*1 dissenting. Judge, Smith, I agree cannot that Free I dissent because respectfully must case Siemens against Industrial’s indispensable party. is an Flow constitutes a guaranty, the fax from Schultz whether depends upon did, If existed. it Indus- any guaranty whether i.e., depends upon If no against severally. an action Siemens right bring trial had the at all. In either existed, Siemens is not responsible then guaranty and the merits of the case, indispensable party, Free Flow is not being litigated and Siemens are Free Flow between dispute Free not an indispensable party, action. Because Flow was another dismissing the action on basis. the trial court erred Judge Presiding McMurray I authorized to state that am in this dissent. Judge Eldridge join 5, 1997 Decided December 18, 1997 denied December
Reconsideration for Longino, appellant. John T. Jameson, Hill, L. appellee. Louis N. Mitzi for
King Spalding, & PEACHTREE CASUALTY A97A1533. LUNCEFORD v. INSURANCE COMPANY. Judge. Smith, pol-
The issue in this is whether an automobile insurance appeal (Peachtree) Insurance Casualty Company issued icy language We conclude that the broad punitive damages. covers reverse this and we therefore encompasses type coverage, policy to Peachtree. grant summary judgment the trial court’s in an collision with Terry Lunceford was involved automobile other alleged, among He filed suit her and Susan Brown. He influence of alcohol. driving that she was while under the things, Peach- injuries punitive damages. for sought damages personal insurer, action tree, brought declaratory judgment Brown’s then did not Lunceford, its contending Brown and did The trial court concluded that punitive damages. cover summary judg- granted for such provide ensued.1 ment to Peachtree. This Lunceford appeal to cov- following regard policy provides 1. The insurance judgment against based in favor of Peachtree The trial court entered a default Brown declaratory judgment. complaint for on Brown’s faitee to answer Peachtree’s “We will erage: pay, behalf of an insured person, damages any which insured person legally liable because of and property damage arising out of an accident involving your insured car or a non-owned car.” agree We do not with Peachtree that this language plainly “does not provide coverage dam- On the ages.” contrary, leads to the oppo- *2 site conclusion. The coverage language broad, “dam- encompassing ages” without Although limitation. it contains exclusion for bodily injury or property damage caused intentional acts, the policy does not contain an exclusion for punitive And the law is clear in insurer, this state that an “having affirmatively expressed coverage in broad promissory terms, has a duty to define any limitations or (Citations exclusions clearly and explicitly.” and punctuation omit- ted.) Gatewood, MAG Mut. Ins. Co. v. (367 169, 186 Ga. App. 173 SE2d true,
It is argued by Peachtree, that the definitions section of the policy defines bodily injury, property damage, and accident with- out reference to punitive damages. And, as further argued by Peach- tree, the policy does not expressly recite that it will pay “all sums” that could be recovered its insured. But the failure to use language to specifically reference damages in the defini- tions section does not prevent coverage. Had Peachtree wished not to cover or to exclude punitive damages, it could have done so clearly and specifically. not, It did consequently, is bound by the broad of language the policy.
