Liability insurers are no strangers to time-limited demands sent by plaintiff’s counsel. In Georgia, these demands are called Holt demands after the seminal case S. Gen. Ins. Co. v. Holt, 416 S.E.2d 274 (Ga. 1992). In Holt, the Georgia Supreme Court held that an insurer can be liable to its insured for unreasonably declining a time-limited settlement offer. When an insurer unreasonably rejects such an offer, the insurer can be liable up to the full amount of the judgment, throwing policy limits out the window. While time-limited demands create pitfalls in every jurisdiction, gamesmanship by plaintiff’s attorneys has created a unique hazard for liability insurers in Georgia.

Holt demands in auto accident cases are controlled by Georgia statute O.C.G.A. § 9-11-67.1. While the legislature created the statute to prevent skullduggery by plaintiff’s attorneys, they have nonetheless found creative ways to get around the statute since it was initially enacted in 2013. Specifically, plaintiff’s attorneys in Georgia have made a habit of attaching arcane conditions to a Holt demand in the hope that an insurer will inadvertently reject the demand, opening up the limits of the policy.

A handful of recent cases illustrate this practice:

• In Pierce v. Banks, 890 S.E.2d 402 (Ga. Ct. App. 2023), the Holt demand included conditions that payment be made 15 days after the offer was accepted and that the settlement check include no restricting language. While the insurer attempted to accept the offer by sending a check the same day it accepted the offer, the court held that the insurer rejected the offer by failing to issue the check before the 15th day and by including language on the check that it would void after 180 days.
• In Patrick v. Kingston, 577, 898 S.E.2d 560 (Ga. Ct. App. 2024), the court reached the same conclusion where the insurer’s settlement check included language that it would expire after 90 days. The court held that the insurer had made a counteroffer by not meeting the exact terms of the settlement demand.
• Finally, in Redfearn v. Moore, 902 S.E.2d 233 (Ga. Ct. App. 2024), the insurer did not include any self-voiding language on the check, but rather included language requiring endorsement by all payees. The court again sided with the plaintiff, reasoning that language requiring endorsement by all payees constituted a restriction on the check.

The above cases do not even paint the full picture of the gamesmanship at play here. In fact, plaintiff’s attorneys in Georgia have gone so far as to argue that misplacing a comma in the payee name on the check. While that supposed variation has not been reached by a court, it shows the mindset of plaintiff’s attorneys in preparing their Holt demands.

The Georgia legislature has stepped in again by amending § 9-11-67.1 to create a purported safe harbor for any insurer who attempts to accept a Holt demand and to state that any provisions in a settlement offer besides those specifically enumerated in the statute is not a material term. However, because the amended statute only came into effect July 1, 2024, the new statute has not yet been tested in court. Given the propensity of plaintiff’s attorneys to attempt to get around the protections created by § 9-11-67.1, insurers should nonetheless be on guard and take great care when attempting to accept a Holt demand.