CHANDLER et al.
LIBERTY MUTUAL FIRE INSURANCE COMPANY
This Opinion is Uncorrected and subject to revision by the court.
MILLER, Judge. Barnes, P. J., and McFadden, J. concur. Ellington, P. J., concurs in judgment only. Andrews, P. J., Dillard, and Branch, JJ., dissent.
Collie Chandler and Sharon Milbry-Chandler, along with their daughter (collectively, " the Chandlers" ), were injured in an automobile accident after their car was struck by another driver, Evans Johnson III, who was insured by Liberty Mutual Fire Insurance Company (" Liberty Mutual" ). After the Chandlers settled their claims against Johnson, Liberty Mutual, who was also their insurer, denied their claims under Milbry-Chandler's uninsured motorist policy (" the UM policy" ). The Chandlers then filed suit against Liberty Mutual for breach of contract and bad faith based on its denial of their UM claims. During discovery, Liberty Mutual refused to produce certain relevant documents relating to the settlement of other claims under Johnson's liability policy. After the Chandlers subpoenaed those documents, the trial court ordered Liberty Mutual to produce them for an in camera inspection. After reviewing the documents in camera, the trial court denied the Chandlers' request to produce and then granted summary judgment to Liberty Mutual on the ground that the Chandlers failed to exhaust the limits of Johnson's liability policy. The Chandlers appeal, contending that the trial court erred: (1) in refusing to order Liberty Mutual to produce the documents in question, and (2) in granting summary judgment to Liberty Mutual. For the reasons that follow, we agree and reverse.
On appeal from the grant of summary judgment this Court conducts a de novo review of the evidence to determine whether there is a genuine issue of material fact and whether the undisputed facts, viewed in the light most favorable to the nonmoving party, warrant judgment as a matter of law.
(Citations and punctuation omitted.) Campbell v. The Landings Assn., Inc., 289 Ga. 617, 618 (713 S.E.2d 860) (2011).
So viewed, the evidence shows that on April 5, 2010, Collie Chandler was driving north on Forest Parkway. With Chandler in the car were Milbry-Chandler, their daughter, and his brother. Chandler proceeded through a green light and was hit from the side by a vehicle driven by Johnson. The Chandlers and Chandler's brother were injured in the accident and the Chandlers' vehicle was damaged. Attorney Paula McGill represents the Chandlers, and she initially represented Chandler's brother as well, although Chandler's brother retained other counsel in 2010.
The limits of Johnson's liability policy with Liberty Mutual were $25,000 per person and $50,000 per accident for bodily injury claims. Milbry-Chandler's UM policy, also provided by Liberty Mutual, had coverage of $100,000 per person and $300,000 per accident. During settlement negotiations, Liberty Mutual informed McGill that any damages that were not covered by the liability policy would be paid under the UM policy.
On March 24, 2011, McGill sent a demand letter to Liberty Mutual on behalf of the Chandlers. Under Johnson's liability policy, the Chandlers demanded $15,250 to settle Collie Chandler's claim; $13,250 to settle Milbry-Chandler's claim; and $9,000 to settle their daughter's claim. In the same letter, the Chandlers sought to settle their remaining claims under the UM policy for $241,000.
On April 15, 2011, Liberty Mutual accepted the Chandlers' demands under Johnson's liability policy and issued checks to the Chandlers in the total amount of $37,500. McGill held the Chandlers' settlement checks for several months while awaiting confirmation that Chandler's brother had also settled under the liability policy. After Liberty Mutual advised her that the limits of Johnson's liability policy had been exhausted, McGill deposited the settlement checks on June 22, 2011.
Thereafter, the Chandlers sought to recover under the UM policy, but Liberty Mutual would not proceed because it contended that the limits of Johnson's liability policy had not been exhausted. The Chandlers then filed the instant lawsuit, alleging that Liberty Mutual waived the requirement of exhaustion of the limits of the liability policy by promising to pay the claims under the UM policy or, in the alternative, that Liberty Mutual purposely misled the Chandlers as to their intent to pay the UM claims.
During the discovery period, the Chandlers requested that Liberty Mutual disclose any documents in its possession relating to the settlement negotiations between Liberty Mutual and Chandler's brother. Liberty Mutual objected to the request, arguing that the documents were neither relevant nor reasonably calculated to lead to the discovery of admissible evidence. The Chandlers then served Liberty Mutual with subpoenas to produce all documents relating to settlement negotiations with Chandler's brother, as well as a designee to testify to the date and amount of any settlement. Liberty Mutual filed an emergency motion to quash the subpoenas.
Following a hearing on the emergency motion, the trial court ordered Liberty Mutual to disclose all documents related to any settlement between Liberty Mutual and Chandler's brother for in camera review so that the trial court could determine if the limits of Johnson's liability policy had been exhausted. Liberty Mutual produced the file on Chandler's brother's claim. Upon review, the trial court found that nothing ...