good morning i represent nancy smith the longtime phoenix present and and we're here about a car accident that she had when you take this dispute and you boil it down to its  very essence what you're left with is whether or not the property of the had followed the statutory scheme in arizona for canceling a policy and or also the common law  protocol for following the proper steps for canceling a policy and if you're going to seek the protection of the that protocol for cancel your policy the law requires that you follow it in your problem with specificity when when you deviate from that protocol then it calls into question whether or not you've done it right arizona standard is announced in the in the case that both sides rely on and you've heard about a lot about that in the briefing is the norm in case and the norm in cases the case that kind of lays out the standard you know that it adopts say a clear and unequivocal standard so if an insurance company intends to cancel a policy there rick wired to have a clear and unequivocal notice to cancellation or it seems from the ends that there may have been some ambiguity and as you were just discussing whether the policy was or was not in effect  january nineteenth two thousand and thirteen because of the language that you say my you require but how is there any m p quit ambiguity as to where the policy would be in effect after cancellation notice and it says that if you do have a reinstatement offer option that you put in the cancellation notice that it must contain clear and unequivocal language about the mechanics of the reinstatement so for example in the norman case itself the cancellation notice had a letter that went with it this said if you pay before the cancellation date then you have you have coverage and there is no lapse in coverage if you pay after the cancellation date then we can accept the policy premium and apply it prospectively not retroactively so it's very it's clear  from the normal case itself that it lays out a framework that if you're going to have a reinstatement option and you know the court says you must clearly enter equivalently give the mechanics of the reinstatement explaining how to it and the court specifically sates at page two of three to two spilling over two or three that you have to explain the consequences of failing to do so so here i mean you know policyholder the reader that if they pay that the amount due which is the two hundred eighty seven dollars if they pay the amount due whether it's prospect of a retroactive so for example if if they paid after if they paid the amount due on the nineteenth of january nineteenth you know would it be prospective or retroactive what would there be a lapse in coverage for the day of the accident and you know that wasn't in dispute i think that they well yes they say that this is says it's printed on the eighteenth and it says that the minimum payment due has to be paid by the one thousand and if it is we don't have it by the nineteenth then you can be charged a late fee and so for an additional fee and if you're cancelling if you're canceling a policy there's no reason to charge an additional fee or a late fee if you have a clear and unequivocal intent to cancel the policy why would you anything in this this last letter that they sent out that indicated that they could reinstate the without any most of coverage in the cancellation notice or nor in the installment notice on any anything in there about that one and the perry's failed to pay within that seven day grace period does it matter that the cancellation notice set an unreasonable deadline to reinstate the policy you know it does it does for a couple of reasons but couldn't the perrys have paid within the original seven day window under the statute yes they could they could have paid within the statutory period and the the focus on the grace period in our view is kind of a red herring because the statute sets out a seven day period of time where you can pay and still have coverage after the due date on the premium at that point in time it becomes incumbent upon the insurance company to mail out a clear and unequivocal in fact under that statute cancellation is ordinarily effective upon mailing so i guess it is a peak allowed under arizona law to set whatever deadlines  over and above that seven day period it once and even if there are unreasonably short because it seems like i mean that seems to be a compelling point here for your clients is that they didn't get that last notification until if you do a if you give a reinstatement option in the cancellation notice if you say amount due in a number what you're basically saying is will accept your premium and continue coverage so if you if you do that if you have an amount doing that in in there you have to explain both the mechanics of the mechanics of it and what the consequences of not doing it so also your argument is that this statement that if the minimum payment is not received by tomorrow you or your coverage ends tomorrow that that's actually an offer that they can reinstate yeah it is an offer and that's exactly what happened your honor i mean  to they paid late they paid an additional fee because they paid late as the installment notice warning they would so installment notice that if you pay late after the cancel date we may charge an additional fee they send out the through from wisconsin terror's owner they open the notice kevin opens the notice mr perry open the notice and paid the premium and at that point after the and after he did it after the accident it was the days after after after the accident so  he got i mean in the normal case says basically very clearly if you're going to say pay us money give us some money and your cancellation notice you can do that the law allows that allows you to ask for money in the cancellation notice but if you do you have to explain both you know how to do it and what happens so if if and i can see that if the peak notice that said if you pay late after the  then you will have a lapse in coverage until we receive the payment and that's really what the law provides i mean there was some some shuffling about the temple case