State Farm Mut. Auto. Ins. Co. v. Five Transp. Co.

Citation271 S.E.2d 844,246 Ga. 447
Decision Date01 October 1980
Docket NumberNo. 36456,36456
PartiesSTATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY v. FIVE TRANSPORTATION COMPANY et al.
CourtSupreme Court of Georgia

Dickey, Whelchel, Miles & Brown, Richard A. Brown, Jr., Brunswick, for appellant.

J. S. Hutto, Wallace E. Harrell, Brunswick, for appellees.

MARSHALL, Justice.

This is a wrongful death action being prosecuted by appellee Alma Christine Stalvey, in her individual capacity and as administratrix of the estate of her deceased husband, Buford E. Stalvey.

It is alleged in the complaint that the deceased died as a result of injuries sustained in a collision between an automobile driven by him and a truck owned by appellee Five Transportation Co. It is alleged that the cause of this collision was the negligence of the driver of the truck. Five Transportation Co. is named as a defendant, and its liability insurer, appellee Liberty Mutual Insurance Co., is named as a co-defendant. 1 The plaintiff is seeking to recover the following items of damage: $1,000,000 for the wrongful death of the deceased; $25,000 for pain and suffering of the deceased prior to his death; $1,050 for property damages to the automobile; and $185 in wrecker and storage charges.

The deceased was insured under an automobile insurance policy issued by the appellant, State Farm Mutual Automobile Insurance Co. This insurance policy provided $5,000 in personal injury protection (PIP) benefits written as mandatory no-fault coverage under § 3 of the Georgia Motor Vehicle Accident Reparations Act (Code Ann. § 56-3403b). 2 (Subsequent references to the Reparations Act will be by Code section.) It also provided $45,000 in PIP benefits written as optional no-fault coverage under Code Ann. § 56-3404b. 3 Under this policy, State Farm has paid the plaintiff:.$1,249.75 in medical expenses incurred by the deceased: $3,500 in funeral expenses; 4 and $10,250.96 in survivor's benefits. 5 State Farm is obligated to pay the plaintiff an additional $34,999.29 in survivor's benefits, thereby exhausting the $50,000 policy limit.

State Farm has filed a motion to intervene as a party plaintiff in this case, arguing that under Code Ann. § 56-3405b(d)(1) (Ga.L. 1978, p. 2075) it is subrogated to the plaintiff's claims to the extent of all no-fault insurance benefits which State Farm has provided her.

Code Ann. § 56-3405b(d)(1), as enacted in 1978, contains the following pronouncements concerning the subrogation rights of no-fault insurers and self-insurers where the responsible tortfeasor is also insured or is a self-insurer: 6 "Insurers and self-insurers providing benefits without regard to fault described in sections 56-3403b and 56-3404b shall not be subrogated to the rights of the person for whom benefits are provided, except in those motor vehicle accidents involving two or more vehicles, at least one of which is a motor vehicle weighing more than 6,500 pounds unloaded. The right of recovery and the amount thereof shall be determined on the basis of tort law between the insurers or self-insurers involved. Expenses incurred in exercising the rights of subrogation hereunder shall be at the sole expense of the insurers and self-insurers involved." 7

The trial court denied State Farm's motion to intervene on three grounds: (1) the weight classification in Section 56-3405b(d)(1), which allows subrogation only in those motor vehicle accidents where one of the vehicles weighs in excess of 6,500 pounds, is arbitrary and unreasonable and, therefore, violative of the equal protection and due process clauses of the state and federal constitutions; (2) State Farm has no interest in the outcome of this suit, nor will disposition of this action impair State Farm's ability to protect its subrogation interests; (3) Section 56-3405b(d)(1) specifically limits the insurer's right of recovery to the insurance carrier of the tortfeasor, and, therefore, State Farm has no right to intervene in this action against the tortfeasor.

We granted State Farm's application for interlocutory appeal, and, for reasons which follow, we reverse.

1. In the first enumeration of error, the appellant argues that the trial court erred in holding that § 56-3405b(d)(1) is unconstitutional. We agree. 8

What we are dealing with in the present case is a statutory classification that restricts the no-fault insurer's right of subrogation to multivehicle accidents in which one vehicle weighs in excess of 6,500 pounds unloaded. The effect of this is to limit litigation over subrogation to those accidents involving heavier commercial vehicles, such as trucks and buses. Litigation over accidents involving only passenger vehicles is thus eliminated.

A statute is presumed to be constitutional until the contrary appears, and, therefore, the burden is on the party alleging a statute to be unconstitutional to prove it. E. g., Adams v. Ray, 215 Ga. 656, 113 S.E.2d 100 (1960). The record in this case contains no statistical evidence on the question, and it is entirely logical to assume that accidents involving heavier vehicles tend to inflict greater injuries and thereby give rise to larger claims. Therefore, this weight classification in the statute promotes one of the purposes of the Reparations Act, which is to eliminate wasteful litigation over moderate to small claims. Cannon v. Ga. Farm, etc., Ins. Co., 240 Ga. 479, 482, 241 S.E.2d 238 (1978).

