                              FIRST DIVISION
                                DOYLE, C. J.,
                         PHIPPS, P. J., and BOGGS, J.

                   NOTICE: Motions for reconsideration must be
                   physically received in our clerk’s office within ten
                   days of the date of decision to be deemed timely filed.
                               http://www.gaappeals.us/rules


                                                                    March 23, 2016




In the Court of Appeals of Georgia
 A15A1915. GEORGIA CASUALTY & SURETY COMPANY v. BO-093
     VALLEY WOOD, INC. et al.
 A15A1916. VALLEY WOOD, INC. v. GEORGIA CASUALTY & BO-094
     SURETY COMPANY.

      BOGGS, Judge.

      Following a jury trial in this insurance coverage case, Georgia Casualty &

Surety Company (“Georgia Casualty”) appeals from a judgment in favor of Valley

Wood, Inc. In Case No. A15A1915, Georgia Casualty asserts that the trial court erred

in the following ways: (1) denying its motion for a directed verdict; (2) denying its

request for jury charges concerning agency law and false statements; (3) instructing

the jury on the theft by taking criminal statute and fraud; and (4) awarding

prejudgment interest. In Case No. A15A1916, Valley Wood asserts that the trial court

erred by granting a directed verdict in favor of Georgia Casualty on the issue of bad
faith damages under OCGA § 33-4-6 and denying its motion for a directed verdict in

its favor on the same issue. For the reasons explained below, we reverse in Case No.

A15A1915 and dismiss Case No. A15A1916.

                                Case No. A15A1915

      1. Georgia Casualty asserts it was entitled to a directed verdict in its favor

based upon OCGA § 33-24-7 (b). This code section provides, in part:

      Misrepresentations, omissions, concealment of facts, and incorrect
      statements shall not prevent a recovery under the policy or contract
      unless:


       (1) Fraudulent;


       (2) Material either to the acceptance of the risk or to the hazard
      assumed by the insurer; or


      (3) The insurer in good faith would either not have issued the policy or
      contract or would not have issued a policy or contract in as large an
      amount or at the premium rate as applied for or would not have provided
      coverage with respect to the hazard resulting in the loss if the true facts
      had been known to the insurer as required either by the application for
      the policy or contract or otherwise.




                                          2
       The evidence introduced at trial shows that the co-owner of Valley Wood,

Richard Ramey, obtained insurance coverage with Georgia Casualty through Valley

Wood’s insurance agent, J. Smith Lanier. It is undisputed that the insurance

applications submitted by the Lanier agency to Georgia Casualty were not signed.

Ramey testified that until the week before trial, he had never seen the application

before. He denied being asked the questions in the application “by anybody,” giving

permission for anyone to answer the questions or being asked the type of questions

in the application by anyone at the Lanier agency. No one from the Lanier agency

testified at trial.

       An underwriter with Georgia Casualty testified that he received the application

through an email from the Lanier agency, that he would have rejected the application

for crime coverage if the application had stated that Valley Wood did not audit with

a certified public accountant and did not require countersignatures on checks, and that

his underwriting decision was based upon the applications. Ramey admitted that

Valley Wood did not perform full audits each year or require countersignatures on

checks.

       With these facts in mind, we must now determine whether Georgia Casualty

was entitled to a directed verdict in its favor. “A directed verdict is authorized only

                                          3
where ‘there is no conflict in the evidence as to any material issue and the evidence

(adduced), with all reasonable deductions therefrom, shall demand a particular

verdict.’ OCGA § 9-11-50 (a). [Cit.]” Massachusetts Bay Ins. Co. v. Wooten, 215 Ga.

App. 386, 387 (2) (450 SE2d 857) (1994).

      Under OCGA § 33-24-7, misrepresentations, omissions, concealment of
      facts, and incorrect statements made by an insured during negotiations
      for an insurance policy will bar recovery under that policy where they
      were material either to the acceptance of the risk or to the hazard
      assumed by the insurer; or where the insurer in good faith would not
      have issued the policy or contract if the true facts had been known to the
      insurer. To avoid coverage under this statute, the insurer need only show
      that the representation was false and that it was material. A material
      misrepresentation is one that would influence a prudent insurer in
      determining whether or not to accept the risk, or in fixing a different
      amount of premium in the event of such acceptance. While ordinarily
      the question of materiality is for the jury, where the evidence excludes
      every reasonable inference except that the misrepresentation was
      material, the issue becomes a question of law for the court.


