Summary
finding that nearly identical language on the front page of an insurance policy did not grant the independent agent "authority to receive notice"
Summary of this case from Jenkins v. CLJ Healthcare, LLCOpinion
CV 118-031
2019-09-16
AUTO-OWNERS INSURANCE COMPANY, Plaintiff, v. XYTEX TISSUE SERVICES, LLC ; Xytex Tissue Storage, Inc. d/b/a Xytex Tissue Services ; Xytex Cryo International, LTD. ; Xytex Research, Inc.; Xytex Corporation; Xytex Laboratories, Inc.; Lindsey Meagher; Mary Margaret Meagher; and Emma Grace Meagher, Defendants.
ORDER
J. RANDAL HALL, CHIEF JUDGE
Before the Court are Plaintiff Auto-Owners Insurance Company's ("Auto-Owners") Motion for Summary Judgment (Doc. 41) and Motion to Exclude or Limit the Report and Testimony of the Xytex Defendants' Expert, Eric J. Zuckerman (Doc. 42). The Clerk of Court gave notice satisfying the requirements of Griffith v. Wainwright, 772 F.2d 822, 825 (11th Cir. 1985) (per curiam), to Defendants Xytex Tissue Services, LLC; Xytex Tissue Storage, Inc.; Xytex Cryo International, LTD.; Xytex Research, Inc.; Xytex Corporation; and Xytex Laboratories, Inc. (collectively, "Xytex Defendants"); and Defendants Lindsey Meagher, Mary Margaret Meagher, and Emma Grace Meagher (collectively, "Meagher Defendants"). (Doc. 43.) Xytex Defendants filed responses in opposition to both motions (Docs. 44, 45), Plaintiff filed replies in support (Docs. 49, 50), and Xytex Defendants filed sur-replies (Docs. 53, 54). Both motions are ripe for consideration. For the reasons explained below, the Court GRANTS Auto-Owners' summary judgment motion. Thus, Auto-Owners' motion to exclude is DENIED AS MOOT.
I. BACKGROUND
On February 14, 2018, Auto-Owners filed a declaratory judgment action in this Court to determine its responsibilities in connection with a lawsuit arising out of a nitrogen leak. (Compl., Doc. 1.) The Court decides Auto-Owners' Motion for Summary Judgment based on Auto-Owners' argument that Xytex Defendants breached the notice condition in their insurance policy with Auto-Owners. Thus, the Court only outlines the facts related thereto.
William "Bill" Bates is an insurance agent at the Cohen-Bailie Insurance Agency. (Resp. to Mot. for Summ. J., Doc. 44, at 1; Decl. of Mr. Blalock, Doc. 44-3, ¶ 5.) On July 13, 2016, Mr. Bates signed a commercial insurance application ("Insurance Application") for Xytex Defendants as "producer." (Insurance Appl., at 4.) Auto-Owners' Policy Number 074618-48132332-17 (the "Policy") was issued on December 12, 2016, and in effect when the nitrogen leak occurred. (Policy, Doc. 41-6, at 9; Notice of Occurrence, Doc. 41-4, at 11.)
Xytex Tissue Services, Inc. is not listed as an applicant on the Insurance Application. (See Insurance Appl., Doc. 44-9, at 1.)
In the Policy, Section IV - Commercial General Liability Conditions provides the following notice requirement:
2. Duties In The Event Of Occurrence, Offense, Claim Or Suit
a. You must see to it that we are notified as soon as practicable of an "occurrence" ....
* * *
b. If any claim is made or "suit" is brought against any insured, you must:
* * *
(2) Notify us as soon as practicable.
You must see to it that we receive written notice of any claim or "suit" as soon as practicable.
(Id. at 133.) The Policy also includes the following "no action" clause:
3. Legal Action Against Us
No person or organization has a right under this Coverage Part:
a. To join us as a party or otherwise bring us into a "suit" asking for damages from an insured; or
b. To sue us on this Coverage Part unless all of its terms have been fully complied with.
