                           FIFTH DIVISION
                          MCFADDEN, C. J.,
      MCMILLIAN, P. J., and SENIOR APPELLATE JUDGE PHIPPS

                    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


                                                                   September 5, 2019




In the Court of Appeals of Georgia
 A19A0804. ACCC INSURANCE COMPANY OF GEORGIA v. McF-028
     WALKER et al.

      MCFADDEN, Chief Judge.

      Where “an insurer assumes and conducts an initial defense without effectively

notifying the insured that it is doing so with a reservation of rights, the insurer is

deemed estopped from asserting the defense of noncoverage regardless of whether

the insured can show prejudice.” World Harvest Church v. GuideOne Mut. Ins. Co.,

287 Ga. 149, 156 (2) (695 SE2d 6) (2010). “For a reservation of rights to be effective,

the reservation must be unambiguous; if it is ambiguous, the purported reservation

of rights must be construed strictly against the insurer and liberally in favor of the

insured.” Id. at 152–53 (1).
      At issue is whether ACCC Insurance Company of Georgia is estopped from

asserting the defense of noncoverage. ACCC moved for summary judgment on that

issue. The trial court denied the motion, and ACCC appeals. We hold that there are

genuine issues of material fact, so we affirm.

      1. Factual background.

      “On appeal from an order granting or denying summary judgment, we conduct

a de novo review, construing the evidence and all reasonable conclusions and

inferences drawn therefrom in the light most favorable to the nonmovant.” State Farm

Automobile Mut. Ins. Co. v. Todd, 309 Ga. App. 213, 213-214 (1) (709 SE2d 565)

(2011) (citation and punctuation omitted). So viewed, the record shows that this

action arises out of an automobile collision that occurred on November 6, 2016.

Shawn Walker sued Ermes Medrano, the named insured on the ACCC policy at issue,

and his son, Anthony Medrano.

      Walker filed suit on March 22, 2017. ACCC retained defense counsel for the

Medranos, and that attorney filed an answer to Walker’s complaint on the Medranos’

behalf on April 24, 2017. That same day, ACCC filed this declaratory judgment

action to determine whether it had a duty to defend the Medranos and whether the

claims arising from the collision were covered by the policy.

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      ACCC moved for summary judgment, arguing that there was no coverage

because of certain policy exclusions. Walker responded arguing, among other things,

that ACCC had waived its noncoverage defenses. The court summarily denied

ACCC’s motion. We granted ACCC’s application for interlocutory appeal, and this

appeal follows.

      2. Reservation of rights.

       ACCC argues that the trial court erred in denying its motion for summary

judgment because, under the circumstances of this case, policy exclusions excepted

coverage for damages arising from the collision and ACCC effectively reserved its

rights to deny coverage. Walker responds that ACCC waived any issues of

noncoverage because it assumed control of the Medranos’ defense without first

unambiguously informing them of its reservation of rights.

      An insurer “is deemed estopped from asserting the defense of noncoverage” if

it “assumes and conducts an initial defense without effectively notifying the insured

that it is doing so with a reservation of rights[.]” World Harvest Church, 287 Ga. at

156 (2).An insurer’s notice of its reservation of rights must be timely and

unambiguous, and it must “fairly inform[] the insured of the insurer’s position.” Id.

at 152 (1). To do so, the notice “cannot be only a statement of future intent” but “[a]t

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a minimum, . . . must fairly inform the insured that, notwithstanding the insurer’s

defense of the action, it disclaims liability and does not waive the defenses available

to it against the insured. The reservation of rights should also inform the insured of

the specific basis for the insurer’s reservations about coverage[.]” Id. (citations and

punctuation omitted).

      Here, the parties do not dispute that ACCC assumed the defense of the action

on behalf of the Medranos and filed an answer on their behalf on April 24, 2017. The

question is whether ACCC timely and unambiguously so informed Ermes Medrano

and thereby effectively reserved its rights to deny coverage.

      ACCC argues that it orally informed Ermes Medrano of its reservation of rights

in a voice mail message left on his telephone on April 5, 2017 — 19 days before it

entered a defense on the Medranos’ behalf. But the employee who left the voice mail

testified only that she had “called and left a voice mail with Ermes Medrano, because

Anthony Medrano is a minor, regarding ACCC defending the [underlying] lawsuit,

. . . pursuant to [a] previous reservation of rights issued on the file” “due to coverage

concerns.” That message may or may not have been sufficient. Whether it effectively

reserved ACCC’s rights by unambiguously communicating to Ermes Medrano the



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kind of information required by World Harvest Church, supra, 287 Ga. at 152-153(1),

is a question for the fact finder.

      ACCC also asserts that not until November 17, 2017, when it took Anthony

Medrano’s deposition, did it learn of two of its potential defenses: that Anthony

Medrano was allegedly driving in violation of the terms of his driver’s license and

that Anthony Medrano was allegedly driving without his father’s permission to use

the car. Accordingly, ACCC argues that its November 20, 2017 reservation of rights

which listed those two defenses was timely.

      But more than a year earlier, on November 6, 2016, the Georgia Uniform Motor

Vehicle Accident Report listed the driver of the insured vehicle as Anthony Medrano

and indicated that Anthony Medrano had been charged with driving on an invalid

license in violation of OCGA § 40-5-20 and driving on a restricted license in

violation of OCGA § 40-5-30. Whether ACCC had constructive knowledge of its

potential defense that Anthony Medrano was allegedly driving in violation of the

terms of his driver’s license before it assumed the defense is a question for the fact

finder.

      Whether ACCC had constructive knowledge of its potential defense that

Anthony Medrano was driving without his father’s permission before ACCC assumed

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the defense of the Medranos is also a question for the fact finder. The accident report

indicated that the collision occurred at about 10:30 on a Sunday night. And Ermes

Medrano testified that at some unspecified time “after this accident” he told ACCC

that he allowed Anthony Medrano to use the car “for school purposes,” although he

also testified that Anthony Medrano could use the car any time he wanted it.

      “[C]onstruing the evidence and all reasonable conclusions and inferences

drawn therefrom in the light most favorable to [Walker],” Todd, 309 Ga. App. at 214

(1), ACCC has not demonstrated that there is no genuine issue of material fact on the

waiver issue. So we affirm the trial court’s denial of ACCC’s motion for summary

judgment.*

      Judgment affirmed. Senior Appellate Judge Herbert E. Phipps, concurs.

McMillian, P.J., concurs in the judgment only.

      *THIS OPINION IS PHYSICAL PRECEDENT ONLY. COURT OF

APPEALS RULE 33.2.




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