Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1698058823952.pdf (Georgia)
1923 del codice civile ed il fallimento del contraente o del beneficiario, in Assicurazioni, 1959, II, 23; A.

De Martini, Natura del credito del beneficiario di assicurazione sulla vita e sua impignorabilità, in sede ordinaria e fallimentare, in Assicurazioni, 1956, II, 101).

A minority states, on the contrary, that article 1923, para.

1, of the Italian Civil Code, is aimed at preventing the insurer from being involved in executive procedures with third parties by the creditors of the insured.
In the same logic, the insensitivity of the sums owed by the insurer to executive or pre- cautionary actions would prevent the costs of legal disputes from being incurred (L. Buttaro, voce “Assicurazione sulla vita”, in Enc.

dir., III, Milano, Giuffrè, 1958, n. 38, 651; A. Donati & G. Volpe Putzolu, Manuale di diritto delle assicurazioni, Milano, Giuffrè, 2012, 193.
On the subject also P. Gaggero, Pignoramento e sequestro del credito verso l’assicuratore sulla vita, in Le assicurazioni pri- vate, a cura di G. Alpa, Torino, Utet, 2006, 2969, who considers the acquisition by the creditors of the sums already collected by the beneficiary does not invalidate the social security programme of the life insurance contract, which would be indifferent to the subsequent use and the concrete destination of the sums paid by the insurer).

732 5.
732 5.

Prerequisites Because of the choice point out in the previous § IV, the Georgian leg- islator is rightly concerned with the position of the beneficiary nominated in the life insurance contract: the Art.

853 CCG regulates the right of the beneficiary to take over the same contract when the insured is subject to the enforcement actions of creditors or bankruptcy proceeding is opened against him.

The prerequisites set out in para.


(1) for the rule to apply are thus i) the existence of an enforcement proceeding against the insured in respect of the insurance claim, or ii) the existence of a bankruptcy pro- ceeding against the insured.

A creditor might, for example, attach the life insurance policy of the debtor/insured against whom he has obtained a payment order by way of enforcement.
In other words, it is necessary that one or more creditors of the in- sured alternatively take enforcement actions against the latter, with spe- cific reference to the insurance claim arising from the pending life insur- ance contract, or that bankruptcy proceeding has been opened against the debtor/insured and his assets.
In the first case the rule refers to a «judgment», the legislator intending this term to refer to a decision of a court; the general rules on claims will therefore apply, in particular Art.

142 of the Civil Code concerning the limitation period, as well as Arts.

264-268 of the Civil Procedure Code concerning the enforceability of the decision.
It is clear from the wording of the first paragraph that the enforce- ment against the insurance claim must be effectively existing and formally initiated or that the insolvency proceeding against the insured’s assets has already been opened, since the mere threat by the insured’s creditors to take such actions is not sufficient to allow the beneficiary to succeed into the contract.
Thus, the mere existence of an enforceable court decision (or, a fortiori, one that has not yet become enforceable: in this respect, see what is provided by Articles 251 and 264 et seq.

of the Georgian Code of Civil Procedure) is not sufficient to allow the beneficiary to exercise the right of subrogation granted by Art.

853 CCG, since it could not neces- sarily be followed by the actual attachment.
Moreover, the enforcement measures must allow the creditor to find effective satisfaction from the claim arising from the insurance.

This means that the object of the actions of the insured’s creditors must be the entire insurance claim.

733 6.

The right of «subrogation» The first paragraph of Art.
853 takes into account two different situa- tions: on the one hand, the enforcement of a judgment concerning an in- surance claim and, on the other hand, the bankruptcy proceeding opened against an over-indebted and insolvent insured.
Although the rule expressly mentions both individual enforcement by attachment and total enforcement in the context of the insured’s insol- vency, the legal effect that follows remains the same: one who is named as beneficiary in the life insurance policy has the right to take over the insured’s rights against the insurer.
It is worth noting that, in this part, the rule follows the same pre- scription provided by the Georgian legislator in Article 372 of the Civil Code with reference to contracts in general, which regulates precisely the effects that the satisfaction of a claim by a third party produces in the re- lations between the obligated parties.

Art.
Art.

372 CCG states that, precisely in cases where «a creditor seeks enforcement against a thing belonging to the obligor», each person «who is at risk of losing the right to the thing as a result of the enforcement may satisfy the creditor».

The consequence for the third party who satisfies the creditors is precisely the transfer to him of the «right of claim».

That said, Art.

853 CCG uses the phrase «take the place» and in the second part of para.
(1) the verb «participates» in an a-technical and ge- neric manner.

It is worth considering the legal meaning of these terms.

From the practical point of view, the effect described remains essentially the same: the beneficiary takes the place of the insured in the relationship with the insurer.

However, many legal systems, at least those of continen- tal Europe, know different ways in which a subject may “take the place” from another in a given legal relationship.
As a first approximation, we can speak of assignment (cession) or subrogation.

Each of these two le- gal constructions, which are absolutely independent of each other, brings with it considerable differences and consequently produces very different legal effects, rights and obligations for the parties.
Many contemporary legal systems (it is the case of Italy, Germany, France, Switzerland, Russia, to name but a few) make a clear distinction between assignment (cession) and subrogation, also in the respective le- gal disciplines.

The difference, as often, is not merely nominal since the reference to one or the other institution places different rights and obliga- 734 tions on the parties.
Although this difference is certainly well known and has existed for a long time in most continental European legal systems, the Georgian legal system seems to know very little about the doctrine of subrogation, which is often confused with the different doctrines of assignment (cession) or regress.
The Georgian legislator, in fact, does not seem to be particularly sensitive to this issue, not distinguishing clearly between the two institutions, on the contrary often adopting rather gen- eral formulations as in the case of Art.

853 CCG.

Indeed, the phenomenon of «subrogation» is hardly ever described in the Civil Code, nor is its regulation outlined6.
The only case in the Civil Code where the Georgian legislator makes clear reference to the doctrine of subrogation and expressly uses that term is that provided for in Art.

473, which concerns the «right of subrogation in the case of entire performance by one of the obligors».

A further reference to the doctrine of subrogation, but only as regards the effects, is made in Art.
832 of the Civil Code where, in regulating the legal relationship in which the parties are successors to their rights during the pendency of the relationship, a subrogation phenomenon is essentially outlined.
Precisely because of the consequences the choice of one or other doc- trine produces, the underlined confusion could create many problems for legal practitioners and for the parties themselves, who struggle to identify the rights and obligations that are actually imposed on them following the change of subjective position in a given legal relationship (in the case under comment, the relationship between creditor, insured, beneficiary and insurer) and which they can therefore claim from each other.
So, it is appropriate asking what the legislator in Art.

853 CCG substantively intended to refer to and therefore to which discipline one may actually refer.

This is certainly not the right place to dwell on the various theoret- ical constructions7, but it is appropriate to indicate at least some of the effects produced by the phenomenon of subrogation.

Subrogation, like assignment (cession), describes the transfer of a right of credit.
According to Georgian legislation, both involve the transfer of the creditor’s rights to a third party.

But, in the case of subrogation, the third party obtains these rights in full, also without prejudice to the secu- 6 For cession the references are instead to Arts.

198 and 199 of the Civil Code of Georgia.


7 For a more discussions and references about the distinction between cession and subrogation in Georgian legal system see N. Motsonelidze, Separation of Subrogation from Regress and Cession, Ivane Javakhishvili Tbilisi State University Faculty of Law, Journal of Law, n. 1, 2014, pp.

130 ss.

735 rities, privileges and interests that were initially agreed upon between the creditor and the (original) debtor.
So, subrogation by payment produces the succession of a third party who thus takes the place of the rights of the subrogated party, giving rise to a subjective modification of the oblig- atory relationship already established by the latter with another party as a result of the payment of the debt by the subrogating third party.
Given such ambiguity of the rule 853, in order to try to resolve the impasse it is necessary to take into consideration the entire wording of the rule as well as the rationale and purpose for which it was introduced, including the effects it intends to produce, trying to understand which of the two institutions it might be referred to.
In determining that (and so, in practice, which discipline the parties should follow after the takeover), it firstly should be noted that there is no provision requiring the parties to give notice of the takeover.

It will also be said in the following that the payment set in para.

(1) must be considered more properly as a require- ment for the takeover and not its effect.
However, the absence of any agreement or consent on the part of the insured or the insurer, as well as of the insured’s creditor, is probably decisive.

In fact, the institution of «cession» undoubtedly presupposes such consent since it is based on the agreement of the parties (in this sense, Articles 198 and 199 of the Civil Code of Georgia), whereas sub- rogation is based on the law and only rarely on the agreement of the parties.

Despite the uncertainties, it can be quite reasonably concluded that Art.
853 CCG produces a particular succession that can be in some way traced back to the characters and forms of legal subrogation8; and it is because it produces a succession without the agreement of the parties and indeed hypothetically even against the will of the parties (if it does not, the rule could not achieve its purpose, that is the protection of the ben- eficiary and the expectation that he/she has regarding the life insurance policy taken out in his/her favour), with all the consequences as regards the legal effects produced between the parties.
The rights of the insured against the insurer are thus not transferred to the beneficiary on the basis 8 Although the wording indicates otherwise, «subrogation» could find some legal basis in Art.

207 CCG.

The rule 207, in fact, establishes the possibility of a legal «cession», but derogating from the requirement set in the second paragraph of Art.

199 CCG which instead imposes the existence of an agreement for the cession to be perfected.
It is therefore not unreasonable to assume that this rule can be taken as the basis for the recognition of the (different) legal phenomenon of subrogation in Georgian legal system.

736 of a contract concluded between the insured and the insurer or between the insured and the beneficiary but are due to the law.

Well, in the case of Art.


853 CCG it should be argued that the rights of the insured are transferred to the beneficiary who takes over the legal relationship previously existing between the insurer and the in- sured by paying the debt to the creditors of the debtor/insured.

The subrogated beneficiary acquires the legal position of the insured, who thus becomes only the person to whom the insured event is connected.

Consequently, the subrogating party becomes fully liable for the pay- ment of the premium.
With subrogation the legal relationship and its content remain the same, since the previous relationship does not cease and a new one is not formed.
As mentioned before, the same rules and procedures already in force in the pre-existing relationship between the insured and the insurer continue to apply between the beneficiary and the insurer and the beneficiary who is subrogated must respect them: in short, the rights and obligations originally envisaged by the parties remain unchanged (even the limitation period remains so).

Only the subjective side of the mandatory relationship is modified.
The differ- ence is relevant from the point of view of the cause of the legal transac- tion: if the pre-existing legal relationship – the only existing one, which continues to exist as it is despite the subjective change – turns out to be invalid, this invalidity also affects the relationship with the subrogating party.

7.

Consent, term and notification The Georgian legislator does not make the right of subrogation granted to the beneficiary conditional on the prior consent of the in- sured.
It is therefore an automatic legal effect attributed directly by the law to the beneficiary, who may then decide whether to exercise it or not, and from whose effects the insured cannot resist.

Even this solution is not common to all legal systems: for example, §170 of German Insurance Contract Act (Versicherungsvertragsgesetz) – source of deep inspiration of Art.

853 CCG as already said – requires the insured to give his consent to the beneficiary’s subrogation in the relationship with the insurer9.
So, 9 According to most German scientists, not only the insured is not obliged to give his consent, but in principle he could also refuse it without any specific reason, except extreme cases of wholly abusive refusal (MünchKommVVG/Mönnich § 170 Rn.

22; R/L/ Langheid §170 Rn.

6; B/M/ Winter §170 Rn.

37; Hasse VersR 2005, 15, 33; Schauer, Das österreichische VersVertragsrecht, 3, Aufl.

1995).

737 it is got to be a precise choice by the Georgian legislator.
However, the absence of the need for the insured’s consent is not entirely irrelevant: in fact, it overlooks the creditors’ interest in clarity and, above all, legal cer- tainty of the matter within a precise time frame.

Besides, Art.

853 CCG does not indicate a time limit within which the beneficiary may exercise his subrogating right.

This is a rather unfortu- nate omission: it is clear the absence of a time limit makes the situation be- tween the parties deeply uncertain.
The creditors, on the one hand, would not know until the end who is liable to pay their debts; on the other hand, the insurer would not know until the end who to consider as its contrac- tual counterpart.

Instead, according to §170, (3) VVG the subrogation is effected by giving notice thereof to the insurer within one month after the time when the person entitled to subrogate learns of the attachment/ forced execution or after the insolvency proceeding has been opened.
In the end, it should be inferred from the silence of the Georgian leg- islator that the beneficiary may anytime exercise the right of subrogation, at least until the last useful moment, that is until the insured’s creditors have been satisfied with the insurance claim or the insurance relationship has been terminated.
Given the absence of a consent and of a time limit for exercising the right of subrogation, it is doubtful the granting of any burden of noti- fication (of the enforcement actions) on the insured’s creditors towards the named beneficiary.

However, this would prevent a potential damage to the position of the beneficiary, which is who Art.
853 CCG on the contrary means to protect, since the latter could factually lose the benefit provided by the rule if he has not informed of the enforcement or bank- ruptcy proceedings initiated against the insured10.

Equally doubtful is whether any burden of notification is charged to the insured, who could therefore eventually be held liable for the damage caused to the beneficiary in the event of its omission.
Anyway, the prob- lem is mitigated by considering that, at least in matrimonial relationships (which likely represent the chosen field of life insurance), the duty of no- tification could be inferred indirectly from the legal obligations in force between spouses under Article 1179 of the Civil Code or under Articles 1198-1199 of the Civil Code with respect to children if the second para- graph of Article 853 of the Civil Code applies.
10 Despite the drawback, in German legal system several scientists exclude such an obligation charged to the insured’s creditors or to the insolvency administrator.

738 Anyway, once it has occurred, the event of succession is definitive: any subsequent event that might modify or extinguish the subrogation right is no longer relevant (just think of the case of divorce between the insured and the beneficiary).

8.

The «named» beneficiary According to Art.


853 (1) CCG, in the first instance the person entitled to subrogate is the beneficiary «specifically named» in the life insurance contract.

Well, the rule applies when the insured designates a third person as beneficiary of the insurance benefit at the time when the insured event occurs (e.g.

the death of the insured).


As already mentioned, the benefi- ciary of a life insurance policy is usually the insured, unless the legislation on compulsory insurance or the insurance contract stipulates otherwise or the beneficiary has not been designated by the contract (Art.

11 (4) and (5) of the Georgian Law On Insurance).

That’s the case covered by Art.

853 CCG: according to Art.


11 (8) of the Georgian Law On Insurance, the conclusion of an insurance contract in favour of the beneficiary does not release the policyholder from the fulfilment of the obligations defined in the contract itself, which therefore remain within the relationship with the insurer, except when the beneficiary exercises the right of subrogation granted under Art.

853 CCG.

According to Art.


11 of the Georgian Law On Insurance, the benefi- ciary is a natural or legal person who receives the proceeds of an insurance policy according to an insurance contract or to the insurance legislation.

At least about the voluntary insurance, the third paragraph of the said Art.

