Prudential Ins. Co. of America v. Nessmith, 69458
Decision Date | 08 March 1985 |
Docket Number | No. 69458,69458 |
Citation | 329 S.E.2d 249,174 Ga.App. 39 |
Parties | PRUDENTIAL INSURANCE COMPANY OF AMERICA v. NESSMITH. |
Court | Georgia Court of Appeals |
Ben Kingree, III, Atlanta, John B. Miller, Savannah, for appellant.
William S. Stone, Blakely, for appellee.
This discretionary appeal comes from the denial by the trial court of appellant's (Prudential) motion for summary judgment. Appellee Paul E. Nessmith, Sr. brought this action to recover the proceeds of a life insurance policy with a face value of $100,000. The named insured was Nessmith's son, Paul E. Nessmith, Jr. Appellee father was the beneficiary of the policy. The insured died of a gunshot wound on September 15, 1982. The annual premium was due on July 1 of each year. The contract of insurance provided for a 31-day grace period, thus extending the time for payment of the premium to August 1 of each year. At the time of the insured's death, the premium due on July 1, 1982 had not been paid. The policy provided that insurance coverage would lapse if the premium was not paid within the grace period. Appellee argues that the insured, Nessmith, Jr., and Prudential had mutually temporarily departed from the terms of the contract requiring payment by August 1 of each year because the year preceding his death, Nessmith, Jr. had been allowed to pay the premium on September 23 and in 1979 had been allowed to pay on August 2 and to have the policy continue. Held:
OCGA § 13-4-4 reads as follows: " " Southern Feed Stores v. Sanders, 193 Ga. 884, 887, 20 S.E.2d 413 (1942). "Though a quasi new agreement arises where the parties mutually depart from the terms of the original agreement and pay or receive money under such departure [cit.], there must be more than a simple breach on the part of one of the parties; there must be a mutual departure." Crawford v. First Nat. Bank of Rome, 137 Ga.App. 294, 296, 223 S.E.2d 488 (1976). Sovereign Camp W.O.W. v. Whitaker, 57 Ga.App. 418, 423, 195 S.E. 584 (1938). In the case of Unigard Mut. Ins. Co. v. Fox, 142 Ga.App 706, 236 S.E.2d 851 (1977), the court applied this rule to hold that evidence of a single payment made outside the grace period allowed by the policy was not sufficient as a matter of law to create a jury issue under the OCGA § 13-4-4.
To avoid the obvious consequences of the rules stated above, able counsel for appellee makes several arguments. First, he argues that the evidence shows that Prudential did more than merely accept a few late payments; he argues that Prudential, through its agent, Johnson, solicited payment of the premium outside the term allowed by the contract thus inducing belief on the part of the decedent insured, Nessmith, Jr., that non-payment of premiums within the period allowed by the contract was not of such consequence as to trigger lapse of the policy if payment were made within a reasonable time. Thus, he argues that this situation is controlled by the holding in Continental Cas. Co. v. Union Camp Corp., 230 Ga. 8(1), 195 S.E.2d 417 (1973). In Continental Cas., there was evidence of letters written by employees at central headquarters of Continental Casualty to the insurance broker for Union Camp and to Union Camp directly, the tenor of which led Union Camp to believe that arrangements to pay outside the policy term could be made and would be accepted. These letters were written outside the grace period allowed by the policy. We have examined the record in the case at bar and find evidence that Johnson, the agent for Prudential, would receive...
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