good morning you're honest and mad please report david harrison behalf of outdoor sports gear inc which for convenience sake i'll be referring to is always g today i'd like to reserve five minutes of my time both for a bottle and to purchase agreement the a p a whether o s d or a and as is liable for the injuries allies of the national by lawsuits the nd question is whether and to what extent and that's what required under the terms of the a p a to purchase insurance that would have covered the liabilities alleged in the national by his own lawsuits now our position is that the district court strayed from some very fundamental principles of contractual interpretation and as a result reached the wrong conclusion as to both issues and today but i'd like to do is i'm going to go through i'm going to discuss what we believe is the right outcome but at the same time as i go through these issues i'd like to highlight emphasize that i'm going to refer to as the at a minimum errors the errors that we believe are so fundamentally in correct that at a minimum this court should reverse the district court's on certain issues to correct those  and all injuries of any types regardless of when the underlying tort occurred so long as the injury itself quote unquote occurs at the time of closing i e it occurs after one thousand nine hundred and six when an s purchased oh is she swimming pool business now the court interpret in this the district court should have looked at the plain meaning of the words particular the word occur and tried to determine what those words mean to an ordinary person with a district court never engaged in this analysis instead with a district court is it looked at a complicated california court of appeal decision called armstrong now armstrong dealt with a very specific issue of when standard c g l insurance policies are triggered for the purpose of as best as relay coverage matter of california law as at the time the contract was entered into well actually armstrong came out after the parties entering the into the a p a st of all but nd of all i would argue that what armstrong court was deciding was not whether or not as a matter of law especially as related injuries occurred a certain time when it was assigned was as a matter of c g l policy i recognize i'm involved  california right i agree that that that was based on a heightened sense of factual record when i when i when we have here in this case this is best related injuries so why would that be the natural thing that the court would look to but i think when you look at california case law and frankly case law across the country what you see is that courts continuously struggle to try to pinpoint when and especially as related injury quote unquote occurs or when a cause of action accrues a nd what the courts routinely say is that that when it occurs depends upon the policy issues that are play in california and your california law it occurs at the time determining when when and injury occurred without when is it that you say it occurred well i think that if the person realizes that well i think that that that the question is a bit misleading frankly i think that when you with a contract the question should be what did the they know they have the injury that's correct now now what i would say if you're even if there was some physical insult that set in course the chain of events that led to them realizing it at some earlier date i believe that's only because it's because the physical infill would be the cause but not necessarily the injury and if you look at the party's contract and two point zero three b three they're very careful to separate cars from fact they would have been pretty easy to write this thing that to say injury that were known prior to the closing or injuries that were known after the closing right to do it was written in a way that's correct it wasn't written that way and i think what's important to realize is that it is written so that and that's assuming liability for potential towards where the hor conduct occurred prior to closing and assuming liability for the future injuries from the prior occurrence horses tortious conduct now one thing that i think your honest questions point us to is the fact that  stead with the armstrong court it is adopted what's known as a continuous trigger theory now under the continuous trigger theory the court recognized that yes an injury occurs at the moment of exposure however new an additional injuries continue to occur over the wife of the injury until the exposed person's death now as a result what the armstrong court how it is it's not just the policy that was in place of the time exposure that is triggered and used to cover the rather it is each and every studio policy that was ever in place over the life of the disease the fall of the expose so as a result a whole bunch of these policies were implicated and they all had to share based upon the time they were in  that if for example oh s g had made inadequate concrete it was faulty in some way and they had paved a pool with this and the concrete after thirty years to tear rates and as a result after for that injury because it's part of two point zero three three what an s agree to was to agree to assume liability for deef defective products for product liability issues and if you're going to say that injury happens and in the ideas it on these asbestos cases the injury happens when the bestest fibers get into the hole the ole or whatever it is isn't that right why isn't it the theory that's the theory not taught it's i mean it's really not like the case you just described when we know when the injury happens when the guy fell through the concrete right i take your honest point i think however that an average person reading the language of a cur would think that is when someone actually came down with symptoms with an average person have a clue i mean honestly it would and this to me really well i mean i think an average person knows what an injury is a knows what occurs is that you know the other thing that i wonder about is i mean that i mean at the time well before this time it's best as coverage litigation is going on across