Canal Insurance v. Integon Indemnity Corp. , 180 Ga. App. 670 ( 1986 )

Deen, Presiding Judge.

On March 12, 1982, Cynthia Taylor Robinson was operating an automobile which was involved in a collision with one driven by Nellie C. Williamson. Williamson and her passengers sustained injuries and subsequently brought two lawsuits against Robinson in the State Court of Cobb County. At the time of the accident, Robinson was driving a Dodge Omni automobile owned by Stag, Inc., a retailer of used motor vehicles, which was insured by Canal Insurance Company. Robinson was not an employee of the corporation, but was driving the vehicle with its permission. Robinson owned a Ford automobile insured by appellee, Integon Indemnity Corporation, and it was the sole automobile listed in the policy. In February of 1984, Integon filed a complaint in the Superior Court of Cobb County seeking a declaratory judgment to declare the company free from liability in the pending state court lawsuits. Canal counterclaimed asking the court to declare Integon to be the primary insurance carrier. Both parties then moved for summary judgment. The court below found that Integon’s policy excluded coverage and granted summary judgment in favor of Integon. Canal appeals. Held:

The policy in question, Integon’s, states that it covers only an owned automobile or a temporary substitute automobile. The policy defines a temporary substitute automobile as “an automobile not owned by the named insured . . . while temporarily used with the permission of the owner as a substitute for an owned automobile when withdrawn from normal use for servicing and repair or because of its breakdown, loss or destruction.” Mrs. Robinson’s deposition shows that her Ford automobile was being driven by her former husband on the date in question and was not inoperable.

Canal argues that the exclusion of coverage provision in the policy is void as against public policy and cites Cotton States Mut. Ins. Co. v. Neese, 254 Ga. 335 (329 SE2d 136) (1985), in support of its argument. In that case, the issue before the court was whether an exclusion in an automobile insurance policy which excluded coverage of the insured “while attempting to avoid apprehension or arrest” is void as against public policy because Georgia has a compulsory insurance law. (The evidence showed that the insured was trying to outrun a police cruiser at the time of the collision.) The Supreme Court decided that the exclusion was void for public policy reasons because the public interest required insurance coverage for each vehicle operating on the public roads. In Neese, supra at 341, three public interests were identified: “(1) as insureds, to limit the insurer’s risks and thereby keep automobile insurance premiums as low as possible; (2) as members of the public in general, to improve safety on the highways; and (3) as accident victims, to have access to insurance funds to satisfy their judgments.” The opinion in Neese, however, made it very clear that the court was addressing only the exclusion in that particular case and commented that there are exclusions from coverage in automobile insurance policies which would not violate public policy.

OCGA § 33-34-4 (a) requires: “No owner of a motor vehicle required to be registered in this state or any other person, other than a self-insurer . . . shall operate or authorize any other person to operate the motor vehicle unless the owner has insurance on the vehicle providing the following minimum coverage: (1) Motor vehicle liability insurance equivalent to that required as evidence of security for bodily injury and property damage liability under the motor vehicle safety responsibility laws of this state; (2) Compensation to insured injured persons without regard to fault up to an aggregate minimum limit of $5,000.00 per insured injured person . . .” As pointed out by the trial court, this state’s compulsory insurance laws were enacted to insure that accident victims would have adequate recourse for the recovery of damages. Anderson v. Southeastern Fidelity Ins. Co., 251 Ga. 556, 557 (307 SE2d 499) (1983). In this case, Robinson had the requisite coverage on her Ford automobile, and Stag, Inc., had liability coverage in force on its automobile.

OCGA § 33-34-3 (a) (1) requires “[a]ll policies of motor vehicle liability insurance issued in this state must be in accordance with the requirements of this chapter; and no insurer shall issue a policy of motor vehicle liability insurance in this state that does not contain at least the minimum coverages required under this chapter.” Subsection (e) provides: “Each policy of liability insurance issued in this state providing coverage to motor vehicles owned by a person, firm, or corporation engaged in the business of selling at retail new and used motor vehicles shall provide that, when an accident involves the operation of a motor vehicle by a person who is neither the owner of the vehicle involved in the accident nor an employee of the owner and the operator of the motor vehicle is an insured under a complying policy other than the complying policy insuring the motor vehicle involved in the accident, primary coverage as to all coverages provided in the policy under which the operator is an insured shall be afforded by the policy insuring the said operator and any policy under which the owner is an insured shall afford excess coverages.”

Integon argues that OCGA § 33-34-3 (e) is not applicable to this case under the holding in Barfield v. Allstate Ins. Co., 172 Ga. App. 882, 883 (324 SE2d 731) (1984), wherein this court held that OCGA §

33- 34-3 (e) did not express a public policy requiring Allstate “to afford primary coverage to [plaintiff’s] vehicle.” An examination of Barfield reveals that Allstate brought a declaratory judgment action seeking an interpretation of the code section and the plaintiff alleged that a policy exclusion which provided that the insurance company was not liable for “injury or destruction of property a person insured owns, is in charge of or rents ...” was enforceable and not void as against public policy. The defendants argue that this code section expresses a public policy that the plaintiff (Allstate) shall afford primary coverage for the damage to defendant’s automobile. In holding that the code section expresses no such policy, the court found that Allstate issued the liability coverage as required under OCGA § 33-34- 4, but could find no law requiring an automobile insurer to provide collision coverage although such coverage was required to be offered on an optional basis. An examination of the relevant statutory and case law revealed no public policy requirement of such coverage.

In the instant case, Integon issued the statutorily required liability coverage to Ms. Robinson. When OCGA § 33-34-3 (e) is read together with OCGA § 33-34-4 (a) (1) it is obvious that all motor vehicle policies must provide that they have primary liability in a situation such as that set forth above. The Barfield case is distinguishable because it involved optional collision coverage which the insured elected not to carry and did not involve mandatory liability coverage as in the case at bar. State Farm &c. Ins. Co. v. Lietz, 122 Ga. App. 596 (178 SE2d 218) (1970), and Hemphill v. Home Ins. Co., 121 Ga. App. 323 (174 SE2d 251) (1970), are not applicable as they were decided prior to the enactment of the compulsory insurance law in 1974.

Judgment reversed.

Banke, C. J., McMurray, P. J., Birdsong, P. J., Carley, Sognier, Pope, and Benham, JJ., concur. Beasley, J., dissents.