Daily Underwriters of Am. v. Williams

Decision Date13 March 2020
Docket NumberA19A2101,A19A2102
Citation354 Ga.App. 551,841 S.E.2d 135
Parties DAILY UNDERWRITERS OF AMERICA v. WILLIAMS. Daily Underwriters of America v. Williams.
CourtGeorgia Court of Appeals

Dennis Corry Smith & Dixon, Brent Michael Estes, Atlanta, for Appellant.

Pasley Nuce Mallory & Davis, Derek Chad Nuce, for Appellee.

McFadden, Chief Judge.

The issue in these companion appeals is whether Georgia law authorizes the direct actions Veronica Williams and Marleaux Williams brought against the insurer of an interstate motor carrier. One of Georgia’s direct action statutes, OCGA § 40-1-112 (c), does not authorize those actions because it is applicable only to intrastate motor carriers. But the other direct action statute, OCGA § 40-2-140 (d) (4), which is applicable to interstate carriers, does authorize them. So we affirm the trial court’s denials of the insurer’s summary judgment motions claiming that the direct actions against it were not authorized.

1. Facts and procedural posture .

Viewed in the light most favorable to the nonmovants, see Aequicap Ins. Co. v. Canal Ins. Co. , 303 Ga. App. 508, 508, 693 S.E.2d 863 (2010), the evidence shows that on July 18, 2014, Veronica and Marleaux Williams were injured when a tractor-trailer driven by Edward Heard struck their car. Heard owns and operates CC&D Trucking, LLC, as a sole proprietorship, and he was driving in the scope of the business of CC&D at the time of the accident. Daily Underwriters of America had issued a liability insurance policy to CC&D which was in effect at the time of the accident.

Veronica Williams, the car driver, and Marleaux Williams, the car passenger, brought separate negligence actions against Heard, CC&D, and Daily Underwriters. They cited OCGA § 40-1-112 (c) in their complaints as authorizing those direct actions against Daily Underwriters.

Daily Underwriters moved for summary judgment in each case, arguing that OCGA § 40-1-112 (c) applies only to insurers of intrastate motor carriers. Daily Underwriters contended that its insured, CC&D, was an interstate motor carrier at the time of the crash. Therefore, it argued OCGA § 40-1-112 (c) does not authorize the direct actions against Daily Underwriters.

In their response, the Williamses cited, among other things, OCGA § 40-2-140 as authorizing the direct actions against the insurer. The trial court denied Daily Underwriters’ motions for summary judgment.

We granted Daily Underwriters’ applications for interlocutory review, and these appeals followed. In Case No. A19A2101, Daily Underwriters appeals from the trial court’s denial of its motion for summary judgment in the action filed by Veronica Williams. In Case No. A19A2102, it appeals from the denial of its corresponding motion in the suit filed by Marleaux Williams. Because the appeals raise the same issues, we consider them together.

2. Direct action statutes.

Daily Underwriters argues that direct actions against the insurer of an interstate motor carrier are not authorized in Georgia. It is true that the general rule in Georgia is that a liability insurer may not be joined directly as a defendant in an action for damages against its insured. Haezebrouck v. State Farm Mut. Auto. Ins. Co. , 252 Ga. App. 248, 248-49 (1), 555 S.E.2d 764 (2001). But exceptions for motor carriers to that general rule are provided by two separate direct action statutes: OCGA §§ 40-1-112 (c) and 40-2-140 (d) (4).

See Frank E. Jenkins III & Wallace Miller III, Ga. Automobile Insurance Law § 46:1 (b) (1) (2019-2020 ed.).

As explained below, OCGA § 40-1-112 (c), when read together with OCGA § 40-1-126, authorizes direct actions against insurers of motor carriers engaged in intrastate commerce — but not against insurers of motor carriers engaged in purely interstate commerce. OCGA § 40-2-140 (d) (4), however, does authorize direct actions against insurers of motor carriers engaged in interstate commerce.

(a) OCGA § 40-1-112 (c).
(i) The statute construed.

OCGA § 40-1-112 is found in the Georgia Motor Carrier Act of 2012. See OCGA §§ 40-1-50 through 40-1-200. OCGA § 40-1-112 (a) requires a "motor carrier of household goods or property or passengers" to file with the Department of Public Safety a certificate of insurance "evidencing a policy of indemnity insurance by an insurance company licensed to do business in this state. .... The failure to file any form required by the department shall not diminish the rights of any person to pursue an action directly against a motor carrier’s insurer ." (Emphasis supplied.) The right to pursue such a direct action against an insurer is set out in OCGA § 40-1-112 (c), which provides: "It shall be permissible under this part [i.e., Title 40, Chapter 1, Article 3, Part 2] for any person having a cause of action arising under this part to join in the same action the motor carrier and the insurance carrier, whether arising in tort or contract ." (Emphasis supplied.) As this court has explained,

[t]he purpose of permitting joinder of the insurance company in a claim against a common carrier is to further the policy of the Motor Carrier Act, that is, to protect the public against injuries caused by the motor carrier’s negligence. The intent of this [s]tate’s motor carrier laws is that the insurer is to stand in the shoes of the motor carrier and be liable in any instance of negligence where the motor carrier is liable.