the country injury from a spasm the type of injury that derives from this best  was clearly knowns and by then even though it was hidden in the s it was it was coming out there are lawsuits all across the country i know i worked on as best as coverage insurance litigation represented clients not the fortunately were out of it by the time the armstrong case that i so i'm just wondering now and also it's clear that at a certain point i don't know when  because a lot of people were exposed and didn't know when exactly any injuries or symptoms would occur and you know death would occur in the context tracting any sort of symptoms and then connecting the symptoms to the actual disease so all this is going on the time is contracts drafted and the if i realize your point this arms own quite appeals decision actually came out two months after company that was being sued by two of this best as insurance now you factures settled that certainly by the end this was this particular wrists and exposure about as best as was know i just i can't understand th in the manufacture well i would point out that at least to my knowledge has only been two perhaps three allegations of his vessels related illness related to the swimming pool so i don't know how common it is what i would like to go back to is is the you know i think even if we we agree were to agree which we don't but if we were to agree that it was appropriate to look to armstrong again i would just emphasize that the court got that decision wrong it when it declared that that should be shared i mean our response is that if you're going to follow armstrong and if we're going to hold that armstrong is the law of the land in california and i think that's that's where you have to come out as you have to come out that o s d is liable for a portion of injuries that occurred from the time when they own the business and that's responsible for the time after which they bought the business and you a portion of just as the armstrong court did i would also say related to liability issue the nd major error i think  the court made was with regard to the loss of consortium claims and you know with the district court it is just kind of group loss of consortium and with the as best it's related injuries and said always to use it is liable for all of it now the problem with that is loss of consortium is  independent tort and the case law is very clear and i think just logically speaking it makes sense that a loss of consortium doesn't occur now so at the same time as as the injured spouse is injured rather occurs when the injured spouse says injuries to to to go back to what is our minimum baseline position is your honor asked with regard to ten point zero seven and the insurance is through r r r what we believe is the most fundamental error there was that the district court changed the standard after a trial one standard was announced in the summary judgment order in which the court said we're going to decide a trial whether it's best coverage is quote unquote available after a trial the district court issued a trial ruling we're actually said the issue is not  allocation of liabilities based on when the injury occurs thus o s d is responsible for injuries or current before the closing time and injury occurs when will it happens or when it takes place it does not or not occur when it manifests when it does damage came in to existence at the onset of symptoms if the parties had intended that interpretation that meaning they would have used words like manifest discovers a cruise but they didn't they use the plane and unambiguous term occurs which means happens or takes place it will take about as what about this continuous injury thing that your post i'm sure you're on  armstrong in addition to determining that as a matter of california law that as best this injuries st occur upon exposure also adopted as a matter of policy something called the continuous trigger that's an ensure of an insurance law which is designed to insure the maximum available insurance policies and insurance coverage for the insured it has no applicability here into a contract between private parties and in fact  making it less available but most importantly there's nothing in the a p a that suggests that you could could adopt or read in a continuous trigger it treats the it permanence of an injury as a singular indivisible it doesn't contemplate injury having one single injury being a assumed liability and also at the same time some portion of that injury being excluded liability so the continuous trigger although not applicable here is a matter of policy at all also is it consistent with the parties with the parties contract and it's undisputed over the matter of california law and on the record fear that all of that the best as exposure significant expenses exposure causes almost immediate harm and that all of that exposure occurred here before the closing time if you look at your three hundred and twenty seven to twenty eight for thirty four and your four  seven that's in the record where you'll see that all of the exposure the underlying exposure occurred pretty closing you take you take those undisputed facts combine it with armstrong combine it with the pla interpretation of the word occurs and then you see the district court was absolutely correct on summary judgment for the wrongful death and loss of consortium claims how could the injury have occurred precl when someone's alive how can they how can a wrongful death claim accrue likewise how can loss of consortium claim accrue in the s or eighties when you know that the other spouse wasn't aware of these things and presumably was able to two three see three it says that she is responsible for quote unquote contingent liability for personal injury where the personal injury occurs before the closing time the personal injury that occurred before the closing time is under armstrong the asbestos related injuries and the contingent liability is the loss of consortium claim we know under california law they say you saying it's out there even though we don't know about it it's contingent it's a contingent liability at the time of the entry arises under california