Reserve Ins. Co. v. Campbell

• Decision Date: 06 February 1963
• Docket Number: No. 39897,No. 1,39897,1
• Citation: 107 Ga.App. 311,130 S.E.2d 236
• Parties: RESERVE INSURANCE COMPANY v. Alexander CAMPBELL, III
• Court: Georgia Court of Appeals

Page 236

130 S.E.2d 236

107 Ga.App. 311

RESERVE INSURANCE COMPANY v. Alexander CAMPBELL, III.

No. 39897.

Court of Appeals of Georgia, Division No. 1.

Feb. 6, 1963.

Syllabus by the Court

Where an insured fails to make and file with the insurer a proof of loss, required by the policy as a condition precedent to the bringing of suit, but alleges that the insurer has rejected his demand for payment of the loss and has, instead, offered to pay a lesser amount, a jury question is raised as to whether the policy requirement has been waived.

But if the insured is to rely upon an absolute refusal to pay as a waiver, he must allege and prove that the refusal, or what amounted to a refusal, occurred within the time provided for filing a proof of loss.

On November 21, 1961 Alexander Campbell, III, brought suit against Reserve Insurance Company alleging that the defendant had issued to him a policy of fire, theft and collision insurance upon a certain automobile with provision therein that any loss thereunder should be payable to him and to the First National Bank of Atlanta, as its interest may appear, which held an encumbrance against the vehicle. ¹ He further alleged that on April 21, 1961, he had suffered a collision loss to the automobile in the amount of $363.71; that he had made demand on the defendant for payment thereof less a deduction of $100 as provided in the policy, and that the defendant had countered with an offer to pay him $173.01, resulting in an arbitrary refusal on its part to pay the loss. In addition to the amount of his asserted claim he sought the recovery of a penalty of $65.93 and $150 attorney's fees. Although the policy provided that the making and filing of a sworn proof of loss with the company was a condition precedent to the bringing of suit for any loss thereunder, no such was alleged. Defendant's general demurrer on the ground that 'the petition shows on its face that the plaintiff is not entitled to recover' was overruled, and it excepts.

Woodruff, Savell, Lane & Williams, Edward L. Savell, Benj. B. Blackburn, III, Atlanta, for plaintiff in error.

Eugene S. Taylor, Atlanta, for defendant in error.

EBERHARDT, Judge.

Did the failure to allege that proof of loss had been made, as required by the policy, render the petition subject to the general demurrer? 'Proofs of loss are primarily intended for the purpose of securing an adjustment between the insured and the company (19 Cyc. 854), and it is in accordance with sound public policy that our law recognizes the right of insurance companies to make such requirements in their contracts. By Civil Code 1910, § 2490, ² this right on the part of the insurance companies to prescribe regulations as to notice and preliminary proof of loss is specifically allowed, and it is therein provided that such stipulations must be substantially complied with on the part of the insured unless such compliance is waived by the insurer's absolute refusal to pay.' Moore v. Dixie Fire Ins. Co., 19 Ga.App. 800, 803, 92 S.E. 302; 'Where the plaintiff's right to recover on an insurance contract depends upon a condition precedent to be performed by him, the failure of his petition to allege the performance of such condition precedent, or allege a sufficient legal excuse for its nonperformance, renders said petition subject to general demurrer. Delta Ins. Co. v. Wood, 99 Ga.App. 58, 107 S.E.2d 693.' Equitable Life Assurance Society v. Hollingsworth, 103 Ga.App. 505, 119 S.E.2d 725; Harris v. Towns, 106 Ga.App. 217(3), 126 S.E.2d 718. ³ Since there is no allegation that any proof of loss was filed with the company within sixty days after the loss we must assume that it was not done. It is a well settled rule that pleadings must be construed in the light of their omissions as well as their averments. Houston v. Pollard, 217 Ga. 184, 121 S.E.2d 629. Strother v. Kennedy, 218 Ga. 180, 186, 127 S.E.2d 19. The real question with which we must deal then, is whether the allegations that '10. The actual amount of the loss to said automobile was $363.71. Under the terms of said insurance policy the defendant would be indebted to the plaintiff in the amount of $263.71. 11. Plaintiff has made demand of defendant for said amount, which defendant has arbitrarily refused to pay, making instead an offer to pay $173.01, or approximately $90.70 less than their actual liability' are sufficient to plead a waiver of the policy requirement as to the filing of a proof of loss.

Section 2490 of the Code of 1910, carried forward as § 56-831 in the Code of 1933, provided inter alia, that 'Every insurer shall have a right to prescribe regulations as to notice and preliminary proof of loss, which shall be substantially complied with by the assured * * *. An absolute refusal to pay shall waive a compliance with these preliminaries.' This section was repealed by the Insurance Code of 1960. (Ga.L.1960, pp. 289, 754). Substituted therefor was what is now designated as Code § 56-2427, which provides that an insurer shall furnish to the insured forms on which to make proof of loss and that failure to do so shall constitute a waiver of the requirement. No reference is made in this substituted section, however, to an absolute refusal of the insurer to pay, or the effect thereof.

A well-settled principle is that the law will not require the doing of a vain thing. Thus, if one to whom money is payable expressly declares that he will not accept it, no tender is required. State Mutual Life Ins....