Justia Georgia Supreme Court Opinion Summaries

Velicia Carter was injured in an automobile collision with Jeova Oliviera. It was alleged that Oliviera was under the influence of alcohol at the time. Oliviera had an auto liability insurance policy with GEICO General Insurance Company with a $30,000 per person liability limit. Carter was insured by Progressive Mountain Insurance Company, including uninsured/underinsured motorist (UM) coverage of $25,000 per person. Carter sued Oliviera and served Progressive as her UM carrier, and entered into a settlement in which GEICO paid the $30,000 limit of Oliviera's policy, and Carter executed a limited liability release. It allocated $29,000 of GEICO's payment to punitive damages and $1,000 to compensatory damages. Progressive answered the suit as Carter's UM carrier and sought summary judgment on the UM claim, which the trial court granted, ruling that, by imposing the condition that $29,000 of the liability coverage limit be allocated to the payment of punitive damages, Carter failed to meet a prerequisite for recovery of the UM benefits. The Court of Appeals affirmed, finding that, by allocating a portion of the payment to punitive damages, rather than allocating all of the payment to compensatory damages, Carter failed to exhaust the limits of Oliviera's liability policy, and, therefore, forfeited the ability to make a claim on her UM policy. The Supreme Court granted a writ of certiorari to the Court of Appeals to determine if that Court properly applied the motor vehicle insurance limited liability release provision of OCGA 33-24-41.1. Finding that the Court of Appeals erred, the Supreme Court reversed that Court's judgment. View "Carter v. Progressive Mountain Ins." on Justia Law

The Georgia Department of Corrections (GDOC) entered into a construction contract with Lewis Walker Roofing (Walker Roofing) to re-roof several buildings at Valdosta State Prison. The Contract contained two “no assignment” clauses, and as a prerequisite to contracting with GDOC, Walker Roofing was required to obtain payment and performance bonds. It obtained such payment and performance bonds from Developers Surety and Indemnity Company. Walker Roofing did not complete its work within the time frame required by the Contract, and GDOC declared Walker Roofing in default. Developers Surety did not notify GDOC within 25 days of receipt of GDOC's notice of default regarding whether it would remedy the default or perform the contract. However, approximately three months after the declaration of default, Developers Surety gave GDOC the option of entering into a contract with another company for the completion of the work. GDOC then contracted with that company to finish the project. Under the payment and performance bonds and prior to Walker Roofing's default, Developers Surety had provided financial assistance to Walker Roofing. Developers Surety filed suit against GDOC for breach of contract and for a declaratory judgment that it had no obligation under the payment and performance bond it issued to Walker Roofing on behalf of GDOC. GDOC filed a counterclaim for breach of contract. The parties filed cross-motions for summary judgment, and the trial court determined that Developers Surety's claims were not barred by sovereign immunity and that GDOC had breached the construction contract as a matter of law. It concluded that GDOC waived its sovereign immunity by entering into the contract with Walker Roofing, and that the doctrine of equitable subrogation gave Developers Surety the ability to file suit against GDOC once it incurred liability and paid the obligations of its principal under the bond. Consequently, the trial court granted summary judgment to Developers Surety and denied it to GDOC; in the same order, the trial court entered judgment in favor of Developers Surety in the amount equal to the "financial assistance" Developers Surety provided to Walker Roofing. The Supreme Court granted certiorari to the Court of Appeals to consider whether the State’s sovereign immunity was waived for the claim Developers Surety made on its contract with the State. The Supreme Court found that immunity was indeed waived in this instance, and accordingly, it affirmed the judgment of the Court of Appeals. View "Georgia Dept. of Corrections v. Developers Surety & Indemnity Co." on Justia Law