11 states that the beneficiary could be designated by the insured.
For this purpose, in the specific context of life insurance, pursuant to Article 844 (2) of the Civil Code it is necessary that the beneficiary gives his con- sent in writing, which represent the moment from which the right to get the benefit upon the occurrence of the insured event arises for him.
In other words, Georgian legislator does not impose to name a bene- ficiary in the life insurance contract11, so the insured could abstractly and legitimately not specify the identity of the beneficiary in the insurance contract (or specify him/her only later, by written notice to the insurer or by provision in the Will) and even not name him/her at all (as well as 11 Article 844 (1) of the Civil Code of Georgia expressly states that «life insurance may cover the policyholder or another person».
739 revoke him/her at any time, Art.

350 (2) CCG12) without affecting the validity of the insurance contract in any way.

However, this choice is bound to affect the applicability of the rule itself: because manner of designation for the purposes of validity is one thing, designation for the purposes of the applicability of Art.

853 CCG is another one13.

In fact, rule 853 para.


(1) refers only to cases in which a beneficiary is specifically appointed and consequently the right of sub- rogation is granted to the beneficiary only if he/she is clearly identified.
That the identity of the beneficiary must already be clear from the life insurance contract can be deduced from the very wording of the pro- vision when i) in the first paragraph, it links the right of subrogation to the person who «is specifically named as the beneficiary»; ii) in the second paragraph, when regulating the succession of the right of subro- gation to the spouse or children of the latter, it makes the transfer of this right conditional on the case in which the beneficiary «is not named».
A merely generic designation is therefore not sufficient (just thinking of the indication «spouse», «cohabiting partner», «parents» or «heirs»), and it undoubtedly produces the effect envisaged by the second para- graph of Art.

853 CCG.

Although this is certainly the closer interpre- tation to the wording of Art.
853 CCG, there is no need to make the rule inapplicable also in cases where the beneficiary is not determined but determinable: matters of reasonableness and efficiency should lead to assume as valid even all those designations which, although not ex- pressly named, allow the identity of the beneficiary to be unequivocally determined (for example, this could be the case where the contract ge- nerically refers to the «parent» as the beneficiary and the insured has only one direct ascendant).
In conclusion, a further requirement of the rule is that the beneficiary should actually be determined in the life in- surance contract at the time of execution or the opening of bankruptcy proceeding against the insured.

12 Even the rule 350 (2) CCG is not common to all legal systems: in the Italian one, for exam- ple, the beneficiary can always be revoked, unless he has declared his intention to take advantage of the appointment and its benefits (Art.

1921 of the Italian Civil Code).


13 Also in Italian legal system, for example, the designation of a beneficiary in life insurance contracts is effective even if the beneficiary is only generically determined (Art.

1920, para.

2, Civil Code).

740 9.

The other persons «entitled to the benefit».

Inheritance implications Those entitled to the right of subrogation are not only the persons «specifically named» as beneficiaries in the life insurance contract.

In fact, para.

(2) of Art.


853 CCG establishes a gradation between persons who are given the same right to succeed because of the beneficiary’s failure to exercise it.

In particular, the same right also applies to the insured’s spouse or to his or her children.
Although the rule is silent on this matter, the terms «spouse» and «children» should be read in a systematic way with the others provisions of the Georgian legal system, concluding for the equivalence also with cohabiting subjects or adopted children or children born out of wedlock (this, of course, in compliance with the rules govern- ing these hypotheses: the reference is, for example, to what set in Articles 1190, 1191, 1239 and following and 1309 of the Civil Code).
These other persons, however, are placed in a subordinate situation with respect to the «named» beneficiary, and the subrogate right granted in the first instance only to the latter is extended to them only if one of the two conditions set out in the second paragraph of Art.

853 CCG is met, that is i) the lack of interest by the «named» beneficiary to exercise the right of subrogation and thus to receive «the benefit», or ii) the absence of a specific indication of the beneficiary’s identity14.
At a closer look, the first of the two requirements lose some of its importance due to the inex- istence, as mentioned above, of a time limit within which the named ben- eficiary may exercise the right of subrogation; because it becomes rather complex to ascertain with confidence the lack of interest of the latter and so the fulfilment of the former requirement above.

Said this, some questions could ensue from this clear provision.
First of all, it is surely possible for a number of persons to be named as bene- ficiaries in a life insurance contract.

In such a case, what happens?

Geor- gian legislator, indeed, does not expressly consider such a hypothesis, but anyway it is possible to conclude that if several persons entitled to the benefits succeed to the insured, they all become joint debtors in the rela- tionship with the insurer.

They will all therefore must pay the premium pro rata, for instance.
They will also be joint creditors, so they can only 14 Whereas §170 VVG does not contain any reference to the interest in receiving the benefit by the named beneficiary: in German legal system, the subrogation right of the spouse or the children of the insured arises only if the beneficiary is not specifically named in the life insurance contract.

741 manage the insurance relationship jointly.


To reason otherwise would un- fairly burden the position of the insurer who had to accept the splitting of the insured’s role typical of the life insurance.

It is also possible, rather more likely, that even the persons who be- come entitled to the right of subrogation only after the beneficiary under para.

(2) Art.

853 CCG are more than one (e.g.

if the insured has sever- al children).


While the rule certainly places the «named» beneficiary in a preferential position, it does not seem to do the same for the spouse and children of the insured.

Therefore, according to a strictly literal inter- pretation, these subjects would all have the same right to subrogation at the same time.
According to a different interpretation, the legislator could have intended to continue the gradation scale, so subordinating the take- over right of the insured’s children to the non-exercise of the same right by the spouse, in turn subordinated to the non-exercise by the «specifically named» beneficiary.

Under this last approach, there would be no problem in regulating the succession of the different beneficiaries.
If, on the other hand, it is the first interpretation that should be adopted, there would un- doubtedly be a need to regulate the hypothesis in which several persons exercise the same right: if necessary, the adoptable solution could be, by analogy, the same already described for the case of a number of «named» beneficiaries, that is everyone is entitled may jointly and in equal parts par- ticipate in the life insurance contract.
Obviously, as in the case of several named beneficiaries, the general limitation for its exercise remains in place: the spouse or child who alone exercises the takeover right cannot be sub- rogated pro quota but must be subrogated in the relationship in its entirety and is therefore obliged to satisfy the insured’s creditors for the full.
At this point, a clarification is required: the right to the insurance claim and the right of subrogation accorded to the beneficiary are quite different in themselves, but in practice inevitably end up overlapping in the event of the situation described by Art.
853 CCG occurs: in fact, if the beneficiary does not exercise the right of subrogation, then the creditors of the insured will certainly satisfy themselves on the insurance claim, thus removing the “benefit” from the ownership of the beneficiary named in the contract by the insured/debtor.

This situation inevitably affects the rules governing inheritance.

In practice, in fact, it could also happen that the «named» beneficiary passes to the insured.
The problem arises as to who is «entitled to the benefit» at the time of the occurrence of the insured event.

Therefore, Art.

853 (2) 742 CCG must be coordinated with the provisions of Book VI of the Civil Code, in particular Art.

1328, according to which «an estate shall include the aggregate of both property rights (assets of the estate) and liabilities (li- abilities of the estate) of a decedent as of the moment of his/her death».
So, it is necessary to establish whether or not the right of subrogation granted by Art.

853 CCG falls within the beneficiary’s estate: one way or the other clearly produces different outcomes.

In the first case, the right of subro- gation belongs to the beneficiary’s heirs of course, who may or may not decide to avail themselves of it (in the latter case, because of reasonable- ness the right reverts to the subjects set in Art.

853 para.

(2) CCG).


In the second case, the right to take over belongs to the spouse of the insured or to his or her children (substantially equating death with waiver), or oth- erwise, in application of Article 351 CCG, it belongs to the insured party.

The Art.
The Art.

1328 of the Civil Code expressly includes in the estate all the property rights of the deceased: such must certainly be considered the right of claim arising from the conclusion of the life insurance policy, but also the subrogation right under Art.
853 CCG, especially because of the consequences that would follow: if this were not the case, the beneficia- ry’s right (and the heirs’ expectation) to obtain the insurance claim would be prejudiced without any real reason and only by the mere accidental death of the beneficiary.

The above considerations lead to the conclusion that the right of sub- rogation passes to the heirs of the beneficiary.

The gradation provided for in Art.


853 (2) CCG does therefore not take place: it is expressly applica- ble only in the event of waiver or non-designation of the beneficiary and not in the event of his/her death, the latter event which would instead give rise to the normal succession phenomenon governed by the law and to the opening of the estate, that thus could also include the right of subrogation placed by Art.

853 of the Civil Code in the hands of deceased beneficiary.

10.
10.

Payment of the surrender value Art.

853 CCG requires the beneficiary who intends to «participate in the contract» and so to exercise his/her right to take over, to carry out a specific operation: «he/she shall meet all the requirements of the creditor or secure the bankruptcy assets to the extent of the amount that the pol- icyholder could have received from the insurer upon termination of the insurance contract».
This is a fundamental requirement, around which the entire mechanism of the rule basically revolves.

743 Firstly, the insurance contract must obviously exist and must also be valid.

In addition, a further premise is necessary in order to understand the aforesaid requirement: for the application of Art.

853 CCG, the life insurance policy must be redeemable, i.e.

it must be a policy for which the payment of a surrender value is expressly provided for by law or by the contract itself.
This latter is, in fact, the value to which the Georgian legislator refers in Art.

853 CCG with the term «the amount».

Well, the surrender value is the amount accrued under the life in- surance policy up to the moment the insured decides to exercise early withdrawal.

In the practice, the surrender value is substantially lower than what the insurer is obliged to pay when the insured event occurs.
Usually, the surrender value is very low or even zero in the early stages of the life of the insurance policy, partly due to the insurer’s need to amortise the related costs.

Anyway, the surrender value subsequently is set to increase more and more with the duration of the life insurance contract.

So, a further requirement for the application of the rule is the exis- tence of a positive surrender value.
Although the rule does not express- ly provide for such a value, its provisions (and the rule itself) would be meaningless if such a value did not exist, since it makes no sense either for creditors to take enforcement actions on the insurance claim in the absence of a value on which to satisfy themselves, or for the beneficiary to take over the contract in place of the insured by paying his/her creditors.
If so in principle, it is however possible to argue that the surrender value need not necessarily be already current but may also be future: in fact, in such a case it is reasonable to recognise the creditor’s interest in seizing the rights of the insured as they accrue, and thus expect to take enforce- ment action against the insured only later.
Well, the beneficiary must guarantee the payment to the creditors of the insured/debtor or to the bankruptcy estate of the surrender value of the life insurance policy, i.e.

of the sum that in abstract terms would be reimbursed at the termination of the insurance contract by the insured: the beneficiary’s convenience in making this payment and taking over the contract in place of the insured has already been mentioned in § III above15.
15 What said with respect to the «named» beneficiary certainly also applies to the case where the right of subrogation is exercised by the different persons envisaged in Art.

853 (2) CCG.
744 In other words, the party entitled «to take the place» of the insured in the life insurance contract must pay to the creditors who have enforced the contract against the latter (or to the bankruptcy estate following the opening of bankruptcy proceeding against him and his assets) the amount that would have become due on the date of the attachment (or the open- ing of the insolvency proceeding) if the insured had exercised his notice of termination and requested the insurer to pay the surrender value of the insurance contract.
Although the rule on this point seems to be very clear, the interpretation of the statutory requirement is rather controversial.

In particular, it is doubtful whether the obligation to pay «the amount» on the party who «participates» in the contract is to be considered as a mere legal consequence of the takeover or, on the contrary, whether it is an actual condition for the exercise of that right.
In other words, it is not clear from the wording of the rule if the payment by the beneficiary is a mere effect of the exercise of the right of subrogation or if it plays the role of a legal requirement.

According to a strictly literal interpretation, the qualification of the payment obligation sets in Art.

853 CCG should certainly be understood as a consequence, an effect of the subrogation itself.
Well, this approach could also be justified by the assumption that the beneficiary’s right of subrogation takes priority and that the interests of creditors are already adequately protected somewhere else by the law.

This conclusion is widely accepted by scientists of legal systems in which is in force the same rule (e.g.

the German legal system, §170 VVG16).

Such an approach, mutatis mutandis, would also seem to be suggested by the wording of Art.

372 CCG.
372 CCG.

However, such a conclusion actually clashes precisely with the history, meaning and purpose of the rule 853 CCG, which would on the contrary consider the payment as a real condition to be fulfilled in advance: while it is true the rule clearly intends to protect the interests of the beneficiary, thus facilitating the takeover, at the same time this must be done without endangering the needs of insured’s creditors, since they too are protected by the same rule although indirectly.
But the rights of creditors would be seriously jeopardised if the beneficiary could formally take over the insurance contract without creditors being satisfied in advance with their claims against the insured.

Well, it would be much more difficult for them to recover their claims once the beneficiary had exercised his right of sub- 16 MünchKommVVG/Mönnich § 170 Rn.

22; Sch/B/Ortmann § 170 Rn.

18; L/P/Peters § 170 Rn.

11; Elfring BB 2004, 617, 620.


745 rogation, since they would lose the asset on which they could easily have been satisfied (i.e.

the claim under the life insurance contract).

In other words, the payment mechanism envisaged by the Art.

853 CCG would no longer fulfil the role it was intended for, that is securing creditors’ claims: the insured’s creditors are really protected only if the subrogation takes effect after the payment of the surrender value to them.
Otherwise, the insured’s creditors will certainly lose a claim of good solvency (the surrender value) and receive in exchange a claim of the same amount but less solvable, since this time it is owed from the party who takeover and no longer from the insurer (usually a pretty much solid legal person).

So, the true protection of the legitimate interests of creditors requires that the payment of the surrender value (i.e.
the value which would have become payable if the insured had exercised its right of withdrawal at the earliest moment following the attachment or the opening of bankruptcy proceed- ing) be considered a legal condition for being able to exercise the subro- gation right.

It should be therefore more correctly included among the conditions referred to in Article 350 (1) (b) of the Civil Code of Georgia.
Even the mentioned absence of a time limit for the beneficiary to exercise the right of subrogation and pay creditors (§ VII above) suggests that this must be the right qualification.

Otherwise, it would allow the beneficiary to achieve its purpose (i.e.
to take over the life insurance contract) without having any real control over the moment of the payment and so not adequately guaranteeing the rights of creditors, who are exposed to the possibility of an uncertain payment at least in time (if not in being).

In short, the consequence would once again be total uncertainty for creditors who have acted against the insured/debtor.

As is seen, in the end the choice is not completely without practical implications.
746 V – ACCIDENT INSURANCE Article 854 - Concept 1.

An accident insurance contract may be concluded for an accident affecting either the policyholder or another person.

2.

If the accident insurance contract is concluded not by the insured person but for his/her benefit, then the life insurance rules shall apply to such contract.

Lorena Di Gaetano Summary: 1.

Introduction.

2.

Legal framework.

3.

Analysis of the article.

4.

Comparative analysis.

France and Italy.

1.


Introduction Article 854 is located under Chapter XX (“Insurance”), Section Fifth, of the Georgian Civil Code (Law No.

786 of 26th June 1997)1.