that we refer to our brief and the temple case is not an automatic cancellation because it prece the statute but in that case that the carrier actually said you know we're accepting your premium but we're doing it prospectively and when you have a notice saying pay us money but you don't tell the policy ramifications are consequences are for pay us money and they pay money it's unclear and it's in big us a whether or not the premium is going to be paid prospected or retroactive but it said you are now be driving without coverage right or it's of significance of that well you know i think that goes to the very heart of the ambiguity your honor i mean here they use both the present tense and the future tense they say if you don't pay you will be your false policy what we cancelled and then further on down the notice they say you are now currently doing that and you know the norm in court said if you're going to do that if you're going to go back to  pay us money and will reinstate the policy and include what the normal car refers to as a reinstatement option you can do that but you have to explain the consequences of it you have to say if you pay after the cancel date you will have a lapse in coverage until we receive the payment and then will apply it prospectively to a new policy or will reinstate it if you pay before the cancel date then there is no babson coverage and they don't do that and both both the norman case and the dissemble case addressed that issue and they do it under a different one to sort of the rubric of the statute and one does that under the rubric of the common law a reasonable expectations and the reason expectations in arizona is you know a common law doctrine in it and it basically it starts with did the carrier do something to induce policyholder to believe that they would have coverage and that's the darker motors case  n it it it's it's a political to this case they already are your essential argument is that a notice that you're that you're not there that you have no coverage as of what january nineteenth is actually an offer to reinstate absolutely absolutely ok if you want to reserve the right i would like to preserve the rest of  primary your honors and may please the court my name is jennifer andersen and i represent the apple e peak property and casualty insurance corporation your honour's the district court probably granted judgment on the pleadings to peak because the cancellation notice that was sent to the perrys clearly and unequivocally cancelled their auto insurance policy as of january nineteenth two thousand and thirteen when the  only ignored and a prior installment notice but they failed to make a payment even three days after the statutory grace period and i want to just out the ets if i could really distinguish between two things which i think are a little bit muddled norman says two basic things it says that an engine not withstanding the statute and insurance insurer can postpone the cancellation date as long as the intent to cancel by that date is clear and clear and unequivocal the insurer can also provide a reinstatement offer but it doesn't have to the languages may it may provide a reinstatement offer so what opponents are trying to argue as far as i can tell is that because there was a delay in the postponement of the cancellation date that necessarily makes it an offer to reinstate the policy and that's simply not the case nothing about this cancellation notice invited the perrys to pay after january nineteenth well because i guess i'm just trying to determine what significance we should assign to the fact that the premium old under the cancellation notice was the same m l as in the perrys monthly bill correct your honor so what should we not put any significance to that well the significance of it is that the premium amount due is not standing alone it's accompanied by an explanation of why it's there that explanation is that it helps to define the terminations date that says if a minimum payment to eighty six thirty seven is not received by january nineteenth two thousand and thirteen your coverage will end on that day so for example let's say th doesn't that's also just that they were pain on their existing policy and not a new policy i mean because it seems like that's your argument from your briefing this that the money that they paid after they got this notice after the access to days after the accident that that was going toward a new policy so i'm just not sure that that's clear would have been clear to them in light of the fact they paid the same amount of money that they were paying on a regular bill and then they paid a late fee so at the very least i'm just wondering why wouldn't it under norman a reasonable person assume as  much well first of all if you look at the installment notice it doesn't say we will accept late payments as long as you pay a fee it says please mail it on time you know late payments or insufficient payments may result in an additional fee at the insurers discretion and it certainly doesn't say that there will be no lapse in coverage and so  appellants latched on to this language about a fee in the installment notice first of all ignoring that they rejected that installment notice by not making a payment by january ninth which was the first which was the actual due date so so as the district court found that january that that december twenty twenty twelve installment that was the offer that was the only offer involved and the allegations making it plausible that the extra money was for a late fee there's nothing in the record that the only thing in the record is a complaint that says a complaint allegation that says are you answering yet i'm trying to buy when a when they pay the money and i'm sorry what i was trying to get there but i was taking too long they got a new policy they had a new policy which was issued so mr perry called insurer on the twenty third i believe a new policy was issued that day effective on january twenty fourth it was sent to the perrys they've never claimed they didn't get it they've never asked for their money back and the terms of it are the same as the old yes but but it there is that