and i understand he at least have to split their argument when you understand you'll be up to you to keep track of that account it would not have had it not been for the misrepresentation under section one fifty four because it does not matter that the misrepresentation was intentional or not it does not matter that is  as mystical and less well situated to know if the ms of the misrepresentation under illinois law for many many years an insurance company is entitle to rely on the application  context where the doctrine makes any sense where one is intentional acts are stupid and would otherwise threaten the coverage of other insurance who are innocent of those every illinois case that has applied the innocence rough rule except this looked at it from the standpoint of excluded intentional acts including economy fire versus war and which the r v say is the touchstone of this whole hold up and despite the defendant's insistence intentional act exclusion because the entire it in focus on an intentional act exclusion should not apply where one insurer was innocent of the wrong every case which follow war why s or precision they dealt with the intentional act excluding the significance of that is recognized in judge powers decision for the seventh circuit and home insurance versus done there the court correctly recognize circumstances the court here decided that although it correctly recognized that the facts in done were very similar to the fashion here the case was distinguishable for three reasons is the policy was for the the case is actually on all fours with the situation we have we have here and some ask the question if you are correct that the misrepresentation of one partner i'm defeats that not practice policy for the entire firm and for the individual what should those other partners to how do how do other lawyers protect themselves revisiting a large firm what  risk management program that at the time of policy we knew all a memo was sent to every member of the firm basically to come forward are there any claims because if the claim was reported on a claims made policy prior to the policy we knew the claim would be covered by the expiring policy that wasn't done here the person with knowledge of the claim didn't report the claim so there was no covers they say we have such where the actually there are three insur a policy or professional liability insurance and they make that argument they didn't make it in the trial court they did ration in the appellate court yet they have a couple of pages in their brief in this court about the one year limitation provision but the arguments policy has it is going to expire the insured wants to coverage the insurance companies and is willing to renew provided that the information revolves is suitable for the underwriting purpose of the risk of use so it it t statute talks about both renewal and new issue policy there's no question here this is a renewable policy they had been insured by as a mutual for a couple of years prior to the renewal in two thousand and  appreciable requirement of section one fifty four that was not satisfied by its beauty the misrepresentation was in writing it was on the application it was either intentional or material or both and it was made on behalf of the insured golden rule this court's decision from two thousand and three refutes the argument that section one fifty four most be construed to favor innocent insurers because they're the court found rescission of a policy to be available remedy even though the insurer was innocent of the misrepresentation he the first district in its decision here had a comment after it attempted to distinguish dawn and war that this court has consistently held that section one fifty four is designed to protect insurers we looked we never found a case where this or void as a result of the insurance company act and we said mr chambers has your argument begin and end a section one fifty four yes and under one fifty four you need actual intent or not you do not you need only  misstatement of material fact that goes for the risk to be assume and what could be more material to a policy issues will walker and failure to disclose forcing signatures on settlement documents lying to a court lying to a client portion but it looks like it's the second sentence that says no such misrepresentation of the warranty shall defeater avoid the policy unless it shall been made with actual intent to deceive or materially affect either the acceptance is an attempt by a commercial insurance carrier to void a valid contract for insurance or professional liability insurance only after received notice of the claim any time an insurance company seeks to exclude coverage its right to do so must be clear and free from doubt contractual provisions which limit or exclude or statutory provisions which limit or exclude must be construed in favor of the insured and most strongly against the insurer it's fair to say that the public policy of this state is to fine for coverage on behalf of an insurer in the event there's a close call now in front of the circuit court and and the reason state farm brought that action is because it had a clause in his contract that says concealment of fraud and that clause says the entire policy shall be void if any insured intentionally concealed or misrepresented any material fact or circumstance relating to the insurance in the misselling case you had mom and dad on the house mom and dad were insured three children were one of the children in the miss sally case but would be a good idea to commit insurance fraud and trashed the house they lied about that to state farm when they investigated claim and the court found that