Government Employees Insurance Company v. Hardin., 108 Ga. App. 230, 132 S.E.2d 513 (1963)
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Judgment affirmed. Carlisle, P. J., and Bell, J., concur.
Summary
Judgment affirmed. Carlisle, P. J., and Bell, J., concur.
Text
Randall Evans, Jr., contra.Fulcher, Fulcher, Hagler & Harper, J. Walker Harper, for plaintiff in error.
1. A letter to the insured stating that appraisal is agreeable to the company, and suggesting that if the company's offer of settlement is unsatisfactory the insured proceed under appraisal provisions of the policy, is not a demand for appraisal which makes compliance with appraisal provisions a condition precedent to suit on the policy.
2. (a) Evidence that the insurer offered the insured less than half of the amount of his claim authorized a finding that the insurer had made offer of settlement amounting to a refusal to pay; and such finding of fact would constitute a waiver of proof of loss.
(b) Evidence discussed in the opinion created an issue whether the insurer acted in bad faith in refusing to pay the insured's claim.
In this case the plaintiff insured brought suit alleging that the defendant insurer refused to pay his collision loss covered by his insurance policy, and also claiming a 25% penalty and reasonable attorney's fees for the insurer's bad faith in refusing to pay. The jury found a verdict for the plaintiff in the amount sued for and also awarded a penalty and attorney's fees. The defendant, as plaintiff in error in this court, assigns error on the trial court's orders sustaining the plaintiff's oral motion to dismiss a plea in abatement filed by the defendant, and overruling the defendant's motion for judgment notwithstanding the verdict and motion for new trial.
1. In its plea in abatement the insurer contended that the plaintiff was precluded from maintaining the action because he had failed to comply with a provision of the policy requiring, in the event of a controversy as to the amount of loss and upon demand of either party, that the parties select appraisers to determine the amount of loss. The plea alleged that the defendant had written the plaintiff a letter referring to this provision of the policy and stating in part: ". . . From our independent appraiser, A. L. Cloud, of Macon, Georgia, he puts the value of the insured unit at between $650 and $795 . . . If you desire to retain the service of an independent appraiser on this it will be perfectly agreeable to this Company . . . As our file now stands we have an agreed price on the cost of repairs of our insured's 1956 Chrysler four-door New Yorker at $474.52. If this is unsatisfactory to your client we suggest that you contact our representatives, Gay and Taylor and proceed along the conditions set forth in paragraph 10 of the A-2 policy." When a policy contains a provision for appraisal, and the insurer "names and selects an appraiser and in writing communicates the selection to the insured, at the same time demands in writing that the insured name an appraiser, and the insured fails to comply with such demand, and refuses and fails to name an appraiser as provided in the policy, the designation of an appraiser by the insured is a condition precedent to the right of the insured to maintain a suit on the policy." National Fire Ins. Co. v. Lam,
Our courts have held that a refusal to pay waives compliance with requirements prescribed by the insurer for proofs of loss; and that a jury may find that an offer of a sum substantially less than the loss claimed amounts to a refusal to pay. Great American Co-op Fire Assn. v. Jenkins,
"Probable cause for refusing payment will negative the imputation of bad faith, and without such probable cause refusal will be at the company's peril." Travelers Ins. Co. v. Sheppard,
The defendant contends that testimony as to an agreement whereby plaintiff and his counsel were to divide equally all damages awarded, including attorney's fees, over $473, had the prejudicial effect of causing the jury to award an excessive sum as attorney's fees. Since the defendant elicited this testimony in cross examination, it affords no ground for setting aside the award of attorney's fees.
The trial court did not err in overruling the defendant's motion for judgment notwithstanding the verdict and the general and special grounds of the motion for new trial.
ON DEFENDANT'S MOTION FOR REHEARING.
The defendant contends that the evidence presented at the trial showed that its refusal to pay the amount claimed by the plaintiff was not frivolous and unfounded; but that the disparity between the defendant's offer, based on a reputable estimate of the cost of repairing the plaintiff's automobile, and the plaintiff's claim, approximately twice that amount, shows on the contrary that the defendant had reasonable and probable cause for refusing to pay the claim. This argument overlooks the evidence of the plaintiff's demand that the defendant itself repair and restore the automobile to its condition before the accident. The defendant, according to its own undisputed evidence, was not willing to undertake to repair because of the statement in the demand that plaintiff would not consider the claim satisfied unless the repairs made by the defendant restored the automobile to its former condition. But this demand was in accordance with the provision of the policy limiting the company's liability to the actual cash value of the property or the cost to repair or replace the property with other of like kind and quality. It may be true that if the defendant had made repairs and thereafter the plaintiff had unreasonably claimed that the automobile was not restored to its former condition, the defendant's refusal to pay at that time could not be said to be in bad faith. This, however, was not the state of facts at the time of the defendant's refusal. The defendant relies on Real Ins. Co. v. Cohen,
Rehearing denied. Carlisle, P. J., and Bell, J., concur.
1963
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