Mornay v. Nat. Union Fire Ins. Co. of Pittsburgh , 331 Ga. App. 112, 113, 769 S.E.2d 807 (2015) (citation and punctuation omitted).

Within the same part of the Georgia Motor Carrier Act is a disavowal of any apparent effort by the state to regulate purely interstate commerce. OCGA § 40-1-126 provides:

In circumstances where a motor carrier is engaged in both interstate and intrastate commerce, it shall nevertheless be subject to all the provisions of this part [i.e., Title 40, Chapter 1, Article 3, Part 2] so far as it separately relates to commerce carried on exclusively in this state. It is not intended that the department shall have the power of regulating interstate commerce of such motor carrier, except to the extent expressly authorized by this part as to such commerce. The provisions of this part do not apply to purely interstate commerce nor to carriers exclusively engaged in interstate commerce . When a motor carrier is engaged in both intrastate and interstate commerce, it shall be subject to all the provisions of this part so far as they separately relate to commerce carried on in this state.

(Emphasis supplied.)

The foregoing "statutes relating to the same subject matter are in pari materia and must be construed together and harmonized whenever possible." Long v. Dev. Auth. of Fulton County , 352 Ga. App. 815, 821 (3) (b), 835 S.E.2d 717 (2019) (citation and punctuation omitted). In so construing these Code sections, "we apply the fundamental rules of statutory construction that require us to construe a statute according to its terms, to give words their plain and ordinary meaning, and to avoid a construction that makes some language mere surplusage. At the same time, we must seek to effectuate the intent of the legislature." Slakman v. Continental Cas. Co. , 277 Ga. 189, 191, 587 S.E.2d 24 (2003) (citations omitted). See also OCGA § 1-3-1 (a). And because "[t]he direct action statute is in derogation of common law, ... its terms require strict compliance." Mornay , 331 Ga. App. at 113, 769 S.E.2d 807 (citation and punctuation omitted).

With these principles in mind, we find that the plain language of OCGA § 40-1-112 (c) expressly allows an injured party to file a direct action against a motor carrier’s insurance carrier for causes of action arising "under this part," i.e., Title 40, Chapter 1, Article 3, Part 2. And the plain language of OCGA § 40-1-126 clearly provides that "[t]he provisions of this part do not apply to purely interstate commerce nor to carriers exclusively engaged in interstate commerce." So construed together with OCGA § 40-1-112, it is apparent that the plain language of OCGA § 40-1-126 evinces the legislative intent that the direct action provision of OCGA § 40-1-112 (c) does not apply to purely interstate commerce or to a carrier engaged exclusively in interstate commerce.

(ii) The statute applied.

Daily Underwriters contends that its insured, CC&D, was engaged exclusively in interstate commerce at the time of the accident and therefore OCGA § 40-1-112 (c) does not authorize the direct actions against the insurer. Since we are reviewing a summary judgment ruling, we must determine if there exists a genuine issue of material fact as to whether CC&D was an interstate carrier at the time of the accident. See OCGA § 9-11-56 (c) (summary judgment is appropriate where there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law). We conclude that, under the undisputed facts and as a matter of law, it was an interstate carrier.

The record shows that at the time of the accident, Heard was driving his tractor-trailer back to CC&D’s place of business in Bainbridge, Georgia. He had picked up a load in Charlotte, North Carolina; delivered it to a drop-off point in Monroe, Georgia; and was driving back to Bainbridge when the accident occurred. The Williamses argue that a fact question exists as to whether Heard was making an intrastate or interstate delivery at the time of the accident because he had delivered the load to a store in Georgia and was on his way back to his home in Georgia at the time of the accident. They also argue that because Heard testified that he "very rarely" made deliveries within Georgia, he should not be considered a purely interstate carrier.

In distinguishing interstate from intrastate carriers, we have adopted a "trip specific" approach. Grange Indem. Ins. Co. v. Burns , 337 Ga. App. 532, 788 S.E.2d 138 (2016). In Grange , this court reversed the trial court’s order granting summary judgment to a driver injured in an accident with a tractor-trailer....

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    ...party against an insurance carrier which insures a motor carrier." (punctuation and citation omitted)); Underwriters of Am. v. Williams , 354 Ga. App. 551, 553 (2), 841 S.E.2d 135 (2020) ("OCGA § 40-1-112 (c), when read together with OCGA § 40-1-126, authorizes direct actions against insure......
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    ...we must seek to effectuate the intent of the legislature.(Citations and punctuation omitted.) Daily Underwriters of America v. Williams , 354 Ga. App. 551, 554 (2) (a) (i), 841 S.E.2d 135 (2020) (physical precedent only).A review of the relevant COAM statutes and rules makes clear that they......
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