lapse in coverage between when they're policy was canceled on the nineteenth and when it was reinstated on the on the twenty fourth and let it that i'm sorry go ahead i just you know the language in the  simultaneously says seemed a little confusing says that the policy is cancelled and that it will be cancelled simultaneously it says that and so how is that not ambiguous well i it's not ambiguous because looking at the notice of cancellation as a whole it is clear and unequivocal that peak canceled the policy as of and thirteen at twelve zero one standard time you are now driving without insurance protection could it have been worded differently i suppose but there is nothing ambiguous about saying your insurance will terminate on that date at that time what i the perrys had paid the a male due before january nineteenth based on the language in the cancellation notice and states you are now driving without insurance wouldn't peek have been able to turn around and still deny coverage based on that language if he received payment on the nineteenth they would have not not been able to look like that could they have not based on this cancellation notice i mean and that is the entire reason he worded think that terminations effective date as it did if you're just making the cancellation effective on mailing it you get a problem where what if the payment comes in on the same day that the notice goes out then there's a factual dispute about whether pete got the payment before or after it issued the notice the way this is worded if the if the minimum payment of two hundred eighty six thirty seven is received by january nineteenth you know if it's not received by jerry nineteenth your coverage and that day at twelve or one if it if it is perceived then that is an elegy and your your coverages it is in place i'm just trying to follow normal because seems like norman is helpful and norman tells us that each cancellation notice should be judged based on the language in it and the circumstances under which it was set so just what weight should we give the circumstances here where there was no possible way this looks like that the perrys could have painted by the cancellation date because the nose was sent only hours before the deadline expire well and your honor that's even further proof that it wasn't an offer no one could ever accept that offer it was it was not intended to be a real reinstatement offer under norman this case is actually easier than norman because norman involved both a cancellation and a reinstatement offer and it gave the insurance thirteen more days to get in their payment here the insurer is trying to eliminate ambiguity and they're giving an extra day insurer sure doesn't know they're getting an extra day but they're not required to know that they're getting an extra day the traveling public is getting an extra day of protection so it's really it's contrary to public policy it's policy to say that a cancellation notice which provides ample proof that it that it terminates on a certain day is ambiguous but if it's not a real statement offer what is it and why do you send it at all it's a trip it's a non  can't cancellation notice in order to cancel a policy in arizona for nonpayment of premium you have to send a notice you must send a notice under the statute but they already received a notice pretty not and not a non not  cancellation notice no your honor they had received an installment offer which the district court recognized was the only offer and it said on it this is the only offer you will receive we do not provide you no follow up offers a reminder offers and so the perrys were fully on notice this was mailed i think it was printed and put in the mail and they get it in the insure knew they would get it after yes your honor yes your honor this is yeah and that's and that's the reason for the language you know you are now driving without insurance protection the insured was going to get it after you know that policy all right here's what here here's what the complaint says and i'm sure that if i'm missing something mr lewis will make that apparent so paragraph fifty one of the complaint says on january twenty third two thousand and thirteen mr kevin perry paid two hundred ninety four dollars and thirty seven cents to peak for premium payment peak except of the premium payment which included premiums for january eighteenth twenty thirteen to generate twenty third twenty thirteen to this day peak has never returned any of the premiums accepted from mr perry so there's going to get a fee there there's nothing about a fee in the record it's an i mean you know and actually in the district just there is nothing in the record or in the allegations that the perrys paid a late fee in conjunction with that as well as part of or in conjunction with that payment on january twenty third  both parties attached numerous documents not in the record to their pleadings there's no affidavit from the perrys there's a saying you know this was a fee or the insurance company told us it was a fee or the insurance company said we could pay a fee there's just they made this payment and actually addition is they got another their policy they got another policy yes your honor and that is in the record as  well and i want to touch on a couple of our policy in the record yes yes your honor and it has a date on it yes it's effective january twenty fourth after the accident and was so clear to you or that they would have known that it was clearly a payment on a new policy especially for including a late fee i guess that's have been just a little bit of difficulty reconciling well under under arizona law and actually under the to temple case because into temple it says that where the insured fails to make a timely timely payment in response to an installment notice such as the installment notice sent here in december twentieth well that's a rejection of that offer when the insured makes a pays a late fee that's a counteroffer that's construed as a counter offer which the insurer then has an opportunity to you to accept or not accept into temple the insured paid a late payment accompanied with a note saying please