Court Opinion

ID: 9851046
Source: CourtListenerOpinion
Date Created: 2023-09-24 05:06:34.115784+00
Date Added: 2024-06-11T09:20:47.788473
License: Public Domain

Deen, Judge.
The jurisdiction of the juvenile courts of this State extends only to minors domiciled in the county where the court is located. Hampton v. Stevenson, 210 Ga. 87 (1) (78 SE2d 32); Ingle v. Bubenstein, 112 Ga. App. 767, 768 (146 SE2d 367); Whitman v. State, 96 Ga. App. 730 (1) (101 SE2d 621). The suspension of the minor’s driving license by the Juvenile court Judge of Clarke County was void, the insured and her son being residents of Oconee County. However, although the suspension was void, the license was as a matter of fact suspended, there was no appeal from the judgment, it was complied with, and therefore the statement in the application for insurance that no license or permit to drive had been suspended was in fact inaccurate.
Nevertheless, if the insured’s position is correct the judgment in her favor should be sustained. It is obvious from the application itself that the insurance agent was given and wrote down the pertinent data about the son’s collision, which collision *584was the reason for the juvenile court proceeding referred to above.
As succinctly stated in Reserve Life Ins. Co. v. Bearden, 96 Ga. App. 549 (1) (101 SE2d 120), even though the application is attached to and a part of the policy, and even though there is a material misrepresentation therein such as would be sufficient to avoid the policy under present Code. Ann. § 56-2409 (2) and (3), and even though there is a limitation on the authority of the agent in the policy to waive any provisions of either, unless there is a limitation on the authority of the agent in the application itself sufficient to put the proposed insured on notice of the limitation on the authority of the agent, the general rule applies that the knowledge of the agent is the knowledge of the principal. The principal, to whom is imputed the actual knowledge of the agent, is then barred from the otherwise valid defense of misrepresentation. “Where, under such conditions . . . not involving actual fraud [i.e. collusion between agent and insured], an insured makes a false statement on an application for insurance of which, the agent of the insurance company has actual knowledge, this knowledge is imputed to the insurer, who is thereafter estopped from urging this defense.” Id., p. 551 and cit. This was specifically affirmed on certiorari in Reserve Life Ins. Co. of Dallas v. Bearden, 213 Ga. 904 (102 SE2d 494) with the statement: “[T]he ruling by the court, as set out in the first headnote and the corresponding division of the opinion and upon which error is assigned, is supported by and in harmony with the prior decisions of this court, viz., Mechanics & Traders Ins. Co. v. Mutual Real Estate &c. Assn., 98 Ga. 262 (25 SE 457); German-American Mutual Life Assn. v. Farley, 102 Ga. 720 (1) (29 SE 615); Johnson v. Aetna Ins. Co., 123 Ga. 404 (51 SE 339, 107 ASR 92); Metropolitan Life Ins. Co. v. Hale, 177 Ga. 632 (170 SE 875); John Hancock Mutual Life Ins. Co. v. Yates, 182 Ga. 213 (185 SE 268).”
It thus appears that if an insured makes a false • statement on ah application for insurance of which the agent of the insurance company has actual knowledge, this knowledge is imputed to the insurer, who is thereafter estopped from urging this defense. Johnson v. Aetna Ins. Co., 123 Ga. 404 (2), supra; National Life *585&c. Ins. Co. of Tenn. v. Sneed, 40 Ga. App. 131 (149 SE 68); Ocean Accident &c. Corp. v. Howell, 46 Ga. App. 69 (166 SE 678); John Hancock Mut. Life Ins. Co. v. Yates, 50 Ga. App. 713 (179 SE 239); Rhodes v. Mutual Benefit Health &c. Assn., 56 Ga. App. 728 (194 SE 33); Reserve Life Ins. Co. v. Bearden, 96 Ga. App. 549, supra.
Although a limitation on the authority of the agent to waive the provisions of the insurance contract, when it appears on the face of the application, makes any effort of the agent to waive a provision ineffective, there is no limitation of authority on the application in this case. New York Life Ins. Co. v. Patten, 151 Ga. 185 (106 SE 184); Reserve Life Ins. Co. v. Bearden, 96 Ga. App. 549, supra. The chief reason for the majority rule that an insurer cannot rely upon the falsity of answers inserted in an application for insurance by its own agent in response to questions correctly answered by the insured, is the protection of the insured who has acted in good faith and answered the inquiries correctly. The insurer, to protect itself, need only to select competent and trustworthy agents. The company which makes it possible in the first instance for the agent to perpetrate a fraud should suffer, rather than the other innocent party to the contract. See 17 Encyclopedia of Georgia Law 679, § 370.
