a nonresident insurance company, and the other defendant is its agent with authority to issue and sell policies of insurance for it in this State. The plaintiff Pace applied to the plaintiff bank for a loan to finance the balance due by him on a described automobile. His application was approved on condition that he purchase a policy of insurance in the amount of $775 covering loss of the automobile by fire, and other specified perils, extending over a period of 18 months, with a standard mortgagee clause in favor of the bank. He ordered such a policy from the defendant company through its aforementioned agent. The order was accepted, and the agent made a written memorandum thereof showing that Pace's automobile was insured for $775 by the defendant company against loss by fire, and other specified perils, for a period of 18 months, with a standard mortgagee clause in favor of the plaintiff bank. The memorandum also recited payment of the premium due therefor. The agent of the defendant company notified the plaintiff bank that Pace's automobile was so insured. The loan which the plaintiff Pace had applied for was then closed. On June 29, 1954, the agent of the defendant company prepared and executed the insurance policy theretofore ordered by the plaintiff Pace, attaching a standard mortgagee clause thereto in favor of the plaintiff bank, but the policy was not then delivered. The insured automobile was completely destroyed by fire on July 12, 1954, through no fault of the plaintiffs or either of them; and its actual cash value, at the time of destruction, was $775. The insurance policy was delivered to the plaintiff bank on August 10, 1954, by the agent of the defendant company; and, on inspection of it, the plaintiff bank learned for the first time that by simple mistake or typographical error its effective date was from July 29, 1954, to January 29, 1956, and not from June 29, 1954, to December 29, 1956, as intended by all of the parties; but, that prior to delivery, the mistake had been corrected by the agent of the defendant company by an endorsement reciting that its effective beginning date was June 29, 1954, and a copy of the endorsement was forwarded to the defendant company by its agent at the time the original was attached to the policy. On August 30, 1954, and within the time required by the policy, the plaintiffs submitted to the defendant company written and verified proof of loss. The proof of loss so furnished was on a standard form and fully complied with all requirements respecting notice of loss. By the terms of the policy, $775 was due and payable to the plaintiffs within 30 days after proof of loss was furnished. On November 22, 1954, and in compliance with the provisions of Code, § 56-706, the plaintiffs made a written demand on the defendant company for payment of the aforesaid amount of $775. The defendant company arbitrarily, capriciously, and in bad faith refused to comply with the terms of the policy by paying the loss sustained by the plaintiffs. Since the defendant company's refusal to pay the insured loss within 60 days after demand therefor was in bad faith, it is liable to the plaintiffs in an amount equal to 25% of $775, or the sum of $193.75 as damages, and also $387.50 as reasonable attorneys' fees incurred in consequence of the defendant company's refusal to pay the insured loss; and there is a prayer that the plaintiffs have judgment against the defendant company for those amounts. The petition also prays for reformation of the policy so as to fix its effective date for the period from June 29, 1954, to December 29, 1955, and for a judgment against the defendant company for $775, the value of the automobile at the time of its destruction and the amount for which it was insured. No defensive pleadings were filed, but on the trial the defendant company made an oral motion to strike from the petition all allegations respecting damages and attorneys' fees on the ground that the facts alleged in the petition were insufficient to show that its refusal to pay the amount of insurance claimed by the plaintiffs was in bad faith. The motion was denied, and there is an exception to the ruling. As against the defendant company, the jury found...