Bankers Fidelity Life Insurance Company v. Oliver., 106 Ga. App. 305, 126 S.E.2d 887 (1962)

Status: DECIDED

Docket Number: 39536

Parts: Action to recover paid insurance premiums. Scre...

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Summary

Judgment affirmed on condition that the. defendant in error write off from said judgment the sum of $750 awarded as at- torney\'s fees within ten (10) days from the date the remittitur of this court is made the judgment of the trial court; otherwise reversed. Bell, J., concurs. Felton, C. J., concurs specially.

Summary

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Smith, Kilpatrick, Cody, Rogers & McClatchey, Devereaux F. McClatchey, for party at interest not party to record.Hilton & Hilton, L. H. Hilton, contra.Sam F. Lowe, Jr., Smith, Field, Ringel, Martin & Carr, for plaintiff in error.

1. The law of the case by the previous decision on appeal is that the plaintiff can recover under former Code 56-519 insurance premiums paid.

2. The evidence authorized a recovery by plaintiff for premiums paid.

3, 4. Attorney's fees are not recoverable against a defendant in a suit based upon Code 56-519. However, interest may be allowed the plaintiff from the time the action accrued.

5. In an action for recovery of premiums based on an insurance agent's fraud in the procurement of a policy of insurance, the testimony as to statements made to witnesses other than the plaintiff concerning such policy was admissible.

The trial resulted in a verdict and judgment for a total of $400 for the plaintiff with interest at 5% from the dates she made her payments to the defendant, and $750 attorney's fees. The defendant made a motion for new trial, which it later amended to add several special grounds. The defendant made a motion for judgment notwithstanding the verdict on the grounds stated in its motion for directed verdict made at the conclusion of the evidence, which will be discussed in the opinion.

On the judgments of the court allowing plaintiff's amendment and overruling defendant's motion to strike plaintiff's allegations and prayers respecting attorney's fees; overruling its motion for new trial; and overruling its motion for judgment notwithstanding the verdict, the defendant assigns error.

1. When this case was previously before this court, it was decided on November 30, 1961, that the plaintiff's petition set out a cause of action under former Code 56-519 for recovery of insurance premiums based on the agent's fraud in the procurement of the policy of insurance. Bankers Fidelity Life Ins. Co. v. Morgan, 104 Ga. App. 894, 899 (123 SE2d 433); Bankers Fidelity Life Ins. Co. v. Harrison, 104 Ga. App. 899 (123 SE2d 438); Bankers Fidelity Life Ins. Co. v. Oliver, 104 Ga. App. 902 (123 SE2d 440). Defendant's argument that there can be no recovery by the plaintiff under Code 56-519 after the repeal of the statute, effective January 1, 1961, is without merit. This issue existed at the time of the former appeal; the statute had at that time been repealed. It is the law of the case by the previous decision that the plaintiff can recover as provided by that Code section. Lowe v. City of Atlanta, 95 Ga. App. 113 (97 SE2d 191); Langford v. Milhollin, 104 Ga. App. 894, 896, 899, supra.

The second ground of the motion for judgment notwithstanding the verdict is: The evidence fails to show that the defendant's agents were authorized to make the alleged misrepresentation, and the defendant could not the liable therefor; but on the contrary the evidence shows that the agents were employed by the defendant under a written agreement only, which specifically provided that the agents had no authority to alter the terms of the company's policies, and that the agent shall not do any illegal act or violate any state insurance law. On the former appeal this court held that the purpose of former Code 56-519 was to make the insurance companies directly liable for statements of their agents declared therein to the unlawful. "The company cannot, merely by inserting in its contract a provision that it is not to be bound by the acts of such agents, relieve itself from the effect of the law, . . . The petition set out a cause of action for recovery of premiums based on the agent's fraud in the procurement of the policy of insurance . . ." (Emphasis supplied).

2. The plaintiff's own testimony is sufficient to authorize a finding that the defendant's agents made "false representations as to the form, nature, and character of the policy" sold to plaintiff, which is the essence of plaintiff's cause of action. Whether or not there was proof of the specific representation alleged by plaintiff, that after two years plaintiff could withdraw all sums deposited by her with interest, the evidence authorized a recovery by plaintiff for premiums paid. The first ground of defendant's motion for judgment notwithstanding the verdict, that the evidence did not prove the case presented in plaintiff's petition, and the general grounds of the motion for new trial are without merit.

3. The question whether the plaintiff can recover attorney's fees is raised by several of the assignments of error. Unless the recovery of attorney's fees is expressly authorized by a special statutory provision, the cases in which they can be recovered in this State are those within the meaning of Code 20-1404, which provides: "The expenses of litigation are not generally allowed as a part of the damages; but if the defendant has acted in bad faith, or has been stubbornly litigious, or has caused the plaintiff unnecessary trouble and expense, the jury may allow them." The damages allowed under this Code section are compensatory, not punitive or vindictive. Bowman v. Poole, 212 Ga. 261 (91 SE2d 770).

While on the former appeal this court stated in its opinion that Code 56-519 "provides a statutory remedy by imposing a statutory penalty" (Bankers Fidelity Life Ins. Co. v. Morgan, 104 Ga. App. 894, 897, supra), the action is in reality a "statutory liability" and not a "penalty" since it creates a liability in favor of individuals instead of for the public generally. Neal v. Moultrie, 104 Ga. App. 894, 899, supra. The plaintiff is entitled to interest from the time the "statutory liability" accrued which was the date the premiums were paid. Burns v. Beck, 95 Ga. App. 161, 175 (97 SE2d 365); Deckner-Willingham Lmbr. Co. v. Turner, 104 Ga. App. 894, supra; nor do I agree that the case of John V. Farwell Co. v. Jackson Stores, 105 Ga. App. 692 (125 SE2d 541, 545).

Rehearing denied. Bell, J., concurs. Felton, C. J., concurs specially.

1962