Pennsylvania Millers Mut. Ins. Co. v. Thomas Milling Co., Inc.

• Decision Date: 16 January 1976
• Docket Number: No. 1,Nos. 51300,51301,s. 51300,1
• Court: Georgia Court of Appeals
• Parties: PENNSYLVANIA MILLERS MUTUAL INSURANCE COMPANY v. THOMAS MILLING COMPANY, INC., et al. THOMAS MILLING CO., INC., et al. v. PENNSTLVANIA MILLERS MUTUAL INSURANCE COMPANY

Page 55

224 S.E.2d 55

137 Ga.App. 430

PENNSYLVANIA MILLERS MUTUAL INSURANCE COMPANY v. THOMAS MILLING COMPANY, INC., et al.

THOMAS MILLING CO., INC., et al. v. PENNSTLVANIA MILLERS MUTUAL INSURANCE COMPANY.

Nos. 51300, 51301.

Court of Appeals of Georgia, Division No. 1.

Jan. 16, 1976.

Rehearing Denied Jan. 30, 1976.

W. Ward Newton, Lyons, for appellant.

Mimbs & Cooley, Jackson S. Cooley, Hazlehurst, for appellees.

MARSHALL, Judge.

This is an action brought by an insured (plaintiff Thomas Milling Co., Inc.) against its insurer (defendant Pennsylvania Millers Mutual Insurance Co.) to enforce the policy protection afforded by existing policies of insurance for property damage to plaintiff's milling facilities, and an additional count alleging liability based in tort arising out of the insurer's gratuitous but allegedly negligent inspections of the insured's business site. The trial court granted the insurer's motion for summary judgment as to five counts of the insured's petition, all of which were ex contractu and based upon the contract of insurance. The court denied the insurer's motion for summary judgment as to the ex delicto, sixth count of insured's petition based in tort. The insurer, Pennsylvania Millers Mutual, appeals in case No. 51300 the denial of its motion for summary judgment as to the sixth count of plaintiff's petition based in tort. The insured, Thomas Milling, appeals in case No. 51301, the grant of the insurer's motion for summary judgment of the five counts of insured's petition based on the contract.

The following disputed and undisputed facts are pertinent to our decision. The milling equipment and supplies of Thomas Milling were insured by virtue of two valid, existing contracts of insurance issued by Pennsylvania Millers Mutual. During the life of these policies, certain steel grain storage bins and load-out tanks were damaged with concurrent grain loss. The insured maintained that the damage resulted from an explosion, a covered casualty, whereas the insurer claimed the damage resulted from a latent structural defect, which caused the bins to collapse, a non-insured risk. Though the contract of insurance did not require inspections by the insurer, the insurer did inspect the insured's premises each calendar quarter, filing reports of deficiencies. The insured maintained that it acted upon the findings and recommendations of the insurer. The insured claimed in the sixth count of its petition that insurer having undertaken to conduct inspections, thereby assumed the obligation to detect dangerous conditions and the duty to report such to the insured. It alleged that the failure to detect the dangerous condition which resulted in the damage to the steel bins and load-out tanks and to report that defect to the insured was negligent and gave rise to the remedy based in tort. The insured contends these inspections were safety inspections whereas the insurer contends these were internal inspections undertaken as a minimal precaution in connection with its present insured risk and the possible renewal of the two policies.

The contracts of insurance required the insured to bring suit on the contracts within 12 months of the occurrence of the incident giving rise to the claim. Other provisions of the contracts gave the insurer a period of 60 days in which to consider a claim before making payment for a valid claim. The facts indicate the insured filed its suit 12 months and 10 days after the incident. Held:

1. The trial court correctly granted the insurer's motion for summary judgment on the counts based in contract. Where parties make by agreement a fixed and unqualified limitation that no suit or action on the policy shall be sustainable unless commenced within 12 months next after the incident giving rise to the claim, statutory limitations do not apply and the parties are bound to their contract as written. Under such a stipulation and limitation, the time is computed to begin from the date the incident occurred, and not from the accrual of the right of action under other stipulations of the policy. Maxwell Bros. v. Liverpool etc., Ins. Co., 12 Ga.App. 127, 76 S.E. 1036; Gibraltar Fire etc., Insurance Co. v. Lanier, 64 Ga.App. 269, 13 S.E.2d 27; Modern Carpet Industries, Inc. v. Factory Ins. Assn., 125 Ga.App. 150, 186 S.E.2d 586. There being no genuine issues of material fact and the insurer being entitled to verdict as a matter of law, the trial court properly granted summary judgment for the insurer. Holland v. Sanfax Corp., 106 Ga.App. 1, 126 S.E.2d 442; Raven v. Dodd's Auto Sales & Service, Inc., 117 Ga.App. 416, 421, 160 S.E.2d 833.

2. We also agree with the trial court's denial of the insurer's motion for summary judgment as to...