accept this as premiums for my old policy but the insurance company then wrote rewrote a new policy just like here with a new a new start date that didn't cover the accident and the court held that that was a clear indication of a clear rejection of the insured counteroffer and it was an appropriate so the cancellation was upheld and there was a new policy there has to be clear and unequivocal there has to be clear manifestation of a waiver in other words the elements of a waiver which are discussed in the temple are not here waiver of the waiver of a waiver of the cancellation date you know waiver of a late payment so you can actually make sure because you just said previously that there's no evidence of a l that seems like the perrys paid more than two hundred eighty six thirty seven looks like it was eight dollars more which i think the installer notices is the late fee so the installment noticed i'm sorry you're out of this domino is does not does not contain a number for a late fee there's no amount i mean maybe in the perry's mind they made they were three were paying a late fee voluntarily i don't know where that where that number came up from but take a take keep in mind that the new policy has a new premium for the new period so there's nothing in there about how that money came how that amount came to be you're thinking that that's an increase in the brain yeah but we don't know that there's nothing in the record that indicates what it is other than a payment for a premium of some sort either the old policy which the perrys contender the new policy which under the temple that's because he can never never waived its right what he wants what else would it be if it wasn't a late  date on it it also said that all prior notice it bills and notices of cancellations that the that those dates did not change that didn't change any of the they report the accident the insurance company yes you're right thank you very much thank you i think the court has hit on a very important issue which is this additional fee and as counsel pointed out it was decided as a motion for judgment on the pleadings so we didn't have the benefit discovery we didn't have a benefit of doing in iraq tours to figure out exactly what this fee was for so i mean you had the policy did you argue that it was it we argued that it was a dish an iffy that was that was that was presented and it's just exactly eight dollars more and when you couple that with the fact that the installment knows that notice says if you pay after and this is a quote the cancel date if you pay after the cancel date we may charge you an additional fee so maybe i jumped to conclusion that the exact eight dollar fee was a late fee or an additional fee on the old policy but in the motion for judgment on the pleadings we have no we can't take a deposition we can do a thirty six notice we can't ask them what that was for you know and so but when you couple those two communications it leads a reasonable person to assume as it did me and perhaps the court that the eight dollars was a fee a late fee or an additional fee for be a lapse in coverage and that's really what goes to the heart of norm and you know i draw the court's attention to the paragraph twenty one of norm and where it basically says we're they they reject ok and so but then they go on to say when he notices reference to an amount due as this cancellation did is unaccompanied by an explanation this creates a creates an uncertainty to the policyholder that results in a disqualifying ambiguity and that's right there in norman so if you give a cancellation notice that says pay us money and there's a reinstatement notice and you don't explain what that is for then you  you know and it would you know it would be interesting to know i mean we you know like i said this is a motion for judgment on the pleadings we had had no discovery we did are you that and and but if you take you know you take eight dollars in the added to the amount do you end up with the amount that they collected and it was on it was a collection that they took from a payment the day after the accident on the old policy number so i mean it's not like they went through a new underwriting process and they went through and we rated him and then  gave a premium increase based on some kind of rating the day after the actually called or and they took the payment over the phone and they took that to thirty seven or twenty seven thirty seven added eight dollars exactly to for a to extend coverage and he's got the premium notice in his hand and he pays the two of the seven thirty seven and at that point they say they turn around on a grand i'm not this cancellation notice that says you assure us was canceled on the nineteenth and he's told he doesn't have any insurance and then he gets a new policy yeah but he didn't he didn't buy any he didn't offer he didn't offer to buy a new policy he offered to reinstate his own policy the insurance company rewrote the policy with the labs there's going to be an offer to acceptance and this is what i'm saying that the temple case give some guideline what kevin perry did the installment notices pay to have two hundred eighty seven dollars and thirty seven cents and w continue our coverage of the lapse that's that's in some notice the the council a distinct cancellation notice says will reinstate you for two eighty seven thirty seven right and and what what he did is he paid the two eighty seven thirty seven plus a day dollar fee and then they rewrote a whole new policy that's they accepted an offer that wasn't out there that's that's going to thank you very much thank you both you for your presentations and arguments here today  the case of perry versus pique proper i'm sorry to interrupt we jennifer anderson for a peek we had a motion to strike portions of the reply brief which are in a collective dimension during my oral argument an alternative to that we requested the ability to file the server applied directly addressing just the new arguments based on the temple i think that would be helpful for the court if we were able to do that thank you thank you the case of but i'm not ordering that i will let you know if