Opinion
38426.
DECIDED OCTOBER 25, 1960.
Action on insurance policy. Albany City Court. Before Judge Jones. May 3, 1960.
Robert W. Reynolds, for plaintiff in error.
Perry, Walters Langstaff, Fred B. Hand, Jr., contra.
Where one of two sums is due under an insurance policy, the acceptance by an insured of the lesser of the two sums is an accord and satisfaction of the obligations of the insurance company under the policy under the facts of this case.
DECIDED OCTOBER 25, 1960.
W. H. Hatfield, the plaintiff, was employed by MFM Truck Tractor Company, Albany, Georgia, and was insured under a group life and accident insurance policy, the defendant in the case being the insurer, Colonial Life Accident Insurance Company. On March 10, 1959, the plaintiff suffered an accident while repairing a corn picking machine causing him to lose his left hand at the wrist.
By amended petition, the plaintiff alleged that he lost his balance and was thrown into the "teeth" of the machine; that he was pulled with force and violence; that his hand was severed at the wrist and there was such a pulling and straining of nerves and muscle tissue, that he suffered and is now afflicted with severe emotional injury caused by pain throughout his left shoulder, neck and back. Further, it is alleged that the plaintiff is wholly and continuously disabled.
A copy of the insurance contract, made a part of the petition, is identified as Exhibit "A". Part "A" of the contract provides for the payment of $500 for the loss of the hand which would be in lieu of any other indemnity provided for in the contract. Part "B" of the contract entitled, "Total Disability," provides for the payment of $100 per month for 12 months and $50 per month for a period of ten consecutive years after the first year of continuous disability.
By the amended petition, the plaintiff alleged that he is illiterate and is unable to read and write except for the signing of his name; that on December 15, 1959, he received a letter, silent as to release and waiver of further claim against the defendant, together with a $500 draft upon which there was a release and waiver of further claim against the defendant; that the defendant falsely misrepresented the nature of the $500 draft in that no reference to a release was made in the letter. The letter attached to the petition reads as follows: "We have now completed our processing of the claim for the serious loss you sustained as a result of your accident of November 10, 1959. Enclosed is our draft in the amount of $500 which covers the amount due under the policy for the loss of a hand. While we certainly regret your unfortunate accident occurred, we are glad to be of service to you under your policy." Thereafter the plaintiff cashed the check and on February 1, 1960, filed his action under part "B" of the insurance contract in the City Court of Albany seeking to recover $7,200 less the amount ($500) previously paid by defendant.
The gravamen of the plaintiff in error's contention in this case is that he is not bound by the release which he signed on the back of the draft for $500 sent him by the insurance company for the loss of his hand. In the view we take of the case it is immaterial whether the insured signed a formal release or not. The insurance policy provided for exclusive alternative obligations of the company. It obligated the company to pay $500 for the loss of a hand or a larger amount for total disability. It is presumed that the insured knew of the policy provisions and knew that he could not collect both $500 for the loss of a hand and the larger amount for total disability. It is also presumed that under the policy requirements the insured filed a claim for some amount. The insurance company sent the insured a draft and stated that it was for the amount due under the policy for the loss of a hand. The insured, knowing that the draft was for a lesser sum than the total disability provided for in the policy, indorsed and cashed the draft. Under the ruling in Rivers v. Cole Corporation, 209 Ga. 406 ( 73 S.E.2d 196) the acceptance and cashing of the draft for the lesser sum provided for in the policy was an accord and satisfaction of the obligation of the insurance company. Code § 20-1204.
The court did not err in sustaining the general demurrer to the amended petition and in dismissing the action.
Judgment affirmed. Nichols and Bell, JJ., concur.