Summary
In State Farm Mutual Automobile Ins. Co. v. Glover, 113 Ga. App. 815, 149 S.E.2d 852 (1966), the court held that the insurer's right to intervene was based upon the constitutional due process issue of the insurer's right to defend against its liability under its policy.
Summary of this case from Allstate Ins. Co. v. HuntOpinion
41867.
ARGUED MARCH 7, 1966.
DECIDED MAY 16, 1966. REHEARING DENIED JUNE 13, 1966.
Action on insurance policy. Sylvester City Court. Before Judge Monk.
Divine Busbee, George D. Busbee, for appellant.
Adams Henry, Ronald F. Adams, Burt Burt, Donald Rentz, Junior Lee Jordan, pro se, for appellees.
Under the uninsured motorists law the plaintiff's insurer has the constitutional right to urge the non-liability of the uninsured motorist where the case is in default as to the uninsured motorist, and to contest the jurisdiction of the court over the uninsured motorist. Under the facts of this case there is no conflict of interest as to the plaintiff's insurer and the plaintiff.
ARGUED MARCH 7, 1966 — DECIDED MAY 16, 1966 — REHEARING DENIED JUNE 13, 1966 — CERT. APPLIED FOR.
This is an appeal from the City Court of Sylvester by State Farm Mutual Automobile Insurance Company, which had filed defensive pleadings as intervenor (as allowed by order of the trial judge) in an automobile damage suit pending in the City Court of Sylvester. Appellant had issued its policy of automobile liability insurance containing "uninsured motorist" coverage which applied to the collision being sued on. Certain orders and rulings of the trial judge adverse to appellant are appealed to this court as being in error. For convenience, appellant is sometimes referred to herein as "State Farm" and/or "Intervenor," and Arthur Guarnieri is sometimes referred to herein as "plaintiff," the position he occupied in the trial court. On May 13, 1965, Arthur Guarnieri, by next friend, filed his suit for personal injuries in the City Court of Sylvester, against Junior Lee Jordan, alleged therein to be a resident of Colquitt County, and against William Glover, alleged therein to be a resident of Worth County. The petition alleged that the plaintiff sustained personal injuries and property damage for which the action was brought, allegedly caused by the negligence of the defendant, Junior Lee Jordan, while operating an automobile belonging to defendant William Glover which was involved in a collision with the motorcycle being operated by plaintiff. This petition was served on Junior Lee Jordan but was never served on William Glover. Plaintiff caused a copy of the petition in this matter to be served on State Farm as provided by Ga. L. 1964, pp. 306-309, which Act relates to uninsured motorists. No defensive pleadings or appearance has ever been made in the case by either Junior Lee Jordan or William Glover. State Farm filed its petition in the trial court for leave to intervene in the cause, alleging that it had issued an automobile liability insurance policy providing coverage to plaintiff for damages caused by an "uninsured motorist" under provisions of such insurance policy; that it had been served with a copy of the petition filed by the plaintiff; that it was necessary to protect State Farm's rights that it be given leave to intervene, made a party to the cause, and allowed to file an answer and other defensive pleadings to the plaintiff's petition; and that State Farm should be given an opportunity to resist the rendition of a judgment operating to its prejudice in the case. On June 19, 1965, at a time when no party was in default, the trial judge entered an order extending the time within which the insurance company might file "an answer, demurrers, pleas or any other pleadings" in the case for an additional period of time after the entry of the final order of the court granting or denying the petition for leave to intervene. This order was consented to in writing by the plaintiff's counsel. The trial court ordered the petition for leave to intervene filed and set a date for hearing thereon. The trial court entered an order on July 10, 1965, reciting that the petition to intervene having come on regularly to be heard on July 9, 1965, the court ordered that the petition for leave to intervene by State Farm be granted, and ordered that State Farm be made a party intervenor "authorized to make such appearances and to file such answer and other pleadings as it deems appropriate." Thereafter, State Farm filed a timely plea to the jurisdiction of the court on July 21, 1965, before filing its answers or demurrers to the petition. In this plea State Farm alleged that (1) Junior Lee Jordan is a resident of Colquitt County, Ga., is not a resident of Worth County, Ga., and that the Superior Court of Colquitt County has jurisdiction of this case and the City Court of Sylvester has not; (2) that at the time of filing of the plea to the jurisdiction by State Farm, Junior Lee Jordan has failed to file a plea to the jurisdiction or other defensive pleadings, though more than thirty days have elapsed since the time he was served with process and suit; (3) that intervenor