Opinion
44632.
ARGUED SEPTEMBER 2, 1969.
DECIDED SEPTEMBER 19, 1969. REHEARING DENIED OCTOBER 3, 1969.
Action on insurance policy. Madison Superior Court. Before Judge Williford.
Greer, Sartain Carey, Jack M. Carey, John Cromartie, for appellant.
1. The right of a collision insurer to subrogation may be forfeited by its refusal or unreasonable delay in paying the loss and by its subsequent indirect participation through payment of counsel in an action by the insured against the tortfeasor without insisting on the preservation of its rights.
2. The burden is on a party contending that it is entitled to setoff by reason of a payment to the insured of a part of the latter's damages to show the amount of the payment for this purpose.
ARGUED SEPTEMBER 2, 1969 — DECIDED SEPTEMBER 19, 1969 — REHEARING DENIED OCTOBER 3, 1969 — CERT. APPLIED FOR.
Austin filed an action against Allstate alleging that his automobile had been damaged in the sum of $2,700 in a collision with a third party and that the defendant, with whom he was insured, refused to pay the collision damages. Allstate admitted coverage and refusal, but defended on the grounds that (a) Austin had recovered the alleged damage from the tortfeasor by an action at law, and the satisfaction of the judgment in that case, by depriving defendant of its right to subrogation, shows he is not entitled to recover; (b) The verdict in the previous suit in the sum of $1,500 represents damages in excess of what would have been recoverable under the policy, and plaintiff cannot recover twice for the same injury, and (c) in any event the defendant would be entitled to a setoff of $1,500 against any amount awarded the plaintiff in this action. The policy contained a provision as follows: "Allstate will pay for loss to the owned automobile ... caused by collision, less the deductible amount" which was $50. By agreement of counsel a special question as to the amount of loss was submitted to the jury, who found it to be $1,750, and the other questions were left for the court, who found against the defenses pleaded and entered judgment for the plaintiff in the sum of $1,700, the amount of the loss less the deductible. It appears from the court's judgment and the record that Austin had sued the tortfeasor for both personal injuries and property damage, that Allstate, who carried both the collision and liability insurance, employed counsel who appeared in that action, and that the $1,500 verdict was a general verdict. Error is enumerated on the court's failure to direct a verdict for the defendant, and failure to allow a setoff in the amount of $1,500.
1. One of the standard policy provisions having reference to the collision insurance provides that "upon payment... Allstate shall succeed to all the insured's rights of recovery therefor, and the insured shall do whatever is necessary to secure such rights and do nothing after loss to prejudice them." The satisfaction of Austin's judgment was, of course, a complete settlement of his cause of action against the tortfeasor and was such an act as would make impossible any subsequent assignment of a claim for property damages to Allstate or collection by Allstate. It is stated in Universal Credit Co. v. Service Fire Ins. Co., 69 Ga. App. 357 (1) ( 25 S.E.2d 526): "Any payment as damages received by the insured from the wrongdoer before settlement with the insurer, reduces by operation of law the liability of the insurer pro tanto, and where the insured releases his right of action against the wrongdoer before settlement with the insurer, that release destroys, by operation of law, his right of action on the policy." And under Coleman v. State Farm Mut. Auto. Ins. Co., 104 Ga. App. 328 (3) ( 121 S.E.2d 833) one who, after receiving collision insurance, sued the tortfeasor for both personal injury and property damage, and thereafter settles his case for a lump sum "thus destroying the insurer's right of subrogation, [cannot] then escape completely free of liability under the loan receipt under the guise of having settled for personal injuries only." The same would apply to the policy condition that insured do nothing to prejudice the insurer's subrogation claim which would arise on payment of collision loss, unless due to some other fact the insurer is not entitled to insist on the policy provision because of a prior breach of the contract on its own part.
