Popham v. Landmark Am. Ins. Co.

• Decision Date: 09 March 2017
• Docket Number: A16A1851
• Citation: 340 Ga.App. 603,798 S.E.2d 257
• Parties: POPHAM v. LANDMARK AMERICAN INSURANCE COMPANY, et al.
• Court: Georgia Court of Appeals

340 Ga.App. 603

798 S.E.2d 257

POPHAM

v.LANDMARK AMERICAN INSURANCE COMPANY, et al.

A16A1851

Court of Appeals of Georgia.

March 9, 2017

Nicole Jones, Douglasville, for Appellant.

Kenneth Drew Jones, Nathan Alexander Gaffney, Atlanta, Susan Joy Levy, Decatur, Philip Wade Savrin, Atlanta, for Appellee.

Bethel, Judge.

Charles Popham ("Popham") appeals from an order granting summary judgment in favor of defendants Landmark American Insurance Company ("Landmark") and Tapco Underwriters, Inc. ("Tapco") (collectively, the "defendants").¹

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. OCGA § 9-11-56(c). We review a grant of summary judgment de novo and construe the evidence in the light most favorable to the nonmovant. Home Builders Ass'n of Savannah, Inc. v. Chatham Cty. , 276 Ga. 243, 245 (1), 577 S.E.2d 564 (2003).

So construed, the record shows that Popham contacted independent insurance agent Steven Greenberg ("Greenberg") to obtain a new commercial liability insurance policy for his tree removal business. After contacting several underwriters, Greenberg obtained an insurance quote for Popham from Tapco, an underwriter that had the authority to issue insurance policies on behalf of Landmark. Popham met with Greenberg on November 17, 2010 at which time Popham signed an application for insurance and paid a down payment on the premium to Greenberg. Popham received a certificate of insurance from Greenberg showing a policy effective date of November 17, 2010.

Tapco issued a binder to Popham stating that it would provide temporary insurance coverage until November 29, 2010, provided that Tapco "receive[d] a properly completed application and a premium payment within 12 days." Per the terms of the binder, Popham's failure to remit a completed application and the premium payment to Tapco by that date would nullify and void coverage. The language of the binder also provided that the binder

"exists on its own terms and expires on its own terms. When a binder expires on its own terms, no coverage exists thereafter. Requirements for notice of cancellation to insureds do not apply to expired binder."

In deposition, both Greenberg and Popham stated that they each understood that the premium payment had to be paid by November 29, 2010.

On November 29, Popham met with Greenberg to make another premium payment, and Greenberg mailed a premium check and Popham's insurance application to Tapco either that day or the following day. However, it is undisputed that Tapco did not receive the premium payment and the application by November 29, 2010.

On December 7, 2010, Tapco notified Greenberg that it had not received the application and premium check for Popham's policy and that the binder was null and void. Two days later, on December 9, 2010, Tapco received Greenberg's mailing containing the application and the premium check and deposited the check that day. The following day, Tapco informed Greenberg that additional application materials were required to issue the insurance policy and that the policy's effective date would be December 9, 2010. Greenberg faxed the additional materials to Tapco, and Tapco, acting on behalf of Landmark, wrote an insurance policy for Popham with an effective date of December 9, 2010.

Meanwhile, on December 1, 2010, Popham was cutting trees with two other men present. One of the other men was seriously injured after a tree fell on him. The injured man brought suit against Popham in late 2011 and won a default judgment against him in early 2012 after Popham failed to respond to the suit. Popham later filed an insurance claim with Landmark, which it denied, stating that no policy was in effect on the date of the accident.

On November 17, 2014, Popham filed suit against the defendants, alleging negligence,² breach of contract, and failure to pay an insurance claim in bad faith. Popham also sought punitive damages and attorney fees from the defendants. The trial court granted motions for summary judgment in favor of the defendants with respect to all claims, and this appeal followed.

In his brief before this Court, Popham enumerates several alleged errors in the trial court's ruling. First, he argues that the trial court erred in ruling that there was no agency relationship formed between Greenberg and Tapco or Greenberg and Landmark. Second, Popham claims the trial court erred in finding that no insurance contract existed between Popham and either Tapco or Landmark at the time of the December 1, 2010, accident. Third, Popham claims that the trial court erred in allowing Landmark to amend its answer to assert a statute-of-limitations defense to his personal injury claims after the trial court's scheduling order deadline. Derivative of those rulings, Popham claims the trial court erred in granting summary judgment on his bad faith claims and his claims for punitive damages and attorney fees.