has not waived jurisdiction as to the parties herein and any waiver by Junior Lee Jordan of jurisdiction would be prejudicial to this intervenor; and (4) that as of the date of the filing of the plea the codefendant, William Glover, has not been served with process or copy of the petition herein. Appellant filed demurrers to the petition and an answer. Appellant renewed its demurrers after the petition was amended by plaintiff. In its answer, appellant denied the material allegations of negligence contained in the petition. On August 12, 1965, appellant propounded interrogatories to plaintiff. On August 13, 1965, plaintiff propounded interrogatories to appellant. On August 21, 1965, appellant filed objections to the interrogatories propounded by plaintiff. On August 23, 1965, plaintiff filed objections to appellant's interrogatories. The attorney for plaintiff, H. P. Burt, filed an affidavit relating to the interrogatories on August 27, 1965. The attorney for appellant, Mr. George D. Busbee, filed an affidavit relating to the interrogatories on August 27, 1965. On August 28, 1965, the plaintiff filed an amendment striking paragraph 1 of the original petition, wherein plaintiff had alleged that Junior Lee Jordan was a resident of Colquitt County and inserting in lieu thereof a new paragraph 1 alleging that Junior Lee Jordan was a resident of Worth County. On September 11, 1965, plaintiff filed three motions in the case. They are as follows: "1. Comes now plaintiff and moves the court to dismiss intervenor's (State Farm Mutual Insurance Company) answer with respect to contesting the alleged negligence charged against defendant, Junior Lee Jordan, on the ground that said case is in default as to Junior Lee Jordan and the only issue remaining is the question of damages. Plaintiff moves the court to strike the following paragraphs to defendant's answers: 1, 2, 3, 4, that portion of paragraph 7 denying paragraph 9 of plaintiff's petition and paragraph 8." "2. Comes now plaintiff, and moves the court to dismiss intervenor's (State Farm Mutual Automobile Insurance Company) demurrers on the ground; (I) There is no provision of law authorizing intervenor to file said demurrers." "3. Comes now plaintiff, and moves the court to dismiss intervenor's (State Farm Mutual Automobile Insurance Company) plea to the jurisdiction on the ground: (I) A plea to the jurisdiction is a personal plea, which can only be filed by the defendant, Junior Lee Jordan. (II) Said action is in default as to defendant, Junior Lee Jordan, who was served personally in said State and county. (III) There is no provision of law authorizing intervenor to file said plea." Appellant filed a motion to dismiss the plaintiff's petition because plaintiff had wilfully failed and refused to respond to interrogatories to which no objections were filed by plaintiff, and that plaintiff had wilfully failed to answer interrogatories or cause any hearing to be held on his objections. On December 11, 1965, the court entered two orders. The first order reads as follows: "The plaintiff's motion to dismiss intervenor's answer with respect to the alleged negligence charged against defendant, Junior Lee Jordan, coming on for a hearing, and after due consideration of same, it is ordered that said motion be sustained and that the case be marked in default as to defendant, Junior Lee Jordan." The second order of December 11, 1965, reads as follows: "The plaintiff's motion to dismiss intervenor's plea to the jurisdiction, coming on for a hearing, after due consideration of same, it is ordered that said motion be sustained, and the said plea be dismissed." On January 3, 1966, the court entered an order overruling the demurrers of appellant as renewed. On January 3, 1966, the trial judge also entered the following order in this case: "With respect to the pending motions as filed in court in the above stated case, by the plaintiff in said case, and also by the intervenor in said case, pertaining to the interrogatories as filed in court by each of said respective parties hereto and more specifically pertaining to the admissibility and execution of certain numbered questions as propounded and contained in interrogatories as filed with the clerk of the court by each of said parties hereto, and, it now appearing to the court that said case is, in default as to the defendant in said case, no answer having been filed. And it further appearing, that the question involved in this cause of action is one of unliquidated damages, which of course is incumbent on the part of the plaintiff to prove. Accordingly, all motions and objections as made by each of the parties hereto, plaintiff and intervenor, with respect to interrogatories, are hereby overruled and denied, excepting such evidence only as may be applicable and admissible in establishing the amount of unliquidated damages in said case, and/or in mitigation thereof and which evidence when so submitted, the intervenor herein is not precluded from contesting the same in mitigation of the amount of such damages claimed by due cross examination as he may deem proper."