Peachtree cites two decisions in support of its argument policy language plainly excludes punitive damages. Both are inapposite. Both involve statutory construction of legislation rather than interpretation of an insurance contract. In O’Gilvie v. States, United S._(117 454) 519 U. 452, (1996) SC 136 LE2d United States Supreme (a) (2) Court interpreted 26 USC 104 § examined the meaning of the language “damages received ... account of personal injuries or sickness” in the context of whether punitive damages were excluded gross from income for tax purposes. Recognizing ambiguity of the phrase, 136 LE2d at the court rules applied concerning statutory interpretation and concluded that punitive damages were not included within the phrase at issue. In Terrell, Roman v. 83) App. (1990), relied on by court, the trial we considered whether punitive damages were recov- erable from an uninsured motorist carrier. We construed former (a) (1) OCGA 33-7-11 § a UM requiring carrier “to compensate its insured for all sums the insured could recover from the tortfeasor because bodily injury or property damage.” (Emphasis in original.) Roman, at 221 supra Discussing the rationale behind awarding punitive damages, we did state that “[pjunitive damages are not of’ . . but rather ‘because . . . . of’
awarded ‘because some aspect the victim’s which caused tortfeasor’s conduct emphasized concluding was After loss.” Id. statutory plain, and held construction the rules we used pot damages against awarding punitive carrier did serve as a UM wrongdoer. Id. at 222. deterrence argues Relying O’Gilvie, that since on Roman mon- punitive etary compensation rather than the tortfeasor’s behavior address bodily bodily injury, phrase “because encompass damage” injury property damages. cannot in the insurance and O’Gilvie reliance on Roman But Peachtree’s ignores important them and this case. distinctions between regard apply to contract construc- sections
Different Code statutory interpretation. § 13-2-2,which sets out See OCGA tion and general statutory concerning contract construction. Rules rules though respects, interpretation, differ in focus. See similar some City Pope, App. 1-3-1; Buchanan v. OCGA (476 53) (1996). Notably, are construed sometimes statutes legislative purpose. broadly, narrowly, depending on their sometimes Compare Doe, 264, 265-266 Smith v. *3 (1988) (uninsured broadly legislation to be construed motorist indemnifying person legally purpose legislative entitled of effectuate motorist) McFrugal recovery Rental uninsured from (418 60) (1992) (narrow con- Garr, 262 SE2d Riverdale v. Ga. 369 charge allowing public fee, records to struction of statute since statute is burden struing ambiguous language custodian records). public right In con- of access to contracts, however, in insurance those ambiguities against must construed the drafter. OCGA 13-2-2 be (5); Colony Co., Machine Works v. Ins. Tifton 37) (1996). phrase the as it Here, we must examine analysis appears therefore must in an insurance contract. Our be governed through application contract of the rules of construction statutory interpretation. rather than those of Examining policy applying this insurance the rules concern- ing construction, reiterate that the insurance does contract we broadly clearly damages, and its not exclude “damages.” It to conclude on this addresses is therefore reasonable coverage. argument ground policy provides can also that the But the bodily injury property or dam- be made that the “because ages” ambiguous. phrase comparable The at issue here is to that Cemetery Co., construed in v. Travelers Indem. Greenwood Supreme Court construed the word 313 “for” in the context of a reciting payment endorsement any anguish professional mal- would be made “for mental practice, because (Punctua- any the insured.” error or mistake conduct omitted.) emphasis the tion and Id. at 316. The court found word “ ” “ meanings: ‘equivalent amount, to have several to’ or ‘to the “for” ” “ argued by ‘by of,’ insurer, of’ or value or extent the reason ” argued by of, of,’ ‘because on account the insured. Id. Because of ambiguity, upon longstanding this the court relied the rule that the [Cit.]” “interpretation prevails. which favors the insured Id. phrase
Here, Greenwood, like the word “for” the “because of bodily injury property damage” reasonably or could be construed as damages meaning “equivalent compensation to” or “to the extent of” bodily injury. phrase words, for In other mean could pay only damages equal insurer would those to the amount of dam- ages bodily injury property damage. Greenwood, for But as in phrase “by another construction could be that the or “on account of.”Under this alternative means reason of”
