problem that i have so that you can address we don't talk about it in advance so i don't know if i'm just speaking for myself or if others share it looks to me as though since a final judgment is being paikin from england to california or arizona you must suffer under the law challenge not the judgment because we're not the house of lords we don't review english judgments you must challenge the british legal system and it's an uphill battle because that's where we've got the whole idea of due process and we have one circuit cases saying british legal systems just try hard sell if i h the problem we have with that your honor is that and i should preface my remarks by saying that particular analysis is only applicable to english system is fair our point when it comes to the system of justice in england is that it skewed towards lloyds in this unique situation where the i don't understand why that's different from a whole lot of things that we recognise for example the national labor relations act has its one of its objects the promotion of organization among labor and if it's tilted in favor of unionization and most banking regulation is tilted in favor of preserving the soundness of banks insurance regulation in the united states is tilted toward preserving the sound insurance companies and in both banking and insurance law as the government uses a strong arm to force solvent banks or solvent insurance companies basically take over weak ones at very much wrath to the contrary of their owners interests and why is this any different it may not be different your honor i just point this out because this is a factor in agreement that your client signed in the general undertaking so it's it's really and then my problem the next problem is that it seems to me that the gender undertaking has been up that you can't argue with your own right i think that that's not the argument we're making we're making an argument that they did not agree or consent to the terms of the advertised contract which they never saw did was done without our consent without the clients now i think that's the key point for our attack here argument and very basic terms is that under the california recognition act we now take a fresh look at these judgments and we decide one simple issue and that is are they in accord with california public policy or do they  providing the names an opportunity to raise a particular issue a gnat's if you are fragile and concealment that is a defense that the names have here in california but did not have under english law advance which they did they could it could be enforced another tip isn't the courts of england that are imposing this unless as a result of an arrow your agreement to follow whatever that in clarifying that in the richards case there was a presumption of the court that the names would obtain in england a process that was fair and i believe it's clear that the court in th by you're asking us to examine whether it's fair that you're not allowed to raise fraudulent concealment at as a defense or counterclaim in in the and in the way that you otherwise would be that's right in a california court and i'm thinking that isn't the question i'm thinking the kinds of contracts that won't be enforced because they violate public policy would be things like a contract that after your daughter is born and she grows up you will give her to me in marriage at your children will be given to somebody else's flayed possibly gambling contract so i don't know if they're against public policy anymore now that there's so much legal gambling these extreme sorts of contract that civilized nations would not allow people to agree to and i can't see that there's any barrier to civilized nations allowing people to agree to put this defense here instead of there or had to sacrifice various individual at economic interests in order to favor the soundness of insurance coverage  it seems like it's not the same category as as the contract against public policy that won't be enforced despite the judgment of another nation's courts that grant to process of l a separate issue from the contract your honor vs any issue of the unconscionably already of the kind there's two categories here where you can avoid enforcement of a foreign judgment in the first one is where the courts there are not civilized courts that grant what against due process of law though you have not conceded it you've recognized that that's not your strongest argument and the second category is contracts that are so again so contrary to public policy that at they will not be in force despite the judgment of courts that to grant due process of law that is your primary focus as i understand it but the dispute about public policy that you're a strikes me as not in the same category not in the same ballpark as the kind of contrary to public policy contracts that won't get in force kill salman rushdie that would not be enforced if it were some sort something that was contractual and approved by the courts of the nation the granted due process and it becomes very public policy from one's other examples those are the sorts of you haven't appointed and we're going to have this person enter into one of contract you know without asking you i'm putting waiving your rights here and your rights there might have something except for the fact that this was all the result  agreement that's where i get stuck it does go back to the original on the green that justice presented it it does focus on the general undertaking and we just disagree that when they signed the general undertaking they could have possibly contemplated that they were going to be reallocated the way that they were or that they could have foreseen that this was going to happen why because they were not told about the horrors in the pipeline when they signed that general undertaking and then turned to the undertaking we don't have a problem for not arguing that point but we are arguing is england does not recognize a cause of action for fraudulent non disclosure it's never change could raise it it's just that you couldn't raise it as a defense to the action the idea was the policyholders get the coverage in these huge environmental want to asbestos why abilities at and then you're free in separate lawsuits to fight it out with the people that persuaded your your clients to become names at problem is first they have to pay the money so that the policyholders and the latest get their money so the insurance stays good and then the investors fight it out that th correct your honor but that's that's the procedural part of it the substance so you didn't lose your your bill if you didn't lose your ability to get a remedy for the fraud if there was fraud we did that's our argument argument is that we never once had an opportunity because of the nature of english law on friday night nondisclosure to raise that so you will not meet first of all that is largely again the result does that deference in english law in california law trigger the public policy exception to the recognition act in our our position is essentially that it triggers the recognition act public policy exception it's so important that the names be protected or any california citizen be protected from any fragment