Mag Mut. Ins. Co. v. Miles

Docket NumberA22A1668
Decision Date15 November 2022
Citation366 Ga.App. 174,881 S.E.2d 21
CourtGeorgia Court of Appeals

Alphonso Avery Howell IV, Gregory Tyson Talley, Coleman Talley, for Appellant.

John Albert Dow III, The Dow Firm, for Appellee.

Phipps, Senior Appellate Judge.

Martha Miles, individually, as the surviving spouse of Bryan Miles, and as the executor of Bryan's estate (collectively, "Miles"), obtained a $3 million judgment against South Georgia Oncology Hematology Center, P.C. ("SGO"). Miles then sued MAG Mutual Insurance Company, seeking to recover the proceeds of SGO's insurance policy with MAG. MAG now appeals from the denial of its motion for summary judgment, following our grant of its application for interlocutory review. See MAG Mut. Ins. Co. v. Miles , Case No. A22I0145 (Mar. 28, 2022). Among other arguments, MAG contends that the undisputed facts show that SGO cancelled its policy before Miles asserted her claims against SGO. For the reasons that follow, we agree and reverse.

Viewed in the light most favorable to Miles, the nonmovant, see Henry v. Griffin Chrysler Dodge Jeep Ram , 362 Ga. App. 459, 460, 868 S.E.2d 827 (2022), the record shows that MAG issued a professional liability insurance policy (the "Policy") to SGO in June 2013. The Policy identified Barjinder Singh, M.D., and Sridhar Srinivasan, M.D., as the only two "[p]rotected" providers and initially was to be effective from July 10, 2013, to July 10, 2014. By its terms, as a "claims-made" policy, the Policy provided coverage only for claims made while it was in effect. See Brown v. Hitch , 208 Ga. App. 784, 785, 431 S.E.2d 751 (1993) (a claims-made policy covers claims that accrue and are reported to the insurer during the effective dates of the policy); accord Serrmi Products v. Ins. Co. of Pennsylvania , 201 Ga. App. 414, 414, 411 S.E.2d 305 (1991). In December 2013, MAG issued a "Policy Cancellation" cancelling the Policy effective December 1, 2013.

In February 2014, Bryan and Martha Miles sued Dr. Singh, SGO, and numerous other defendants for medical malpractice and related claims arising out of the alleged misdiagnosis of a tumor in Bryan's brain and his ensuing medical treatment (the "Underlying Action"). After Bryan died, his wife, as his surviving spouse and executor of his estate, filed an amended complaint that added a wrongful death claim. In May 2018, the trial court in the Underlying Action entered a default judgment against SGO and awarded Miles $3 million in damages. In January 2019, Miles tendered the judgment to MAG for satisfaction under the Policy. The record contains no indication that MAG responded to Miles's demand.

In March 2019, Miles brought this action against MAG for breach of contract, seeking to recover the $3 million judgment against SGO. MAG thereafter filed a motion for judgment on the pleadings and summary judgment, arguing, in relevant part, that: (i) Miles's claims against SGO were not asserted during the Policy period, as required for coverage under the claims-made policy at issue here; and (ii) neither SGO, nor anyone acting on its behalf, provided MAG with actual notice of the claims, as also required by the Policy. The trial court denied MAG's motion on grounds that, as relevant here, disputed factual issues remain as to: (i) whether the Policy was effectively cancelled in December 2013, before Miles initially asserted her claims against SGO in February 2014; and (ii) whether MAG received sufficient notice of Miles's claims against SGO to satisfy the Policy notice requirements.1 This interlocutory appeal followed.

Because resolution of the issues raised in this appeal implicates matters outside of the pleadings, we assume, without deciding, that MAG's motion for judgment on the pleadings was properly denied and address only whether MAG was entitled to summary judgment. See OCGA § 9-11-12 (c) ("If, on a motion for judgment on the pleadings, matters outside the pleadings are presented to and not excluded by the court, the motion shall be treated as one for summary judgment...."). "We review de novo a grant or denial of summary judgment, viewing the evidence and all reasonable conclusions and inferences drawn from it in the light most favorable to the nonmovant." Henry , 362 Ga. App. at 460, 868 S.E.2d 827.

Summary judgment is proper when there is no genuine issue of material fact and the movant is entitled to judgment as a matter of law. The burden on the moving party may be discharged by pointing out by reference to the affidavits, depositions and other documents in the record that there is an absence of evidence to support the nonmoving party's case. If the movant meets this burden, the nonmovant cannot rest on his pleadings, but rather must point to specific evidence giving rise to a triable issue.

Id. at 460-461, 868 S.E.2d 827 (citations and punctuation omitted); see OCGA § 9-11-56 (c), (e).

