Hart v. Waldo

• Decision Date: 08 April 1903
• Citation: 43 S.E. 998,117 Ga. 590
• Parties: HART v. WALDO et al.
• Court: Georgia Supreme Court

43 S.E. 998

117 Ga. 590

HART v. WALDO et al.

Supreme Court of Georgia

April 8, 1903

Syllabus by the Court.

1. A representation which is true, and not calculated to deceive cannot be the basis of an action for deceit.

2. It follows that where, in a suit for deceit against an insurance company and one of its agents, the petition alleges that the deceit consisted in the agent's stating to plaintiff contrary to the requirements of her policy, that what she had done was all that was necessary with regard to furnishing proofs of loss, and further alleges that the agent had full authority to make this statement, and to waive the requirements of the policy as to proofs of loss, a demurrer to the petition should be sustained, for the agent's statement, acted on by the plaintiff, operated to release her from the obligation to make proofs of loss, and was therefore true.

3. The holder of an insurance policy is chargeable with knowledge of its conditions; and this is none the less true where he voluntarily parts with actual possession of the policy by pledging it as security for a loan.

4. Misrepresentations as to the legal effect of a contract, and the obligations imposed thereby, where there is no fiduciary relation between the parties, and the circumstances are not such as to give the plaintiff a legal right to rely, without further question, upon the statements of the defendant, will not support an action of deceit.

Error from City Court of Atlanta; H. M. Reid, Judge.

Action by B. D. Hart against A. L. Waldo and others. Judgment for defendants, and plaintiff brings error. Affirmed.

J. L Travis and Westmoreland Bros., for plaintiff in error.

Slaton & Phillips, for defendants in error.

SIMMONS, C.J.

Judgment affirmed.

CANDLER J. (concurring).

I concur in the judgment rendered, and I also entertain the view (in which all of my Brethren do not agree with me) that the alleged misrepresentations relied on by the plaintiff in the court below related exclusively to a matter of law; that they were, at most, merely expressions of the opinion of one of the defendants; and that therefore they are not legally sufficient to support an action of deceit. In my opinion, this is the overshadowing question in the case; and, with the utmost respect for the views of my Brethren, I desire to give expression of my idea of the law which should control the decision.

It is of course, apparent that the insurance company could do no acts which would render it liable to such a suit as this, except through the medium of an agent, and everything for which it is sought to hold it liable in the present case is alleged to have been done by Waldo. It follows, therefore, that if, under the allegations of the petition, the plaintiff had no right of action against Waldo, who is charged to have personally made the representations set forth, there could be no recovery against the insurance company, which merely benefited by those representations; and what is said in the discussion which follows as to Waldo applies with equal force to his codefendant, the insurance company. A careful reading of the petition discloses that the only deceit charged against Waldo was a misrepresentation to the plaintiff of the legal effect of her policy, and the obligation she had assumed thereunder. It is not alleged that he made any misstatement to her of what stipulations the policy contained, but the whole case rests upon the ground that Waldo falsely represented to the plaintiff that, regardless of the terms of the policy, she would not be required to submit to the company sworn proofs of loss. It affirmatively appears from the petition that the plaintiff was, constructively at least, in possession of the policy. The record is silent as to when she parted with the actual possession of it, but, at all events, she was, in law, chargeable with a knowledge of its contents and the obligations which it imposed upon her. This is none the less true because she voluntarily parted with the actual possession of the instrument by pledging it as security for a loan. The policy was a contract, by the terms of which she, as well as the company, was bound, and with a knowledge of the conditions of which she was chargeable. It is not contended that any influence was brought to bear upon her to induce her to part with the policy by giving it as collateral security for a loan on the property insured; and her ignorance of its contents, arising, as is alleged, out of the fact that she had parted with the physical possession of it, is in no sense chargeable to either of the defendants. She was, in law, bound to know its contents. See, on this subject, Security Ins. Co. v. Gober, 50 Ga. 405 (2); Thomson v. Southern Mutual Ins. Co., 90 Ga. 78, 15 S.E. 652; Morrison v. Ins. Co., 69 Tex. 353, 6 S.W. 605, 5 Am.St.Rep. 63; Wierengo v. American Ins. Co., 98 Mich. 621, 57 N.W. 833; Quinlan v. Providence Ins. Co., 133 N.Y. 356, 31 N.E. 31, 28 Am.St.Rep. 645. In the last-cited case it appeared that the plaintiff had an arrangement with the agent of the insurance company by which "his policies were left in charge of the latter, who was to attend to the plaintiff's interests in case of any loss by fire." On the trial the plaintiff testified that he did not read the policy, and was ignorant of its conditions. The court held that it was immaterial whether the plaintiff had read the policy or not; that "the conditions and limitations were a part of the contract, and he was bound to take notice of them, and is not excused upon the plea that he omitted to acquaint himself with the provisions of the policy, and his arrangement with Kelsey [the agent] to take charge of his insurance interests was...