Parris & Son, Inc. v. Campbell, s. 47512

• Decision Date: 04 January 1973
• Docket Number: Nos. 47512,47513,Nos. 1,3,2,s. 47512,s. 1
• Citation: 196 S.E.2d 334,128 Ga.App. 165
• Court: Georgia Court of Appeals
• Parties: PARRIS & SON, INC. v. F. Coin CAMPBELL, Jr. et al. UNITED STATES FIDELITY & GUARANTY COMPANY v. F. Coin CAMPBELL, Jr. et al

Page 334

196 S.E.2d 334

128 Ga.App. 165

PARRIS & SON, INC. v. F. Coin CAMPBELL, Jr. et al.

UNITED STATES FIDELITY & GUARANTY COMPANY v. F. Coin CAMPBELL, Jr. et al.

Nos. 47512, 47513.

Court of Appeals of Georgia, Division Nos. 1, 2, 3.

Jan. 4, 1973.

Rehearing Denied Feb. 14, 1973.

Syllabus by the Court

All evidence submitted in support of and in opposition to the motions for summary judgment reveals the lack of any right of recovery by the plaintiff against either the insurer or its agent beyond the terms of the policy currently in force when the loss occurred, which the insurer has offered to pay, hence it was error to deny the motions for summary judgment submitted by the defendants.

Plaintiff purchased his various coverages of insurance through Parris & Son, Inc., a local agent for United States Fidelity & Guaranty Company. A homeowner's policy was among them. It was issued on a three-year term, the premium being payable in advance annually with the coverage to be extended at the end of the first and second years if the premiums therefor were paid when due. Under Coverage C the coverage for theft of any one item of jewelry, watches, necklaces, bracelets, gems, precious and semi-precious stones, etc. and of any article or item of fur, was limited to $1,000.

During the three-year term of the policy the company applied to the Insurance Commissioner for approval of a homeowner's policy form which further limited the coverage to $500 in the aggregate for losses by theft of jewelry, watches, necklaces, etc. and furs. Approval was granted and the company thereafter issued all homeowner's policies on the newly approved form.

Upon expiration of the three-year term of the policy No. HOU1175643 March 17, 1970 the agent prepared for the plaintiff a new policy No. HP464931, written on the newly approved form, effective March 17, 1970 to March 17, 1973, and sent it to him by mail. Plaintiff duly received the policy in a sealed envelope, put it away in a filing cabinet where his policies were kept, without opening the envelope or examining the policy.

Some nine months later, in February, 1971, his home was burglarized and he suffered a loss of jewelry and furs which he valued at more than $3,000, as well as other items which were also covered by the policy terms. He made claim for his loss in the total amount of $6,063.70, and the company offered to pay only $1,715.73, the amount being reduced because of the change in coverage occurring in the newly approved policy form upon which the current policy had been written.

He brought suit in two counts against both the insurer and its agent, seeking recovery of his full loss, alleging in Count 1 that at no time had he been informed by them of the decrease in coverage, that he had relied upon them to provide coverage which would properly protect him, and that the reduction had been such a dereliction of duty as to constitute bad faith, for which he also sought damages and attorney's fees.

In Count 2 he alleged that all items lost in the burglary had been protected under coverage of his policy of insurance with defendants and that he was entitled to recover their full value. Copies of both policies were attached.

Defendant admitted that it had issued the policies and delivered them to plaintiff, asserted that policy No. HOU1175643 had expired prior to plaintiff's loss and that it had offered to pay to the extent of the coverage provided in policy No. HP464931 which was in force and effect at the time of the loss, and asserted that if any false representations had been made concerning the coverage they had been made by the agent without authority to do so and were not binding on the defendant, that the policy No. HP464931 as written constitutes the whole contract between plaintiff and defendant and that plaintiff is entitled to no coverage beyond that provided in it.

Depositions were taken. Plaintiff admitted that he had received the second policy about the time when the first had, by its terms, expired, and that he had not opened the envelope in which it came to him, that he had not examined or read either policy until after the burglary occurred, and asserted that he had simply relied upon the agent to provide him with suitable coverage. After the loss he had communicated with the agent, who then had told him that he was 'fully covered,' and that he 'should not worry.'

The agent admitted that it had written policies for the plaintiff for several years, including the two referred to in the complaint, but denied that it had made any misrepresentations to him relative to the coverage.

In answer to interrogatories served upon it the insurer asserted that numerous changes in policy forms had been made during the years since plaintiff started doing business with it, but that these changes are regulated and must be approved by the Insurance Commissioner; that when changes are approved and made the company (as do all others) sends out information relative thereto and new forms for writing policies to its agents, and that such was done in this instance. The changes apply only to policies issued on the new forms, and it has not been the practice to send notices directly to policyholders.

Each of the defendants moved for summary judgment and from denials thereof this appeal was filed, the required certificate for immediate review having been obtained.

John F. Davis, Jr., Hopkins & Gresham, L. Penn Spell, Jr., Thomas P. Gresham, Atlanta, for appellants.

Swertfeger, Scott, Pike & Simmons, Joseph Szczecko, Decatur, for appellees.

EBERHARDT, Presiding Judge.