1. MAG first contends that the undisputed facts show that the Policy was cancelled in December 2013, thereby precluding coverage for Miles's claims, which were asserted for the first time in February 2014. We agree.

"The burden of proving a cancellation of a policy of insurance is upon the party asserting such cancellation." Ector v. American Liberty Ins. Co. , 138 Ga. App. 519, 521 (2), 226 S.E.2d 788 (1976) (citation and punctuation omitted). "The method of cancellation provided for in an insurance policy is not necessarily exclusive so as to preclude an effective cancellation of the policy by mutual agreement without compliance with the procedure so provided." Davidson v. State Farm Mut. Automobile Ins. Co. , 161 Ga. App. 21, 24 (2), 288 S.E.2d 832 (1982) (citation and punctuation omitted). Thus, a policy "may be cancelled at any time before loss, by an agreement between the parties, and ... such cancellation may be by the consent of the parties, express or implied from the circumstances, independently of the terms of the policy." Id. at 24-25 (2), 288 S.E.2d 832 (citation and punctuation omitted); accord Fernandez v. WebSingularity, Inc. , 299 Ga. App. 11, 16 (4), 681 S.E.2d 717 (2009) ("Parties may by mutual consent abandon an existing contract between them so as to make it not thereafter binding[,] and the contract may be rescinded by conduct as well as by words.") (citation and punctuation omitted); Nationwide Mut. Ins. Co. v. McCollum , 179 Ga. App. 500, 502 (1), 347 S.E.2d 231 (1986) (same); Ector , 138 Ga. App. at 521 (1), 226 S.E.2d 788 (the parties to an insurance policy may mutually agree to cancel it in a manner not explicitly provided for in the policy). "The consideration for the oral agreement to rescind is provided by each party's discharge of the duties of the other." Fernandez , 299 Ga. App. at 16 (4), 681 S.E.2d 717 (citation and punctuation omitted); accord WorksiteRx, LLC v. DrTango, Inc. , 286 Ga. App. 284, 285, 648 S.E.2d 775 (2007).

Here, the Policy contained the following cancellation provisions:

You can cancel this policy in whole or in part at any time. We can also cancel this policy, but our right to cancel has some restrictions which are described below.[2]
How you can cancel. To cancel this policy or any part of it, you must deliver the policy, or the part you want canceled to us or any of our authorized agents. If this isn't possible, notify us in writing and include the future date you want coverage to end. Upon our receipt of written notice of cancellation, we may waive the future date requirement by confirming the date and time of cancellation in writing to the person named in the "Policy issued to" section of the Declarations Page. You'll get a refund for the unused premium, calculated according to short-rate tables or formulas in our rating plan filed with the Commissioner of Insurance.
How we can cancel if you don't pay your premium. If you fail to pay any premium when due, we can cancel your policy. If we cancel for this reason, we'll mail or deliver a written cancellation notice to you at least 10 days before your coverage will end.
How we can cancel for other reasons. We can also cancel this policy for any reason other than nonpayment of premium. If we do, we'll mail a written cancellation notice to you.
If your policy has been in effect less than 60 days, we'll mail this notice at least 10 days before your coverage will end.
If your policy is a renewal or has been in effect 60 days or more, we'll mail this notice at least 45 days before your coverage will end.

The record shows that, on November 26, 2013, SGO's office manager informed a MAG account manager via e-mail that SGO would be closing its practice on November 29, 2013. The e-mail sought information regarding "malpractice ‘tail’ coverage"3 for Dr. Srinivasan, stated that Dr. Singh would no longer require coverage because he was leaving the country, and provided Dr. Srinivasan's contact information, if further details were required. On December 5, 2013, Natasha Davis, a MAG account service consultant, sent an e-mail to Dr. Srinivasan stating:

Here is what we need to cancel the policy:

1. Written cancellation (email is fine) from you and Dr. Singh requesting us to cancel the policy effective your last day the practice was in operation. If your coverage with [your new practice] is effective 12/1/13[, w]e will need to cancel the policy effective 12/1 to avoid any gaps in coverage.
2. Forwarding addresses for Dr. Singh and yourself that we may send you tail information.4

Two days later, Dr. Srinivasan responded, in relevant part:

You can please consider this email as a confirmation for canceling my policy effective 12/1/13.
I'll check with Dr. Singh and will let you know. He is in India and is not planning to come back to the US in near future.

Four days later, Davis sent an e-mail to other MAG personnel highlighting "Dr. Srinivasan's request ... to cancel policy effective [12]/1/13"5 and further stating, "Dr. Singh will need to be cancelled effective 12/1 as well. He is out of the country so I doubt we...

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