It is made up of two paragraphs: the first one states that an accident insurance contract may be concluded for the risk of an accident affecting either the policyholder or a third party.
Paragraph 2 refers to the different case in which the insured person and the policyholder don’t coincide, but there’s a coincidence between the insured person and the beneficiary of the policy; in such case, life insurance rules will apply.

The Article doesn’t provide any definition of “accident insurance” but limits itself to list the parties involved by the contract; as to the disci- pline, paragraph 2 recalls “life insurance rules”.
Arguing from the position of the article, which follows the sections on health (III) and life insurance (IV), closing the whole chapter (XX), accident insurance contract can be seen as a contract whose object is the person and not the patrimony of the insured.

Missing a clear regulatory definition, an 1 Available at https://www.ilo.org/dyn/natlex/docs/ELECTRONIC/90468/118660/F999089 720/GEO90468 Geo.pdf (last access 30th September 2021).
747 indirect confirmation comes from Article 4 of the Law of Georgia on In- surance, 2 May 1997 No 690 (“the object of insurance”)2, which states: «1.
The object of insurance may be any property or personal non-property in- terest (…), including: a) insurance related to the life, health, ability to work, pension provision and other personal interests of the insured (personal in- surance); b) insurance related to owning, administering and using property (property insurance); c) insurance related to an injury that the insured causes to third persons (natural or legal) or to their property (liability insurance)».
Provided that “the accident” considered by the law is the one affecting “the person”, the corresponding contract of insurance should be qualified as a kind of “personal insurance” (a) due to its relation to «life, health, ability to work … and other personal interests of the insured».

Among the “other personal interests”, bodily integrity certainly is included.
As to the event, the word “accident” refers to «any sudden, unexpect- ed and unforeseen event affecting the body of the insured person against his will and resulting in temporary bodily injuries or traumas»3.

2.

Legal framework Personal accident insurance has not a long history.

The earliest companies were founded in England and America in the XIX century; they were chiefly intended to ensure travellers from acci- dental bodily injuries.
Actually, those companies started their activity by selling “accident tickets” at railroad stations; afterwards they estab- lished a general accident insurance, often combining it with life insur- ance.

A fixed sum was payable for fatal accidents, while “a reasonable compensation” was due for accidents not causing death.

A modern sys- tem of personal accident insurance is traditionally dated from this pro- vision of compensation for non- fatal injury.
The lack of reports prevent from stating how the compensation was calculated, thus it is hard to say whether the contract was ruled by the indemnitary or by the stated-value principle4.

2 Available at:https://matsne.gov.ge/en/document/download/29884/17/en/pdf (last access 30th September 2021).

3 The aforeamentioned definitions match the so called “Basic concepts” used in the Law of Georgia on Insurance (Law No.

690 of 2nd May 1997, article 2).


Compare W. C. Niblack, Law of Voluntary Societies, Mutual Benefit Insurance and Accident Insurance, Chicago, 1894, p. 701: “Some violence, casualty or vis major is necessarily involved in the term “accident.” It means, in short, in insurance policies, an injury which happens by reason of some violence, casualty or vis major to the assured, without his design or consent, or voluntary co-operation”.

4 McGill Guide, Accident insurance, in American Law Review, vol.
7, no.4, 1873, pp.

585-587.

748 According to the general principles, non-life insurance is intended to retaliate the insured for the damage resulting from an accident; in life in- surance, instead, the insurer makes a payment to the occurrence of an event relating to human life5.

A problem of qualification remains with regard to accident insurance contracts.
Companies tend to compensate the loss (medical expenses…) suffered by the insured because of the accident, but at the same time such events affect humain life; indeniably, accident insurance policies share with life policies the aspect of being related to human life.

Whenever the statutory discipline is poor, applicable rules depends on the solution of this dilemma.
For scholars supporting the idea that accident insurance is a species of life-insurance genus, «life is invaluable and none amount of money can compensate the death or disablement of a human be- ing»; consequently, «the amount recoverable is not measured by the extent of the insured’s loss, but is payable whenever the specified event happens, irrespective of whether the assured in fact sustains a pecuniary loss or not».
That means that accident insurance policies should be deemed non-indem- nity contracts6.

Some European countries gave a statutory solution to the question; an articulated definition can be found in § 1 of the Austrian Versi- cherungsvertragsgesetz (Insurance contract law act): «In the case of indem- nity insurance, the insurer is obliged to compensate the policyholder the financial damage suffered.
In the case of life assurance and accident insur- ance, the insurer is obliged to pay to the policyholder the agreed amount».

European Insurance Law separates life from non-life insurance as well7.

The problem related to the accident insurance is that, in other law systems, it lies between the two.

Article 854 of the Georgian Civil Code is no exception, as it designs the contract as a combination of a damage insurance disciplined by life insurance rules when it comes on behalf of others.
The indemnitary principle is well expressed in Article 858, which states «the policyholder has no right of recourse against the person who is liable for the damage» and whose meaning is preventing to get a sum of money exceeding the compensation.

Thus, the problem of picking out the 5 ESA, Insurance, chapter 16.08, available at: https://ec.europa.eu/eurostat/esa2010/chapter/ view/16/.

Last access September 30th 2021.


Compare the terms and expressions in article 799 e 808 of the GCC: “compensate damages/ firm fixed insured sum”; “danger or event”.

6 E.R.

Hardy Ivamy, General Principles of Insurance Law, London, 1966, p.9.

7 See the Definition of Insurance Contract in European countries by the European Commis- sion: https://ec.europa.eu/info/sites/default/files/definition_of_insurance_contract_en.pdf (last ac- cess September 30th 2021).

749 applicable provisions remains.


Preliminarily, we need to detect the ratio legis under the renvoi to life insurance law when the insured, other than the policyholder, coincides with the beneficiary.

3.

Analysis of the article The concept expressed in Article 854 is a specification of a more gener- al principle implied by other articles of the Civil Code, which admits that a contract, signed by two parties, may have effects onto another person8.
From the combinations of these provisions, different scenarios are possible: 1.

The policyholder insures him/herself against the risk of an accident to his/her own person.

2.

The policyholder insures him/herself against the risk that a third party may be affected by an accident.

3.

The policyholder insures a third person against the risk of being affected by an accident.

4.

The policyholder pays the premiums, but in the event of a damage the sum is paid to a third person.
The first case is also the ordinary one, as any person has an interest in subscribing a policy aimed to protect his own physical integrity.

When the insured is other than the contractor, two different situations may oc- cur: insured is just the one who bears the risk (n. 2); the insured is also the beneficiary (n.3).

At last (4), the insurer may be obliged to pay the proceeds to a person other than the policyholder and the insured person.
The general principle which unifies all these cases in point is that of the dissociation from the subjective side of the relationship; that means that the promisee can be other than the insured person, who can be other than the beneficiary.

Article 854, paragraph II, refers to the particular case in which the in- sured person, other than the policyholder, coincides with the beneficiary.
As a specification of the rule expressed in Article 836 («The policy- holder may conclude an insurance contract with the insurer in his/her own name for the benefit of another person»), the provision in point dif- ferentiates through the referral to life insurance rules.

8 See articles 836-838 about damage insurance, 843 on health insurance, 844.

1 on life insurance.


750 This particular discipline is probably justified by the fact that, in Ar- ticle 836, the policyholder doesn’t act in the name of the other person but he concludes the contract in his own name.

Actually, the beneficiary needs not to be named (art.

836, part II); he remains external to the structure of the contract, as his role comes up just if the insured event occurs; not as the damaged person, but just as the one vested of the right to the policy benefit.
His right is nonetheless alternatively subordinated to the consent of the policyholder or to the possess of the policy document (art.

837-838).

Article 854 seems to be based on a different assumption.

Here, there’s in fact a perfect coincidence between the beneficiary and the insured per- son; i.e., the one who bears the risk of having an accident is the same per- son entitled to receive the policy proceeds.
The reason why the legislator recalls the rules about life insurance contract is probably connected to the need of an active participation of the insured in the contract.

By giving ex ante his written consent (ex Article 844), the insured, aware of his rights and duties, ceases to be an outside to the contract9.

4.

Comparative analysis.

France and Italy.


The object of the accident insurance contract in France is to grant the beneficiary a sum of money in the case of a personal accident causing death, illness or incapacity, either temporary or permanent, according to what the parties agreed upon.

The difference from other personal policies lies in the cause of the event, limited to the “accident”, while other poli- cies cover the same event independently from its cause.
The policy documents usually define the accident as «a sudden and violent action cuased by something external and independent from the insured willness».

This definition allows to tell illness form accident.

The first one is a lasting process, the second one is a sudden event.

Nonethe- less, a sudden event, such as a heart stroke, is not deemed to be an accident whereas the victim was already affected by heart disease.

In the case, in- deed, the cause of the event was not “external”10.
According to Article L-112 of the French Insurance Code, «L’assurance peut être contractée en vertu d’un mandat général ou spécial ou même sans mandat, pour le compte d’une personne déterminée.

Dans ce dernier cas, 9 M. Mazzola, Polizze vita e assicurazione “per conto altrui”, in Responsabilita’ Civile e Pre- videnza, fasc.6, 1giugno 2019, p. 2135.

10 J. P. Vial, Assurances contre les accidents corporels.
La «mort subite» du sportif en question, 29 novembre 2016, https://institut-isbl.fr/assurances-contre-accidents-corporels-mort-subite-spor- tif-question/ (last access 30th September 2021).

751 l’assurance profite à la personne pour le compte de laquelle elle a été con- clue, alors même que la ratification n’aurait lieu qu’après le sinistre».
The contract stipulated on the account of another person, in other words, has effect in his legal sphere only with his consent; however, insured’ s will may intervene at the time of the stipulation or at the time of the accident either.

The definition of what is an “Accident” is similar all around Europe, and the risk covered is quite the same in all European countries11.

Howev- er, there are strong differences on a practical level.
First of all, most Euro- pean countries have introduced a specific discipline tailored for different types of insurance.

Italian insurance law is an exception, as it is evident from the lack of the personal damages insurance category within the civil code12.

The Italian insurance system, based on the outdated dichotomy life/damage insurance, essentially assignes jurisprudence the task of fac- ing the needs coming from society.
Georgian civil code seems to be more modern, as it contemplates dif- ferent diciplines for diverse types of contracts, but at last it seems to have missed the goal.

The referral to life insurance rules requires the same task to Georgian courts.

Italian insurance law is based on the strict dichotomy damage in- surance/life insurance; tertium non datur.

Accident insurance and other forms of policies originated by practical experience are not contemplated.
Many of them are governed by private agreements between companies and clients, within the limits of inderogable rules.

Accident insurance, in particular, is just mentioned in Article 1919 of the Italian Civil Code with the purpose of extending a typical institution of the damage insurance, the insurer right of subrogation, to the accident insurance contract13.
As to the other applicable rules, after a long period of debate the Civil Court of Cassation gave the final word; accident insurance law is deemed to be a damage insurance contract when it covers the risk of non fatal accidents; life insurance rules, in fact, are applicable when the accident provokes the insured death14.

This distinction doesn’t match Article 854 of the GCC, where the discrimen is given not by the event, but by the subjects to the contract.
11 See the paper by the European Commission, cit.

(https://ec.europa.eu/info/sites/default/ files/definition_of_insurance_contract_en.pdf).

12 I. Clemente, L’assicurazione infortuni:una figura in cerca di disciplina.

Nota a: Cassazione civile, 10 aprile 2002, n.5119, sez.

un., in Diritto e Fiscalità dell’assicurazione, fasc.1, 2004, pag.

236.

13 M. Sanna, Polizza infortuni e natura del debito di indennizzo dell’assicurato.

Nota a: Cassazio- ne civile, 11 gennaio 2007, n.395, sez.
III, in Responsabilità Civile e Previdenza, fasc.6, 2007, pag.

129.

14 Corte di Cassazione, Sezioni Unite, sentenza n. 5199 del 10 aprile 2002.

752 Article 855 - Effects of injury to health If the insurer’s liability depends on injury (harm) intentionally done to health, then the absence of intent shall be presumed until proven oth- erwise.

Alexandra Manfredino Elena Martina Paone Summary: 1.

Introduction.

2.

The provisions of the 1942 Italian Civil Code.

3.

The Common law discipline.

4.


The comparison with the Georgian law.

1.

Introduction Article 855 of the Georgia Civil Code refers to cases where an injury is intentionally caused by the party whose interest is the basis for the in- surance claim; from the reading of this Article, it can be inferred that the absence of the casualty requirement does not provide for insurance cover- age1.

Consequently «fortuity – probability, contingency, risk – is essential to insurance»2.
Fortuity, in this sense, «is a perspective-ladened concept, and each of its possible perspectives is more or less closely associated with a theoret- ical view of insurance»3.
Hence, it can be emphasized that there is neither a definition of “acci- dent” in the provisions of the Georgian Civil Code nor an exhaustive list of covered events; instead, it is provided only a reference to injury (harm) caused to health and to the element of intentionality which, in accordance with article 855, is presumed absent from the act that caused the injury unless proven otherwise.
Given these premises, in the following paragraphs it will be conducted an analysis of both the provisions included in the Italian Civil Code and the Common law discipline, with the aim to compare them to the Geor- gian dispositions.

1 As stated by scholars, «[f]ortuity, or lack thereof, is primarily a matter of intent».

R. E. Kee- ton & A. I. Widiss, Insurance Law: a Guide to Fundamental Principles, Legal Doctrines, and Com- mercial Practices, Minnesota, 1988, cit., p. 475.
2 J. E. Scheuermann, Fortuity, Intent, and Causation in Liability Insurance Law, ELON L.

REV., vol.

9, issue 2, 2017, cit., p. 330.

3 Ibid.

In particular, «[i]n the liability insurance context, an event may be deemed fortuitous, or not, from the perspective of (a) the injured third party, (b) the insured, or (c) the insurer».

Ibid.

753 2.
Ibid.

753 2.

The provisions of the Italian Civil code According to the Italian Civil Code, article 1882, insurance contracts can be divided into two macro sectors: life insurance and insurance against damages.

Accident insurance contracts are certainly difficult to link to a predefined regulatory framework given that they contain both the con- cept of injury (and therefore of harm) to the person and the one of an event pertaining to human life.
However, in these kinds of insurance contracts the insurer is bound to pay in the event of injury resulting from an accident, i.e.

an injury to the insured caused by a fortuitous, violent and external event, objectively as- certainable, capable of determining a disability (temporary or permanent) or death4.
Thus, in the first case, the insurance can be qualified as insurance against damages, with the peculiarity of having as its main element an injury to a person and not to things5; in the second case, on the contrary, it may be considered more properly within the sphere of life insurance6.
Considering as stated, the detailed contents of these contracts are sub- ject to the general principle of contractual autonomy7; still, some specific aspects remain regulated by the Civil Code: in particular, given the exis- tence of the requirement of the fortuity of the event that causes the injury, it is applicable the principle stated by article 1900 c.c.

4 L. Farenga, Manuale di Diritto delle Assicurazioni Private, Torino, 2019, p. 245.
5 Since, in this circumstance, the object of the risk is represented by a person and not a thing, an economic value cannot be attributed to the damage.