interpretation, the insurer required pay would be for all for which the insured is legally injured property liable because a claimant was or his dam- aged, including punitive damages. construction, too, This is reason- equally logical pos- able. And where two or more are constructions ambiguous sible, the contract is and must be construed supra generally Grange Greenwood, insurer. at 316. See Hurst v. (4) (470 659) (1996)..Accord- Mut. Cas. ingly, phrase property damages” “because of providing coverage puni- must be construed Peachtree as interpretation. tive under the latter application
We note Peachtree’s reliance on Brown’s for insur- signature appears following language part: ance. Above her application “Please be advised that for insurance does request punitive damage coverage. include a Punitive jury pun- are which are sometimes awarded a court or [whose] irresponsible ish or deter someone conduct is so and without regard safety punishment for the of others that inis order.” OCGA provides “[e]very § 33-24-16 insurance contract shall be con- according entirety strued to the of its terms and conditions as set amplified, by any forth in the and as extended, or modified . . . application part policy’’ (Emphasis supplied.) made a See also *4 (249 76) (1978). Rudd, 393, 395, West v. 242 Ga. n. 1 here, SE2d But application expressly part by incorporated was not made of or ref- policy, erence into the fact, insurance and in it recites that Brown may understands that it is not “a binder of bound, be accepted, rejected, by company upon receipt.” or modified application part policy, reject Because the was not made of the we argument partial summary judg- Peachtree’s ment based on the that it was entitled to
application. application by incorporated Moreover, if even the were reference policy, “[i]t language into the does not . . . follow that the of the 8 controlling language
application if the form is over Fidelity Rogers Co., in v. Ins. two are conflict.” Southeastern 199) (1987). (354 application App. form indicates While request coverage, did not the form also indicates that Brown obligation on the same terms. The Peachtree had no issue broadly policy language, above, as discussed at best covers all dam- ages ambiguous respect punitive damages and, worst, at is applica- Peachtree. The and nevertheless must be construed merely ambiguity, tion adds another and we must continue therefore interpret of the insured. Id. favor “public policy precludes requir- 2. Peachtree also contends that ing pay punitive a tortfeasor’s insurer to awarded under language § 51-12-5.1.” It maintains that the of this statute OCGA legislature’s “unequivocally puni- demonstrates” the intention that damages punish tive or deter the tortfeasor and not that “tort defend- responsibility damage punitive ants shift awards to innocent insurer.” argument adversely This is controlled to Peachtree our hold-
ing
App.
Co.,
in Fed. Ins. Co. v. Nat. Distrib.
671) (1992)
recovery
punitive damages
liability
in the
context
public policy.
points
does not contravene
Id. at 768
out
supra,
argues
Greenwood,
that we relied on
in Federal and
that the
statutory
analytical
applicable
framework of Greenwood is not
light
§
of the enactment of
51-12-5.1 after
OCGA
argument ignores
express
Greenwood was decided. But this
sion in Federal that
supersede
against punitive damages
our
deci-
the enactment of OCGA 51-12-5.1 did not
Supreme
holding
Court’s
Greenwood that insurance
legislatively
App.
is
authorized. 203 Ga.
at
Greenwood,
768. See also
Nor is the absence of that lia- bility may damages, argued insurance cover Peach- recovery Supreme tree, fatal to of such It is true that the express legislative Greenwood, Court stated in “In the absence of authority might against pub- well be said such contracts were (Punctuation omitted.) policy.” lic But Id. at 316-317. only against punitive damages dicta. The court stated that insurance legislation might against public policy. Moreover, in the absence of be legislation express the absence of tract. tract are in the more does not affect the freedom to con- con- “ ‘[I]t long provisions given that, is axiomatic as the of a compliance governing requirements statutes, with the parties may provisions from, to the contract include different ” prescribed than, in the statute or statutes.’ liberal those Moore v. State Farm Mut. Auto. Ins. argument support Peachtree’s does not deviation holding Supreme ruling from our Federal and the Court’s Green-
9 liability that insurance cannot with Peachtree agree simply wood. We is in this state. forbidden punitive against Roman, supra, argue reliance on note Peachtree’s We also Roman public policy. contravenes against punitive insuring to be awarded “allowing punitive does state function the can serve no deterrent because company insurance (Citation and damages.” the person paying wrongdoer omitted.) Roman, at 222. But Peachtree fails to supra punctuation language, that after this this reciting out in its brief appellate point insuring on to the deterrent effect of recognize Court in Roman went in the to UM liability coverage, opposed against punitive that “at least some to deter- relationship context. We stated coverage, area, insurance liability rence is because is the possible insured’s which would be raised to cover the car- premiums tortfeasor original.) Id. Roman therefore is not payout.” (Emphasis rier’s ban on authority judicially imposing public policy insurability damages. punitive J., JJ, reversed. P. Judgment McMurray, Eldridge, Ruffin Andrews, J, J., J., C. P. Birdsong, Beasley,