Appellee AGCO Corporation (AGCO) manufactured and sold a self-propelled, agricultural spray applicator called the "RoGator." In 2005, AGCO began offering an Extended Protection Plan (EPP) to its RoGator customers. Appellant Lloyd’s Syndicate No. 5820 d/b/a Cassidy Davis provided the master policy of insurance for the EPP program, which covered AGCO for certain liability to customers who purchased the RoGator EPP. Glynn General Corporation administered the plans. Between 2005 and 2008, AGCO enrolled about 2,050 RoGator machines in the EPP program. In 2008, a number of customers presented claims under the EPP based on the failure of wheel motors on the RoGator. After it paid about 25 claims related to this failure, Cassidy Davis invoked the "Epidemic Failure Clause" of the master insurance policy and refused to pay for any more claims. AGCO then sued Cassidy Davis asserting various claims, namely claims for breach of contract and bad faith denial of insurance coverage. The trial court granted partial summary judgment to AGCO and denied partial summary judgment to Cassidy Davis on a breach of contract issue, holding that the EPP covered failures caused by design and engineering defects in the RoGators. The trial court also denied Cassidy Davis’s motion for summary judgment on the bad faith claim, rejecting the insurer’s argument that it was not obligated to indemnify AGCO until a court entered a judgment establishing AGCO’s legal liability to its customers. The Court of Appeals affirmed the trial court on both issues. Cassidy Davis appealed, arguing: (1) that the Court of Appeals erred in its interpretation of the coverage provision of the extended protection plan; and (2) the Court of Appeals erred in its interpretation of the indemnity provision of the master policy of liability insurance. Upon review of the matter, the Supreme Court concluded the Court of Appeals misinterpreted the relevant language of both contracts. Therefore the Court reversed on both issues. View "Lloyd's Syndicate No. 5820 v. AGCO Corporation" on Justia Law

In March 2010, Justyna Kunz was involved in a car accident with GEICO's insureds, Crystal, Joseph, and Elizabeth Kalish. Kunz received medical treatment at Athens Regional Medical Center; the Hospital Authority of Clarke County and Athens Regional Medical Center (collectively, "the Hospitals") filed three hospital liens. Kunz subsequently filed suit against the Kalishes. Kunz's attorney wrote a letter to the Kalishes' attorney accepting their $100,000 policy limit settlement offer. The settlement documents, signed in Fall 2010, expressly required Kunz to satisfy the hospital liens out of the settlement fund and constituted a "general[ ] release ... from all legal and equitable claims of every kind and nature." The liens were never satisfied. The Court of Appeals held that, under OCGA 44–14–473 (a), the Hospitals were barred by a one-year statute of limitations from filing suit against GEICO to collect on the hospital liens. The Hospitals appealed the appellate court's decision. Finding that the appellate court erred in arriving at its conclusion, the Supreme Court reversed. View "Hospital Authority of Clarke County v. GEICO General Insurance Co." on Justia Law

The Georgia Insurance Insolvency Pool (GIIP) brought a declaratory judgment action against two insureds who purchased workers compensation insurance from the Southern United States Insurance Company (SEUS) before SEUS became a member of GIIP. SEUS insureds whose claims predated June, 2006 were not covered by GIIP, and those insureds faced exposure when SEUS was liquidated in October, 2009. In 2010, the Georgia Legislature enacted a law to expand GIIP's "covered claims" to include certain insureds who obtained insurance from a captive insurer that later became insolvent. The effect of the 2010 amendment was to retroactively cover the previously excluded claims of SEUS insureds. GIIP claimed that extension of coverage would decrease GIIP's reserves and increase the assessments levied on member insurance companies. The defendants, whose claims would be covered only because of the 2010 amendment, filed a motion to dismiss, asserting GIIP lacked standing to bring suit. The trial court granted the motion and the appellate court affirmed. Upon review, the Supreme Court concluded the legislature gave GIIP the power to sue and be sued, and as such, had no standing to challenge the 2010 statutory amendment. View "Georgia Insurer's Insolvency Pool v. Hulsey Environmental Services, Inc." on Justia Law

In a commercial general liability policy (GCL) coverage case, the United States Court of Appeals for the Eleventh Circuit certified two questions to the Georgia Supreme Court: (1) whether, for an "occurrence" to exist under a standard CGL policy, Georgia law requires there to be damage to "other property;" and (2) if "no" to the first question, whether for an "occurrence" to exist under a standard CGL policy, Georgia law requires that the claims being defended not be for breach of contract, fraud, or breach of warranty from the failure to disclose material information. The Supreme Court answered the first question in the negative, and the second in the affirmative to fraud, but negative as to breach of warranty. View "Taylor Morrison Services, Inc. v. HDI-Gerling America Insurance Co. " on Justia Law