Consequently, the application of the indem- nity principle and of the norms that are linked to it, namely articles 1905-1909 of the Civil Code (limits of indemnity, defects of the thing, value of the insured thing, partial insurance, over-insur- ance) should be excluded.

However, there is a contrast with the case law on this matter.
For more on the topic see ivi, pp.

245-246.

6 On this topic, art.

2 of the Code of Private Insurance (legislative decree no.

209 of 7 Sep- tember 2005) provides a classification of risks that has its roots in the EU legislation.

This Code has replaced over a thousand special regulations in force with 355 articles with the aim of bringing together, within a unitary corpus, the existing regulations while also innovating them, to ensure their compliance to EU provisions and international agreements.
P. Perlingieri, Istituzioni di Diritto Civile, Napoli, 2012, p. 366.

7 As provided by article 1322 of the Italian Civil Code, the parties can freely determine the content of the contract within the limits imposed by the law and the corporate norms; moreover, the parties are also free to enter into a contract that does not belong to the regulated categories, provided it is aimed at achieving interests that are worthy of protection according to the legal system.
754 According to this article, the insurer may be considered not obliged to pay in the case in which the event has been willingly caused by the insured, the policyholder (if different from the insured) or by the ben- eficiary8.

The presence of willful misconduct9 – i.e.

the will to determine the event while being aware of the damaging effects that can derive from it – in order to get a benefit from the agreement means that the fortuity requirement is no longer met10.
In conclusion, from the combined reading of articles 1900 and 2697 of the Civil Code, the burden of proof of willful misconduct falls on the insurer who can use it as an exemption from performance11.

In fact, the Italian legislator provides in the first paragraph of article 2697 c.c.

that the parties making a claim at trial must prove the facts that form its basis.
On the other hand, as stated in paragraph 2 of the same article, the parties challenging the efficiency of such facts or objects that the law is modified or extinguished bear the burden of proof of the facts on which the objection is based.

In this way, Article 2697 places the burden of proof on each party who has made a claim in court, making it relatively easy for the court to decide in individual cases.
Thus, the article refers to the procedural position of the parties to divide between the plaintiff and the defendant the negative consequences resulting from the lack of proof of facts (ac- cording to the latin maxim onus probandi incumbit ei qui dicit)12.
8 Conversely, as stated by article 1900, paragraph 2, c.c., the insurer is liable for the event caused by intent or gross negligence of the individuals for whose action the insured is liable; also, in the same article, paragraph 3, it is provided that the insurer is also obliged in case the event is a consequence of an act committed by the policyholder, the insured, or the beneficiary out of human solidarity or to protect those interests which are common with the insurer.
9 See, for a more detailed analysis of the willful misconduct, F. Zambardino, Comment on article 849, in this book.

10 On the other hand, an action capable of producing damage is contrary to the princi- ples of public order, since it can involve, beyond the intrinsic illicitness of the act, a dangerous situation (for example, fire).

L. Farenga, Manuale di Diritto delle Assicurazioni Private, cit., p. 151.

11 Ivi, p. 152.
11 Ivi, p. 152.

12 See generally L. P. Comoglio, Le Prove Civili, Torino, 2004; M. Taruffo, Onere della Prova, Dig.

Civ., vol.

XIII, Torino, 1996.


755 The rule expresses the fundamental so-called “dispositive princi- ple”13 according to which only the evidence that the parties have pro- duced in the course of the proceedings should be placed at the basis of the decision of the judge, with the exception of the cases in which evidence may be obtained ex officio, as provided by the law (which therefore con- stitutes a derogation from the rule in question).
The doctrine states that this rule must not be intended only as aimed at dividing the procedural initiative among the interested parties; instead, it is also aimed at allowing a judicial pronouncement even in the hypothe- ses in which the fact has remained uncertain14.

In fact, the judge is subject to the prohibition of non liquet15.
From the Article 2697 c.c., therefore, it can be derived that where the preliminary results do not offer suitable elements for the full ascertain- ment of those facts, the loss of the party that had the burden to provide the relevant evidence is declared.

Moreover, with a crucial judgment handed down in unified sections on the subject of labor proceedings, the Court of Cassation affirmed that the absence of contestation binds the judge to consider the not contested facts as existing16.
On the issue of non-contestation, it is also important to point out that the legislator has amended (by Law no.

69 of June 18, 2009) article 115 of the Civil Procedure Code.

The new wording of par.


1 allows the judge to 13 One of the corollaries of the dispositive principle is the “principle of request”, expressed by article 99 of the Civil Procedure Code, according to which any person seeking to assert a right must make a request to the competent judge: therefore «an individual must therefore take positive action to obtain a right and not count on the outcome of official procedures set in motion by the judge».
Another corollary linked to it is the so-called “evidential principle”, expressed by article 115 of the Civil Procedure Code, «whereby the judge can reach a decision only on the basis of evidence [...] adduced or presented by the parties» and cannot obtain knowledge of them ex officio.

G. Alpa & V. Zeno-Zencovich, Italian Private Law, Abingdon, 2007, cit., p. 279.
14 See generally F. Agnino, R. Amatore, G. Buffone, A. Celeste, C. Costabile, F. Di Mar- zio, M. Di Marzio, G. Ianni, A. Massafra, G. Romano, D. Salari, A. Scarpa, P. Sordi, C. Tra- puzzano, Codice Civile Commentato, Milano, 2021.

15 The principle of the prohibition of non liquet dates back to Roman law.

According to it, the judge could not refuse to deliver a judgment because of the lack of clarity of the situation.

C. Pinel- li, Il Giudice e la Legge, RIV.

AIC, n. 3, 2016, 9.
AIC, n. 3, 2016, 9.

For more on the topic see also: A. M. Rabello, Non Liquet: From Modern Law to Roman Law, ANN.

SURV.

INT’L & COMP.

L., vol.

10, 2004; J.

Stone, Non Liquet and the Function of Law in the International Community, BRIT.

Y.

B. INT’l L., vol.

35, 1959.

16 Cass., ss.uu., no.

761/2002.

The principles affirmed in this judgment were also reiterat- ed by subsequent case-law in relation to non-contestation in ordinary proceedings (Cass., I, no.

6936/2004).
6936/2004).

756 consider as proven those facts that have not been specifically contested by the other party either directly or indirectly.

This reform has been crucial for the actual implementation of the provisions of Articles 2697.

3.
3.

The Common law discipline The insurance can be considered as a private contractual relationship through which «the insured and insurer agree that, should a contingent event (within a class of identified contingent events) happen, the insurer agrees to bear all or some defined portion of the economic costs created by the happening of that event, costs which, but for the contract, the in- sured would bear.
In more common parlance, by the insurance contract the insured transfers to the insurer the risk (and not the certainty) of the happening of an event that causes economic costs»17.

The main element of this definition is represented by the requirement of fortuity, a concept that has been explained many times in different sources of the Common Law jurisdictions.
For example, in New York’s insurance statutes, a “fortuitous event” is described as «any occurrence or failure to occur which is, or is assumed by the parties to be, to a substantial extent beyond the control of either party»18.
Specifically, within the framework of accident-based liability policies, there’s a provision of indemnity coverage for injury caused by an “occur- rence” or “accident”: a definition of the term can be found in the current standard-form Commercial General Liability policy, in which the insur- ing agreement provides coverage for property damage and bodily injury caused by such an event19.

17 J. E. Scheuermann, Fortuity, Intent, and Causation in Liability Insurance Law, cit., pp.

337-338.
337-338.

In an insurance claim «“[w]ho pays” is a question of concern to all of the parties »: the frequent answer to the question is the insurer, «either because it has a legal duty to do so or be- cause public policy favors compensating a victim by turning to the party with the “deep pocket”».

L. J. Kibler, Intentional Injury Exclusionary Clauses: The Question of Ambiguity, VALPARAISO UNIV.

L.

SCH., vol.

21, issue 2, 1987, cit., pp.

361-362.

18 See generally N.Y. INS.


Lᴀᴡ § 1101(a)(2), available at https://law.justia.com/codes/new- york/2020/isc/article-11/1101/.

Accessed on 11 February 2022.

19 Therefore, «there is an actual or alleged causal relation between an accident (or occurrence) and the injury to the interests of a third party for which the insured is allegedly or actually liable».
However, despite agreeing on the fortuity requirement, in the case law and commentary it has been debated for a long time a key interpretive question about what should be regarded as “accidental”: the act per se or the injuries resulting from such act.

For further information on the topic see J. E. Scheuermann, Fortuity, Intent, and Causation in Liability Insurance Law, cit., p. 345.
757 In particular, it is expressly provided that that an occurrence is «an accident, including continuous or repeated exposure to substantially the same general harmful conditions»20.

Moreover, liability insurers «have the contractual right to place limits on their obligations as long as the limitations are against neither statutory provisions nor public policy»21.
In doing so, they can include in their insurance policies conditions, definitions and exclusions such as the so-called intentional injury exclu- sionary clause which has the function to release the insurer from liabil- ity for bodily injuries or property damages that have been intentionally caused22.
It is possible that a dispute may arise if those limits are not clearly understood by all the parties: in fact, it is plausible that a claim will be filed asking the courts to resolve any ambiguity pertaining to the intentional injury exclusionary clause23.

However, Common Law juris- dictions disagree on the interpretation of the clause and on its level of ambiguity24.

In general terms, the courts take into consideration two main factors to rule on the matter.
The first one is the language of the clause which if 20 The standard Commercial General Liability Coverage Form is available at https://www.

techriskreport.com/wp-content/uploads/sites/26/2019/05/2012-CGL.pdf.

Accessed on 11 February 2022.

21 L. J. Kibler, Intentional Injury Exclusionary Clauses: The Question of Ambiguity, cit., p. 362.

22 Ibid.
22 Ibid.

23 From the interpretation of the courts it is determined «whether the insured is entitled to coverage under the terms of the policy or whether he forfeits his right to coverage when he com- mits an intentional act resulting in an injury to a third party.

But the court’s interpretation also may determine whether the injured party is to be compensated at all, particularly if the insured is judgment proof».

Ivi, 363.
Ivi, 363.

The courts may decide to give priority to the compensation of the injured party instead of the analysis of the policy according to the principles of contract law.

In fact, «[l]iability insurance was initially designed to protect an insured against loss caused by his tort liability to a third person [...].

But liability insurance has come to be used openly and extensively as a device for insuring compensation to victims».
See generally R. Keeton, Basic Text on Insurance Law, St. Paul, 1971, cit.

24 In this respect, courts that have ruled that the clause in question is inherently ambiguous are those in California, Connecticut, Idaho, Indiana, Kansas, Maine, Michigan, Minnesota, and New York.

Conversely, courts in Arizona, Arkansas, the District of Columbia, Georgia, Louisiana, Mon- tana, North Carolina, Oregon, Washington, and Wisconsin have stated that the intentional injury exclusionary clause is not ambiguous.
There are also courts in other states (such as in Minnesota and Illinois) that have reached both conclusions and others that rule on the matter on a case-by-case basis.

See generally the collection of cases by J. L. Rigelhaupt, Annotation, Construction and Application of Provision of Liability Insurance Policy Expressly Excluding Injuries Intended or Expected by In- sured, 1984.
758 deemed ambiguous will consequently ensure that the party which drafted the contract, i.e., the insurance company, must provide coverage for the intentional act25.

The second factor taken into consideration by the courts is the intent of the insured.

In fact, if he intentionally caused the injury the clause will be triggered and, as a result, the insurer will be not obliged to pay the claim, to compensate the victim or have a duty to defend the insurer26.
It must be taken into account that «just as they are split on determin- ing whether the language of the intentional injury exclusionary clause is ambiguous, courts are split on how to define intent»27.

This is especially noticeable in the rulings by courts who deemed the exclusionary clause to be ambiguous.
For example, the Court of Appeals of Indiana (in the 1975 case Home Insurance v. Neilsen) assigned three different meanings to the phrase “caused intentionally”: «(1) Intentional refers to the volitional act which produces injury [...].

(2) Intentional refers to the result achieved.

Only where the insured intended to inflict the precise injury or degree of injury which in fact resulted should the injury be considered as not acci- dental.
(3) Intentional is more demanding than (1) but not so difficult of proof as (2).

It refers instead to the volitional performance of an act with an intent to cause injury, although not necessarily the precise injury or severity of damage that in fact occurs»28.
To determine whether or not the act in question falls within the pro- visions of the policy, the definition of the concept of intent is pivotal in- 25 Naturally, the insured will seek to prove that the clause is indeed ambiguous, arguing that its wording may be open to different interpretations.

On the contrary, the insurer will state the opposite.
The courts have taken three different positions on the matter, namely: (i) the ambiguity of the clause is linked to the de facto situation of the case; (ii) the clause is ambiguous by its very nature; (iii) the clause is unambiguous.

For example, some courts have ruled that the clause is free from ambiguity based on its literal wording: by looking at the plain, ordinary and popular meaning of the words, it can be held that there’s only one reasonable interpretation that fits the clause (i.e.
the so called “plain meaning approach”).

L. J. Kibler, Intentional Injury Exclusionary Clauses: The Question of Ambi- guity, p. 368.

26 In this context, the insured will typically take one or more of the following positions: «(1) [h]is act was privileged and thus not wrongful, i.e.

he acted in self defense.

(2) The blow was unin- tended, i.e., he was merely negligent or was not at fault at all.

(3) He did not commit the act charged, i.e., someone else struck the blow.
(4) He intended only a minor bodily contact, not a major injury such as is alleged to have resulted».

D. F. Farbstein & F. J. Stillman, Insurance for the Commission of Intentional Torts, HASTINGS L. J., vol.

20, issue 4, 1969, cit., p. 1229.

27 L. J. Kibler, Intentional Injury Exclusionary Clauses: The Question of Ambiguity, cit., p. 372.

28 Home Insurance v. Neilsen, Court of Appeals of Indiana, 1975.

759 deed29.
759 deed29.

The overall definition that Common Law jurisdictions have ad- opted can be traced back to tort law and can be linked, in particular, to the Restatement of Torts30 and Prosser’s Law of Tort: the two core elements of these definitions are «the desire of the actor to cause the consequences of his act and his understanding or belief that certain consequences will probably follow from his act»31.
In particular, the Restatement of Torts refers to the actor who «desires to cause the consequences of his act, or [...] believes that the consequences are substantially certain to result from it»32; similarly, Prosser uses the wording «to those consequences that are desired, but also to those which the actor believes are substantially certain to follow what he does»33.
Ultimately, the ratio of the intentional injury exclusionary clause is to prevent the insured, «who commits an intentional wrongful act which results in harm to a third party [from passing] the responsibility of his wrongful act to his insurer»34.

4.
4.

The comparison with the Georgian law From the reading of article 855 of the Civil Code of Georgia, the in- surer’s duty in accident insurance contracts is based on the absence of willful misconduct aimed at inflicting damage (injury) to health; there- fore, it is presumed that the conduct was not intentional until the oppo- site is proved.
29 Each party in a dispute concerning a liability insurance policy is interested in the court’s decision about the ambiguity of the clause: «[t]he insurance company, which believes it is being asked to pay an unjustified claim, argues that the clause is not ambiguous.

