Martin v. Chasteen

354 Ga.App. 518

841 S.E.2d 157

MARTIN

v.CHASTEEN.

A19A1980

Court of Appeals of Georgia.

March 13, 2020

Blaine Alexander Norris, for Appellant.

Hawkins Parnell & Young, Christine Lupo Mast, Zachary Stephen Lewis, Atlanta, for Appellee.

McFadden, Chief Judge.

This appeal challenges the grant of summary judgment to an insurance agent who was sued for failing to procure certain coverage for the insured. Because the insured has failed to show that there is a genuine issue of material fact, we affirm the order granting the motion for summary judgment.

1. Facts and procedural posture.

Viewed in the light most favorable to the nonmovant, see Unique Auto Sales v. Dunwody Ins. Agency , 348 Ga. App. 656, 824 S.E.2d 578 (2019), the evidence shows that in December 2011, Mark Martin used insurance agent Thomas Chasteen to obtain an insurance policy for Martin’s farm in Bishop, Georgia. The policy included coverage for two dwellings and an equipment building on the property. Martin renewed the policy in December each year and received policy declaration pages showing the same two dwellings and the equipment building as covered structures. In 2013 and 2014, Martin built a new horse barn on the property. During that time, Martin and Chasteen communicated about possible insurance coverage for the new barn, but coverage for the barn was never added to the farm policy. In February 2016, the barn was struck by lightning and destroyed by fire.

Martin filed a complaint against Chasteen, alleging that he had been negligent in failing to add coverage for the barn to the farm policy. Chasteen moved for summary judgment. The trial court granted the motion, finding that recovery is barred because Martin had an obligation to read the policy and the declaration pages of the policy clearly showed that the barn was not covered. Martin appeals, challenging the grant of summary judgment.

2. Summary judgment based on obligation to read.

"Summary judgment is proper when there is no genuine issue of material fact and the movant is entitled to judgment as a matter of law." Tyson v. Scottsdale Indem. Co. , 343 Ga. App. 370, 371, 805 S.E.2d 138 (2017) (citation and punctuation omitted). Here, contrary to Martin’s claims, the trial court correctly granted summary judgment to Chasteen on the basis that Martin had failed to meet his obligation to read and examine the policy.

(a) General rule .

In general, an insured has an obligation to read and examine an insurance policy to determine whether the coverage desired has been furnished. If an examination of the policy would have made it readily apparent that the desired coverage was not issued, the policyholder[‘s] failure to examine the policy bars recovery against the insurer or its agent for negligent failure to provide coverage.

MacIntyre & Edwards, Inc. v. Rich , 267 Ga. App. 78, 79-80 (1), 599 S.E.2d 15 (2004) (citation omitted). Accord Lavoi Corp. v. Nat. Fire Ins. of Hartford , 293 Ga. App. 142, 147 (2), 666 S.E.2d 387 (2008) (where insurance agent procures a requested policy and the insured fails to read it to determine what is covered, the agent is thereby insulated from liability).

In this case, as the trial court found, an examination of the declaration pages of the insurance policy made it readily apparent that the new barn was not covered. The declaration pages clearly showed that the only covered structures were the same two dwellings and the equipment building that had been covered since the beginning of the farm policy, and that the new barn had never been added to the policy as a covered structure.

Nevertheless, Martin argues that his duty to read does not authorize summary judgment because there is a question of fact as to whether he possessed a copy of the entire policy, not only the policy declaration pages. However, "[i]nsureds are charged with knowledge of the insurance policy’s contents, and are bound by those contents even if they do not have physical possession of the policy." Burkett v. Liberty Mut. Fire Ins. Co. , 278 Ga. App. 681, 682-683, 629 S.E.2d 558 (2006). Accord Tyson , 343 Ga. App. at 374 (2) (a), 805 S.E.2d 138. Martin "alleged the existence of the policy and is chargeable with knowledge of its contents. Insured persons under an insurance policy are presumed to know its conditions if they intend to rely upon its benefits, or else they must find out those conditions. That is particularly true when, as in this case, the policy in issue is a renewal policy." Southeastern Security Ins. Co. v. Empire Banking Co. , 230 Ga. App. 755, 757 (3), 498 S.E.2d 282 (1998) (citations and punctuation omitted). See also Wells Fargo Home Mtg. v. Allstate Ins. Co. , 199 Fed. Appx. 912, 915 (11th Cir. 2006) (Under Georgia law, "an insured without a copy of the policy must make an effort to ascertain the policy’s terms.").

Given that the declaration pages of the renewal policy in effect at the time of the fire made it readily apparent that the barn was not covered, Martin was "obligated to examine [the] insurance policy and to reject it if it [did] not furnish the desired coverage." Canales v. Wilson Southland Ins. Agency , 261 Ga. App. 529, 530 (1), 583 S.E.2d 203 (2003). His failure to ascertain the policy’s terms bars recovery, so "we affirm the trial court’s grant of summary judgment to [Chasteen]." Lavoi Corp. , 293 Ga. App. at 149 (2), 666 S.E.2d 387 (affirming summary judgment to insurance agent sued for failure to procure coverage for two facilities, including one destroyed by fire, where it was readily apparent from declaration pages of policy that those facilities were not covered). See also State Farm Fire & Cas. Co. v. LeBlanc , 2013 WL 2149750 *8, 2013 U. S. Dist. LEXIS 69928 *24 (III) (B) (1) (a) (M.D. Ga. 2013) ("In this case, it was readily apparent from the declarations page that there was no coverage. ... The onus was on the insured to ensure the coverage [was] correct.").

(b) Exceptions to general rule.

The general rule that an insured has a duty to read "has several exceptions, including [w]hen the agent has held himself out as an expert and the insured has reasonably relied on the agent’s expertise to identify and procure the correct amount or type of insurance, unless an examination of the policy would have made it readily apparent that the coverage requested was not issued ." Cottingham & Butler, Inc. v. Belu , 332 Ga. App. 684, 686-687 (1), 774 S.E.2d 747 (2015) (citation and punctuation omitted; emphasis supplied). Another exception is "where the evidence reflects a special relationship of trust or other unusual circumstances which would have prevented or excused plaintiff of his duty to exercise ordinary diligence to ensure that no ambiguity existed between the requested insurance and that which was issued." Traina Enterprises v. Cord & Wilburn, Inc. Ins. Agency , 289 Ga. App. 833, 837 (2), 658 S.E.2d 460 (2008) (citation and punctuation omitted). Contrary to Martin’s claims, neither the expert exception nor the special relationship/unusual circumstances exception applies to this case.

Under the expert exception, "the insured is relieved of the responsibility to minutely examine the policy." MacIntyre & Edwards , 267 Ga. App. at 81 (1), 599 S.E.2d 15. But "the insured is not relieved of all responsibility to examine the policy." Atlanta Women’s Club v. Washburne , 207 Ga. App. 3, 5, 427 S.E.2d 18 (1992). Rather, the "insured’s duty to read the policy remains if an examination of the policy would have made it readily apparent that the coverage [requested] was not issued." MacIntyre & Edwards , 267 Ga. App. at 81 (1), 599 S.E.2d 15. As discussed above, an examination of the policy declaration pages would have made it readily apparent that the barn was not covered. So the expert exception does not apply because "if it is readily apparent that the insured did not...