State Farm Mut. Auto. Ins. Co. v. Allstate Ins. Co.

• Decision Date: 10 July 1974
• Docket Number: No. 2,49480,Nos. 49479,s. 49479,2
• Parties: STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY et al. v. ALLSTATE INSURANCE COMPANY et al. Juanita G. MARTIN v. ALLSTATE INSURANCE COMPANY et al
• Court: Georgia Court of Appeals

Page 170

208 S.E.2d 170

132 Ga.App. 332

STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY et al. v. ALLSTATE INSURANCE COMPANY et al.

Juanita G. MARTIN v. ALLSTATE INSURANCE COMPANY et al.

Nos. 49479, 49480.

Court of Appeals of Georgia, Division No. 2.

July 10, 1974.

Syllabus by the Court

An insurance company may by a declaratory judgment action, and after procuring a reservation of rights agreement from one claiming to be insured under its policy, seek a judicial determination of its obligations under the policy and its duty, if any, to defend certain pending actions. The fact that prior to the filing of the action, the conditional agreement to defend the pending suits, and the reservation of rights contract between itself and the putative insured, it had denied coverage does not preclude its change of position in the absence of any facts which would constitute an estoppel against it to do so.

One Maupin, driving an automobile owned by Finch and insured by the appellee Allstate Insurance Company, left the road and collided with a tree, killing the driver and two passengers and injuring another. Actions were filed by the parents of the dead passengers against Maupin and the papers forwarded to Allstate, which returned them with a letter stating in part: 'We are not extending coverage to Thomas Maupin (who) did not have other insured's permission to drive the insured vehicle and he does not qualify as an insured under the terms of our policy. We are taking no action in regard to defending the enclosed suits. If you have any questions regarding our denial in this matter, please contact me.'

Subsequently, another suit was filed on behalf of the injured passenger, and Allstate and Maupin's administratrix, Mrs. Martin, entered into a reservation of rights agreement which recited that it was to the mutual advantage of the parties that the tort actions not go undefended; that Allstate agreed to afford a defense to the claims under a reservation of rights and the privilege of denying coverage and withdrawing from the defense on 15-day notice. The administratrix reserved the right to contend that the policy applies, but not that any waiver exists.

Allstate then filed a declaratory judgment action, against the administratrix, the plaintiffs in the tort claims, State Farm Mutual Auto. Ins. Co., and other insurance companies holding uninsured motorist insurance coverage in the event that no coverage was provided by Allstate. The tort actions were temporarily enjoined. Mrs. Martin, State Farm and United Services Automobile Association, another uninsured motorist insurer, filed motions to dismiss on the ground of lack of justiciable controversy in that 'Allstate does not seek guidance as to whether their policy would apply but rather seeks approval of their denial of coverage to Juanita Martin.' Affidavits were submitted, the court treated the issue as a motion for summary judgment against Allstate, denied the relief sought, and these appeals result.

Greer, Pollock & Klosik, Kenneth C. Pollock, Savell, Williams, Cox & Angel, Elmer L. Nash, Atlanta, for...