(Id. )
On February 5, 2017, there was a nitrogen leak in Xytex Tissue Services, LLC's building located at 1100 Emmett Street, Augusta, Georgia 30904 resulting in fatalities. (See Notice of Occurrence, at 11.) Jan Scholer, Ph.D., President of Xytex Cryo International, states, "I notified [Mr.] Bates of the accident which forms the basis of the underlying lawsuit within days of same. This notification was either by telephone or email." (Decl. of Dr. Scholer, Doc. 44-5, ¶¶ 6, 8.) On February 9, 2017, Mr. Bates prepared a "General Liability Notice of Occurrence/Claim" based on the February 5, 2017 incident for Evanston Insurance Company, not Auto-Owners. (Notice of Occurrence, at 11.)
On August 31, 2017, Meagher Defendants filed a complaint in the Superior Court for Richmond County, Georgia against Xytex Defendants ("Underlying Lawsuit"). (See Underlying Lawsuit Compl., Doc. 1-1.) The same day the lawsuit was served, Dr. Scholer emailed Mr. Bates the following: "We were served today with a lawsuit.... The suit is attached. Would you please notify our insurance carriers." (Sept. 7, 2017 Email to Mr. Bates, Doc. 44-6, at 1.) Mr. Bates never sent notice of the lawsuit to Auto-Owners because he believed the "location of 1100 Emmett St was deleted from [the] policy." (See Feb. 5, 2018 Email from Mr. Bates, Doc. 44-12, at 1.) Xytex Defendants never provided notice of the occurrence or lawsuit directly to Auto-Owners, only to Mr. Bates. (See Sept. 7, 2017 Email to Mr. Bates, at 1; Decl. of Mr. Blalock, ¶¶ 8-9.) Mr. Bates failed to notify Auto-Owners of either the occurrence or lawsuit.
In the current action, Auto-Owners moved for summary judgment arguing, in part, that it has no duty to defend or indemnify Xytex Defendants because Xytex Defendants failed to satisfy the notice provision in the Policy, which is a condition precedent for coverage. For the following reasons, the Court agrees with Auto-Owners.
II. SUMMARY JUDGMENT STANDARD
The Court should grant summary judgment only if "there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." FED. R. CIV. P. 56(a). The purpose of the summary judgment rule is to dispose of unsupported claims or defenses, which, as a matter of law, raise no genuine issues of material fact suitable for trial. Celotex Corp. v. Catrett, 477 U.S. 317, 322-24, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Facts are "material" if they could affect the outcome of the suit under the governing substantive law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). A dispute of those material facts "is ‘genuine’ ... [only] if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Id. "The mere existence of a scintilla of evidence in support of the [nonmovants'] position will be insufficient" for a jury to return a verdict for the nonmoving parties. Id. at 252, 106 S.Ct. 2505 ; accord Gilliard v. Ga. Dep't of Corrs., 500 F. App'x 860, 863 (11th Cir. 2012) (per curiam).
As required, the Court views the record evidence "in the light most favorable to the [nonmovants]," Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986), and will "draw all justifiable inferences in [their] favor." United States v. Four Parcels of Real Prop., 941 F.2d 1428, 1437 (11th Cir. 1991) (en banc) (internal punctuation omitted). Additionally, the parties opposing summary judgment "may not rest upon the mere allegations or denials in [their] pleadings. Rather, [their] responses ... must set forth specific facts showing that there is a genuine issue for trial." Walker v. Darby, 911 F.2d 1573, 1576-77 (11th Cir. 1990).
III. DISCUSSION
For the reasons discussed below, the Court finds Xytex Defendants did not provide timely notice to Auto-Owners, a condition precedent to coverage under Georgia Law. Thus, Auto-Owners owes no duty to Xytex Defendants to defend or indemnify.
"The obligations of parties to an insurance policy are a matter of contract, and the parties are bound by the terms of the policy." Auto-Owners Ins. Co. v. DFH Dev., Inc., No. 1:08-CV-1465-JOF, 2009 WL 2515638, at *3 (N.D. Ga. Aug. 12, 2009) (citing Resolution Tr. Corp. v. Artley, 24 F.3d 1363, 1367 (11th Cir. 1994) ). Under Georgia law:
It is well established that a notice provision expressly made a condition precedent to coverage is valid and must be complied with, absent a showing of justification. Where an insured has not demonstrated justification for failure to give notice according to the terms of the policy, then the insurer is not obligated to provide either a defense or coverage.