It is true that, in a given case, a motor vehicle accident involving lighter vehicles might well give rise to larger claims. However, this does not automatically render a statutory classification such as this unconstitutional. In its regulation of business and industry, the state is not bound to make classifications which are perfectly symmetrical or mathematically precise, so long as the classifications are not arbitrary or unreasonable.

"In the area of economics and social welfare, a State does not violate the Equal Protection Clause merely because the classifications made by its laws are imperfect. If the classification has some 'reasonable basis,' it does not offend the Constitution simply because the classification 'is not made with mathematical nicety or because in practice it results in some inequality.' Lindsley v. Natural Carbonic Gas Co., 220 U.S. 61, 78, 31 S.Ct. 337, 340, 55 L.Ed. 369. 'The problems of government are practical ones and may justify, if they do not require, rough accommodations-illogical, it may be, and unscientific.' Metropolis Theatre Co. v. City of Chicago, 228 U.S. 61, 69-70, 33 S.Ct. 441, 443, 57 L.Ed. 730. 'A statutory discrimination will not be set aside if any state of facts reasonably may be conceived to justify it.' McGowan v. Maryland, 366 U.S. 420, 426, 81 S.Ct. 1101, 1105, 6 L.Ed.2d 393." Dandridge v. Williams, 397 U.S. 471, 485, 90 S.Ct. 1153, 1161, 25 L.Ed.2d 491 (1970). "Under the equal protection guarantee of our State Constitution (Code Ann. § 2-203), classification in legislation is permitted when the classification is based on rational distinctions, and the basis of the classification bears a direct and real relation to the object or purpose of the legislation. C. & S. Nat. Bank v. Mann, 234 Ga. 884, 887, 218 S.E.2d 593 (1975); Dunn v. State, 239 Ga. 537, 238 S.E.2d 77 (1977); Wilder v. State, 232 Ga. 404, 405-408, 207 S.E.2d 38 (1974); Coy v. Linder, 183 Ga. 583, 189 S.E. 26 (1936)." Cannon v. Ga. Farm, etc., Ins. Co., 240 Ga. 479, supra, p. 482, 241 S.E.2d 238. Likewise, if a statutory classification is rational and nonarbitrary, it is not unconstitutional as a matter of substantive due process. See, e. g., Usery v. Turner Elkhorn Mining Co., 428 U.S. 1, 15, 96 S.Ct. 2882, 2892, 49 L.Ed.2d 752 (1976). See generally, 16A Am.Jur.2d 978, Constitutional Law, § 816.

We therefore hold that there is no constitutional impediment, either under the equal protection or due process clauses, to the state's making the subrogation rights of a no-fault automobile insurer dependent upon the weight of the vehicles involved in the accident.

2. However, in City Council of Augusta v. Lee, 153 Ga.App. 94(2), 264 S.E.2d 683 (1980) (cert. den.) and Hall v. White, 150 Ga.App. 545, 258 S.E.2d 256 (1979) the Court of Appeals has held that under Code Ann. § 56-3410b(b) a person eligible for § 56-3404b optional no-fault benefits is not precluded from pleading and recovering against the tortfeasor those damages for which compensation is available under § 56-3404b(d). Section 56-3410b(b) provides: "Any person eligible for economic loss benefits described in section 56-3403b, subsection (b) is precluded from pleading or recovering in an action for damages against a tortfeasor, those damages for which compensation is available for economic loss under said section: Provided, however, that nothing contained in this section shall preclude the introduction of any evidence otherwise admissible in a judicial proceeding for the purpose of proving the extent of the injury or injuries sustained by such person." 9

In Hall, the Court of Appeals held that, although the insured is precluded by reason of § 56-3410b(b) from pleading and recovering those damages for which compensation is available under § 56-3403b (mandatory no-fault benefits), the insured can plead and recover those damages for which compensation is available under § 56-3404b. In Lee, the Court of Appeals simply held that compensation received as optional no-fault coverage under § 56-3404b is "collateral source insurance" and is not relevant and material in an action by the insured against the tortfeasor. 10

However, neither Hall nor Lee considers § 56-3405b(d)(1), as enacted in 1978. In our opinion, § 56-3405b(d)(1) gives to the insurer, in those cases in which it is entitled to subrogation, the right of subrogation to the extent of benefits provided under both §§ 56-3403b and 56-3404b. 11 In those cases in which the insurer is not entitled to subrogation under § 56-3405b(d)(1), we...

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