The insurance company appeals from the order of the court, dated January 3, 1966, overruling the general demurrers of Intervenor to plaintiff's petition as amended; the order of December 11, 1965, sustaining plaintiff's motion to dismiss Intervenor's answer; and from the order of December 11, 1965, sustaining plaintiff's motion to dismiss Intervenor's plea to the jurisdiction.
Appellant's enumeration of errors is as follows: "1. The court erred in sustaining plaintiff's motion to dismiss appellant's plea to the jurisdiction by order dated December 11, 1965. 2. The court erred in sustaining plaintiff's motion to dismiss appellant's answer with respect to the alleged negligence charged against Junior Lee Jordan and marking this case in default as to defendant Junior Lee Jordan by order dated December 11, 1965. 3. The court erred in overruling appellant's demurrers and renewed demurrers on each and every ground thereof by an order dated January 3, 1966. 4. The court erred in overruling appellant's motion and objections and in sustaining plaintiff's motion and objections with respect to certain interrogatories in an order dated January 3, 1966. 5. The court erred in its order dated January 3, 1966, which order, in effect, held that intervenor could not contest the question of defendant's negligence but could only introduce evidence on the question of the amount of damages plaintiff is entitled to recover."
1. The only question involved is whether the insurance company has a right to protect its constitutional right of due process by intervention or some method with a less technical name. The answer is in the construction of the uninsured motorists laws. Ga. L. 1963, p. 588 et seq., as amended by Ga. L. 1964, p. 306 et seq. ( Code Ann. § 56-407.1). The answer lies in the following propositions: (1) The uninsured motorists law provides that the injured party's insurance company may defend an action against an unknown motorist. (2) It provides that a copy of petition and process be served upon the injured party's insurance company in case of an action against a known uninsured motorist. (3) It provides that to show liability against an insurance company under a policy insuring against injury caused by an uninsured motorist it is only necessary to show the rendition of a judgment against the uninsured motorist. State Farm Mut. Auto. Ins. Co. v. Girtman, 113 Ga. App. 54 ( 147 S.E.2d 364). (4) The law requires insurance companies writing liability policies to include protection against uninsured motorists. In such circumstances it would seem that the General Assembly intended that an insurance company in affording the protection to an insured would have a right to take whatever legal steps were necessary and fitting to see to it that the court trying the action against an uninsured motorist, first, had jurisdiction of the case and the person of the uninsured motorist, and second, to insure that the judgment against the uninsured motorist was not in default, and to insure that the judgment was rendered on legal and sufficient evidence. What an insurance company would be allowed to do in any given case would depend on the circumstances of the particular case. Here the problem is easy. Assuming that the court had jurisdiction on the pleadings and the uninsured motorist had permitted the case to go in default, the insurance company should have the right to contest the liability of the uninsured motorist by whatever name the pleadings might be called, if it in fact was in possession of evidence sufficient to raise a jury question. The insurance company could also raise the question of the jurisdiction of the court as to subject matter or parties. The right to file a plea to the jurisdiction is not confined to the person directly affected by a lack of jurisdiction. Anyone who would be injured by a failure to raise the jurisdictional question and has such a relation