concur. dissent. Judge, dissenting. Beasley,
I dissent. respectfully
First, reaches majority opinion beyond sole issue case and rules that the insurance policy punitive covers damages. Lunceford, action, defendant in this declaratory judgment did not summary judgment, move for the trial court did not deny summary Lunceford, judgment his entitlement to summary judgment was below, and not briefed he does not assert on that he is appeal entitled summary judgment. His enumeration of error is that “the trial court erred in granting summary judgment to Appellee, Peachtree Casualty Insurance Yet the Company.” majority opinion concludes that “the ‘because of phrase bodily injury or property damages’ must be construed Peachtree as providing coverage and that “we must continue to damages” interpret favor of the insured.” The in effect majority rules that Lunceford is entitled summary judgment.
But issues not raised and ruled the trial court are not decided in this Court. Ford 128, Motor Co. v. Tippins, (1) 121) (1997); State, Butler v. 172 Ga. App. 406- (1) (323 We do not create and then rule on for summary judgment. cross-motions case,
At most in this Lunceford would be entitled to raise the reversed, is, issue in the trial court if this case were properly if summary Peachtree is not entitled to judgment.
The second reason for this dissent
is that
the policy does not
correctly applied
The trial court
the rules of
cover
interpretation
§
13-2-2 and came to
for contracts as found OCGA
undisputed
support
facts
it.
this conclusion.
“The cardinal rule of construction is to ascertain the intention of
parties.”
Laxmi, Inc.,
13-2-3;
OCGA
Irvin v.
(467
(1935).
599)
(1996);
Lewis,
Hull v.
Parol evidence outside the four corners of contract itself may by way explain proving contract, a of the attendant and sur- ambiguity rounding circumstances, when there is in the terms. (1). Immediately signature OCGA 13-2-2 application above the insured’s on the in for insurance a box marked “APPLICANT’SSTATE- — desig- paragraph SIGNING,” READ BEFORE MENT nated “PUNITIVE part request there is quoted statement, Therein is the in DAMAGES.” majority opinion, application in the that the does not include a punitive damages, explaining why punitive for and when damages general, concluding can in be awarded cases and with damages damages may information: “Punitive are which be awarded (1) Repairing/replacing people’s prop- the actual above erty; costs of: other expenses pain suffering or the actual medical and and you might accidentally portion cause in an In accident.” of the application designated & “COVERAGE RATING” and “PREMIUMS listing punitive damages HERE,” MUST BE SHOWN there is no for coverage punitive damages premium. or a abundantly punitive damages
It was thus made clear that are a category separate categories from the described, two covered that the punitive damages, premium would not cover and thus that the charged policy, specified immediately signa- for the below Brown’s coverage. ture, did not include such conformity plainly
The itself stated, was with this and straightforward fashion, what was covered. The whole contract is arriving any part. be examined at the of construction OCGA § 13-2-2 page, particulars In the middle of the front whereon all the respect specific policy shown, to this are it is stated: “THERE IS NO COVERAGE PROVIDED UNDER THIS POLICY A UNLESS SPE- Charges CIFIC PREMIUM CHARGE IS SHOWN BELOW.” are categories coverage: “Bodilyinjury Liability,” “Prop- listed for four — erty Damages Liability,” “Damage your auto other than Colli- — “Damage your nothing sion,” and auto Collision.” There is punitive damages. provision quoted majority at the outset of 1 of Division opinion promise pay. begin- constitutes the insurer’s It is near the — ning OTHERS,” of “Part I LIABILITY TO which starts out —
naming types — Bodily “Coverage Injury. A included: Coverage Property Damage.” quoted provision, B In the words damage” print. “bodily injury” “property In the defini- are in bold and policy, page portion of the the first narrative tions “bodily person meaning Injury” “Bodily to a and harm is defined as Damage” “Property that results from it.” sickness, disease or death tangible property.” meaning “damage to or destruction defined meaning provision, “an unex- is defined as “Accident,”as used in the injury bodily property pected event that causes and unintended ownership, damage or use of a car.” maintenance and arises out of the damage” “property “bodily injury” Again, are bolder the words print. anywhere Such did not
There is no mention
damages
among the “Exclusions” because
have to be listed
damages
bodily
property
part
injury
in the first
are not
catego-
place.