Kay-Lex Co. v. Essex Ins. Co., 286 Ga.App. 484, 649 S.E.2d 602, 606 (2007) (quoting Federated Mut. Ins. Co. v. Ownbey Enters., Inc., 278 Ga.App. 1, 627 S.E.2d 917, 919 (2006) ). Notice provisions in insurance policies play an important role by enabling the insurer "to investigate promptly the facts surrounding [an] occurrence while they are still fresh and the witnesses are still available, to prepare for a defense of the action, and, in a proper case, to determine the feasibility of settlement of the claim." S.C. Ins. Co. v. Coody, 957 F. Supp. 234, 237 (M.D. Ga. 1997) (quoting Richmond v. Ga. Farm Bureau Mut. Ins. Co., 140 Ga.App. 215, 231 S.E.2d 245, 250 (1976) ).
Plaintiff states that the notice provision coupled with the "no action" clause creates a condition precedent. Xytex Defendants do not dispute this, and the Court agrees that the notice requirement is a condition precedent. Therefore, the "condition must be performed before the contract becomes absolute and obligatory on the other party." KHD Deutz of Am. Corp. v. Utica Mut. Ins. Co., 220 Ga.App. 194, 469 S.E.2d 336, 338 (1996) (quoting Glass v. Stewart Title Guar. Co., 181 Ga.App. 804, 354 S.E.2d 187, 189 (1987) ).
The Policy's Commercial General Liability Conditions section provides that the insured is required to "notify us as soon as practicable" of a claim and "see to it that we are notified as soon as practicable of an ‘occurrence.’ " The Policy defines "we" and "us" as "the company providing this insurance," which is Auto-Owners. (Policy, at 2, 9, 122.) Xytex Defendants, therefore, needed to provide notice to Auto-Owners of the occurrence and claim "as soon as practicable." Auto-Owners and Xytex Defendants do not dispute this summary of their respective obligations. The current dispute is whether Xytex Defendants provided the required notice. The Court discusses (A) whether Xytex Defendants complied with the Policy's notice provision and (B) if not, whether the noncompliance was justified.
A. Compliance with the Policy's Notice Provision
Xytex Defendants did not provide notice of the occurrence or claim directly to the company providing the insurance — Auto-Owners. Instead, Defendants argue they provided notice to Mr. Bates, which "constituted notice to Auto-Owners based on Mr. Bates's apparent authority." (Resp. to Mot. for Summ. J., at 8-9.) The Court now addresses whether notice to Mr. Bates based on his apparent authority satisfied the Policy's notice requirement.
Xytex Defendants do not argue that Mr. Bates had actual authority to receive notice, and the Court finds no facts in the record supporting that conclusion. Thus, notice to Mr. Bates can only be sufficient under a theory of apparent agency.
1. Apparent Agency Standard
Under Georgia law, independent insurance agents are generally considered agents of the insured; not agents of the insurer. See Se. Express Sys., Inc. v. S. Guardian Ins. Co. of Ga., 224 Ga.App. 697, 482 S.E.2d 433, 435 (1997). However, it is possible for an insurer to place an independent agent "in a position of apparent authority such that one might be justified in assuming that the agent had authority to receive notice of an occurrence or claim." Kay-Lex, 649 S.E.2d at 607 ; see Bowen Tree Surgeons, Inc. v. Canal Indem. Co., 264 Ga.App. 520, 591 S.E.2d 415, 417 (2003) (considering the insurance agent a dual agent for both the insurer and insured). As the party alleging an apparent agency relationship between Auto-Owners and Mr. Bates, Xytex Defendants carry the burden to create an issue of fact as to whether apparent agency existed. Carter v. Kim, 157 Ga.App. 418, 277 S.E.2d 776, 776 (1981) ("[W]here the existence of an agency is relied upon, the burden of proof rests with the party asserting the relationship."). Furthermore, for the insured "[t]o rely on a theory of apparent agency, ‘the insured must also show justifiable reliance on the representation of agency.’ " Johnson Landscapes, Inc. v. FCCI Ins. Co., No. 1:13-CV-1130-SCJ, 2015 WL 10891934, at *8 (N.D. Ga. Feb. 13, 2015) (quoting Kay-Lex, 649 S.E.2d at 607 ), aff'd, 620 F. App'x 887 (11th Cir. 2015) (per curiam).
