Southern Guar. Ins. Co. v. Preferred Risk Mut. Ins. Co.

• Decision Date: 09 September 1987
• Docket Number: No. 44410,44410
• Citation: 359 S.E.2d 665,257 Ga. 355
• Parties: SOUTHERN GUARANTY INSURANCE CO. v. PREFERRED RISK MUTUAL INSURANCE CO.
• Court: Georgia Supreme Court

Page 665

359 S.E.2d 665

257 Ga. 355

SOUTHERN GUARANTY INSURANCE CO. v. PREFERRED RISK MUTUAL INSURANCE CO.

No. 44410.

Supreme Court of Georgia.

Sept. 9, 1987.

Robert M. Darroch, Elizabeth A. Obenshain, Jenkins, Bergman & Darroch, Atlanta, for Southern Guar. Ins. Co.

Fred A. Gilbert, Gilbert & Montlick, Decatur, E. Wycliffe Orr, Gainesville, Andrew J. Hill III, Blasingame, Burch, Garrard & Bryant, Timothy W. Floyd, University of Georgia, School of Law Legal Aid & Defender Society, Athens, John E. Talmadge, Talmadge, Mullis & Green, Atlanta, for Preferred Risk Mut. Ins. Co.

CLARKE, Presiding Justice.

We granted certiorari to consider whether a family exclusion clause in an automobile liability insurance policy is void as against public policy in this case. In August, 1983, Mrs. Gordon was driving a car insured by Southern Guaranty Insurance Company under a policy issued to Mr. Cooper which provided coverage to anyone driving the car with the express permission of the named insured or "within the scope of such expressed permission." She was driving the car with the permission of Mrs. Cooper, an insured under the policy and a passenger in the car. Mrs. Gordon was involved in an accident, and Mrs. Cooper was injured.

Southern Guaranty brought suit for declaratory judgment, naming as defendants Mrs. Gordon and her insurer, Preferred Risk Mutual Insurance Company, and Mrs. Cooper. Southern Guaranty was granted summary judgment on the basis that the Cooper policy contained an exclusion for bodily injury to the insured or any relative of the insured residing in the same household as the insured. Preferred Risk appealed, and the Court of Appeals reversed.

The Court of Appeals found in Preferred Risk Mutual Insurance Co. v. Southern Guaranty Insurance Co. of Ga., 181 Ga.App. 688, 353 S.E.2d 590 (1987) that this case is controlled by our decision in GEICO v. Dickey, 255 Ga. 661, 340 S.E.2d 595 (1986). In GEICO v. Dickey we held that a family or household exclusion clause in an automobile liability insurance policy was against public policy where the exclusion was broader than the tort immunity of the insured in the state in which he was being sued, North Carolina. Although we found that the exclusion would have been valid in Georgia, where the policy was written, because of Georgia's interfamily tort immunity which would insulate the insured from liability, we held that "[w]hen an insured purchases a policy of automobile insurance in Georgia which gives him protection against liability in Georgia, he is entitled to the same protection when he crosses into another state." Id. at 663. A crucial factor in our finding that a family exclusion clause is not per se against public policy was the finding that the exclusion dovetailed with absence of liability in Georgia, where the policy was written and delivered.

Although we reiterated in GEICO v. Dickey the principle that "... compulsory liability insurance is required 'not only for the benefit of the insured but to ensure compensation for innocent victims of negligent motorists.' Cotton States Mutual Insurance Co. v. Neese, 254 Ga. 335, 329 S.E.2d 136 (1985)[,]" GEICO v. Dickey, supra, 255 Ga. at 662, 340 S.E.2d 595, our decision turned on the exposure of the insured to liability. If the compensation of victims were the overriding consideration in every case, we would conclude...