that particular insurer is not entitled to cover a mom and dad when al capone said they were entitled because they were innocent shirts what's the difference is there a difference between coverage and contract formation policy would be void with all due respect and that is what is going on here we have a valid contract of insurers it is not void you have an issue home vs done doesn't apply in the so can you talk in the language of contract from ation s absolutely no misrepresentations when this contract was for not he made no representations at all there is no question that will to penis jr knew nothing about what his partner's it's not maybe he was innocent acceptance of the risk of a hazard assume by the company so might my question he it seems a little tortured to say that you that when the policy was made that had nothing to do with your client it's it seems at least from the language of the statute that the purpose of the relevant language from section one fifty four is to allow insurance companies to avoid risk that they have not fairly contract and that's why i think you hear questions regarding the formation of the contract i understand but the language of that statute does not give an insurance company a right to rescission it simply does not and this indicate we didn't cite golden rule we did say golden rule and this court described section one fifty four as we note that section one fifty four is representative of statutes which are designed to relieve against rigorous the factual misrepresentation of fact of their acceptance of the risk if they had known that they would not have entered i understand but the exact does the stage of human right to rescind as to to hypothetical with mr cham death four hundred person law for the person who signs the policy under these circumstances dissolve the three hundred ninety nine or if they had no knowledge of what he was doing and they made no mess representations yeah they should be yes they should become so that's what i'm going to risk right there it is and then we get back to what i used to be a mutuals arguing is the status quo tremors mentioned what is the status quo this represent misrepresentation was made by sam to saline on april twenty ninth the policy expired on may first had m would have had notice of this one will too penis jr would have been covered if in a rescission case and that's what this is this is not a statutory right to avoid insurance coverage this is a common law equitable obviously their insurance where they have actual aerial research every once in a while they're going to get a bad apple they shouldn't be allowed to just walk away from the good apples because there's one our application from every member of the four hundred person law firm fair but i don't think forward i again i doubt very seriously i spin which one fears for the person walking it in a case where you've got two guys other exclusions from the public but had her penis signed this application under that to my knowledge is what it says i know of nothing it would be absolutely true at that point issue that justice tice and justice thomas picked up on how should lawyers protect themselves in the certain set of circumstances i don't know the answer to that with respect to a four hundred member law firm because we don't know how that law firms organize whether they're corporation or l l c or otherwise but what we are presented with here under the facts and circumstances is a two person law firm organized as a limited liability company under rule seven twenty two they must have appellate court picked up on and was the second reason for overturning the trial court decision in this case what the hell court said was based upon that severability clause there's actually three separate policies of insurance the shirt in this case so this this provision that is drafted by ice v a and put into the policy this is a way to protect lawyers if there are several contracts or several policies of insurance the bad apples are not covered but the good apples would still have coverage picking up further on the issue that justice thomas raised and you know use the four hundred person in that set of circumstances no doubt an insurance carrier would put something else into the possibly policy expressly imputing knowledge or a misrepresentation on an application to all members of that  that's not in this policy there's nothing in here and there's nothing cited by v a to suggest that there's any basis in the contract to impute the misrepresentation to my client the record is clear that mr pierce had no knowledge no participation no actual or constructive knowledge of the circumstances that lead to misrepresentation well excuse me what about the language that chief justice scalia referred to that it says i'm paraphrasing after inquiry what about that after inquiry clause well it was a desk says not open the door to knowledge well it would open the door to knowledge but let's look at this circumstances well tripping us if he was the signing partner here on the renewal invoice if he goes down to his office the bad apple in this case and asks him are you aware of any set of circumstances i don't think anybody in this room would think that santa is a league of their oh yes by the way i committed all these fraudulent transactions and potential malpractise that's never going to happen the only way that that would happen is if your penis was into leno's head or you know had some other way of knowledge knowing what was going on here but he didn't and then wrecked like i said the record is clear they can you can argue that he had any and welfare penis that representation would not be inaccurate he was not aware of anything