To determine whether an insurance agent is a dual agent of the insured and insurer with the apparent authority to receive notice, Georgia courts generally look to whether the insurer placed the independent agent "in a position of apparent authority so that a person of ordinary prudence conversant with business usages and the nature of the particular business is justified in assuming that such agent has the authority to perform a particular act and deals with the agent upon that assumption." Int'l Indem. Co. v. Odom, 174 Ga.App. 6, 329 S.E.2d 307, 309 (1985). Courts look to the policy and conduct of the parties to determine whether an apparent agency exists.
As stated by the Georgia Court of Appeals:
When the terms of the policy or instructions stamped upon the face of a liability policy instruct the insured that it is to provide notice of suit, either to the independent
insurance agent or the insurer, such delegation of apparent authority, notwithstanding the independent contractor relationship, will estop the insurer to deny any notice which was given to the independent agent under its instructions.
Se. Express Sys., 482 S.E.2d at 435. Compare Odom, 329 S.E.2d at 309 (finding the insurance agent had apparent authority when the policy directed the insured to "notify your agent or [the insurer]") (emphasis omitted), with DFH Dev., 2009 WL 2515638, at *1, *5 (finding no apparent authority to accept notice when the policy instructed the insured to "see to it that we receive written notice of the claim or ‘suit’ as soon as practicable"), and Kay-Lex, 649 S.E.2d at 606 ("You must see to it that we are, or our authorized representative is, notified as soon as practicable....") (emphasis omitted).
Courts may also look to the insurer and insurance agent or agency's conduct to establish an apparent agency relationship. See Kay-Lex, 649 S.E.2d at 607. When there is evidence that the independent agent had the authority to bind coverage for the insurance company, issues of fact exist as to dual agency. See Lee v. Mercury Ins. Co. of Ga., 343 Ga.App. 729, 808 S.E.2d 116, 130 (2017) (finding insurance agent may have the power to bind the insurer when, among other things, the agent signed policies as a representative of the insurer and when such an application was received, the application was "typically already bound for coverage"); Sumitomo Marine & Fire Ins. Co. of Am. v. S. Guaranty Ins. Co., 337 F. Supp. 2d 1339, 1353 (N.D. Ga. 2004) (finding the insurance agent had the authority to bind the insurer when the agent "signed [the insurer's] insurance policies, declaration pages, and the Certificates of Insurance as an ‘authorized representative’ of [the insurer]") (applying Georgia law).
Furthermore, an insurer may vest an insurance agency with the apparent authority to accept notice when the insurance agency customarily accepts premium payments and notices on behalf of the insurer. Byrne v. Reardon, 196 Ga.App. 735, 397 S.E.2d 22, 24 (1990). In Byrne, the insurance agency "collected premium payments from the insured, issued a notice of policy expiration and prepared accident notices for this and other accidents reported by the insured showing the agency as the ‘producer.’ " Id. Upon that evidence, the Court of Appeals stated, "[I]t cannot be said that the agency owed no duty to the insurance company to use reasonable care to forward suit papers from the insured in a timely manner." Id.
In Bowen Tree Surgeons, the Court of Appeals interpreted Byrne as only creating "a duty for the insurance agency to notify the insurer of claims in certain situations," not holding "that an insurance agency in such a situation acts as an agent of the insurer for purposes of notice." 591 S.E.2d at 417. The Court, however, applied Byrne to reason that "when the insurance agency customarily accepts premiums and claims on the insurer's behalf," the insurer may be "initiating reliance on the insurance agency" and, thus, may be vesting the insurance agency "with certain authority on its behalf." Id. Applying that logic, the Court found that because "[the insurance agency] customarily accepted premiums and notices of claims on [the insurer]'s behalf" questions of fact existed as to "[the insurance agency]'s ability to accept notice of claims on [the insurer]'s behalf as a fiduciary and as a dual agent." Id.