from either one of these two
Indeed, such an exclusion
only
Explicitly
place.
those mone-
covered were
be out of
ries would
property
tary
dam-
related to
which were
anything
obviously
Monetary damages
age.
related to
else were
“something
more” than
are for
covered. Punitive
Uniroyal
injury
damage.
bodily
property
See
Goodrich Tire
(3) (b) (461
877) (1995),
App. 248,
rev’d
Ford, 218 Ga.
Co. v.
on
*7
Uniroyal
grounds,
Tire
Whether construction, here, the result is the same. It Roman, in contract or English meaning common words used. “Because a matter of the Supreme equated States “on account of” the United of” was Court S._(117 States, 452, 136 519 U. SC in O’Gilvie v. United 454) (1996), meaning describing account of.”The of “on LE2d concept, ways putting relational the same wrote that other Court dictionary, “by drawing again of” or reason are “for the sake arise “on account That case dealt with whether of.” of” injury. personal “by “forthe sake of” or reason are not awarded
Punitive bodily “on account means injury damage. of” or of” This property they bodily are not “because injury property awarded of” either. If is found liable for legally punitive damages, Brown damage she is not “because of “legally bodily liable” damage” [or] but rather because her injury property reprehensibly only The policy compensation. conduct. covers irresponsible trial summary court’s order granting judgment be affirmed. should am Judge
I authorized to state that Chief Presid- Andrews and ing Judge Birdsong join this dissent. 5, 1997
Decided December 18, 1997 Reconsideration December denied Sinowski, Bardack, Freedman & Marc H. for appellant. Chambers, Brooks, Aholt, Mabry, McClelland & F. Douglas Beth Reeves, for appellee. S. Huddleston, Dawson,
Dawson & Patrick A. amicus curiae. STATE A97A1545. FARM FIRE & CASUALTY INSURANCE
COMPANY v. TERRY.
Johnson, Judge. yet
This case presents another permutation “vanishing insurance coverage” dilemma context between disputes automobile insurance carriers and their insureds unin- regarding sured motorist insurance. July
On Kenneth Terry injured in was a motor vehicle involving collision an automobile operated by Undra Davis. The auto- mobile driven was by Davis owned by and rented from McFrugal Auto Rental. Terry sued Davis and served his own uninsured motor- carrier, ist State Farm &Fire Casualty Insurance Company, within *8 two-year statute of limitation for personal injuries. See OCGA 9-3-33; Stout v. (d); 33-7-11 Cincinnati Ins. §§ 195) State Farm filed an answer in its name. own It thereafter became apparent $50,000 Davis was insured toup by McFrugal and adequately any insured against larger judgment by policy. Thus, an excess Davis was not an “uninsured so motorist” the uninsured implicate motorist provisions Terry’s (d). automobile insurance policy with State Farm. OCGA 33-7-11 State Accordingly, Farm requested and received Terry’s consent dismiss without State prejudice Farm a party lawsuit Terry’s Davis. The consent Farm, dismissal was drafted by State