American Casualty Co.v.Holloway c. Co.

Court of Appeals of GeorgiaApr 30, 1959
99 Ga. App. 471 (Ga. Ct. App. 1959)
99 Ga. App. 471108 S.E.2d 881



Garnishment. Albany City Court. Before Judge Jones. January 22, 1959.

Perry, Walters Langstaff, for plaintiff in error.

P. Walter Jones, Jones Lee, contra.

The verdict in favor of the plaintiff loan company against the American Casualty Company, garnishee, being supported by the evidence, and there being no special grounds of error assigned, the trial court did not err in denying the motion of the garnishee in attachment to direct a verdict in its favor nor in denying the motion of such garnishee for a judgment notwithstanding the verdict.


On September 22, 1956, the American Casualty Company, in consideration of the premium paid it, issued its policy and contract of insurance in favor of Luther Jack Hatcher, insured, in the total sum of $1,425, insuring against fire and other specified losses one 14 feet outboard motor boat (speedliner), $550, one 40 horsepower Mercury outboard motor, $750, and one two-wheel motor boat trailer, amount $125. Thereafter the property (except said trailer) was destroyed by being burned, and the insurer was notified thereof.

Said insured was indebted to the Holloway Loan Finance Company, evidenced by two notes, and the loss payable clause on said insurance was made payable to said loan company.

After notifying the insurer of said loss, and before payment to him of the loss thereof, the insured absconded, and left the jurisdiction of the court, leaving unpaid his liability on the notes due to the loan company, totaling $1,295, besides interest and 14 percent attorney's fees. Said notes becoming due, the Holloway Loan Finance Company sued out an attachment before the Hon. George Sabadoes, a justice of the peace in Dougherty County. A service of summons of garnishment in attachment was issued and served on February 3, 1958, upon said American Casualty Company by the sheriff levying upon certain property of the insurer in Dougherty County.

Thereafter the Holloway Loan Finance Company, a partnership, filed in the City Court of Albany its declaration in attachment and sought judgment on said notes. Thereafter judgment was rendered in the plaintiff's favor. The garnishee filed its answer denying any indebtedness to the said defendant insured. The plaintiff in attachment also filed its traverse to the answer of said American Casualty Company. The issue came on for trial in said City Court of Albany before the judge thereof and a jury, and a verdict and judgment were rendered in favor of the Holloway Loan Finance Company and against said defendant, Luther Jack Hatcher, and also judgment was rendered on said garnishment in favor of the plaintiff in attachment and against the said American Casualty Company, garnishee in attachment, in the sum of $1,425.

A motion for a directed verdict was made by said garnishee, American Casualty Company, which was overruled and denied by the court, and also a motion was made for a judgment notwithstanding the verdict, which the court also denied. The garnishee filed a motion for a new trial, assigning error on the judgment denying its motion for a directed verdict, and on the judgment denying its motion for judgment notwithstanding the verdict.

The evidence was conflicting upon the issue involved in the case relative to the liability of the garnishee as the insurer of the debtor, but this question was determined by the jury favorably to the plaintiff and against the American Casualty Company.

The insurer and garnishee herein, the American Casualty Company, set up as its defense the failure of the insured to file a formal proof of loss and that therefore it was not liable to the absconded insured. The evidence authorized the jury to find that the insured before absconding and subjecting himself to attachment, promptly notified the insurer of the loss of said motor boat and engine and that the insurer took such notice and cognizance thereof as to send its agent to endeavor to salvage and repair said Mercury outboard motor, as insured by it. It is the opinion of this court that the insurer had such notice of the loss under said contract of insurance in favor of the absconded debtor and insured so as to render it liable for whatever loss the insured had sustained relative to the insured property and as it appeared from the evidence, and the jury were authorized to find that the speed boat and said outboard motor were injured, destroyed and damaged to the extent of the loss claimed and so as to render the American Casualty Company liable on said policy in the sum of $1,425. There is no merit in the general grounds of the motion for new trial, and the court did not err in denying the motion for a directed verdict filed by the American Casualty Company, nor in denying said motion for a judgment notwithstanding the verdict.

It seems to this court that the American Casualty Company is liable under its contract of insurance issued herein, and hence is liable to the plaintiff Holloway Loan Finance Company. It insured this speed boat and Mercury motor and accepted from the absconded Luther Jack Hatcher, the insured, the premium required of it in consideration of such insurance. The boat and motor were insured against loss by fire. There was a loss sustained as claimed and as covered by the contract of insurance. The American Casualty Company was duly and promptly notified thereof. While no formal proof of loss was made, the American Casualty Company had actual knowledge of the loss and endeavored to salvage and have repaired the outboard motor, and thereafter refused payment of the loss sustained. This court is of the opinion that the ruling in such cases as Sentinel Fire Ins. Co. v. McRoberts, 50 Ga. App. 732 et seq. ( 179 S.E. 256), and others, as well as the principle underlying Code § 56-831 and the law of insurance in general control here. This court, as ruled in the McRoberts case, properly held: "Under the Civil Code (1910) § 2490 (Code of 1933, § 56-831) `an absolute refusal to pay waives a compliance' with regulations prescribed by the insurer `as to notice and preliminary proof of loss.' It is equally true that, if the insurer admits or declares its liability to pay a claim, after loss, `it constitutes a waiver of requirements of the policy as to notice and proofs of loss. Waiver thus occurs where the company promises to pay the loss or the amount of an appraisement when made,' 33 C. J. 32, § 693, and cit. There is no sound distinction between a waiver of proof of loss by a refusal to pay and a waiver by a promise to pay. If anything, the waiver would be more strongly implied by the promise to pay than by the refusal."

When the American Casualty Company sent its agent to salvage the motor, and the clear implication was that the motor was to be repaired, and said motor if of any value was received and taken by it, there was surely a waiver of any formal proof of loss, it having been actually and promptly notified of the loss prior to such time, regardless of the fact that the insurer had absconded.

It follows that the City Court of Albany did not err in denying the motion for a directed verdict and in denying the motion for a judgment notwithstanding the verdict and denying a new trial. There was ample evidence to authorize the jury to find the American Casualty Company liable to the plaintiff in attachment in the sum found.

Judgment affirmed. Townsend and Carlisle, JJ., concur.