In Bowen Tree Surgeons, the Court of Appeals reversed the grant of summary judgment and remanded the case. 591 S.E.2d at 417. On remand, the Superior Court of Burke County entered judgment on a jury verdict for the insureds. See Yeomans & Assocs. Agency, Inc. v. Bowen Tree Surgeons, Inc., 274 Ga.App. 738, 618 S.E.2d 673, 677 (2005). In Yeomans & Assocs. Agency, the insurer and insurance agent appealed and argued, in part, they were entitled to a directed verdict that no agency relationship existed between the insurer and insurance agency. Id. at 680. The Court of Appeals applied the same analysis from the original appeal to the "any evidence" test and found "the evidence presented [to the jury] did not demand a finding as a matter of law that there was no agency relationship between [the insurer and insurance agency]. Therefore, [the insurer] was not entitled to a directed verdict on this issue." Id. (emphasis omitted). The Court cited one other case to support its decision: Odom. In Odom, the Court found the insurer had granted the insurance agent apparent authority to accept notice on its behalf through the conduct of the parties and, importantly, the policy itself, which "stated that in the event of an accident, the insured should ‘notify your agent or [the insurer].’ " 329 S.E.2d at 309 (emphasis in original).
The key in Bowen Tree Surgeons is that the Court found the insurance agency "customarily" accepted premiums and notices of claims "on behalf of the insurer." Courts find cases distinguishable from Bowen Tree Surgeons in two situations. The first situation arises when the insurance agency does not customarily accept the premium payments or notices. See Fleming, Ingram & Floyd, P.C. v. Clarendon Nat'l Ins. Co., No. CV 108-075, 2009 WL 5166256, at *6 n.6 (S.D. Ga. Dec. 29, 2009) ) (finding no evidence that the insurance agency routinely collected premium payments on behalf of the insurer even though there was evidence that the check used to pay the premiums "was most likely made out to the [insurance agency]") (applying Georgia law); Alea London Ltd. v. Cook, No. 4:06-CV-0238-HLM, 2007 WL 5376619, at *13 (N.D. Ga. Sept. 19, 2007) (finding no custom of accepting premium payments when the insurance agency accepted a check from the insured one time) (applying Georgia law). The second situation occurs when the insurance agency does not collect premiums or notices on behalf of the insurance company, but as the agent of the insured. See Johnson Landscapes, 2015 WL 10891934, at *8 ("Although [the insurance agent] did collect premiums from [the insured] and passed along [a] notice from [the insured] to [the insurer], those are acts that [the insurance agent] would perform in its capacity as agent of the insured."); Park-N-Ticket, Inc. v. Fireman's Fund Ins. Co., No. 1:11-cv-03096-JOF, 2013 WL 11927706, at *7 (N.D. Ga. May 8, 2013) (finding the insurance agent's actions "typical of those taken by a completely independent insurance broker" when the insurance agent submitted the insured's insurance application and accepted premium payments) (applying Georgia law); Briggs & Stratton Corp. v. Royal Globe Ins. Co., 64 F. Supp. 2d 1346, 1356 (M.D. Ga. 1999) (stating there were "insufficient facts ... to overcome the presumption that [the insurance agent] was not the agent of [the insurer]" even though the insured sent notices to the insurer through the insurance agency "on twenty-three previous occasions") (applying Georgia law).
2. Applying the Apparent Agency Standard
Mr. Bates assisted Xytex Defendants for many years with their insurance needs and placed policies with different insurance companies, including Auto-Owners and Evanston Insurance Company. (See Decl. of Mr. Blalock, ¶¶ 4-5; Insurance Appl.; Notice of Occurrence, at 11.) Because Mr. Bates worked for an independent insurance agency and assisted the insured with acquiring insurance with multiple insurance companies, he is presumed to be an agent of the insured, not the insurer. See Briggs & Stratton, 64 F. Supp. 2d at 1356 ("Both the Georgia Courts and Eleventh Circuit have held that an independent insurance agent was not an agent of the insurer when the insurer was only one of a number of insurance companies with which it placed insurance."). Xytex Defendants attempt to show issues of fact to overcome this presumption by pointing to (a) the contents of the Policy and (b) the conduct of the parties. Finally, Xytex Defendants state (c) they justifiably relied on that apparent authority.
a. The Policy
The notice provision of the Policy clearly directs the insured to send notice to Auto-Owners and vests no other individual with the authority to receive notice. See DFH Dev., 2009 WL 2515638, at *5 (analyzing the same language as in the notice provision in this case and finding the text clear that "notice could only be given to [the insurer]").