to the case as would justify his intervention may raise the issue. Ryder Automobile Leasing Co. v. Tates, 112 Ga. App. 18 ( 143 S.E.2d 411) and cit. The technical rules heretofore obtaining as to interventions, especially the rule that the intervenor takes the case as he finds it and cannot ordinarily file demurrers to pleadings and the rules on similar matters, no longer are valid insofar as the uninsured motorist law is concerned. The fact that the insurance company is not an insurer of the uninsured motorist and bears no contractual relation to him is no bar to the insurer's rights in the premises. Nor do we consider that there is a conflict of interest as to the insurer and insured any more than there would logically be if the insurer denied coverage under the contract. In such a case as this the interests of both parties, plaintiff and insurer, are represented by counsel and guarded by the court. Any other construction of the uninsured motorists law would render it unconstitutional as it applies to the facts of this case. See State of Missouri v. Craig, (Mo.App.) 364 S.W.2d 343; 95 ALR2d 1321, Anno. p. 1330. As to questions which might arise where an uninsured motorist defends the action against him in whole or part, see discussion in Wert v. Burke, 47 Ill. App.2d 453 ( 197 N.E.2d 717).
2. The court erred in its rulings enumerated as errors numbers 1, 2, 4 and 5 on the merits of the issues.
3. The court did not err in overruling intervenor's general demurrer to the petition for the reason that the objection to the addition of a new cause of action by amendment is not properly raised unless the objection is to the amendment alone and specifically points out that it adds a new cause of action. Tucker v. DuBose, 60 Ga. App. 238 ( 3 S.E.2d 754); Laslie v. Gragg Lumber Co., 184 Ga. 794 ( 193 S.E. 763); Aycock v. Williams, 185 Ga. 585 (1) ( 196 S.E. 54).
Judgment reversed in part; affirmed in part. Bell, P. J., Frankum, Jordan, Hall, Eberhardt and Deen, JJ., concur. Nichols, P. J., and Pannell, J., concur specially.
I concur in the result reached here, but solely on the law of the case, and not on what I consider an unauthorized construction of the Act of 1964.
1. The petition of the insurer for leave to intervene stated the fact of the issuance of the policy, and in paragraph 3 alleged "it is necessary for the protection of the State Farm Mutual Automobile Insurance Company that it be given leave to intervene, that it be made a party to the above stated cause, that it be allowed to file an answer and other defensive pleadings to the plaintiff's petition, and that it be given an opportunity to resist the rendition of a judgment operating to its prejudice in the above stated cause." The prayers were for rule nisi, and that the petition to intervene be granted. The trial judge issued a rule nisi and at the same time entered an order, to which the plaintiff consented in writing, extending the time for the State Farm Mutual Automobile Insurance Company to file an answer, demurrers, pleas or any other pleadings in the case. On the day set for the hearing on the petition, the petition was granted, without any objection on the part of the plaintiff, and the State Farm Mutual Automobile Insurance Company was permitted to intervene and to file an answer and other pleadings and to make such appearances as it might deem appropriate. There is no exception to this order and no cross appeal by the plaintiff, and insofar as this appeal is concerned, this order established the law of the case. The insurer filed demurrers, a plea to the jurisdiction and an answer in its name only, and not in the name of either of the individual defendants; these pleadings, therefore, did not prevent a default as to the individual defendant served (the uninsured motorist), but under the order of intervention the insurer was privileged to contest its liability and the amount thereof.