The United States District Court for the Northern District of Georgia certified two questions to the Georgia Supreme Court. The questions related to the Automobile Insurance Company of Hartford Connecticut's umbrella policy issued to Louis and Betty Wilson. At the time, Georgia law required policies to have uninsured motorist coverage unless the insured rejected that coverage in writing. The Wilsons did not reject uninsured motorist coverage; their policy excluded such coverage despite being required by law. Because it was not written into the policy but required, it was implied by operation of law. In 2010, Louis Wilson was seriously injured in an accident, and gave notice of a claim for uninsured motorist benefits. The insurance company denied the claim, contending that a 2008 amendment to the Georgia law specifically excluded umbrella policies from mandatory uninsured motorist coverage. The questions from the federal court centered on whether the amendment to the applicable Georgia law applied to the Wilson's umbrella policy after 2009, and whether the notice requirements of the amended law applied to umbrella policies. After review, the Georgia Court concluded that the amendment in question here did not apply to the Wilson's umbrella policy, nor did the notice requirement. View "Wilson v. Automobile Insurance Co. of Hartford, Connecticut" on Justia Law

Following the fracture of an underground gas pipeline owned and operated by Atmos Energy Corporation, a subsequent fire and explosion damaged a building owned by Woodcraft by Macdonald, Inc. d/b/a Coachcraft. Coachcraft's insurer, Georgia Casualty and Surety Co., paid Coachcraft $1,675,169 under two policies and then pursued its own subrogation rights against Atmos in federal court where Coachcraft and its owner, intervened as plaintiffs. After more than two years of discovery and preparation for trial, Georgia Casualty decided to settle its claims against Atmos for $950,000. Coachcraft filed an objection to the settlement, arguing Georgia Casualty was prohibited from settling its subrogation claims until Coachcraft was "made whole." The federal court denied the objection. In lieu of continuing its own federal case, Coachcraft also settled its claims against Atmos for $125,000. Following the settlements, Coachcraft demanded Georgia Casualty pay, from its settlement, the remaining amount it claimed was necessary to make it whole from the damage to its building ($179,130.59). Georgia Casualty refused the demand, and Coachcraft brought a breach of contract action. The trial court denied Georgia Casualty's motion for summary judgment on the breach of contract claim, but granted summary judgment on the bad faith claim. On interlocutory appeal, the Court of Appeals found that summary judgment for Georgia Casualty was warranted on both the breach of contract and bad faith claims. The Supreme Court granted Coachcraft's petition for certiorari to determine whether the Court of Appeals erred when it reversed the trial court's denial of summary judgment to Georgia Casualty on the breach of contract claim. Upon review, the Court upheld the Court of Appeals' ultimate conclusion that the "made whole" doctrine did not require Georgia Casualty to demonstrate that Coachcraft had been fully compensated prior to exercising its subrogation rights under the insurance policy. View "Woodcraft by MacDonald, Inc. v. Georgia Casualty & Surety Co." on Justia Law

Following the trial court's grant of summary judgment to the Georgia Insurers Insolvency Pool (GIIP), Lumpkin County appealed, contending that following the insolvency of the County's regular insurer, GIIP was required to step in and cover the pending workers' compensation claims against the County. Specifically, the County argued that the trial court erred in finding that it was not entitled to coverage under the GIIP because the County's net worth exceeded $25 million. Alternatively, the County argued OCGA 33-36-3 unconstitutionally violated the County's due process rights. Upon review, the Supreme Court affirmed: "The County contend[ed] that this ruling was erroneous because the term 'net worth' is inapplicable to government entities, and, instead, the applicability of the twenty-five million dollar exemption under the Act should be assessed based on the County's 'net assets.' The County argue[d] that the bulk of its assets, including land, roads, bridges, and government buildings are restricted from use and are thus unavailable to meet its obligations or satisfy liabilities. Based on the County's calculation of its own net assets, it only has $5.6 million dollars with which to meet these obligations. As a result, the County maintain[ed] that it should receive coverage for its claims from the GIIP. This argument is misplaced." Therefore, the Court held that the trial court did not err in excluding the County from GIIP protection based on the net worth exemption. Furthermore, the County does not possess due process rights by which to challenge the constitutionality of the Act, and its argument premised on any such right necessarily failed. View "Lumpkin Co. v. Georgia Insurers Insolvency Pool" on Justia Law

The Supreme Court granted certiorari in this appeal to consider whether OCGA section 34-9-207 required an employee who files a claim under the Georgia Workers' Compensation Act (OCGA 34-9-1 et seq.), to authorize her treating physician to engage in ex parte communications with her employer or an employer representative in exchange for receiving benefits for a compensable injury. Because the Court of Appeals erroneously held an employee is not required to authorize such communications, the Supreme Court reversed. View "Arby's Restaurant Group, Inc. v. McRae" on Justia Law