Defendants argue the first page of the Policy provides apparent authority to Mr. Bates because, first, "Mr. Bates's agency, address, and telephone number were prominently displayed on the first page of Xytex[ ] [Defendants'] policies with Auto-Owners." (Resp. to Mot. for Summ. J., at 7.) The Court finds this insufficient to create an issue of fact as to whether an apparent agency relationship existed between Mr. Bates and Auto-Owners. Mr. Bates's agency's information is listed on the left column of the page directly above the insured's information "not designated under the stamp on the face of the [P]olicy." See Se. Express Sys., 482 S.E.2d at 436 (limiting Titan Indem. Co. v. Hall Cty., 202 Ga.App. 38, 413 S.E.2d 213 (1991) to situations where "independent agents [are] designated under the stamp on the face of the policy with apparent authority to accept notice for the insurer"). Furthermore, the agency information here is in the exact position as the Policy in question in DFH Dev. where the court found nothing in the policy granted the insurance agent apparent authority to receive notice. 2009 WL 2515638, at *5-*6.
Second, Xytex Defendants argue that on the front page of the Policy, Auto-Owners vested Mr. Bates with apparent authority by stating: "Thank you for selecting Auto-Owners Insurance Group to serve your insurance needs! Feel free to contact your independent Auto-Owners agent with questions you may have." (Resp. to Mot. for Summ. J., at 7; Policy, at 2.) On their own, these statements do not grant Mr. Bates or the Cohen-Bailie Insurance Agency authority to receive notice. Even assuming the statement applies to the Cohen-Bailie Insurance Agency, which is unclear, the statement only directs the insured to contact its independent Auto-Owners agent with questions. Xytex Defendants have the burden to show Auto-Owners vested Mr. Bates with apparent authority to receive notice. When compared with the clear terms of the Policy requiring notice to be given only to Auto-Owners and no statement on the face of the Policy giving Mr. Bates the apparent authority specifically to receive notice, the terms of the Policy do not raise an issue as to Mr. Bates's apparent agency.
b. The Conduct of the Parties
Defendants next argue there is a question of Mr. Bates's apparent agency based on conduct. Xytex Defendants argue that "Mr. Bates was Xytex's sole point of contact with Auto-Owners and occasionally visited Xytex's office for the purpose of picking up checks for premiums on behalf of Auto-Owners." (Resp. to Mot. for Summ. J., at 7.) The Court finds these actions insufficient to establish apparent agency for two reasons.
First, Xytex Defendants fail to show a custom of accepting premiums. The evidence is that Mr. Bates only "occasionally" retrieved Xytex Defendants' premiums as opposed to a custom of accepting every premium payment as in Bowen Tree Surgeons. Regarding claim notices, Xytex Defendants offer evidence that Mr. Bates was asked "to notify any insurer which might provide coverage for the underlying accident." (Decl. of Mr. Blalock, ¶ 9.) The only cited evidence is one notice that Mr. Bates prepared for a different insurance company — Evanston Insurance Company. (See Notice of Occurrence, at 11-12.) Xytex Defendants fail to offer evidence of any past notice Mr. Bates provided to Auto-Owners on behalf of Xytex Defendants.
Second, even if Xytex Defendants can show there was a custom, there is a lack of evidence showing Mr. Bates accepted notices and premiums on behalf of Auto-Owners. Rather, the evidence points to Mr. Bates acting as an agent of Xytex Defendants by occasionally picking up premium checks and notifying all relevant insurers of occurrences and claims. Furthermore, Dr. Scholer's statement that he asked Mr. Bates to "notify any insurer which might provide coverage for the underlying accident" does not suggest he notified Mr. Bates believing him to be an agent of Auto-Owners, in which notice to Mr. Bates would be notice to Auto-Owners. Instead, the statement shows Xytex Defendants used Mr. Bates as their own agent.