In cases involving applications where there is no limitation of authority of the agent as well as cases where there is no application, these two types must be treated differently from the type cases where there is a limitation of authority of the agent contained in the application. In one type the applicant and prospective insured has no notice from the insurance company of this act of placing a limitation on the agent and in the other type case the applicant is put on notice that he is dealing with a limited agent. This court has recognized the difference in some cases and has ignored the difference in others. McLemore v. Life Ins. Co. of Ga., 117 Ga. App. 155 (1) (159 SE2d 480) states: “A life insurance company, by. an express provision in the application for insurance, may define and limit the .power of a mere soliciting agent; and one dealing-with such agent cannot set up a waiver which he knew the agént had no power to make.” Beale v. Life & Cas. Ins. Co. of Tenn., 113 Ga. App. *586506 (148 SE2d 474): “In view of this express limitation - on the authority of the agent contained in the application for insurance, the knowledge-of its agent would not be imputable to the defendant insurance company - and would not constitute a waiver by or estoppel against the insurer of the defense of material misrepresentation.” These particular-type cases -recognize written limitations of authority in the application and generally follow the rule in New York Life Ins. Co. v. Patten, 151 Ga. 185 (106 SE 183): ‘‘[I]n view of the express limitations upon the power of the soliciting agent who received the ■ application and who made manual delivery of the policy, the knowledge of such agent is not imputable to the insurer.” In the other type cases where there is no notice of a limitation of authority to the applicant, the correct rule is as enunciated by the Supreme Court in Metropolitan Life Ins. Co. v. Hale, 177 Ga. 632, supra. The question involved in Hale is: “[W]ill the company, by virtue of having issued the policy with such knowledge on the part of its agents or physician or both, be deemed to have waived such condition or be estopped to claim a forfeiture on account of the breach thereof?” (Emphasis supplied). The court answered this question in the affirmative citing Johnson v. Aetna Ins. Co., 123 Ga. 404 (2) (51 SE 339): “ ‘Limitations in an insurance policy upon the authority of the agent of the company to waive the conditions of the contract of insurance are to be treated as referring to waivers made subsequently to the issuance of the policy.’ ”
The case of State Farm Mut. Auto. Ins. Co. v. Anderson, 107 Ga. App. 348 (130 SE2d 144), involves an application for insurance that did not contain a limitation of the agent’s authority but yet the harsh rule which heretofore had been reserved for the cases where the applicant had been put on notice of a limitation of authority was involked. Brannon v. Allstate Ins. Co., 120 Ga. App. 467 (171 SE2d 319) involved the same situation as in State Farm Mut. Auto'. Ins. Co. v. Anderson, supra. In 'Brannon there was a false answer in the application but the applicant contended under oath that she disclosed all the true fácts to the agent which under Hale, supra, creates a jury question as to -whether the jury would want to believe thé applicant *587or the agent. Yet summary judgment was granted for the insurer without affording the applicant an opportunity to show he had no notice of any agent’s limitation and to introduce evidence before a jury that he disclosed all facts to the agent. i
In the recent case of Lucas v. Continental Cas. Co., 120 Ga. App. 457 (170 SE2d 856), (cert. den.), Judge Eberhardt pointed out in an excellent concurring opinion that we are bound to follow Hale, supra, in cases where there is no notice of a limitation of authority to the applicant, and follow Patten, supra, where there are cases involving limitation of authority. Where there are cases involving limitation of authority in the application then this court must construe the wording of the limitation of authority as to whether there is a limited limitation of authority or whether there is unlimited limitation of authority. Both of these latter cases are Supreme Court cases written in answer to certified questions from our court and any of the other cited cases to the contrary must yield to these Supreme Court cases.
3. The counterclaim of the Andersons alleges that a demand for payment of certain losses by Charles Anderson was made on January 27, 1969. The record before us shows that the declaratory judgment action was initiated on March 11, 1969, well before the expiration of 60 days from demand, which is a prerequisite for any action for attorney’s fees for a bad-faith refusal to pay under Code Ann. § 56-1206 (Ga. L. 1960, pp. 289, 502; 1962, p. 712). See in this connection Reliance Ins. Co. v. Brooks Lumber Co., 101 Ga. App. 620 (115 SE2d 271). The sufficiency of the action by Allstate as presenting a justiciable controversy and as stating a claim for relief has not been questioned. The trial judge was authorized to conclude that there was a reasonable ground for contesting the claim so as to remove the issue from the case. Dependable Ins. Co. v. Gibbs, 218 Ga. 305 (8) (127 SE2d 454); Independent Life &c. Ins. Co. v. Thornton, 102 Ga. App. 285 (6) (115 SE2d 835).

Judgment reversed and remanded for further proceedings in accordance with the second division of this opinion.

Bell, C: J., Jordan, P. J., Parnell and Quillian, JJ., concur. Hall, P. J., and Eberhardt, J., concur specially. Whitman, J., concur's in Dir vision S. Evans, J.,_ concurs in Division. 2. Whitman and Evans, JJ., dissent to Division 1.