non disclosure in the sa judgments went on and the hearings when i for days we have twenty minutes here your honor there were days of appellate argument on the very issue of the tsunami later or the other issues that they complain about the issues were raise company lloyds is kind of like the state insurance commissioner it is the closest analogy probably in the united states is not a perfect analogy is the new york stock exchange i can see that you know if they stop possible under our securities laws lloyd not immune from the consequences of actions committed in bad faith including fraud and that is in fact the case and they don't deny that what the part that or negligent misrepresentation indeed english courts have already awarded substantial judgments to some of the other names in other words the people that were allegedly using the trade name w subject to litigation and all the court knew that that was that they had was right to had those rights and indeed they had the right to sue your honour's pointed out separately lost as of the time that the richard case came here nobody has or a right under public policy to have the defendant to have enough money to pay all the try again if you use the analogy it would be sort of like saying you know and i has never been held to be a fundamental right of public policy i mean many many countries have different views about discovery but let's talk about specifically the so called manifest they're basically what happened here you england were concerned with policyholders their number one concern that they get paid a second to turn is since unlike insurance companies in the united states where your liabilities limited limited to your capitalization or your maximum policy  these rigs and we're going to come up with a premium that will based on the actual oral studies done at that time projecting out what the cost of the spotless liability is not an easy task and we want to allocate that freemium everybody a up with actuarial studies to figure out what the what the appropriate cream should be for this reinsurance to reinsure these risks that all the names bad to insure the policyholders to pay and the lloyd needs the evidentiary standards of the court and by the way they challenge that provision the name challenge that provision one of the issues in the court in england before these judgments were entered was whether or not a wise had the authority to do it and be whether or not this manifest their provision was appropriate they litigated that all the way to be a part of court that was upheld plan a right to challenge that and i if you have a fair tribunals to say that the evidence treats standards as the one you can what you can show on what you can show are going to be different than here particularly where you can challenge those standards which they had the right to do in fact what they're really saying is they shouldn't have to pay the fair share of the premiums that are protected them from their own limited liability because at the top has been paying claims they've gotten a free ride all these years was lloyd's would sign up as names rich people and aristocrats in england they'd never put up any money they'd never write a check and they just kept periodic checks for large amounts of money their share of the premiums essentially what they were doing was making the insurance solvent by pledging their great fortunes and as long as the underwriting was done soundly and their great fortunes were never invaded had then the problem was the asbestos and pollution liabilities here and the great fortunes were invaded now if i understand that what equity haas is all about is protecting those great fortunes five painting reinsurance read policies is at the end of three years nobody could be came a time where the actuarial people had difficulty calculating what that tail liability was a self regulatory agency was the one that implemented it you're right in the fact what people were told is that you have to buy we insurance and you're required to buy reinsurance in the only reason this matters because we're all here focusing on this point agreement and questioning and the argument that's being made is that disagreement is against public policy in california but it's not even an agreement laws differ in some way that is not a fundamental public policy then we are really saying it is only our law that counts  t became impossible i'm sure if you go back to the actuarial studies when this will took place back in the ninety's and compare them to what's been paid out and i suspect this liability i'm not so sure that we have a handle on that today and that's not fraud that's really not fraud but there was there was the old technique basically that at the end of three years at some agent would try to round up a new bunch of underwriters who would essentially take a premium in exchange for insuring the tail eight then the investors who would be willing to take a premium to and  ensure her provide reassurance for the sale became unavailable because of the unpredictability of of the tale a little more complicated than that in general they were required  in england more so than here accounting firms particularly the dilution of the vote counting for financial accounting but actuarial because actuarial and at the end of the period generally a three year period they're required to try and place an actuarial sort of fuel value on that tail inform tail and that's the process they had to go for in the work regulations that govern that and as you proceed along in fact it became more difficult to do that i can answer that question in your honor i don't know i believe that some of them did but again it's my understanding that in english law it's not a cause of action for fraudulent nondisclosure the action against managing agents where for breach fiduciaries duty and for deceit and misrepresentation i did not understand your argument and maybe i missed that the focus of your public policy argument was on the difference between frosting on united states and in california i thought it was the century on  what's described as a settlement author that's part of the appetizer program and my client's getting a free ride my clients get a free ride and a little bit like the enron investors are getting a free license unless you get automobile liability insurance people say i already have my life some title to keep it the state legislature says not unless you buy liability insurance they say i got all kinds of problems by and liability that the car just went through involves a balance of risk and plazas and they videos that that analysis wasn't provided to the names on the names that we're not interested we don't trust lite we're not go and everybody knows it and that's correct and that's why the devastating effect of the nondisclosure hat and the names purchased insurance from the said  cycle of three years and so you don't even know that there is going to be a last until three and a half years after the one year venture and in this case it dealt slowly over the years and in the early names in terms of providing information to the insiders that lloyds interacted with the names in one instance and that was essentially off the road in the meeting when they became names