The Georgia Supreme Court underscored that garage liability coverage would not respond to bailment claims for which garage keepers coverage was designed. The compelling reason is that a "care, custody or control" exclusion applies to the former (and commercial general liability coverage), but not to the latter.

Briefly, the owners of more than 200 autos parked in an airport parking lot, operated by a company specializing in such services, brought a class action suit against the operator for flood damage to their cars caused by torrential rains. They alleged a bailment situation and negligence on the part of the operator.

The insurer of the parking lot company, in the course of litigation and to determine its obligations under its policy, moved for summary judgment. It contended that its obligation was limited to the $250,000 for which the garage keepers coverage was written and that the garage liability and general liability coverages, each effective with a $1 million limit, were not applicable.

The insured appealed a trial court grant of summary judgment to the insurer. The matter ultimately rested with the Georgia Supreme Court. The appeal court found that questions of bailment and insurance application in like situations had not been resolved in Georgia law.

The high court noted that the parking lot was typical of many at airports. It was surrounded by a high fence. Customers obtained tickets from a machine as they entered, on the back of which was printed "....This company assumes no responsibility for loss...." The customers parked the cars, kept the keys and, on returning, exited at the gate upon presenting the ticket and paying according to the time parked.

The court stated that the so-called disclaimer was insufficient to alter the bailment relationship between the operator and its customers. There was no provision for "....patron acknowledgment of the disclaimer" and little likelihood that most would know about it. The vehicles remained in the "care, custody or control" of the operator.

Accordingly, the pertinent exclusion in the garage liability and general liability coverages was effective in the circumstances, and coverage could be found only in the garage keepers coverage part to the extent of its $250,000 limit.

(PARK 'N GO OF GEORGIA, INCORPORATED v. UNITED STATES FIDELITY AND GUARANTY COMPANY. Georgia Supreme Court. No. S9600130. June 17, 1996. CCH 1996 Fire and Casualty Cases, Paragraph 5739.)