Finally, Xytex Defendants argue that signing the Insurance Application as the "producer" shows Mr. Bates was an agent of Auto-Owners. The application, however, is clear that the undersigned "producer" "is an authorized representative of the applicant." (Insurance Appl., at 4.) Signing as the authorized representative of the applicant is distinct from cases such as Lee where the insurance agent signed the application as a representative of the insurer and bound the insurer through his signature.
Xytex Defendants state, "Importantly, the notice of claim, signed by Mr. Bates, identified Mr. Bates as ‘producer.’ (Xytex appendix, exh. I.)." (Resp. to Mot. for Summ. J., at 7.) In the cited "notice of claim," Mr. Bates did not sign as the producer but as the person to whom the information was reported. (Notice of Occurrence, at 11-12 (noting the carrier as "Evanston Insurance Company").) The only form where Mr. Bates signed as producer is the Insurance Application, which the Court discusses above.
In conclusion, neither the terms of the Policy nor the conduct of Auto-Owners and Mr. Bates gives credence to the idea that Auto-Owners vested Mr. Bates with the apparent authority to receive notice on its behalf. Xytex Defendants fail to meet their burden of raising genuine issues of fact as to whether Mr. Bates had apparent authority. Thus, any notice to Mr. Bates did not constitute notice to Auto-Owners.
c. Justifiable Reliance on the Apparent Authority
In addition to showing Mr. Bates had apparent authority from Auto-Owners, Xytex Defendants must also show they justifiably relied on the apparent authority. The Court finds Xytex Defendants fail to raise a question of whether they justifiably relied. In Kay-Lex, the Court of Appeals found no justifiable reliance because there was no evidence that the insured looked at the policy; concluded that the insurance agent was an agent of the insurer; and, on that belief, provided notice to the insurance agent. 649 S.E.2d at 607-08. Xytex Defendants point to no evidence that they concluded Mr. Bates "must also be an agent of the insurer[ ]" and then gave notice to him based upon that conclusion. Id. In fact, Xytex Defendants provide evidence that they did not rely on Mr. Bates as an agent of Auto-Owners but as their own agent with authority from Xytex Defendants to determine who to send notice to.
3. Notice Provided "as Soon as Practicable"
Xytex Defendants' sole argument is that notice to Mr. Bates was sufficient. Having determined it was not, the Court finds no evidence that Xytex Defendants ever provided notice to Auto-Owners. The February 5, 2018 Email from Mr. Bates states that at that time, no notice had been sent to Auto-Owners. Assuming the delay was at least from September 7, 2017 — the day the lawsuit was served on Xytex Defendants — through February 5, 2018, that delay in notice would not be "as soon as practicable" as a matter of law. See Hathaway Dev. Co. v. Ill. Union Ins. Co., 274 F. App'x 787, 791 (11th Cir. 2008) (listing cases finding delays of four, five, and eight months held by Georgia courts to be unreasonable as a matter of law).
B. Justification for Noncompliance
Finally, an insured's failure to comply with a condition precedent may be excused if justified. Xytex Defendants rely solely on the argument that there is a question of fact as to whether notice was provided to Auto-Owners through Mr. Bates. Xytex Defendants fail to argue any justification for their noncompliance. Furthermore, relying on your insurance agent who fails to send notice to your insurer is not justification sufficient to excuse noncompliance with a notice provision. See Kay-Lex, 649 S.E.2d at 608 (finding no justification for failing to give notice because "without an actual or apparent agency relationship ..., [the insured] was not authorized to rely on any statements [the insurance agent] made to him ..."); Alea London, 2007 WL 5376619, at *13.
IV. CONCLUSION
For the foregoing reasons, Plaintiff's Motion for Summary Judgment (Doc. 41) is GRANTED. As such, Plaintiff's Motion to Exclude or Limit the Report and Testimony of the Xytex Defendants' Expert, Eric J. Zuckerman (Doc. 42) is DENIED AS MOOT. Accordingly, the Clerk is directed to ENTER JUDGMENT in favor of Plaintiff, TERMINATE all other pending motions, if any, and CLOSE this case.
ORDER ENTERED at Augusta, Georgia, this 16th day of September, 2019.