Otis v. Wren Mobile Homes, Inc.
| Decision Date | 21 April 1965 |
| Docket Number | Nos. 41200,41201,No. 3,s. 41200,3 |
| Citation | 111 Ga.App. 649,143 S.E.2d 8 |
| Parties | Horace OTIS v. WREN MOBILE HOMES, INC., et al. (two cases) |
| Court | Georgia Court of Appeals |
Syllabus by the Court
A covenant not to sue merely extinguishes the right to pursue the remedy against the covenantee but does nt extinguish the covenantor's cause of action. Accordingly, where the plaintiffs sued a principal and its agent for tortious injuries and damages inflicted by the agent and during the pendency of the suit executed to the agent covenants not to sue in exchange for the payment of a sum of money, such covenants did not extinguish the cause of action against either the principal or the agent, but merely the right to pursue a remedy as to the agent, and the plaintiffs could thereafter maintain the action against the principal even though the principal's liability rested solely upon the doctrine of respondeat superior.
Lanier, Powell, Cooper & Cooper, Jack L. Cooper, Augusta, for plaintiff in error.
Fulcher, Fulcher, Hagler & Harper, J. Walker Harper, Augusta, for defendants in error.
The assignment of error in each of these cases raises but one question for this court's decision, to wit: Where a plaintiff is injured by a trespass committed by the servants and employees of one corporation and brings suit to recover damages sustained as a result of that trespass against that corporation and against another corporation for whom the first is alleged to have been acting as agent at the time of the commission of the trespass, and where before the case is called for trial the plaintiff accepts the payment of a sum of money from the alleged agent corporation and gives to it in exchange therefor a covenant not to sue, which recites that it is in no way to affect the rights of the plaintiff against the principal corporation, is to be construed as a 'covenant not to sue only' and 'may be pleaded as a defense to any action or other proceeding which may be brought, instituted or taken by' the plaintiff against the agent corporation in breach of the covenant; does such covenant bar the plaintiff from proceeding against the principal corporation where the sole basis of liability asserted against such principal corporation is upon application of the doctrine of respondeat superior because of the tortious acts of the agent corporation acting through its servants and employees?
It is conceded by the plaintiffs in error and by the defendant in error that there is no Georgia case directly deciding this question. The trial court, in sustaining the principal corporation's pleas in bar, held that the plaintiffs were barred by the execution of the instruments in question, apparently upon the theory that where the plaintiff's cause of action against the agent or servant has been extinguished, the cause of action against the master or employer, being purely derivative in character, must also be extinguished. In support of the rulings of the trial court the defendant in error cites the cases of Simpson v. Townsley, 283 F.2d 743,...
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Wren Mobile Homes, Inc. v. Midland-Guardian Co. of Ga.
...dismissed as a defendant from both suits. Giving the covenant not to sue, it was decided on appeal to this Court (Otis v. Wren Mobile Homes, Inc., 111 Ga.App. 649, 143 S.E.2d 8) did not bar Horace and Eunice Otis from proceeding against the principal, Midland-Guardian, even though the princ......
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Miller v. Grand Union Co.
...and he will not be barred from pursuing a claim against the unnamed employer who may be vicariously liable. Otis v. Wren Mobile Homes, 111 Ga.App. 649, 143 S.E.2d 8 (1965). Prior to Posey v. Medical Center-West, supra, the rule was different for releases. Because it extinguishes a cause of ......
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Hall v. Skate Escape, Ltd.
...Nalley, Inc., 95 Ga.App. 862(2), 99 S.E.2d 432; Gordon County v. Cochran, 103 Ga.App. 412, 418, 119 S.E.2d 368; Otis v. Wren Mobile Homes, 111 Ga.App. 649, 651, 143 S.E.2d 8; Cash v. Street & Trail, Inc., 136 Ga.App. 462, 463, 221 S.E.2d 640, supra; Smallwood v. Bickers, 139 Ga.App. 720, 72......
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Henderson v. Garbutt
...Nalley, Inc., 95 Ga.App. 862, 864, 99 S.E.2d 432; Gordon County v. Cochran, 103 Ga.App. 412, 417, 119 S.E.2d 368; Otis v. Wren Mobile Homes, Inc., 111 Ga.App. 649, 143 S.E.2d 8; National Upholstery Co. v. Padgett, 111 Ga.App. 842, 844, 143 S.E.2d 494; Pennsylvania Threshermen & Farmers Mut.......