1. Most of the issues before us are controlled by general contract law, insurance being a matter of contract. Cherokee Credit Life Ins. Co. v. Baker, 119 Ga.App. 579(1), 168 S.E.2d 171. 'There is no greater sanctity and no more mystery about a contract of insurance than any other. The same rules of construction apply to it as to other contracts.' Clay v. Phoenix Ins. Co., 97 Ga. 44, 53, 25 S.E. 417, 420. Accord: North British & Merc. Ins. Co. v. Tye, 1 Ga.App. 380(1), 58 S.E. 110. "It is well to keep in mind . . . that insurance is purely a matter of contract." Mitchell v. Federal Life Ins. Co., 57 Ga.App. 206, 208, 194 S.E. 921, 922.

2. Plaintiff's first three-year policy was extended from year to year upon the payment of an additional year's premium until expiration of the three-year term. The current policy is upon a standard form, approved by the State Insurance Commissioner as the law provides. It made some changes in the coverage as compared with the prior policy. It was a new contract, qualifying as a renewal as renewals are defined in Citizens Oil Co., Inc. v. Head, 201 Ga. 542(2), 40 S.E.2d 559. The parties are free to make their own contracts, within the prescribed bounds of law, and the courts are not authorized, by interpretation, to rewrite or to change them, or to extend the coverage. McCullough v. Kirby, 204 Ga. 738(5), 51 S.E.2d 812; West View Corp. v. Alston, 208 Ga. 122, 127, 65 S.E.2d 406. This principle applies to insurance contracts. Cato v. Aetna Life Ins. Co., 164 Ga. 392, 398, 138 S.E. 787; Hartford Accident & Ind. Co. v. Hulsey, 220 Ga. 240, 241, 138 S.E.2d 310.

3. The representations alleged to have been made by the agent of the insurer, whether prior to or after the loss, to the effect that the insured was 'fully covered' can amount to no more than an opinion as to coverage or a legal opinion as to the effect of the contract, which does not give rise to actionable fraud. See Self v. American National Ins. Co., 51 Ga.App. 251(2), 180 S.E. 21; Home Ins. Co. v. Montgomery, 59 Ga.App. 173, 175, 200 S.E. 168; National Life &c. Ins. Co. v. Parker, 67 Ga.App. 1, 8, 19 S.E.2d 409; Sherwin-Williams Co. v. St. Paul-Mercury Indem. Co., 97 Ga.App. 298, 102 S.E.2d 919, and cits.; Fields v. Fire & Cas. Ins. Co., 101 Ga.App. 561, 114 S.E.2d 540; Wells v. Metropolitan Life Ins. Co., 107 Ga.App. 826, 834, 131 S.E.2d 634; Bryant v. Motors Ins. Corp., 109 Ga.App. 47, 52, 134 S.E.2d 905; Brown v. Mack Trucks, Inc., 111 Ga.App. 164, 141 S.E.2d 208; Sasser v. Coastal States Life Ins. Co., 113 Ga.App. 17, 21, 147 S.E.2d 5; Posey v. Gulf Life Ins. Co., 115 Ga.App. 531, 154 S.E.2d 745. And see Sorrells v. Atlanta Transit System, 218 Ga. 623, 129 S.E.2d 846; Williams v. Lockhart, 221 Ga. 343(3), 144 S.E.2d 528; Walker v. Story, 14 Ga.App. 803, 82 S.E. 355; DeMayo v. Walton, 114 Ga.App. 483, 151 S.E.2d 886.

4. There was no relationship of principal and agent between the insured and the agent of the insurer, and thus no fiduciary relationship. Sherwin-Williams Co. v. St. Paul-Mercury Ind. Co., 97 Ga.App. 298, 299, 102 S.E.2d 919, supra; Fields v. Fire & Cas. Ins. Co., 101 Ga.App. 561, 562, 114 S.E.2d 540, supra; Clinton v. State Farm Mut. Auto. Ins. Co., 110 Ga.App. 417(2), 138 S.E.2d 687; Sutker v. Penn. Ins. Co., 115 Ga.App. 648, 653, 155 S.E.2d 694.

5. Nor does the expression of an opinion as to coverage work an estoppel-even against the agent who voiced it, or against his principal. Trust Co. of Ga. v. S. & W. Cafeteria, 97 Ga.App. 268, 285, 103 S.E.2d 63.

6. The representations or expressions alleged to have been made are too indefinite to constitute a contract. Necessary elements of the risk must be specified with definiteness, including the amount of the indemnity and the premium. Todd v. German-American Ins. Co., 2 Ga.App. 789, 794(2), 59 S.E. 94. 'The insurance company might have been willing to insure the stock of goods and 10 bales of hay for a certain premium, and yet unwilling, for the same premium, to insure the same goods if it had known that 60 bales of hay were stored in the building.' Alston v. Greenwich Ins. Co., 100 Ga. 282, 285, 29 S.E. 266, 267. And see Sasser v. Coastal States Life Ins. Co., 113 Ga.App. 17, 20, 147 S.E.2d 5, supra. 'The requirement of certaity extends not only to the subject matter and purpose of the contract, but also to the parties, consideration, and even the...