Wilson Marine Sales & Service, Inc. v. Fireman's Fund Ins. Co., 49745

• Decision Date: 15 October 1974
• Docket Number: No. 3,No. 49745,49745,3
• Citation: 211 S.E.2d 145,133 Ga.App. 220
• Parties: WILSON MARINE SALES & SERVICE, INC. v. FIREMAN'S FUND INSURANCE COMPANY et al
• Court: Georgia Court of Appeals

Page 145

211 S.E.2d 145

133 Ga.App. 220

WILSON MARINE SALES & SERVICE, INC. v. FIREMAN'S FUND INSURANCE COMPANY et al.

No. 49745.

Court of Appeals of Georgia, Division No. 3.

Oct. 15, 1974.

Rehearing Denied Nov. 6, 1974.

Hendrix, Shea & Oldfield, John H. Oldfield, Jr., Savannah, for appellant.

Perry Brannen, Sr., Savannah, for appellees.

Syllabus Opinion by the Court

WEBB, Judge.

Fireman's Fund Insurance Company, through its agency Cranman Insurance Agency, Inc., issued to Coastal Marine Sales & Service, Inc. a fire insurance policy on a building, boats, motors, trailers, equipment and accessories located on East Victory Drive in Thunderbolt. Fire loss occurred during the term of the policy. Fireman's Fund declined payment of the claim because 'Our investigation developed that a condition existed which suspends the insurance as more clearly defined in lines 28 through 32 of the policy conditions.' Those policy conditions, usual in the standard form fire insurance policy, are that 'unless otherwise provided in writing added hereto this company shall not be liable for loss occurring (a) while the hazard is increased by any means within the control or knowledge of the insured . . .' The loss claimed totaled $89,245. The statutory notice for penalty and attorney fees was given to the insurer.

Complaint for recovery under the policy was filed in Chatham Superior Court by 'Wilson Marine Sales & Service, Inc., d/b/a Coastal Marine Sales and Service, Inc., individually for itself and on behalf of and for the use and benefit of R & T Enterprises, Inc.' Defendants are Cranman Insurance Agency, a corporation; John Lassiter; and Fireman's Fund Insurance Company. Cranman is the agency through which the policy was obtained; Lassiter is an authorized agent of Cranman; and Fireman's Fund is the insuring company.

The complaint alleges that R & T Enterprises, Inc. is the owner of the insured building at 3105 East Victory Drive, in which 'its principal stockholders, managing officers and directors, William C. Tuten and John M. Roadwalt' conduct their various businesses, including Coastal; and that Coastal since 1969 had conducted a business in a portion of the building, involving sale, servicing, repairs and construction of boats, and general marine work. Further, that when Tuten and Roadwalt purchased these premises they requested Lassiter to cover the business thereon 'with adequate fire and extended coverage for Plaintiff R & T, as well as cover the operation of Plaintiff Coastal with adequate casualty insurance against property loss;' that Lassiter visited the premises; that he was informed about the ownership; that Industrial Bank of Savannah held a security deed on the property; that plaintiffs relied on Lassiter and the defendants 'to provide adequate and complete insurance coverage;' that notwithstanding this, defendants issued coverage in the name of Coastal; and therefore all rights or demands by Coastal as to the building loss are for the use and benefit of R & T, true owner of the building. Coastal owned the marine enterprise. The policy sub judice was issued February 28, 1970 for a three-year period; the fire occurred on April 14, 1971 while the policy was in effect.

Plaintiffs further allege that there had been no change in the hazard since the policy was issued; that the basis of the refusal by Fireman's Fund to pay was that they have engaged in boat building operations on the premises; that this was true when the policy was issued, a fact known to defendants because through them a standard workmen's compensation and employers liability policy was issued to Coastal on February 29, 1970 defining the classification of operations to include 'boat building or repairing-boats not exceeding 150 feet in length, including drivers.' This latter policy was renewed February 29, 1971.

Fireman's Fund was dismissed as a party defendant upon its motion therefor that the complaint as to it fails to state a claim upon which relief can be granted, and from that order of dismissal plaintiffs appeal.

Appellants contend that after loss, the insurance policy and interest in the proceeds can be assigned; that even though they have not contended that there had been an assignment of the policy to R & T, there is no prohibition against R & T assuming the position of the insured; that it is the neglect of Cranman Agency and Lassiter that the policy was issued in the name of the wrong corporate entity; and that R & T did have an insurable interest, known to Lassiter as agent, in the property covered by the policy, a valid claim is made, and the relief sought could be granted on the complaint as brought.

The thrust of Fireman Fund's contention in support of its motion to dismiss is that Wilson Marine itself is the sole plaintiff, that Wilson Marine was not the insured, that there has been no written assignment to Wilson Marine, and that Wilson Marine not being a party to the insurance contract has no standing to maintain the action.

1. '(T)he general rule is that: 'An action on a policy of insurance-or on a written binder-must be brought in the name of the holder of the legal title...