As Popham has failed to bring forth sufficient evidence to support his claims, we affirm the trial court's grant of summary judgment with regard to each enumeration above. Additionally, we hold that the trial court did not abuse its discretion in permitting Landmark to amend its pleadings to raise a statute-of-limitations defense, as Popham failed to demonstrate prejudice resulting from that decision.

1. As a threshold matter, Popham claims the trial court erred in finding that no agency relationship existed between Greenberg and Tapco or between Greenberg and Landmark. He argues that Greenberg was acting as an agent for Tapco and/or Landmark, and that therefore genuine issues of fact exist as to whether an insurance contract between Popham and Tapco and/or Landmark was in effect at the time of the December 1, 2010, accident.

The plaintiff has the burden of bringing forth evidence establishing the existence of the agency relationship. Handy v. DeKalb Med. Ctr., Inc. , 298 Ga.App. 82, 82, 679 S.E.2d 107 (2009). Under Georgia law, "[i]ndependent insurance agents or brokers are generally considered the agent of the insured, not the insurer." European Bakers, Ltd. v. Holman , 177 Ga.App. 172, 173-74 (2), 338 S.E.2d 702 (1985) (citation omitted). An independent insurance agent will be considered an agent of the insurer if the plaintiff brings forth evidence that the insurer granted the agent or broker "authority to bind coverage on the insurer's behalf." Kinard v. Nat'l Indem. Co. , 225 Ga.App. 176, 178 (1), 483 S.E.2d 664 (1997) (citations omitted). Alternatively, if an insurer holds out an independent agent as its agent and an insured justifiably relies on such representation, the independent agent will be considered the agent of the insurer. See Kirby v. Nw. Nat'l Cas. Co. , 213 Ga.App. 673, 678, 445 S.E.2d 791 (1994) (citation omitted).

(a) We must first determine if there is an issue of fact as to whether Greenberg was given authority by Tapco and/or Landmark to bind insurance policies on their behalf.

Greenberg indicated in his deposition that he was acting as an agent for Popham in bidding out his request for liability insurance coverage to multiple underwriters, including Tapco. He testified that he was not an agent or employee of Landmark and had no contract with Landmark. Greenberg claimed that he did not have the authority to issue a binder or an insurance policy on behalf of Tapco or Landmark. Both Tapco and Landmark repeatedly denied that Greenberg had ever been their agent.

Despite these statements, Popham argues that other statements by Greenberg and his counsel suggest Greenberg had the authority to bind Tapco. Popham specifically points to statements by Greenberg that he was a "subagent" of Tapco and had "brokerage agreements" with Tapco,³ as well as a statement by Greenberg's counsel in open court that Greenberg was an agent of Tapco.⁴ Popham contends that these statements cannot be ignored by the trial court and argues that they are sufficient to show a triable issue of fact as to whether Greenberg had the authority to bind Tapco and Landmark.⁵ We disagree.

The inquiry here is not whether Greenberg believes himself to be an "agent" or "subagent" of Tapco or Landmark or how he characterizes his relationship with those entities. Rather, the inquiry in this case is whether he had actually been granted the "authority to bind coverage on the insurer's behalf." Kinard, 225 Ga.App. at 178, 483 S.E.2d 664 ; see also Atlanta Mkt. Ctr. Mgmt. Co. v. McLane , 269 Ga. 604, 606-07 (1) (a), 503 S.E.2d 278 (1998) (evidence of a relationship between the purported principal and agent is insufficient where there is no evidence of agent's authority to create obligations on behalf of the principal).

Importantly, the label or characterization of the relationship by the purported agent is not sufficient to show what actual authority the agent had been given by the purported principal. Kirby, 213 Ga.App. at 677-78, 445 S.E.2d 791 ; cf. Jennette v. Nat'l Community Dev. Services, Inc ., 239 Ga.App. 221, 223 (2), 520 S.E.2d 231 (1999) (noting that labeling the purported agent as an "independent contractor" was not dispositive to agency analysis). In Kirby , an employee of an independent insurance agent indicated in an affidavit that he and his company were agents of the insurer. Kirby , 213 Ga.App. at 675, 445 S.E.2d 791. This Court ruled that despite the employee's "initial representation that he was an agent of [the insurer]" in his affidavit, there was "no evidence to that effect." Id. at 678 (2), 445 S.E.2d 791. Kirby thus makes clear that on summary judgment, plaintiff must come forward with evidence that the insurer granted authority to the alleged agent and cannot rely on conclusory statements by the alleged agent.

While Popham fixates on the use of the terms "agent" and "subagent" by Greenberg and his counsel, those statements do not speak to any authority on Greenberg's part to bind Tapco or Landmark to an insurance policy, and the defendants unequivocally...