2. If my views are correct in Division 1 above, it becomes unnecessary to construe or apply the Act of 1964. However, since the majority has seen fit to base its conclusions upon a construction of that Act, I do not deem it inappropriate that I express my views in reference thereto. The majority opinion reaches its conclusion that the statute authorizes an intervention by the insurer in a suit against a known uninsured motorist, not by reason of any language in the statute, but because to do otherwise would, in the opinion of the majority, make the statute unconstitutional. In so holding, the majority misapplied the rule or misinterpreted the meaning of the rule. The rule is that where a statute is equally susceptible to two constructions, one of which will harmonize it with the Constitution, and the other of which will render it unconstitutional, the former construction is generally to be preferred. Fordham v. Sikes, 141 Ga. 469 (2) ( 81 S.E. 208). What the majority overlooks, too, is that the known uninsured motorist who is the real party defendant to a case also has some rights. It is my opinion that the known uninsured motorist, the defendant in an automobile damage suit, has a right to conduct his own defense without interference from an insurance company and insurance company lawyers, with whom he has no contractual relations, including the right not to plead if he so desires. It is my opinion, therefore, that the majority has given the statute an unconstitutional construction, if it permits the insurance company to interfere in any manner with the conduct of the defense of his case by the known uninsured motorist. However, be that as it may, let us examine the language of the statute and from that language determine what the legislature provided.
The Act of 1964 repealed in its entirety former Code § 56-407A and enacted in lieu thereof an entirely new Code § 56-407A. If there is any authority on the part of an insurer to intervene in an action brought by a plaintiff against a known uninsured motorist it must be obtained from subsection (d) thereof. The section is as follows: "If the owner or operator of any vehicle causing injury or damages be unknown, an action may be instituted against the unknown defendant as `John Doe', and service of process may be made by delivery of a copy of the motion for judgment, or other pleadings, to the clerk of the court in which the action is brought, and service upon the insurance company issuing the policy shall be made as prescribed by law as though such insurance company were a party defendant. The insurance company shall have the right to file pleadings and take other action allowable by law, in the name of John Doe. Provided, however, that in cases where the owner of the vehicle causing the injury or damages is known, a copy of service shall be made upon the insurance company issuing the policy as prescribed by law as though such insurance company were a party defendant." It will be noted that where the uninsured motorist is unknown this section makes provision for a fictitious John Doe action, for service upon the insurance company, and then expressly provides that the insurance company shall have the right to file pleadings and take other action allowable by law in the name of John Doe. Immediately following is a proviso which states that where the uninsured motorist is known the insurance company shall be served as in the John Doe action. Nothing is said about the insurance company filing pleadings or intervening in this latter action. The lack of such provision and the fact that the requirement of service in an action against the known owner is contained in a proviso conclusively shows that there was no intent on the part of the legislature that the insurance company be permitted to intervene and plead in the latter instance. This construction is further enforced by an examination of subsection (e) immediately following. This subsection expressly provides that the securing of a judgment in the John Doe action shall be binding neither upon the plaintiff nor the unknown owner when he becomes known and the then known owner may be sued by the plaintiff, the only provision being that the company be protected for any amount it has paid as the result of the John Doe action. Subsection (e) does provide that where a John Doe action is brought and the owner becomes known he may be joined as a party defendant to such action. It is only when this occurs, under the statute, that any question may arise as to the rights of the insurance company to plead, or continue with pleadings already filed. We have no such case here. In my opinion, the uninsured motorist statute gives ample protection to the insurance company in such a case as the present one where the known uninsured motorist fails to defend the case against him by permitting an entry of default thus preventing a contest by him of the question of liability. In my opinion, the legal liability of the uninsured motorist referred to in the statute, by which the insurer is bound, is a liability established by the findings of a jury, or the findings of a trial judge in the absence of a jury and not by default of the known uninsured motorist. This construction would prevent the alleged unconstitutional effect of the statute, and the statute is more readily and reasonably susceptible to this construction than to the construction placed upon it by the majority.
There is nothing in State Farm Mut. Auto. Ins. Co. v. Girtman, 113 Ga. App. 54 ( 147 S.E.2d 364) contrary to what is stated above. That case merely held that the securing of a judgment against the known uninsured motorist was a condition precedent to a suit against the insurance company. That case did not hold, and is not authority for a holding, that a judgment entered by default is an adjudication of liability of the insurance company, and if any such holding had been made in that case it would have been obiter dictum.
I am authorized to state that Presiding Judge Nichols concurs in this special concurrence.