But the insured, who believes he is entitled to protection under the terms of his policy and who fears his acts may not be covered, argues that the clause is ambiguous.
The third party in the dispute, the injured person who may find that the harm was caused by a judgment-proof defendant and who believes that he is entitled to com- pensation, also argues that the clause is ambiguous».

L. J. Kibler, Intentional Injury Exclusionary Clauses: The Question of Ambiguity, cit., p. 364.

30 The American Restatement of Torts, Second, is a treatise by the American Law Institute, the leading organization in the US which works to clarify, modernize, and improve the law.
Indeed, the Restatement offers coverage of the general principles of the law of torts and constitutes a revision of the original Restatement of Torts.

For more information about the topic, see also https://www.ali.

org/publications/show/torts/.

Accessed on 11 February 2022.

31 L. J. Kibler, Intentional Injury Exclusionary Clauses: The Question of Ambiguity, cit., p. 372.

32 See generally Restatement (Second) of Torts, 1977.

33 See generally W. Prosser & W. Keeton, The Law of Torts, 1984.
34 L. J. Kibler, Intentional Injury Exclusionary Clauses: The Question of Ambiguity, cit., p. 385.

760 Hence, under such circumstances, the insurer has the right to request any valuable information35 related to the causes on the basis of the insured event36.

Similarly, in the Italian legal framework, the insurer has the bur- den of proof of the existence of willful misconduct, as can be deduced by article 2697 of the Civil Code.
In addition, the requirement of the fortuity of the event appears in the Georgian, Italian and Common Law disciplines of insurance contracts.

However, while the Georgian and the Italian Codes specifically contain a disposition on the matter, in Common Law jurisdictions it is general- ly discretion of the insurer to provide an intentional injury exclusionary clause in the contract to limit their obligations.
In conclusion, Georgian solutions provided by Article 855 are in line with the Civil law tradition and have some similar elements with the Ital- ian regulation – specifically, both Codes provide that the burden of proof falls on the insurer and that he cannot be obliged to pay in the case of willful misconduct by the party that caused the injury.

Conversely, the same cannot be stated about the comparison with the Common law discipline.
In fact, in this context, a similar pattern to the one of Article 855 is recognized to be in between tort law (as shown by the circumstance that some definitions have their roots in sources as the Restatement of Torts) and contract law (as reflected by the importance of the intentional injury exclusionary clause).
Nevertheless, it would seem that this difference is not as deep as it can be imagined since, both in Italy and Georgia, when it is needed to resort to some form of benefit, restoration or indemnification, party autonomy on the contract side and tort law or civil liability are entangled.

35 In this regard, as per article 8, paragraph 3, of the Georgian Civil Code,«[p]articipants in a legal relationship shall exercise their rights and duties in good faith».
It follows that «for abidance by the principle of good faith it is necessary to duly perform the duty to inform».

I. Nozadze, Duty to Inform as a Specificity of Demonstration of Good Faith Principle in Voluntary and Compulsory Insurance, J.

LAW (TSU), 2017, issue 1, cit., p. 131.

36 Ivi, pp.

141-142.

761 Article 856 - Effects of intentionally causing an accident 1.
The insurer shall be released from liability if the person entitled to benefits under a contract concluded for the benefit of another person inten- tionally causes the accident by acting illegally.

2.

If another person has the right to receive the benefit, he/she shall be deprived of the right if he/she intentionally causes the accident by acting illegally.

Maria Beatrice Pagani Summary: 1.

Analysis of the article.

2.

Comparative analysis: Italy.

3.

At transnational level.

4.

Final considerations.


1.

Analysis of the article Article 856 is situated in the special part of book 3 (Obligations), title I (Contract law), chapter 20 (Insurance), section 5 (Accident insur- ance).

In particular, the Article in question provides for the case where the beneficiary of a contract concluded in favour of another person or the person entitled to receive compensation intentionally causes the ac- cident by acting unlawfully.
This situation relieves the insurer of any obligation and excludes the beneficiary from any right of collection1, thereby ensuring the actual reason of the insurance contract and the compliance with the general principles that an obligation cannot be the result of an infringement, unjust enrichment or other reasons prescribed by law2 and the parties may also conclude contracts not provided for by the same but not in contravention3.
It is noted that similar rules are provided for each specific type of insurance contract.

About the insurance against damages, Article 829 states the release of the insurer from all obligations if the insured event has been caused intentionally or through significant negligence by the policyholder4.
This Article plays a fundamental role because it defines the degrees of 1 Civil code of Georgia, article 856, in www.ilo.org 2 Civil code of Georgia, article 317, in www.ilo.org 3 Civil code of Georgia, article 319, in www.ilo.org 4 Civil code of Georgia, article 829, in www.ilo.org 762 intentionality that can be considered, widening the spectrum to all those cases in which the event is determined also because of a serious, albeit unintentional, bad conduct of the person who concluded the contract.
Not only, in the context of insurance against damages, there is also a further provision to clarify even more the concept of intentionality, in fact, Article 830 establish the obligation for the policyholder to follow the instructions of the insurer to avoid or reduce damages, of course, as far as possible, including eventual reimbursement by the insurer for expenses incurred in this regard5.
Special rules are applied to cases in which the damage is caused by war or other force majeure causes, for which a special agreement is required6, and to cases in which the damage is caused by a third party outside the insurance relationship7.

Other provisions similar to the one under consideration are also found in the area of civil liability insurance, for which Article 842 is rel- evant.
It merely refers to a circumstance caused intentionally by which liability arises8, and in the field of life assurance, in particular with re- gard to the provisions of articles 849 and 850 which exclude the insurer obligations when the policyholder intentionally causes the death of the person whose death is covered by the contract, as well as in cases of suicide of the insured (while explicitly providing for the possibility for heirs to claim reimbursement of insurance premiums paid)9.
It should be noted that the provisions on life insurance contracts, pursuant to Article 854, also apply in the context of accident insurance contracts, if such a contract «is concluded not by the insured person but for his/her benefit»10.

2.
2.

Comparative analysis: Italy The Italian law does not explicitly deal with accident insurance, which has led to an interpretative dispute as to their systematic place among life insurance, a position prevailing in the case law, or, vice versa, among those against damage, prevailing position in doctrine.
However, it can be said that are accident insurance all those insurances which offer to the 5 Civil code of Georgia, article 830, in www.ilo.org 6 Civil code of Georgia, article 831, in www.ilo.org 7 Civil code of Georgia, article 832, in www.ilo.org 8 Civil code of Georgia, article 842, in www.ilo.org 9 Civil code of Georgia, articles 849 and 850, in www.ilo.org 10 Civil code of Georgia, article 854, in www.ilo.org 763 policyholder a «compensation for damage to the person - resulting from personal injury [...] resulting in death, permanent invalidity (total or par- tial) or even temporary incapacity»11.
In insurance policies the accident is defined as an event due to acci- dent, violence and external.

Therefore the causes must be completely independent of the will of the person who suffers it, or in any case that would benefit from com- pensation, moreover, the action must be sudden and abrupt, as well as linked to factors external to the body12.
It necessarily follows that the voluntary cause of the event from which the accident arises, regardless of the illegality or otherwise of the conduct, does not imply obligations for the insurer.

However, before referring to the general framework, certainly appli- cable to accident insurance contracts, and to other provisions which are considered to be relevant, a further consideration should be given to the general theory of contracts.
In fact, the present case, not only would lead to an imbalance in the synallagmatic relationship but, a contract that pro- vided for benefits resulting from the execution of unlawful acts, would be considered entirely or partially void, in other words, an invalidity to which neither the passage of time nor the acquiescence of the parties can remedy.
In particular, pursuant to Article 1418 of the Italian civil code, «the contract is null and void where it is contrary to mandatory rules, unless the law provides otherwise»13.

In particular, as far as our interest is concerned, reference should be made to the illegality of the contract that occurs for: illegality of the case, illegality of the object, illegality of the reason and illegality of the condition.
The case, the object or the condi- tion are considered unlawful when they are contrary to «imperative rules, public order or morality»14 or when «the contract is the means to circum- vent the application of an imperative rule»15.

For the unlawful reason, ref- erence is made instead of the provisions of Article 1345 of the civil code16.

11 M. Irrera, E. Fregonara, M. Spiotta, Lineamenti di diritto assicurativo, Torino, 2019, 205 ss.
12 Mizar International Insurance Broker s.r.l., La causa fortuita, violenta ed esterna, in www.mizarbrokers.it 13 G. Iudica, P. Zatti, Linguaggio e regole del diritto privato, Vicenza, 2015, 346 ss.

; Codice civile italiano, articolo 1418, in www.normattiva.it 14 The latter refers to “current morality”.

G. Iudica, P. Zatti, Linguaggio e regole del diritto privato, cit., 350.
15 Codice civile italiano, articoli 1343, 1344, 1346 e 1354, in www.normattiva.it 16 Codice civile italiano, articolo 1345, in www.normattiva.it 764 In the light of the specific rules governing insurance, reference should be made to Article 1900 of the Italian civil code, which pro- vides, in general, for all types of insurance contracts17 and in accordance with the general rules governing the principle of authorship18, an ex lege definition of insurable risk19.
In fact, according to the norm, the insurer is not obliged «for the claims caused by wilful misconduct or gross negligence of the policyholder, the insured or the beneficiary, un- less otherwise agreed for cases of gross negligence»20.
The derogation is therefore only allowed in the second case and must be expressed and approved specifically in writing21, an exception to this general provision is found, however, in cases of insurance for civil liability in which the claim caused by gross negligence is included in the insurance guarantee unless otherwise agreed22.
Not only that, according to the general disci- pline of the obligations, «if the fault of the creditor has contributed to the damage, the compensation is decreased according to the gravity of the fault and the entity of the consequences that have derived from it»23.
It is specified that the insurer is obliged «for the accident caused by intent or gross negligence of the persons to whom the insured has to an- swer», the identification of which is the subject of debate but is essentially linked to the provisions of Article 2047, 2048, 2049 and 2051, 2052 of the 17 Although its applicability to life insurance is debated as unrelated to the principle of in- demnity.

However, the rules of articles 1922 and 1927 seem to admit, albeit with some beveling, such norm.
F. Arangio, D. Colangeli, G. Iorio, A. C. Marrollo, M. Palisi, M. Perreca, F. Santi, Sin- istri cagionati con dolo o colpa grave dell’assicurato o dei dipendenti, in Commentario al codice civile, a cura di P. Cendon, Milano, 2010, 342.; A. Bracciodieta, Il contratto di assicurazione, disposizioni generali, Milano, 2012, 184.; Codice civile italiano, articoli 1922 e 1927, in www.normattiva.it.
With specific reference to accident insurance including the event of death, article 1900 of the Italian Civil Code was deemed applicable, specifying, however, that the insurer has the right to refuse the pay- ment of compensation only against the culprit.

«The other beneficiaries not participating in the crime remain due compensation, but must be reduced from the share due to the beneficiary murderer».

M. Rossetti, Sinistri cagionati con dolo o colpa grave dell’assicurato o dei dipendenti, in AA.
VV., Le assicurazioni, a cura di A.

La Torre, Milano, 2019, 157.

18 F. Peccenini, Assicurazione, Bologna, 2011, 155.; Codice civile italiano, articolo 1227, in www.normattiva.it 19 M. Rossetti, Sinistri cagionati con dolo o colpa grave dell’assicurato o dei dipendenti, cit., 156.

20 Codice civile italiano, articolo 1900 co. 1, in www.normattiva.it 21 Cass.

Civ., Sez.

I, 8 giugno 1988, n. 3890.


22 F. Peccenini, Assicurazione, cit., 89.; Codice civile italiano, articolo 1917, in www.normat- tiva.it 23 Codice civile italiano, articolo 1227 co. 1, in www.normattiva.it 765 Italian civil code24, or «for the consequent claims of the policyholder, the insured or the beneficiary, made out of duty of human solidarity or in the protection of the common interests of the insurer»25.
In these two cases, in fact, there is no interest of the agent contrary to the occurrence of the accident, indeed, in the latter there is even a mor- al duty, dictated by rules of civil coexistence generally shared in a given community and at a given time26.

At this point it seems essential to clarify the concepts of intent and gross negligence, so the support of criminal discipline is fundamental, es- pecially with reference to the issue of guilt27.
In Italy, as in the Georgian system28, there are different degrees of culpability.

The wilful misconduct, similar to intentional crime, is the most serious form and occurs if the harmful event consequence of the action/omission is planned and wanted29.
If initially the main guideline was to restrict the scope of Article 1900 of the Civil Code only to cases of specific intent, in which conduct was therefore required for the purpose of obtaining a compensation, today the application is also extended to cases of generic willfullnes30.

24 The articles are about: incapacitated, emancipated minors or persons subject to protection and supervision, things in custody and owned animals.
F. Arangio, D. Colangeli, G. Iorio, A. C. Marrollo, M. Palisi, M. Perreca, F. Santi, Sinistri cagionati con dolo o colpa grave dell’assicurato o dei dipendenti, cit., 340.

25 Codice civile italiano, articolo 1900 commi 2 e 3, in www.normattiva.it 26 M. Rossetti, Sinistri cagionati con dolo o colpa grave dell’assicurato o dei dipendenti, cit., 162; A. Gambino, Assicurazione, in Enciclopedia giuridica, Roma, 1988-2010, 9.
27 A. Bracciodieta, Il contratto di assicurazione, disposizioni generali, Milano, 2012, 185 ss.

28 «An act committed with direct or indirect intent shall constitute an intentional crime.

An act shall be considered to have been committed with direct intent, if the person [who commits it] is aware of the unlawfulness of the act, foresees its unlawful consequences and desires those consequences, or foresees the inevitability of the occurrence of such consequences.
An act shall be considered to have been committed with indirect intent if the person was aware of the unlawfulness of his/her action, was able to foresee the occurrence of the unlawful consequences and did not desire those consequenc- es, but consciously permitted them or was negligent about the occurrence of those consequences.

[…] An act that has been committed through reckless misconduct or negligence shall be considered a crime of negligence.
An act shall be considered to have been committed with reckless misconduct if the person was aware that the act was prohibited under the standard of care, foresaw the possibility of the occurrence of the unlawful consequences, but groundlessly counted on their being prevented.
An act shall be considered to have been committed with negligence if a person was not aware that of the act was prohibited under the standard of care, did not foresee the possibility of the occurrence of the unlawful consequences, although he/she was obliged and was able to foresee them.
An act com- mitted through negligence shall be considered a crime only if so provided by the relevant article of this Code».Criminal code of Georgia, articles 9 and 10, in www.legislationonline.org 29 Codice penale italiano, articolo 43, in www.normattiva.it 30 F. Arangio, D. Colangeli, G. Iorio, A. C. Marrollo, M. Palisi, M. Perreca, F. Santi, Sinistri cagionati con dolo o colpa grave dell’assicurato o dei dipendenti, cit., 335.
766 The fault, however, similar to crimes of negligence, occurs when the event, even if predicted, is not wanted by the agent but are broken precau- tionary rules of care, prudence and expertise which should be respected in the specific situation by the person concerned, without reference to the nature of the professional activity of the person31.