Here the value of the loss has been set by the jury verdict in this case at $1,750 and there is no attack on this finding. Austin's entire recovery in an action for both personal injury and property damage in the former case was $1,500. However, the insurance company upon whom the duty rested under the policy to pay the loss less the $50 deductible, or in other words, to pay the plaintiff $1,700, unconditionally refused to do so, based on its contention that the loss was worth only $1,150 (less than any estimate of damage given by any witness in this case), and it refused to make any payment in excess of this amount. It is true that it also offered to repair the car under an alternative policy provision, but since there was evidence in this case that the car could not be repaired and restored to its former condition this also presented a question of fact as to whether making repair would be payment of the loss, and the trial court was authorized to find that it would not. Therefore, the defendant owed the plaintiff $1,700. Tender, to be effective, must be in full of the specific debt. Code § 20-1105. "A tender which is not in full of the claim at the time it is made is not a good tender." State Hwy. Dept. v. Hewitt Contr. Co., 115 Ga. App. 606 (1b) ( 155 S.E.2d 422). There being no proper tender by the plaintiff of payment of the loss, there was a breach of contract on the part of the insurer which forced the insured into a choice between accepting less than the amount of the loss, attempting further negotiations with the company to the delay or complete loss of any right of action against the tortfeasor, or proceeding with an action against the latter. Whether or not he sought recovery for property damage in that action is irrelevant, since the cause of action was single and any settlement of the personal injury claim would also constitute a release of all claims. Gregory v. Schnurstein, 212 Ga. 497 ( 93 S.E.2d 680). No right to subrogation arises until the insurance is paid. Poynter v. Aetna Cas. c. Co., 13 Mich. App. 125 ( 163 N.W.2d 716); Caldwell v. Keystone Ins. Co., 212 Pa. Super. 379 ( 243 A.2d 448). Whether the destruction of the right to subrogation constitutes a complete defense to an action on the policy, therefore, depends upon whether there is a prior breach of contract or waiver or estoppel on the part of the insurer which of itself cancels out its right to demand subrogation as a condition of payment. The rule in the majority of jurisdictions is stated in 38 ALR2d, Anno., pp. 1095, 1099, as follows: "There is little doubt that the rights of the collision insurance company, under the general rule that a release of the tortfeasor by the insured also releases the insurer, may be waived or lost by estoppel, and that such waiver or estoppel will arise where the insurer deliberately or negligently induces the insured to make the settlement with the tortfeasor, either by refusing or unreasonably delaying settlement under the policy, or by actually suggesting the insured's course of action." In the leading case, Powers v. Calvert Fire Ins. Co., 216 S.C. 309 ( 57 S.E.2d 638, 16 ALR2d 1261), a case remarkably similar to this one, the insured gave notice to the insurer who, while promising payment did nothing toward paying the claim and subsequently, with knowledge that the insured had employed counsel to file suit against the tortfeasor, made no attempt to protect its rights in any way, and the holding was that under the circumstances the company had no right to insist upon subrogation. In the present case Allstate refused to pay the claim in full, and actually employed counsel who appeared in the insured's action against the tortfeasor. The Powers case cites two Georgia cases. In one, Firemen's Ins. Co. v. Ga. Power Co., 181 Ga. 621, 623 ( 183 S.E. 799) it was held: "The plaintiff's right to subrogation is limited by the terms of its policy, and it is dependent upon a compliance by the plaintiff with the terms of the policy." As the Powers case succinctly states, "An insurer will not be permitted to profit from such a course of conduct. It cannot sit down and hold its hands and purse and thereafter escape liability for fulfillment of its contract by reason of the insured's effort, and after fair notice, to recoup his loss by litigation against a wrongdoer." P. 316. The contention that under the circumstances the insured had no right of action against Allstate is without merit.
2. Is the insurer entitled to have a setoff against this judgment to the extent of Austin's recovery against the tortfeasor? It is well settled that no person is entitled to recover full compensation more than once for the same injury. Clark v. American Cas. Co., 96 Ga. App. 328, 334 ( 99 S.E.2d 897). Some of the cases, while recognizing the rule set out in the Powers case, supra, have placed the burden on the plaintiff to show the amount received as reimbursement for loss to the automobile. See Soper v. First Security Ins. Co. America, 148 A.2d 580; Myers v. Firemen's Ins. Co. of Washington, D.C., 274 F.2d 84. In Georgia, however, the general rule is that the burden lies upon the one asserting a state of facts to make proof thereof. The defendant undertook to plead and prove that the plaintiff had already received partial payment for the damage to his automobile. It showed that in Austin's action for personal injury and property damage in the alleged total sum of $6,500 he received $1,500, but it failed to prove what part, if any, of this amount is allocable to the damage to the automobile. It did not, then, prove that the plaintiff had received compensation for this element of his action in any amount which it could claim, but only that the plaintiff might have received some sum ranging between zero and $1,500. To justify an award of damages, or of a setoff against damages, there must be some evidence from which the trior of fact can arrive at some definite sum constituting the damages or payment thereof. Morgan v. Black, 86 Ga. App. 775 (1) ( 72 S.E.2d 558); Ricker v. Brancale, 113 Ga. App. 447 (5) ( 148 S.E.2d 468). The insurer, who through paid counsel participated indirectly at least in the trial of the case, had the opportunity to invoke Code Ann. § 81A-149 and to determine by special questions to the jury what proportion of the verdict was allocable to property damage. Absent any evidence on this subject, it cannot be said as a matter of law that the plaintiff has sustained a double recovery on this item of damage.
Judgment affirmed. Bell, C. J., and Eberhardt, J., concur.