COTTON STATES MUT. INS. CO. v. ATKINSON

Harvey was injured on March 17, 1961, in a collision between Adams and Atkinson, Jr., the latter driving a car belonging to Simonton and insured by Cotton States Mutual Insurance Company. Harvey filed a tort action against Adams, Atkinson, Jr., and Atkinson, Sr., on July 6, 1961, and dismissed it on February 10, 1962, refiling against these three defendants plus Simonton who then immediately contacted Cotton States on his own behalf and was furnished counsel for his defense. A nonsuit was granted as to him on May 15, 1963, and a verdict was returned on the same day in favor of Harvey against Adams and the Atkinsons. Harvey filed an action against Cotton States seeking to require payment by it of the judgment in his favor on the theory that Atkinson, Jr., driver of the Simonton automobile, was an additional insured within the meaning of its automobile liability policy, but he dismissed this action in April, 1965, in the face of an adverse demurrer ruling. The present action by Atkinson, Jr., against Cotton States also seeks an adjudication of its liability to pay the amount of the judgment rendered against him in Harvey's case. Cotton States' motion for summary judgment was denied and it appeals.

DEEN, Judge.

1. Assuming but not deciding that the plaintiff in this action was an additional insured under the policy of liability insurance issued by the insurer to Simonton, this places him in the legal position of a third-party beneficiary to the contract who, as such, would have a right at his election to claim or reject the coverage afforded him in that capacity. Ericson v. Hill, 109 Ga. App. 759 (1a) ( 137 S.E.2d 374). Notwithstanding the questions raised as to the election of the additional insured to invoke the protection of the policy, we cannot reach those contentions since the controlling issue here is that the statute of limitation has run.

Whatever obligation the appellant had to its insureds came into existence either when it received notice of the collision of March, 1961, and the right accrued to it to commence its investigation and settlement procedures, or in July, 1961, when suit was filed against Atkinson, Jr. Simonton, of course, was not sued until 1963 when the second action, also including Atkinson as a defendant, was filed. But, so far as Atkinson is concerned, his right to insist on the performance of contractual duties in his own regard arose at the latest in 1961. The affidavit of Atkinson's own counsel clearly states that neither then nor at any time within the next six years did he evince any intention of insisting upon whatever coverage might have been available to him. Such coverage, of course, arose only by the simple contract of insurance as to which the statute of limitation is six years. Where a policy of insurance contains no contractual limitation upon the time to bring suit thereon, the statutory period of limitation governs the action. Burton v. Metropolitan Life Ins. Co., 48 Ga. App. 828 (2) ( 173 S.E. 922). It follows that while the failure of the plaintiff to request legal counsel to defend the action against him was not of itself a rejection of coverage under the policy, it did serve as a beginning point for the running of the statute of limitation. The issue was raised by the insurer in its second defense, and proved by uncontradicted evidence. It was accordingly error to deny the motion for summary judgment.

Judgment reversed. Bell, C. J., and Eberhardt, J., concur.