Dairyland Ins. Co. v. Gay

• Decision Date: 28 September 1989
• Docket Number: No. A89A1303,A89A1303
• Citation: 193 Ga.App. 65,386 S.E.2d 909
• Parties: DAIRYLAND INSURANCE COMPANY v. GAY et al.
• Court: Georgia Court of Appeals

Page 909

386 S.E.2d 909

193 Ga.App. 65

DAIRYLAND INSURANCE COMPANY v. GAY et al.

No. A89A1303.

Court of Appeals of Georgia.

Sept. 28, 1989.

Eason, Kennedy & Associates, Carolyn J. Kennedy, Richard B. Eason, Jr., Atlanta, for appellant.

Joe A. Weeks, Atlanta, Stanley W. Levitt, Chamblee, for appellees.

SOGNIER, Judge.

Dairyland Insurance Company brought this declaratory judgment action against Kenneth Gay seeking a determination of its obligations as the purported liability insurer of Gay's automobile. Miles Rich Chrysler/Plymouth's motion to intervene was granted. The trial court denied Dairyland's motion for summary judgment and we granted its application for interlocutory appeal.

The record reflects that Gay purchased his automobile from Miles Rich Chrysler/Plymouth on June 24, 1987. At the same time Gay also purchased what was purported to be automobile insurance from Fred Heller, a salesman at the dealership. The sales contract, included in the record, indicates that appellant was the insurance company, that one "Vickie Lyons" was the insurance broker, giving her address and phone number, and sets forth the purported number of the insurance policy. It is uncontroverted that Heller, who was not a licensed insurance agent, kept the premium payments made by Gay. It is also uncontroverted that appellant had no knowledge of Heller or Gay and never received any application forms nor issued any policy of insurance to Gay. As of October 22, 1987, the date of the automobile accident in which Gay incurred the damages for which he sought payment from appellant, Gay had received no policy, bills, or any other direct correspondence of any type from appellant.

Appellant submitted the affidavit of its branch manager, William Schuelke, who averred that Heller was "not an agent, broker, or representative of [appellant] and was not authorized to transact any business on [appellant's] behalf. He was not and never has been authorized to take or complete applications on behalf of [appellant] or submit any applications to [appellant]." Appellant also submitted the affidavit of Elzie Speir, the manager of the Cannon Insurance Agency and the former employer of insurance agent Vickie Lyon, who stated that on the purchase date of the purported insurance, Lyon (misspelled "Lyons" in the affidavit) was not an agency employee; that Heller was not and had never been an agency employee; and that the agency never solicited Gay's business nor received any application for insurance on his behalf. Speir also stated he had given Lyon certain supplies with appellant's name printed on them as examples to assist her in opening her own insurance agency, but averred that "[o]ur supplies were to be used only if we quoted and approved an applicant, but we never did and we never saw them again."

In her deposition, Lyon stated that she was a licensed insurance agent and had worked for Cannon Insurance Agency, but had left the agency several months before the incident in issue. She stated that Heller contacted her about working for him in an insurance agency he was starting and that she and Heller went to Speir's office in the spring of 1987. She stated that at that time Speir gave Heller various forms, including blank application forms, for setting up the business, and that it was her understanding that "Heller was brokering through Mr. Speir," meaning that Heller had Speir's permission to write insurance policies with the companies, including appellant, that Speir represented. Lyon stated that it was "understood and agreed" that Heller and she "were supposed to turn in any applications or money, whether it be cash or check, to Mr. Speir within a 24 hour period."

Lyon testified that she had never talked to anyone at Miles Rich about binding automobile insurance coverage for Gay or anyone else. She stated she had never seen the sales contract before, that unlike the "Vickie Lyons" referenced in the contract there was no "s" on her last name, that the address and phone number thereon were not hers, and that the policy number in the sales contract did not represent a valid binder number. She testified that she had never met or spoken with Gay and that she had never authorized Heller to represent her, to take any action on her behalf, or to use her name. She also stated she never received any money or commissions from Heller or paid him any money for any reason.

Appellant argues that because the evidence is uncontroverted that Heller was not appellant's agent, broker, or representative, no question of fact remains for jury consideration and it was entitled to summary judgment in its favor, citing OCGA § 10-6-5 and Henry v. Dairyland...