If the broken rules are of social origin, they refer to general fault, but if they are legal, they are a specific fault.
The fault is defined as gross when the violation is of partic- ular importance, that is, if there is a «failure to use that minimum of care even of the most inconsiderate people or as conscious behaviour of those who, even without the will to cause damage, operate with extraordinary and inexcusable imprudence [...] or as omitted minimum observance of the diligence»32.
According to Article 1900, therefore, all cases in which the precautionary rules are breached but without conduct of particular seriousness, through negligence, meaning that the prescribed conduct is not taken, imprudence, in the sense of realising what should not be achieved, or incompetence, in the event that particular technical skills are involved, are covered by the insurer.
The Italian jurisprudence has also outlined further concepts designed to reflect the many facets, often characterized by blurred boundaries and debates, which may take on reality, in particular the eventual intention, in which, despite the lack of will of the event, the risk of its realization is accepted resulting from the maintenance of a given conduct, and con- scious guilt, in which, despite the awareness of the possibility of certain consequences, is trusted in their non-implementation33.
The application of Article 1900 in the event of such situations is uncer- tain, however, whether an applicability in the event of intentional conduct seems more secure since, the absence of will would be compensated by 31 F. Arangio, D. Colangeli, G. Iorio, A. C. Marrollo, M. Palisi, M. Perreca, F. Santi, Aggravamento del rischio, cit., 335 ss.
; Cass., 28 marzo 1994, n. 2995.; Codice penale italiano, articolo 43, in www.normattiva.it; Codice civile italiano, articolo 1176, in www.normattiva.it 32 F. Arangio, D. Colangeli, G. Iorio, A. C. Marrollo, M. Palisi, M. Perreca, F. Santi, Aggravamento del rischio, cit., 335 ss.

; G. Fiandaca, E. Musco, Diritto penale, parte generale, Tori- no, 2019, 363 ss.
33 S. Canestrari, La distinzione tra dolo eventuale e colpa cosciente nei contesti a rischio di base “consentito”, in Diritto penale contemporaneo, 2013, p. 1 ss.
In order to clarify the complex dis- tinction between these two concepts, the Thyssenkrupp case, which saw the process of the CEO, of the members of the executive board, of the director and of two executives in charge of occupational safety, who managed, or should have managed, the Turin plant in which, on the night of 5-6 Decem- ber 2007, seven workers were killed in a fire.

A. Aimi, Il dolo eventuale alla luce del caso Thyssenkrupp, in Diritto penale contemporaneo, 2014, p. 1 ss.
767 the acceptance of the risk of the event34, in cases of conscious negligence the Article is considered relevant only if the conduct held, while relying on the non-implementation of the fact, was the result of a serious breach of precautionary rules.

The criminal discipline also helps in reference to the definition of the causal relationship between the conduct held by the insured, the contrac- tor or the beneficiary and the actual realization of the damage35.
In this sense, the most well-established doctrine is that of the conditio sine qua non, which over time has been accompanied by several corrective, which resort to a «process of mental elimination of conduct» to identify whether the conduct of the person was necessary for the occurrence of the event36.

The vision presented here is fundamental to resolve also issues arising from the presence of multiple cases in competition37.
Moreover, Article 40 paragraph 2 of the penal code states that not preventing an event that you have the legal obligation to prevent, is equivalent to causing it38.

This perspective can be found also in all those rules, present both in the Italian39 and in the Georgian40 civil code, on the obligation to rescue41.

34 Although the need to capture the c.d.

“psychological substance” of the agent poses many problems.
G. Losappio, Formula BARD e accertamento del dolo eventuale, in Diritto penale contempora- neo, 2017, p. 1 ss.

35 «No one may be punished for an act foreseen by the law as a crime, if the harmful or dangerous event, on which the existence of the crime depends, is not a consequence of its action or omission».

Even in cases of concurrent causes the causality relationship is not automatically excluded.

Codice penale ita- liano, articoli 40 comma 1 e 41, in www.normattiva.it; Cass.

Civ., Sez.
Civ., Sez.

III, 14 aprile 2005, n. 7763.

See also article 8 of the Georgian criminal code.

Criminal code of Georgia, article 8, in www.legislationonline.org 36 G. Fiandaca, E. Musco, Diritto penale, parte generale, cit., 241 ss.

; AA.

VV., Sinistri cagio- nati con dolo o colpa grave dell’assicurato o dei dipendenti, in Commentario breve al codice civile, a cura di G. Cian, Padova, 2020, 2049.
In the case of insurance contracts, all those measures which, by being part of the causal process, are likely to prevent the damage from being fully or partially realized, must be regarded as rescue measures.

Cass.

Civ., 28 gennaio 2005, n. 1749.

37 Codice penale italiano, articolo 41, in www.normattiva.it.

See also article 8 of the Georgian criminal code.


Criminal code of Georgia, article 8, in www.legislationonline.org 38 Codice penale italiano, articolo 40, comma 2, in www.normattiva.it 39 Codice civile italiano, ad esempio articolo 1914 ss., in www.normattiva.it The article referred to is inserted in the section on non-life insurance.
In Italy, as already mentioned, there is no a specific section devoted to accident insurance, which has opened a dispute on the interpretation of their col- location, according to the jurisprudence prevailing in life insurance and, according to the prevailing doctrine, in insurance against damages.

In addition, there are also intermediate positions that consider such contract as a tertium genus.

M. Irrera, E. Fregonara, M. Spiotta, Lineamenti di diritto assicurativo, cit., 206.
The rule referred to, even with all the necessary measures in specific cases, seems to be a sort of corollary of the provision that the insurer is relieved of liability if the accident is caused by intent or gross negligence of the insured, of the contractor or beneficiary.

40 Civil code of Georgia, ad esempio articolo 830, in www.ilo.org 41 To be understood as the duty of the insured to do everything possible to avoid or reduce the damage.

Cass., 29 maggio 1980, n. 3533.


768 The rules in question «therefore require the policyholder to conduct spe- cific action», pursuing the dual purpose of protecting the interest of the insurer and promoting the general interest in public order, in the preven- tion of accidents and in the limitation of their consequences, avoiding that the insurance contract becomes a means of profit42.
According to the prevailing doctrine and jurisprudence, this obliga- tion arises not as a result of the conclusion of the contract and of the in- surance cover, but rather as a result of the phase of materialisation of the risk43.
Moreover, the binding norm44 that states the costs incurred in order to avoid or reduce the damage shall be borne by the insurer, albeit in pro- portion and «unless the insurer proves that the costs have been incurred on an unreasonable basis»45 , provides further protection against the fact that the concern to incur in excessively expensive expenses become a hin- drance to the rescue effort46.
All the provisions examined above are therefore intended to prevent that the policyholder, the insured or the beneficiary, with the aim of mak- ing a profit on compensation, causes the harmful event voluntarily and, therefore, also to maintain public order47.

However, if the accident is the result of the behaviour of a third party of which the policyholder, but also the insured or the beneficiary, is not liable, obviously not determined by unlawful agreements otherwise the ratio of the norm would be lost.
In procedural terms, such a situation constitutes an impediment to the guarantee claim, so that the burden of proof of the presence of intent or gross negligence rests upon the insurer, unless otherwise provided for in the contract, in any case in compliance with the provisions of Article 2698 of the civil code.

The insurer may also produce evidence collected in criminal proceedings in civil proceedings48.
42 F. Arangio, D. Colangeli, G. Iorio, A. C. Marrollo, M. Palisi, M. Perreca, F. Santi, Obbligo di salvataggio, in Commentario al codice civile, a cura di P. Cendon, Milano, 2010, 498.; F. Peccenini, cit., 89.

43 S. Toffoli, Obbligo di salvataggio, in AA.

VV., Le assicurazioni, a cura di A.

La Torre, Milano, 2019, 259.

44 Codice civile italiano, articolo 1932, in www.normattiva.it 45 Codice civile italiano, articolo 1914 co. 2, in www.normattiva.it 46 F. Pecennini, Assicurazione, cit., 157.
47 A. Bracciodieta, Il contratto di assicurazione, disposizioni generali, Milano, 2012, 183.

48 F. Pecennini, Assicurazione, cit., 90.

«The terms under which the burden of proof is re- versed or modified shall be void where the rights of the parties are not available to them or where the reversal or modification has the effect of making it excessively difficult for one of the parties to exercise the right».
Codice civile italiano, articolo 2698, in www.normattiva.it; F. Arangio, D. Co- langeli, G. Iorio, A. C. Marrollo, M. Palisi, M. Perreca, F. Santi, Sinistri cagionati con dolo o colpa grave dell’assicurato o dei dipendenti, cit., 336.

769 3.

At transnational level A comparative analysis of foreign insurance legislation is character- ised by many problems.
In fact, although there are similar characteristics resulting from the presence of common economic objectives and harmon- isation processes, the subject of insurance is very influenced by the pecu- liarities of the context in which it is inserted49.
With regard to the Spanish legal system, are important the civil code50, in particular the libro cuarto (De las obligaciones y contratos), and the Ley 50/1980, de 8 de octubre, de Contrato de seguro, which dedicates the en- tire Sección tercera of the título III to the “seguro de accidents”51.
Here too there is a general requirement similar to the present one, in particular according to Article 17 of the law of 1980: «[t]he policyholder or the insured must use the means at his disposal to reduce the conse- quences of the accident» otherwise the insurer will be entitled to reduce the benefit in proportion to the extent of the damage and to the degree of fault of the policyholder52.
In addition, if the breach «occurs with the manifest intention of harming or deceiving the insurer, the insurer will be exempt from all the obligations arising from the event».

Also in this con- text, the costs arising from the fulfilment of the obligations in question are borne by the insurer up to the contractual limit and if not inadequate or disproportionate53.
In France, on the other hand, the discipline of insurance should al- ways be sought in the civil code54 and in the Code des assurances, also with a specific part dedicated to “Accès à l’assurance contre les risques d’invalidité ou de décès”55, which refers to the public health code56.

For what is of interest here, Article L113-1 states that the insurer is not liable for losses and damages resulting from the policyholder’s wilful intent57.
In addition, Article L113-11, according to which all the general clauses of loss of the benefit of the policyholder in case of violation of 49 R. Capotosti, Assicurazione, in Enciclopedia giuridica, Roma, 1988-2010, 1.

50 Real decreto de 24 de julio del 1889 por el que se publica el Código civil, in www.boe.es 51 Ley 50/1980, de 8 de octubre, de Contrato de seguro, in www.boe.es 52 S. Toffoli, Obbligo di salvataggio, cit., 267.
53 Ley 50/1980, de 8 de octubre, de Contrato de seguro, artículo 17, in www.boe.es 54 Code civil, in www.legifrance.gouv.fr 55 Code des assurances, in www.legifrance.gouv.fr 56 Code de la senté publique, in www.legifrance.gouv.fr 57 Code des assurances, article L113-1, in www.legifrance.gouv.fr 770 laws or regulations are void, unless such violation constitutes an unlawful act58.

«French law is noteworthy for not providing for the rescue obliga- tion.
This can be translated in contractual clauses providing as a penalty the forfeiture of the right to compensation (or the reduction of the same), which are considered valid only if properly precise and well-highlighted typographically»59.

In Switzerland, on the other hand, the most important texts are: the federal law of the completion of the Swiss civil code (book five: Law on obligations)60 and the federal law on insurance contracts61.
Article 14 of the federal law on insurance contracts relieve the insurer of any liability where the accident was caused intentionally by the policy- holder or the person entitled, whereas in cases of gross negligence it pro- vides for a proportionate reduction of the insurer’s obligations according to the degree of fault of the agent.
It should also be noted that this re- duction is also allowed when the accident is the result of the intentional or gross negligence of «the person living with the stipulating or entitled person» and of «the person whose acts they are responsible for, […] if the contracting party or the person entitled has committed serious negligence in the supervision of that person, either by taking her to his service or by admitting her to himself»62.
Variations are not allowed instead for slight fault and even if the per- sons considered above acted for the duty of humanity63.

In addition, the Swiss legislation also includes a rescue obligation64, and a regulation of rescue costs, which must be reimbursed by the insurer where not mani- festly inappropriate65.

58 Code des assurances, article L113-11, in www.legifrance.gouv.fr 59 S. Toffoli, Obbligo di salvataggio, cit., 266.
60 Legge federale di complemento del codice civile svizzero (libro quinto: diritto delle obbliga- zioni) del 30 marzo 1911, in www.admin.ch; Codice civile svizzero del 10 dicembre 1907, in www.
admin.ch 61 Legge federale sul contratto di assicurazione del 2 aprile 1908, in www.admin.ch 62 Legge federale sul contratto di assicurazione del 2 aprile 1908, articolo 14, in www.admin.ch 63 Legge federale sul contratto di assicurazione del 2 aprile 1908, articoli 14 comma 4 e 15, in www.admin.ch 64 Legge federale sul contratto di assicurazione del 2 aprile 1908, articolo 61, in www.admin.ch 65 Legge federale sul contratto di assicurazione del 2 aprile 1908, articolo 70, in www.admin.ch 771 4.
Final considerations Article 856 therefore plays a fundamental role in the discipline of the insurance contract, not only for the protection of the insurer’s interest, avoiding that the contract becomes a means of profit for the other party, but also of the general interest in public order, accident prevention and limitation of their consequences.
In fact, although the Article in question is placed within the frame- work of the accident insurance, as noted, there are similar articles, albeit with some nuances in terms of guilt, in the regulation of each specific insurance contract.

The conduct envisaged could be capable of excluding the obligations of the insurer even by reference to the general discipline of the obliga- tions, but the rule in question, like all other similar rules, respond to a need for legal clarity.
At this point, however, it seems appropriate to point out that, in order to minimise the possibility of doubts, thereby also con- tributing to the objective of deflating litigation, it would be appropriate to provide explicitly, with reference to each contract under examination, also obligations on the insurer when the event is determined by persons to whom the insured person is liable or when the event was committed for reasons of human solidarity or in the protection of the insurer’s com- mon interests, as is in Italy and in other country previously analysed.
772 Article 857 - Duty to notify accidents If the duties are to be performed for the benefit of the person entitled to benefits, then this person shall make a declaration about the accident.

This rule shall also apply to the duties of communicating information and handing over documents.

Sabrina Darbali Summary: 1.

Introduction.

2.

The Georgian Law.

3.

Comparison with French law.

4.

Comparison with Moroccan Law.

5.

Comparison with Canadian Law.

6.

Conclusion 1.


Introduction Since there is no such thing as zero risk, when an accident occurs, no matter how minor, we are constantly wondering about the possible con- sequences, particularly with regard to the duty to notify the accident, as well as the duty to communicate information and to provide documents.
The duty to notify an accident is a fundamental obligation of the In- sured, which is specific to this contract of good faith in which the Insurer must rely on the Insured’s statements to assess the risk that he will have to cover and to classify it in the risk categories listed in his statistics.

Since the insurance contract is a contract of successive performance which will be adapted to changes in risks which may occur, the Insured must declare any subsequent changes in the risk.

2.
2.

The Georgian law According to Article 857 on the duty to notify an accident (the fifth point entitled “Accident insurance”, chapter twenty “Insurance” - Civil Code of Georgia).