(Citations, punctuation and footnotes omitted.) Pope v.Mercury Indem. Co. &c., 297

Ga. App. 535, 537-538 (1) (677 SE2d 693) (2009). It is well-established that the

insurer need not show “actual knowledge of the falsity of misrepresentations in order




                                          4
to prevent a recovery under the policy.” United Family Life Ins. Co. v. Shirley, 242

Ga. 235, 237-238 (248 SE2d 635) (1978).

      In this case, the undisputed evidence shows that the use of a CPA audit and a

requirement that checks be countersigned were material to Georgia Casualty’s

decision to issue crime coverage to Valley Wood and that it would not have issued

the policy if it had known the true facts. “Where the evidence shows that the insurer

would not have issued the policy if it had been aware of the true facts, the evidence

demands a finding that the omissions or misrepresentations were material to the

acceptance of the risk.” (Citation, punctuation and footnote omitted.) Pope, supra,

297 Ga. App. at 538 (1).

      To the extent Valley Wood argues that it cannot be bound by

misrepresentations in an unsigned application submitted by its insurance agent, we

conclude that these arguments have no merit. “Independent insurance agents or

brokers are generally considered the agent of the insured, not the insurer.” (Citation

omitted.) Canal Ins. Co. v. Harrison, 189 Ga. App. 681, 683 (1) (376 SE2d 923)

(1988). And a “principal shall be bound by all representations made by his agent in

the business of his agency and also by his willful concealment of material facts,

although they are unknown to the principal and known only by the agent.” (Citation,

                                          5
punctuation and footnote omitted.) Assaf v. Cincinnati Ins. Co., 327 Ga. App. 475,

479 (1) (759 SE2d 557) (2014). In this case, the undisputed evidence shows that the

Lanier agency was authorized to procure insurance on behalf of Valley Wood, and

its conduct in submitting an application for insurance would undoubtedly fall within

the scope of its agency relationship.

      We also find no merit in Valley Wood’s claim that Georgia Casualty’s failure

to timely rescind the policy and return its insurance premiums precludes a directed

verdict in Georgia Casualty’s favor. In this case, Georgia Casualty sought “a

declaration that the insurance policy is void because Valley Wood made

misrepresentations in its applications for insurance to Georgia Casualty.” If Georgia

Casualty had rescinded the policy and returned the premium, it would no longer have

had uncertainty with regard to future conduct and this would have destroyed its claim

for declaratory relief. See Minnesota Lawyers Mut. Ins. Co. v. Gordon, 315 Ga. App.

72, 73-76 (726 SE2d 562) (2012) (insurer not entitled to declaratory judgment after

it voided insurance policies). Compare Sentry Indem. Co. v. Brady, 153 Ga. App. 168,

169-170 (264 SE2d 702) (1979) (insurer sought declaratory judgment that policy void

based upon material misrepresentations in the application).



                                         6
      The purpose of the Declaratory Judgment Act is to settle and afford
      relief from uncertainty and insecurity with respect to rights, status, and
      other legal relations. OCGA § 9-4-1. The law is well established that
      declaratory judgment is not available where a judgment cannot guide
      and protect the petitioner with regard to some future act -- as where an
      insurance company has already denied a claim. That is because
      declaratory judgment is not available to a party merely to test the
      viability of its defenses.


(Citations and punctuation omitted.) Drawdy v. Direct Gen. Ins. Co., 277 Ga. 107,

109 (586 SE2d 228) (2003). As a sister state has recognized,

      An insurer may file a declaratory action in order to determine whether
      an insurance policy is voidable. Although a prerequisite to rescission is
      placing the other party in the status quo ante, it does not follow that the
      insurer must allege a return of premiums when seeking a declaratory
      judgment that it is entitled to void the policy. An insurer may want to
      know whether a policy is, in fact, voidable before seeking to rescind the
      policy, and a declaratory judgment is an appropriate means to that end.


(Citations and punctuation omitted.) Transp. Cas. Ins. Co. v. Soil Tech Distrib., 966

So.2d 8, 10 (Fla. Ct. App. 2007).

      For all of the above-stated reasons, we reverse the trial court’s denial of a

directed verdict in favor of Georgia Casualty on the issue of whether the policy was

void based upon misrepresentations in the application.

                                          7
      2. Georgia Casualty’s remaining enumerations of error are rendered moot by

our holding in Division 1.

                              Case No. A15A1916

      Because Valley Wood’s claims of error are rendered moot by our holding in

Division 1, we dismiss Case No. A15A1916.

      Judgment reversed in Case No. A15A1915. Appeal dismissed in Case No.

A15A1916. Doyle, C. J. and Phipps, P. J., concur.




                                        8