that would cause a claim and there's just simply no evidence on this record and again going back to what i said earlier i a as a drafter of this contract could have easily avoided the situation and there are cases that are discussed in the briefs and i won't belabor the point here where there is expressed language imputing this representations by one as to all there is nothing in this policy to suggest that misrepresentation by santos of lino would be imputed as to will to penis or that the policy would be voided or rescinded in that case such as this so on this record i would submit to the size fits fits all sort of circumstance but the facts and circumstances definitely do come into play i mean in this case two person law firm one bad actor one good actor there's no way that then modify their language to put express language in their imputing misrepresentations all we've seen that time and time again that the insurance industry does a debt but in this set of circumstances  the underlying malpractise and misrepresentation was not known by the innocent shirt and given the policy language before the court with the suburb elliptic laws at best it creates three separate contracts at worst it's an ambiguity that should be liberally construed in favor of insurance coverage for the innocent insurance result you notice alina would not benefit as far as i know he's been disbarred and i don't know that he has any assets or filed bankruptcy i am not aware of his sort of circumstances but it would certainly impact my client because he's faced if i just be a successful and we're sending this policy he's exposed to not only this but who knows if there's other situations of malpractise involving santa is leno's act we don't know that but he would definitely be exposing as i said earlier will seven twenty two allows lawyers to form firms as limited liability companies if they have a choice covered that's what they did here and that's the reasonable expectation of will to peanuts  the argument that the innocent and sure doctrine applies to policy formation it applies to the applicability of an explosion this court in golden rule had the benefit of the economy fires and one case for almost fifteen of interpretation that goes to whether there's a duty to the fans we're not considering those rules don't apply this if there are no will of liberal construction we're not looking at a policy we're looking at a statute in the statute doesn't have a car the status quo was returned ed is to say whatever benefit i has been neutral receive it gave back that's all it has to do under the law and sergeant one day is a case where that that help that's all the insurer had to do to perfect and that this is a bill and not an application if we all say if it quacks it's a duck no matter what you call you can call it a goat you can call it a chicken but if it quacks it's a duck this says renewal quote invoice and acceptance for every first through an dollars of women's they don't have to answer an eight page thirty five question application they've been on the books we would submit to the court that the status quo has been returned there is a renewal application that there's no merit to the s which is a separate circuit here's what the first district relies on in new hampshire supreme court case which is no less non binding then to seven circuit decision in home versus dog the dissent in that case by justice well  insurance companies don't have an actuarial function with respect to lying on an application they have an actuarial function with respect to risk and the risk to be seen in connection with the premium charge yeah the  idea of materiality to the risk of justice thomas require a four hundred lawyer law firm it is inconceivable that it would come into the insurance industry having to send a renewal application to every member of the law then you would wonder you only ask partners you or your the associate they're all members of the law firm in the sense that any one of them would be a defendant in a malpractise the fact is a person in a position of trust signs the submit to the court that the absurdity of having a policy procured by law is something this court should not tolerate the fourth district permitted we said to the case of standard mutual versus jones that's a case where the auto insure asked on an application for a new policy to identify all persons who are resident and his license or not and mom and dad as for the wife forgot they had a sixteen year old and an eighteen year old son the eighteen year old the sixteen year old just got his license policies issued policies renewed three days later the sixteen year olds in an accident totals the parents car damages someone else's car injuries for people the insurance company then learns about the sixteen year old on the policy for the very first time after the accident but illinois law permits most claim underwriting you could you don't have to ask questions about the information on an application what happened here  it was ok because the insurance company didn't find out about it within one year therefore it didn't matter so if you're going to lie to the insurance company on an auto homeowner's or fire extended originals why keep your fingers  you don't get found out in one year is in effect with a paltry premium for that auto policy to total vehicles were paid work for bodily injury claims were paid for on a policy that should never happen if your because of some mistake will the people policy formation and we asked this court not to do so we have this court to reject that as it applies to policy formation and leave it where it belongs with respect to policy interpretation as to an intentional