The purpose of Article 857 is to specify the duties to notify the accident, as well as the duties to provide information and doc- uments.

The insured has only one legal duty after the occurrence of the “acci- dent”, namely to report the event to the insurer.

Generally, this duty must be fulfilled within a specific time limit.
Fraudulent or late reporting of the accident may be sanctioned by forfeiture of coverage1.

1 The delay of the notification allows the insurer to apply the forfeiture, provided that it is foreseen in the contract and that it proves the reality of a prejudice.

773 When an accident occurs, the insured must notify the insurer within a certain period.
In fact, the insured has the duty to notify the insurer, as soon as he/she becomes aware of it and at the latest within the time limits fixed by the contract, of any claim likely to entail the insurer’s guarantee.

The deadlines may be extended by mutual agreement between the con- tracting parties.

This provision is of public order2.

The parties may not derogate from it, except in a way that is more favorable to the insured, i.e.

by extending the time limits.


The declaration of the accident presupposes two facts: firstly, that the risk has indeed occurred and secondly, that it falls within the scope of the insurance cover.

Thus, an excluded risk does not have to be reported.

On the other hand, when the two facts are met, the insured must declare the accident to the insurer because it is he who bears the consequences.

He must be informed quickly in order to defend his interests as best as possi- ble.
The insurer is therefore at the mercy of the insured.

Indeed, only the insured can assess whether the event will trigger the guarantee, since only he knows about it and can determine whether the event must be reported or not.

3.

Comparison with French law Article L 113-2-4° of the French Insurance Code states that: «the time limit for reporting an accident may not be less than five working days.

[...] The above deadlines may be extended by mutual agreement between the contracting parties».
For the Court of Cassation3, the insured must notify the claim as soon as he is aware of two elements.

First, the event constituting the loss, but also the possible harmful consequences likely to entail the insurer’s coverage.

This second element is much less objective than the first and leaves a margin of appreciation that is all the more important given that the consequences that need to be assessed are future.
However, in order for the insured to declare the event quickly, without waiting to know with certainty whether or not the consequence is actually harmful to the insur- er, the Court specified that the insured «has a duty to investigate, to the extent of his means, the immediate consequences and those which could be conjectured».

Thus, the Court of Cassation admitted that an insured 2 The legal reporting deadlines are public policy, meaning that the parties can extend them but not shorten them.

3 Cass.
3 Cass.

1re ch.

civ.

21 June 1985, n° 86-15.439, n° 773, “ Rgat “ 1988, p. 558, note Kullmann.

774 could be unaware of the harmful consequences of an accident because the victim seemed to have no injuries after the impact and returned home by his own means4.

Nevertheless, the insured does not have to wait for a possible claim from the victim to report the loss.

However, nothing prevents the company from stipulating in the policy that the declaration must be made at the time of the claim.
There is then no doubt as to the harmful consequences of the loss.

Moreover, such a stipulation is favor- able to the insured since it extends the legal time limit for notification5.

Concerning the form of the accident declaration, article L 113-2-4 of the Insurance Code does not impose any particular form for the accident notification and the insurer cannot require one form to the exclusion of another.
However, it should be noted that in the case of damage insurance, the insured must make his declaration in writing, either against a receipt or by registered letter with acknowledgement of receipt (Article A 243-1, Annex II of the Insurance Code).

In other insurance policies, the notifica- tion can therefore be made by simple letter, but also by telegram or tele- phone.
However, it is obvious that the insured has a particular interest in providing proof of sending the notification, as this proof is incumbent on him/her when the insurer disputes having received it.

According to article 1315 of the Civil Code, «he who claims the performance of an obligation must prove it».

Conversely, a person who claims to be discharged must justify the payment or the fact that produced the extinction of his duty.
Thus, when the insured proves that he or she has made the declaration, or that this point is not contested, it is up to the insurer who claims that the declaration was sent late to provide proof.

Regarding the reporting of accidents to the authorities, the only legal duty of the insured after the accident is to report the event to the insurer.

However, the policy may include other duties.

For some coverages, the 4 Cass.

soc, February 24, 1965, n° 63-12.345, n° 233, “ Rgat “ 1996, p. 472.
5 The insured must notify the accident as soon as he/she becomes aware of it, so as to allow the insurer to make the necessary investigations.

However, article L 113-2 of the Insurance Code pro- vides for minimum time limits to allow the insured to make a claim.

The insurer cannot therefore set shorter time limits.

The common law time limit for reporting a claim cannot be less than five working days.

Saturdays, Sundays and public holidays are therefore not taken into account.
This period is reduced to two working days for theft and twenty-four hours for livestock mortality.

According to article L 123-1 of the Insurance Code, it is four days for damage caused by hail.

Finally, claims due to natural disasters must be declared within ten days of the publication of the ministerial order recognizing the state of natural disaster (Article A 125, Annex I (e) of the Insurance Code).

There is no time limit for life insurance.


The jurisprudence has specified that the day of the disaster does not count.

The time limits therefore only start to run from the day after the accident occurred, or the day the insured became aware of it.

775 insured must report the accident to the authorities.

Thus, the delay in the execution of these contractual duties is sanctioned according to the rules of common contract law.
Article L. 113-11 of the Insurance Code prohibits forfeiture in the event of delay in reporting to the authorities.

The only sanction allowed for such breaches consists of compensation proportional to the loss suffered.

The damages can then be offset against the indemnity due to the insured.

4.
4.

Comparison with Moroccan Law The Moroccan Insurance Code imposes a number of duties on insur- ers with regard to the management and compensation of accident cases, and the insured is required to declare the occurrence of the accident in question.
Thus, Article 12 of the Moroccan Insurance Code sets out the in- sured’s duties at the time of subscription with regard to the declaration of the accident and other insurance policies covering the same risk, while specifying the conditions and modalities of the declaration to be made in the event of a claim.

Therefore, in the first letter you will receive from your insurer after the declaration, the insurer must decide whether you are entitled to full or partial compensation.
If you are partially entitled to compensation, the insurer must explain to you why it is holding you responsible.

It is also important to know that the insurers have signed an agree- ment with each other which regulates the rules of sharing according to the circumstances of the accident.

Thus, it happens that even when you are not responsible, but because the circumstances of the accident make it fit in such or such other case, your insurer retains you a share of respon- sibility.
You are under no duty to accept this.

If you believe that you are not at fault for the accident, you will have to contest the insurer’s decision and provide all the necessary explanations to allow him to re-evaluate your case.

The insurer must also tell you on behalf of which insurer it is acting, the time limits for compensation, your duties as a victim, etc.
In Morocco, there are two distinct classifications of the duty to report accidents, I will mention the duty to report accidents at work (or work accident) and traffic accidents.

776 — The « work accident » insurance.

In Morocco, work-related accidents are currently subject to Law No.

18-12 on compensation for work-related accidents.


Promulgated in 2015, this law introduced, for the first time in Morocco, the mandatory conciliation procedure between the insurance company and the victim, the revision of certain indemnities and the adaptation of the civil procedure.

It also defines the declaration procedure, rights and duties of the parties involved.
All employers subject to the provisions of the Dahir of July 27, 1972 relating to the social security system are obliged to subscribe to an “occupational accident” insurance.

The same applies to local authorities and public establishments not covered by the civil service or the social security system.
Workplace accident insurance is a liability insurance policy taken out by the employer for the benefit of his employees to cover them against the risks they incur in the course of their professional activity.

— In case of a « traffic accident/car accident ».


When the insured is the victim of a traffic accident, whether he is responsible or not, victim or passenger of one of the vehicles involved, if the police forces are not called to the scene of the accident, the first act to be done is to fill in the accident report form.

A good accident report is the guarantee of a good compensation procedure.
Check the boxes corresponding to the circumstances of the accident, make a sketch and give all the necessary explanations on the front of the form.

When the police or the gendarmerie are called to the scene of the traffic accident, the officers will record the identities of the persons involved in the accident and of any witnesses.
When the accident has only resulted in minor injuries, the police officers will often write a handout, indicating the identity of the parties and the circumstances of the accident;6 when the injuries are serious, they will write a police report.

In some cases, there is an investigation that can lead to proceedings before the Criminal Court, if serious offences are found.
6 In the event of an injury, even a minor one, it is strongly recommended that you consult a doctor or an emergency room as soon as possible in order to obtain an initial medical certificate de- tailing your injuries and pain.

If the pain does not appear until much later, it is also recommended to consult a doctor who must establish in his certificate the link between the accident and the pain you describe or the injuries that were diagnosed late.
777 The joint report or the handrail must be sent to the insurer within 5 days from the day of the traffic accident.

But before sending one of these documents, it is possible to make an accident declaration by means of a telephone call.

Then, to be attached with the statement, all documents useful for a better understanding of the circumstances of the traffic acci- dent (photo of the accident site, identity of witnesses, medical certificate or hospitalization certificate).
Upon receipt, the insurer will determine the responsibilities of each party.

To avoid any difficulties, it is therefore important to pay particular attention to the drafting of the report.

5.

Comparison with Canadian Law (Province of Quebec) The main provisions which the legislator deemed as appropriate to enact with respect to the duty to declare an accident are, for the most part, set out in the Civil Code, and more particularly in articles 2485 to 2489 of that Code.
We must also add to these rules section 240 of the Quebec Insurance Act.

The principles set out in this section impose on the insured the duty to inform the insurer of all facts and circumstances that may have an influ- ence on his opinion of the accident.

It is clear that this is a very subjective dimension of the mandatory regime of the initial declaration of accident and that, moreover, it is far from being in the insured’s favour.
The rea- son for this is that at the time of codification, the insured was in a better position than the insurer with respect to the perception of the accident in question.

The imbalance at that time, however, has been significantly reduced due to the professionalism of the insurer.

Consequently, the dis- closure of a claim today appears to be a joint effort by the insurer and the insured, an effort that must be marked by mutual cooperation.
The provisions of the Civil Code were enacted as part of a unitary approach to the duty to disclose.

Their legislative framework is an elo- quent testimony to this and leaves no doubt about it.

These provisions are located in Division 2 of Chapter 1 of the Title of Insurance and Chapter 1 is entitled “General Provisions”.

If the Quebec legislator had wanted to particularize the initial acci- dent notification regime according to the type of insurance contemplated, he would not have done so.
The intention of the Quebec legislator is clear.

In fact, it was clearly expressed in article 2503 of the Civil Code with re- spect to marine insurance, article 2568 of the Civil Code with respect to 778 fire insurance, and article 2585 of the same code with respect to life insur- ance, where it was stated that the provisions of Chapter 1 of the Insurance Title generally applied to these types of insurance insofar as they were not incompatible with their specific provisions.
For example, article 2485 of the Canadian Civil Code sets out the facts that must be reported to the insurer in the event of an accident, and it re- fers to three types of facts: a.

Those which may indicate the nature and extent of the accident (risk); b.

Those which may influence the insurer not to assume the claim in question; c. Those which affect the premium rate.
The insured must therefore declare to his insurer either the facts which indicate the nature and extent of the accident and which may prevent him from assuming it, or the facts which indicate the nature and extent of the accident and affect the rate of the premium.
This is, at the very least, an inconsistent provision; and the signifi- cance of the inconsistency is that there are facts that may prevent a partic- ular insurer from assuming an accident even though they do not affect the nature and extent of the risk.

6.

Conclusion As a party to the insurance contract, the insured, like the insurer, owes several duties.

In addition to the payment of the premium, the insured is also subject to reporting duties.
These obligations are provided for in several laws and insurance codes world wide.

The accident declaration is the account given by the insured of the accident he caused or of which he is a victim.

Insofar as this statement contains a statement of the facts, it can, in certain circumstances, be con- sidered as an admission.
According to established case law, a confession is a unilateral act from which evidence can be deduced and which must be made by the party against whom it is made, but which must not be intended to serve as evidence for the opposing party.
Thus, according to all the legislation studied in the Countries chosen for this comparative comment, the duty to report an accident is of con- siderable importance, insofar as its examination conditions the insurer’s 779 decision as to whether or not to pay for an accident, and the beneficiary of an insurance contract is under a duty to report claims to the insurer as soon as he is aware of them and at the latest within the time limit set out in the insurance contract.
Therefore, most insurance laws require the insured to notify the in- surer in case of an accident.

This duty is justified because the insurer has a legitimate interest in being informed as soon as possible of the accident; he must know the circumstances and the consequences.

The declaration of the accident, in that it describes the facts, can be considered as an ad- mission made by the insured.

Once the accident has taken place, the insurer will bear the burden of the loss.
A quick and accurate information is therefore necessary to allow the insurer to take all necessary measures to verify and evaluate the extent of the accident.

Georgian law is in line with these standard and complies with the in- ternational state of the art.

780 Article 858 – No right of recourse The policyholder has no right of recourse against the person who is liable for the damage.

Giorgi Amiranashvili Summary: 1.

Introduction.

2.

The Essence of the Principle of Subrogation.

3.


Separation of Subrogation from Similar Institutions.

4.

The Current Version of Article 858 and its Shortcomings.

5.

Concluding Remarks.

1.

Introduction Insurance provides compensation for damage caused to a natural or legal person under the influence of various harmful factors.

Harmful fac- tors can be destructive forces of nature, as well as negative factors of so- cio-economic nature, etc.
Insurance can be considered as an important civil legal guarantee for the protection of the rights of participants in civil turnover1.

The origin of the insurance relationship between the insurer and the insured person is based on a contract.

In this case, the parties relate the existence of certain circumstances (the occurrence of the insurance case) to the outcome of the agreement, i.e.

it deals with a conditional trans- action2.


After the occurrence of an insurance accident, a relationship aris- es between several parties, and the injured person acquires the right to claim the same damages from two different persons simultaneously: From a third party who is liable for the occurrence of the insured event and from the insurer who has incurred the insurance indemnity under the contract3.
There is a problem of legal redistribution of liabilities between the insurer, the policyholder, and the third party causing the damage4.

1 M. Tsiskadze, Legal Regulation of Voluntary Insurance, Meridiani Publishers, Tbilisi, 2001, 5 (in Georgian).

2 G. Amiranashvili, Claim for Damages Asserted Against a Third Person (Analysis of the Ar- ticle 832 of the Civil Code of Georgia), in Justice and Law, 1(40)’14, 92 (in Georgian).
3 N. Motsonelidze, Subrogation as Means of Insurer’s Claims Satisfaction, Meridiani Publish- ers, Tbilisi, 2016, 9 (in Georgian).

4 Ibid.

781 2.

The Essence of the Principle of Subrogation “Subrogation” is a word of Latin origin (subrogare), which means the replacement of one object by another5.

It is used to describe the process by which one party takes the place of another person so that he/she can exercise the latter’s rights over a third party in his/her favor6.
For example, if “A” damages “B’s” property and at the same time “B” is insured, the insurance company will pay “B” and the latter’s tort claim against “A” should be transferred to the company.

Hence, subrogation can be seen as a means of avoiding unjust enrichment of “A”7.

It is true that the Georgian lawmaker does not use this term in the Civil Code but substantively reinforces it in Article 832.
According to the first sentence of paragraph 1 of this article, «[i]f the policyholder can assert a claim for damages against a third party, then the claim shall be transferred to the insurer if it pays the damages to the policyholder».

