Purchase of Insurance Does Not Waive Sovereign Immunity, Georgia Court Finds

The city of Alpharetta, Georgia, did not waive its sovereign immunity when it obtained an insurance policy, an appeals court said Thursday, two years after a man drowned in a city pool.

In Sharma vs. City of Alpharetta, the state appellate court’s First Division upheld a trial court’s dismissal of a lawsuit brought by the drowning victim’s spouse. The spouse argued that the city held premises liability and was negligent in lifeguard training and supervision when Amit Sharma drowned in May 2019.

The wife also argued that the city had waived its right to sovereign immunity, or protection from lawsuits, when it purchased a liability insurance policy with State National Insurance Co.

The policy contained this language: “The issuance of this insurance shall not be deemed a waiver of any statutory immunities by or on behalf of any insured, nor of any statutory limits on the monetary amount of liability applicable to any insured were this policy not in effect; and as respects to any ‘claim,’ we expressly reserve any and all rights to deny liability by reason of such immunity, and to assert the limitations as to the amount of liability as might be provided by law.”

As in most states, the state Constitution and state laws decree that municipalities are protected from liability damages by the doctrine of sovereign immunity. Waivers of sovereign immunity must come from the General Assembly, Appeals Court Judge Elizabeth Gobeil explained in the opinion.

The legislature has even declared that a municipality does not give up the immunity by purchasing liability insurance, although questions may arise if the insurance policy wording is ambiguous, the court said.

Sharma’s attorneys argued that the policy was, in fact, ambiguous, because it referred to “statutory immunities,” and sovereign immunity is a constitutional creation. The trial court and the appellate court disagreed, noting that the immunity is embedded in the state constitution and statutes.

“This court can discern no reasonable alternative meaning to this provision other than the express intention to preserve the city’s sovereign immunity where permissible under the law, and to prevent the purchase of the policy from expanding the city’s liability in any way,” the appeals court noted.

Topics Georgia