law the nd spouses loss of consortium claim arises from and has its origin in the st spouses play that's the warner closing of the parties intended for that personal for that wrongful death to be to be responsibility it doesn't we don't think it makes sense as a textual matter or as a logical matter to divorce the liability for the injury from the office or the liability for the death for the liability from the engine because they're all arising out of the single act think for example your honor of let's say so the closing time was close ing but it leads to some sort of exacerbated condition they get gain green going in nineteen one hundred and ninety six dollars and that's not treated and it leads you know to death after the closing it wouldn't make any sense to say that for purposes of a tort reform statute the occurrence word occurrence is what's in the a p a and what armstrong speaks to to california law it's clear is clear on that and of course armstrong although  arising or being decided right around the time of the a p a as a judge were law noted the trial court decision of course was before that time and armstrong builds on a body of california law including the montrose decision from the california supreme court  point zero seven here the issue for this court is whether the district court clearly erred in finding that section ten seven doesn't require as best us related coverage i think it's very clear if you look at pages e five and six that the district court found properly found after bench trial no credible evidence that coverage for as best as related injuries was available in one thousand nine hundred and ninety six it's undisputed that section determined that the dispositive issue here was whether at the time of contracting coverage for as best as related injuries was commercially available did not produce any contemporaneous insurance policies showing that as best as coverage was available normally be associated in available in the specialty market that's it essie are fifty dollars to fifty one dollars and he said s and he said that anthony and sullivan lacked the bargaining power and the diversity of assets they would be necessary to get a manuscript policy so for all those reasons we think the district  any language that can be reasonably interpreted to provide for fees and a dispute between parties to a contract and that's the standard from the district court case that's for california a attorneys fees arising out of any failure of the to pay the excluded liabilities and the exclude and the excluded liabilities are what we discussed or over discussed earlier the underlying as best as related which makes clear that there is no clear statement requirement you don't have to say the attorney which fees are you are you referring to or from two dollars fees in this litigation or the s in having to defend a excluded liabilities that required anthony and sylvan to file this action to seek payment and recovery of those fees in doing so it incurred attorney's fees and those attorney's fees are rise out of that th limited to rd party rd party circumstances are roman at four doesn't have that limitation and even more important the district court's interpretation riggers twelve five which is that three hundred and ninety  the court should do so applying traditional principles of contractual contractual interpretation also your honor you're correct the twelve five does concern control d of the litigation but where there  are rd party actions but the there would have been no reason to say in the case of any rd party claim if every thing in twelve one was about a rd party claim while there would be no reason to say in the case of any rd party claim you that shows that certainly other provisions of twelve one are limited to them and i mean were underage were under roman at four but roman ets one and two are equally clear that they apply to breaches of reps and warranties and provisions that are between the   these sub contractors show indemnify the contractor for attorney's fees suffered or incurred on account of any breach of the aforesaid obligations and covenants and any other provision or covenant of this contract you know that you have that here too i don't believe so because i think what the court incontinently heller was saying is that we have we have a provision saying we'll pay your attorney's fees followed by another provision saying and we'll also pay your attorney's fees and i think the court was again as you have to say it twice as well if you if you construe the st one as being for arises out of or connected with the performance of we're going to the subcontract that wasn't enough but then it goes on and it relies on the nd one that says indemnify hold harmless fees and cetera on account of any breach of the and covenants and any other provision or covenant of this contract i mean are those aren't as effectively both in here too i don't think so i don't think that there is the nd the nd provision there if only the nd provision were here were in this one would that  because that's the one that kind of heller said was sufficient i don't believe that's i don't believe that would be correct either i think continental heller of the court was very concerned of the fact that there that you had two provisions and that the court in that case did not want to render one of them superflui meaningless and since they were back to back and they seemed to be directed towards similar things of course trying to find a way to harmonize them and give effect to both of them and i think if you look at partners what you find is that is that the general rule  california these days is that the default is that if you have a provision that's labeled indemnification talks about one party indemnify and the other talks about one party holding the other harmless the default rule is to assume that that provision is indemnification provision that includes attorneys fees for the parties and a direct action on the contract that that attorneys fees provision is subject to section one thousand seven hundred and seventeen of the california civil code in other words it's interpreted just like a prevailing party attorneys