Such a transfer of the right to claim is known as the principle of “sub- rogation”8.

3.
3.

Separation of Subrogation from Similar Institutions Through subrogation, instead of the policyholder, the insurer has the right to claim compensation for the damage caused by the insurer’s prop- erty interest encroached within the issued insurance indemnity9.

In this case, the content and nature of the obligation do not change, because the obligation to compensate the damage caused by a third party, i.e., the person who caused the damage, arises within the framework of a tort.
The one thing that is changed is the creditor.

No new claim arises, only the creditor changes.

To be clear, the affected policyholder is re- placed by the insurance company.

In such a case, there is an assignment of claims (cession), which is regulated in Article 199 of the Civil Code of Georgia10.

5 G. Amiranashvili, Right of Subrogation Disallowed (Legislative Improvement Issues of the Article 858 of the Civil Code of Georgia), in The Student Law Journal, 2011, 19 (in Georgian).

6 Ibid.

7 Ibid.
6 Ibid.

7 Ibid.

8 M. Tsiskadze, Article 832, in Commentary to the Civil Code of Georgia, Volume 4, Law of Obligations, Special Part, Part II, Samartali Publishers, Tbilisi, 2001, 153 (in Georgian).

9 G. Amiranashvili, Right of Subrogation Disallowed (Legislative Improvement Issues of the Article 858 of the Civil Code of Georgia), cit., 21 (in Georgian).

10 Ibid.

782 One of the important differences between subrogation and cession is that during cession an agreement is made to cede the right to claim.
In case of subrogation, the transfer of rights takes place not by the agree- ment, but by the payment of insurance premium in the event of an in- sured accident, this payment is made by the new creditor to the original one.

Consequently, the cession is carried out as a result of the will of the creditor, while the subrogation takes place by the force of law.
Thus, sub- rogation differs from ordinary cession in that the transfer of claim takes place not on the basis of an agreement but on the basis of law11.

It is also important to define the different meanings of the right to re- course and subrogation when analyzing the Article under consideration.

The notions of subrogation and the right to recourse are unsystematically and vaguely established in the insurance regulations of the Civil Code.
For insurance doctrine and practice, it is essential to separate these two institutions and determine their interdependence12.

It is also important to note that subrogation is one of the most com- mon forms of recourse claims.

The right to recourse as a legal institution has been narrowly defined by the Supreme Court.

This is evidenced by the meaning of the word recourse – reverse and includes the right of re- course arising both through a change of creditor and on the basis of a new obligation13.
The difference between subrogation and the right of recourse is that during the latter, not the person is replaced in an existing obligation, but the tort is terminated, and a new obligation arises.

In case of recourse, one obligation replaces another, and in case of subrogation, only the creditor is changed, while the obligation itself remains unchanged14.

According to the Supreme Court of Georgia, Article 832 does not provide for the right of recourse.
As stated by the Court of Cassation, this regulation envisages a change of creditor in a tort liability and not the right to recourse, because the essence of the obligation itself remains unchanged15.

11 Ibid.

12 K. Iremashvili, Article 858, in Online Commentary of the Civil Code, https://gccc.tsu.ge/, 16.03.2016, 2 (in Georgian).

13 R. Rogava, Scope of Transfer of the Right to Claim Damages to the Insurer and its Limita- tion Period, in The Student Law Journal, 2013, 20 (in Georgian).
14 G. Amiranashvili, Right of Subrogation Disallowed (Legislative Improvement Issues of the Article 858 of the Civil Code of Georgia), cit., 21 (in Georgian).

15 K. Benashvili, The Principle of Subrogation in the Civil Code of Georgia and its Relation to 5, 2018, 96 (in Georgian).
the Compensation of Damages by Recourse and Cession, in ALFG Journal, № 783 This provision does not exclude the unity of the functional purpose of the institutions of subrogation and recourse, which is reflected in the reimbursement of the insurance indemnity (which is at first issued by the insurer), carried out by the debtor responsible for the damage16.
Scientists agree that subrogation and the right to recourse have com- mon signs17, namely, there are varieties of both claims that are aimed at getting the money back18.

The formal basis for the origin of both relations is the law, and as for the material basis, it is the performance of an obliga- tion by a third party.

The purpose is to prevent the unjust enrichment of either party to the relationship of obligation19.

In case of both recourse and subrogation, the creditor loses the right to claim.
In an event of recourse, this is due to the emergence of a com- pletely new, independent legal relationship with the new parties, where the obligation in which the party was a creditor is only a prerequisite for the emergence of a new legal relationship.

In an event of subrogation, the creditor leaves the legal relationship and is replaced by a person who has performed the obligation in his/her favor20.
As it is known, the subject of a pledge can be not only a thing, but also intangible property, such as a demand.

Its peculiarity lies in the fact that the latter is not a physically tangible object.

Therefore, when the debtor performs the obligation early, the pledged demand should be replaced by something else.

In the Civil Code such an event is called “Substitution”.21 4.
The Current Version of Article 858 and its Shortcomings Article 858 of the Civil Code of Georgia (No right of recourse) is used in case of accident insurance.

As of today, this Article is worded as follows: «[t]he policyholder has no right of recourse against the person who is liable for the damage»22.

16 G. Amiranashvili, Right of Subrogation Disallowed (Legislative Improvement Issues of the Article 858 of the Civil Code of Georgia), cit., 22 (in Georgian).
17 N. Motsonelidze, Subrogation as Means of Insurer’s Claims Satisfaction, cit., 171 (in Geor- gian); N. Motsonelidze, Separation of Subrogation from Regress and Cession, in Journal of Law, 1, 2014, 159 (in Georgian).

№ 18 Ibid.

19 Ibid.

20 Ibid.

21 G. Amiranashvili, Right of Subrogation Disallowed (Legislative Improvement Issues of the Article 858 of the Civil Code of Georgia), cit., 22 (in Georgian).

22 Ibid.
22 Ibid.

784 It turns out that if the injured person is insured against an accident and he/she receives the insurance premium from the insurance company or it is given to the beneficiary, then the policyholder has no right to file a recourse claim against the encroaching and claim damages.

Thus, the policyholder has no right to claim double compensation for the damage caused by the accident23.
In determining the purpose of the norm under consideration, it was necessary to focus on the subject of restriction of the right of recourse.

According to Article 858, such a subject is a policyholder.

However, with a literal explanation of the norm, the goal that the lawmaker should logi- cally reach cannot be achieved in this case.

Therefore, the conclusion that the lawmaker refers to the insurer instead of the policyholder should be thoroughly considered24.
Unfortunately, it is impossible to agree with the expressed opinion, according to which an error in Article 858 of the Civil Code of Georgia is only in one word.

In particular, according to this view, at the beginning of the norm, instead of the word “policyholder” there should be an “insured person” (beneficiary)25.

This view is less responsive to the inaccuracies that actually exist in this norm.
It is true that the law distinguishes between “insurer”, “in- sured” and “beneficiary”, but in this case, it is not a matter of a termino- logical error, since these concepts are considered in a unified context in the legal literature within the framework of the relations under consid- eration26.

The problem lies in something completely different.

To begin with, the title of Article 858 is “No right of recourse”.
It is necessary to deter- mine the linguistic meaning of the words of the law and for what purpose the lawmaker uses them27.

What meaning can the word “recourse” be given in this case?

Ac- cording to this title, there is an expectation that this word would imply a 23 M. Tsiskadze, Article 858, in Commentary to the Civil Code of Georgia, Volume 4, Law of Obligations, Special Part, Part II, Samartali Publishers, Tbilisi, 2001, 179 (in Georgian).

24 K. Iremashvili, Article 858, cit., 1 (in Georgian).
25 G. Amiranashvili, Right of Subrogation Disallowed (Legislative Improvement Issues of the Article 858 of the Civil Code of Georgia), cit., 23 (in Georgian); N. Niavadze, Subrogation and Recourse in Insurance Law (Comparative Legal Analysis), Tbilisi, 2012, 40 (in Georgian).

26 G. Amiranashvili, Right of Subrogation Disallowed (Legislative Improvement Issues of the Article 858 of the Civil Code of Georgia), cit., 23 (in Georgian).

27 Ibid.
27 Ibid.

785 recourse obligation since the word should be used in the sense given to it by a particular legal system28.

In addition, attention should also be paid to syntactic connection, i.e.

the interdependence of individual words of the norm.
The meaning of the word used in the norm should be clarified not in isolation, but in connec- tion with the text (context).29 Therefore, it should be analyzed to what extent the policyholder may have the right of recourse against the person liable for the damage.

If the life or health of the insured persons has been damaged, they should have the right to claim tort liability rather than recourse against the person who caused the damage.
It should be noted that such an error is not typ- ical for only Georgian reality, as some Russian authors also believe that subrogation is manifested in the insured person’s right to recourse30.

For a thorough analysis of the above definitions, two distinct compo- sitions should be considered separately.

On one hand, it is possible to as- sume that the lawmaker would prohibit the insurer from receiving double compensation.
Restriction of the right to file a claim against the person who caused the damage to the policyholder is admissible if he/she has al- ready received compensation from the insurer.

However, in such a case it is unclear on what grounds the lawmaker refers to the insurer’s tort claim as a right of recourse against the person causing the damage.
It is also highly necessary to find out more about the connection between such kind of definition of the norm and personal insurance that is established by the Georgian court practice31.

In the given formulation, if it is assumed that the right of the insurer to recourse is meant in the norm, it will not bring the right results either, as this would be an indication that the insurer had compensated the in- jured person and thus replaced the person who caused the damage.
The insurer who has given the insurance indemnity to the injured person does not change the person who caused the damage, but fulfills its obligation to the injured party, according to the insurance contract32.

28 Ibid.

29 G. Khubua, Legal Theory, Meridiani Publishers, Tbilisi, 2015, 187-188 (in Georgian).

30 G. Amiranashvili, Right of Subrogation Disallowed (Legislative Improvement Issues of the Article 858 of the Civil Code of Georgia), cit., 23 (in Georgian).
31 K. Iremashvili, Article 858, cit., 1 (in Georgian).

32 G. Amiranashvili, Right of Subrogation Disallowed (Legislative Improvement Issues of the Article 858 of the Civil Code of Georgia), cit., 23 (in Georgian).

786 In the wording of Article 858, the lawmaker presumably refers to the insurer and, in case of personal insurance, indicates the restriction of his/ her right of subrogation.

Such reasoning is consistent with the Georgian practice and, in general, the legal nature of personal insurance.
In this re- gard, it is worth considering the Court’s reasoning that the definition of Article 832, as the norm regulating special relations, for the purposes of analogy in life insurance does not meet the objective purposes of the law33.

It is well known that the law is based on some kind of purpose.

It is necessary to find out the objective purpose of the law.

A literal definition of the text may conflict with the purpose of the norm34.
The law is unified insofar as its constituent norms are logically con- nected with each other and form a unified system.

Accordingly, the law should be perceived in conjunction with other norms and not in isola- tion35.

In Article 858, the lawmaker implies the principle of subrogation, i.e.

this norm relates to Article 832, but in this case, different legal conse- quence arises.

As already mentioned, the term “recourse” is misused in relation to the policyholder.
If the policyholder has suffered damage, he/ she does not need recourse to anything because he/she can claim tort lia- bility.

The insured person itself needs compensation.

It turns out that the company should have the right of subrogation against the encroaching within the scope of the insurance indemnity, and this is probably the cor- rect content of Article 858, but it is interesting why the lawmaker prohib- its the exercise of this right36.
Article 832.1 states that if the policyholder can file a claim for dam- ages against a third party, then that claim transfers to the insurer if it re- imburses the insured for the damage.

If the policyholder renunciates its claim or the right to secure a claim against a third party, then the insurer shall be released from the obligation to reimburse the amount of money for damages it could have received in respect of the right to reimburse its costs.
Such a transfer of the right of claim is known as the principle of “Substitution”37.

33 K. Iremashvili, Article 858, cit., 1 (in Georgian).

34 G. Khubua, Legal Theory, cit., 193 (in Georgian).

35 Ibid.

36 G. Amiranashvili, Right of Subrogation Disallowed (Legislative Improvement Issues of the Article 858 of the Civil Code of Georgia), cit., 24 (in Georgian).

37 M. Tsiskadze, Legal Regulation of Voluntary Insurance, cit., 45 (in Georgian).
787 Article 832.2 also regulates the case when the policyholder was harmed by a family member.

According to this norm, if the policyholder’s right to compensation for damages applies to the family members living with them, then the transfer of the right is unacceptable if the family member intentionally caused the damage38.
If during the insurance against damages (Article 832 of the Civil Code) the insurer has the right to first pay the insured person and then demand the encroacher to pay for damages (on the basis of subrogation), there is a different rule in personal insurance.

In particular, under the rule of insurance law, the principle of subrogation does not apply to a personal insurance contract.
This means that the insurer is not entitled to issue an insurance premium to reimburse the costs incurred for the life or health of its policyholder and then claim that amount from the encroacher.

This is due to the peculiarities of personal insurance, which means that in- surance assessment is practically impossible here, as life and health are invaluable.

In addition, the limit of the amount of money is not restricted, as the restrictive norms by which the insurance against damages was initi- ated (Art.
820-822 of the Civil Code) do not apply in this case, therefore its determination depends on the agreement of the parties.

The persons decide for themselves within what amount to insure his/her life or health.

The risk of being overpaid (both from the insurance company and the en- croacher) is less in personal insurance.
Accordingly, the content of Article 858 should be that, in case of life and health insurance, the insured person should not have the right to subrogate the person liable for the damage39.

And lastly, the title of the Article should be defined as “No right of subrogation”.
To formulate the content of the article, let’s recall Article 832 of the Civil Code, according to which, «[i]f the policyholder can as- sert a claim for damages against a third party, then the claim shall be trans- ferred to the insurer if it pays the damages to the policyholder».
Based on an analysis of the unity of both of the above mentioned articles, Article 858 can finally be formulated as follows: «[i]f the policyholder can assert a claim for damages against a third party, this claim does not transfer to the insurer, if it compensates the policyholder for damages»40.

38 Ibid.

39 G. Amiranashvili, Right of Subrogation Disallowed (Legislative Improvement Issues of the Article 858 of the Civil Code of Georgia), cit., 24 (in Georgian).

40 Ibid.

788 5.
40 Ibid.

788 5.

Concluding Remarks Finally, it can be said that despite some shortcomings, the Geor- gian legislation shares the experience of developed countries in terms of strengthening the rule of subrogation and determining the scope of its action, however, it is necessary to eliminate the existing shortcomings to make better use of this principle in insurance41.

41 Ibid.
41 Ibid.

789 THE POLITICAL SCIENCE DEPARTMENT OF THE UNIVERSITÀ DEGLI STUDI DELLA CAMPANIA “LUIGI VANVITELLI” THE FACULTY OF LAW OF IVANE JAVAKHISHVILI TBILISI STATE UNIVERSITY COMMENTARY ON GEORGIAN INSURANCE LAW ANDREA BORRONI (GEN.

ED.)

IN THREE VOLUMES C