Court Opinion

ID: 9571173
Source: CourtListenerOpinion
Date Created: 2023-08-21 20:29:35.142876+00
Date Added: 2024-06-11T12:29:04.042272
License: Public Domain

Carley, Chief Judge,
concurring specially.
Appellee-plaintiff was proceeding under two theories. The first theory of recovery was that appellee was subrogated to the claim that Intex, its insured, would have for appellant-defendant’s negligent failure to settle. This theory is discussed in Division 1 and I concur in *559the majority’s- resolution of that issue.
The second theory of recovery was that appellee had its own direct action against appellant based upon the negligent misrepresentation made to Intex as to the limits of coverage. See Robert & Co. Assoc. v. Rhodes-Haverty Partnership, 250 Ga. App. 680 (300 SE2d 503) (1983); Badische Corp. v. Caylor, 257 Ga. 131 (356 SE2d 198) (1987). In Division 2, the majority declines to address this theory of recovery, concluding instead that the trial court’s judgment is predicated in part upon an alternative “third theory, that Intex had a right to recover for the misrepresentations as to coverage, which right could be asserted by plaintiff as subrogee of Intex.” In my opinion, the majority misconstrues the trial court’s judgment. When the relevant language of the judgment is read in context, it would appear that no such alternative third theory of recovery was advanced by the trial court. Instead, it appears that the trial court relied upon an erroneous interpretation of the direct action theory that was advanced by appel-lee. As I read the judgment, the trial court holds that, under the direct action theory, it is ultimately immaterial whether appellant was actually aware that appellee would rely upon the representations as to the limits of coverage, since appellant was actually aware that Intex would rely upon those representations and appellee is subrogated to the rights of Intex. This is clearly an erroneous interpretation of the direct action theory. If appellee is to recover under the direct action theory, it must necessarily recover in its own right and not in the capacity as Intex’s subrogee. In order for appellee to recover in its own right under the direct action theory, it must be shown that appellant was “actually aware [that appellee would] rely upon the information [appellant] prepared.” Badische Corp. v. Caylor, supra at 133. Obviously, appellant’s actual awareness of appellee’s reliance cannot be shown by evidence of appellant’s actual awareness of Intex’s reliance.
Accordingly, I concur in the majority’s conclusion that the trial court’s judgment is predicated in part upon an erroneous legal theory. In my opinion, however, that error relates to the direct action theory and not the so-called alternative third theory of recovery. Therefore, I would not address the merits of the illusory third theory but would simply reverse and remand for the entry of a new judgment which applies the correct legal principles to the issue of appellant’s liability under the direct action theory. As to this direct action theory, the trial court “ ‘has not considered all of the evidence in the light of correct and applicable legal principles [.] [Accordingly,] the case should be remanded to the [trial court] for further findings. [Cit.]’ [Cit.]” Williams v. Morrison Assur. Co., 138 Ga. App. 191, 193 (1) (225 SE2d 778) (1976). See also Ayers v. Yancey Bros. Co., 141 Ga. App. 358, 362 (2) (233 SE2d 471) (1977); Smith v. Helms, 140 Ga. App. 267, 269 (3) *560(231 SE2d 778) (1976).
Decided July 28, 1989.
Bouhan, Williams & Levy, M. Brice Ladson, Joseph A. Mulherin III, Troutman, Sanders, Lockerman & Ashmore, Daniel S. Reinhardt, William N. Withrow, Jr., Stephen W. Riddell, for appellant.
Drew, Eckl & Farnham, W. Wray Eckl, Stephen R. Kane, for appellee.
I concur in the reversal and remand for the entry of further findings as to the appellee’s entitlement to recover the expenses of litigation. The issue of appellee’s entitlement to recover the expenses of litigation should be redetermined after the trial court readdresses the issue of appellant’s liability pursuant to correct legal principles.