U.S. Fidelity & Guar. Co. v. J. I. Case Co.

• Decision Date: 15 June 1993
• Docket Number: No. A93A0430,A93A0430
• Citation: 432 S.E.2d 654,209 Ga.App. 61
• Court: Georgia Court of Appeals
• Parties: , Prod.Liab.Rep. (CCH) P 13,672 UNITED STATES FIDELITY & GUARANTY COMPANY et al. v. J.I. CASE COMPANY.

Page 654

432 S.E.2d 654

209 Ga.App. 61, Prod.Liab.Rep. (CCH) P 13,672

UNITED STATES FIDELITY

& GUARANTY COMPANY

et al.

v.

J.I. CASE COMPANY.

No. A93A0430.

Court of Appeals of Georgia.

June 15, 1993.

Allgood & Daniel, Robert L. Allgood, Augusta, for appellants.

Dye, Tucker, Everitt, Wheale & Long, A. Rowland Dye, Augusta, for appellee.

COOPER, Judge.

In 1988, appellant Robert C. Collins purchased a tractor manufactured by appellee for use on his cotton farm. The tractor was destroyed when it caught fire six months later. According to expert testimony presented at trial, the fire was caused either by an electrical problem in the fuse panel of the tractor or by debris which had accumulated around the heat shield on the exhaust pipe. The tractor was insured under a policy which was issued by appellant United States Fidelity & Guaranty Company (hereinafter "USF & G") to the B.G. Collins Estate, John C. Land and Robert C. Collins d/b/a Burke Farm Management Service, Inc. (hereinafter "Burke"). Collins submitted a claim to USF & G for the loss, which USF & G paid by check to Burke in the amount of $63,411.28. Collins testified that he received a loan receipt which he signed on behalf of Burke, but this document does not appear in the record.

On February 7, 1990, Burke filed a lawsuit against appellee seeking damages on the theories of strict liability and negligence. Although the policy itself is absent from the record on appeal, the trial transcript reveals that the policy contained the following provision: "If any person or organization to or for whom we make payment under this coverage form has rights to recover damages from another, those rights are transferred to us to the extent of our payment." After appellee asserted in its responsive pleadings that this provision made USF & G the real party in interest and it was ascertained during discovery that the tractor had been purchased in the name of Collins, the case proceeded to trial with both USF & G and Collins as the named plaintiffs. The jury returned a verdict against appellee in the amount of $64,411.28 and judgment was entered accordingly. Appellee filed a motion for new trial or, in the alternative, a motion for judgment notwithstanding the verdict. This appeal is from the grant of appellee's motion for j.n.o.v. Appellants enumerate as error the trial court's grant of j.n.o.v. on the ground that the evidence clearly supported the jury's verdict.

1. Appellants contend the trial court erred in concluding that USF & G was the real party in interest because there was no effective assignment of the claim to USF & G under the policy. Appellants point out that the insurance proceeds were paid to Burke and argue that because Burke did not own the tractor, it had no cause of action to assign to USF & G. Appellants contend that they moved to add USF & G as a party plaintiff in order to avoid any real party in interest defense being asserted by appellee but maintain that Collins is the real party in interest both as owner of the tractor and because he never received payment from USF & G.

Whether payment of the insurance proceeds was made in Collins' name or that of his business entity was irrelevant. Although the check itself does not appear to have been placed in evidence, Collins admitted on cross-examination that he was the person to whom payment was made by USF & G for loss of the tractor and that he transferred his claim against appellee to USF & G. Moreover, the assignment issue has previously been decided adversely to appellants by this court in Hoxie v. Americus Auto. Co., 73 Ga.App. 686, 688, 37 S.E.2d 808 (1946) and General Ins. Co. v. Bowers, 139 Ga.App. 416, 418-419, 228 S.E.2d 348 (1976). In both cases, before filing suit against the defendants for negligence in destroying their property, the plaintiffs accepted payment from their insurers in full satisfaction of all claims for loss and damage. The insurers paid the claimants pursuant to a proof of loss and subrogation agreement containing language transferring the cause of action to the insurer which was similar to the provision in the policy under consideration in this appeal. After checks were delivered to the insureds in full payment of the claims, they signed a loan receipt to the insurer. This court held in both cases that the trial court properly dismissed the insureds' lawsuits as they " 'had transferred and assigned in a subrogation agreement all of [their] claims and demands to the insurance company. The trial court was, therefore, authorized to find that the so-called loan receipt was not a novation of the assignment and subrogation agreement, and that the plaintiff had no right to maintain the action.' " Id. at 418-419, 228 S.E.2d 348.

While the assignment provision in the above cases was part of a proof of loss form rather than a specific policy provision as in the present appeal, the effect of the agreement is the same. " '(O)ne can be compensated but once for damage inflicted, and it is obvious that [Collins] has in fact recovered the maximum sum to which he is entitled. The right of action, if any existed, would have been in the [hands of the] insurer under the subrogation agreement ... The insurer was the only possible party plaintiff ... in this action....' [Cit.]" Bryant v. Atlanta Gas Light Co., 149 Ga.App. 126, 127(1), 253 S.E.2d 807 (1979). Accord Parker Plumbing & Heating Co. v. Kurtz, 225 Ga. 31, 165 S.E.2d 729 (1969), rev'g Kurtz v. Parker Plumbing etc., Co., 118 Ga.App. 130, 162 S.E.2d 755 (1968); Imperiale v. Pollard, 187 Ga.App. 427, 370 S.E.2d 494 (1988).

2. Next, appellants contend that even if Collins did assign his cause of action to USF & G, the strict liability claim could still be maintained by USF & G. However, OCGA § 51-1-11(b)(1) restricts such actions to "natural persons." See Mike Bajalia, Inc. v. Amos Constr. Co., 142 Ga.App. 225(2), 235 S.E.2d 664 (1977). In addition, we reject appellants' contention that because the policy provision assigned all claims of the insured to USF & G, it is entitled to bring such an action as subrogee. "OCGA § 51-1-11(b) ... is our statute governing strict liability in tort which is in derogation of common law and 'must be strictly construed or limited strictly to the meaning of the language employed and not extended beyond plain and explicit terms.' [Cits.]" Daniel v. American Optical Corp., 251 Ga. 166, 167(1), 304 S.E.2d 383 (1983). Thus, the appellate courts cannot, "by judicial opinion, enlarge upon or by construction grant rights or causes of action not clearly included in the statute itself." Ford Motor Co. v. Carter, 239 Ga. 657, 663, 238 S.E.2d 361 (1977).

3. Appellants assert that even if USF & G were correctly determined to be the only proper party to pursue the action and were precluded from seeking a strict liability...