Curles v. United States Fidelity & Guaranty Co.

403 S.E.2d 458, 198 Ga. App. 857, 1991 Ga. App. LEXIS 311

• Court: Court of Appeals of Georgia
• Decided: March 6, 1991
• Docket: A90A2171
• Status: Published

Opinion

Birdsong, Presiding Judge.

Alimenta (U.S.A.), Inc. filed suit against Percy W. Curies for property damage to a trailer leased by Alimenta to Curies. The trailer was damaged while in Curies’ use, and Alimenta’s insurer, United States Fidelity & Guaranty Company (USF&G), paid its claim for collision coverage. This is a subrogation claim against Curies.

Curies brought in as third party his lessor’s (Alimenta’s) insurer, USF&G, contending that as a lessee using the trailer with Alimenta’s permission, he is an insured under Alimenta’s policy and that USF&G is obligated to provide liability coverage for any property damage caused by him, thus entitling him to a set-off for the entire subrogation claim.

USF&G was granted summary judgment upon its contention that, as to liability coverage of Curies, the policy contains this exclusion: “This insurance [liability coverage] does not apply to any of the following: . . . 6. . . . ‘Property damage’ to property owned or transported by the ‘insured’ or in the ‘insured’s’ care, custody or control.” (Emphasis supplied.) Curies appeals. Held:

In E. C. Long, Inc. v. Brennan’s of Atlanta, 148 Ga. App. 796, 803 (252 SE2d 642) (cert, den.), we held that “an insurer may not insure an insured against a peril for a premium, and when the loss occurs — pay the insured, take subrogation, and then sue the insured on the basis that his negligence caused the damage. [Cit.] In the same manner where there are two co-insured, and the insurer pays one insured the amount claimed as damages, ‘(n)o right of subrogation arises against a person who holds the status of an additional insured. . . .’ 16 Couch on Insurance 2d, p. 310, § 61-134. Accord, 6A Appleman, Insurance Law and Practice 146, § 4055. [Cits.]”

Damage to this trailer while it was being used by the lessee Curies is the specific peril for which Alimenta procured collision coverage in this policy and paid the premium. Presumably Curies paid in his leasing fee some or all of the premium applicable to this trailer. In principle, subrogation of an insurer is an equitable right which is derived from the rights of the insured and is limited to those rights. 46 CJS 154, § 1209. Where the right of subrogation is provided in an insurance policy (see Carter v. Banks, 254 Ga. 550, 552 (330 SE2d 866)), its foundation is the right of the insured to recover against the tortfeasor and the equitable concept that to allow him to collect damages for his loss from both his insurer and the tortfeasor would be a double recovery. CJS, supra. Damage to the trailer while used by the lessee Curies is the specific risk insured by USF&G; it is the vehicle in Curies’ use that is insured by collision coverage, and Curies is the beneficiary of it.

Decided March 6, 1991. William E. Cannon, Jr., for appellant. Hodges, Erwin & Hedrick, William H. Hedrick, for appellee.

According to the rule laid down in E. C. Long, Inc., supra, Alimenta cannot maintain a subrogation suit on behalf of USF&G against its co-insured, Curies. The trial court erred in granting summary judgment to USF&G.

Judgment reversed.

Banke, P. J., and Cooper, J., concur.