defendant as simply the home ensure the question presented in this case is whether or not and surance company if leak and the insurance company can avoid a policy based upon the statements by insured that were seasonally corrected it's our position of that the insurance company must prove that transportation and he became involved with one william penn who was a taxi driver and he depended upon him for transportation  after that relationship began of mr penn driving the homeowners car the homeowners began to suffer financial problems and it was then determine after the fact that there were cash advances made by mr pin totaling thirty two hundred dollars on a bank america visa and there were four thousand dollars in purchases on american express card currently is theory of the home unsure in this case that mr penn colluded with my client the homeowner to burn his house this despite the fact that my client the home owner had it and that worth the seventy lee home insurer concentrated on the case for misrepresentation on the american express card despite the fact that he produced a credit report listing that american misrepresented to likewise on the bank of america or visa which was the subject of the cash advances my client originally stated at an examination not under oath that a recorded statement  in june soon after the fire that he thought the reason that the this particular credit card in ny give a cash advance was because perhaps they used the wrong two number of it was later determined he stated in june that it was already shut off and as to the mortgage he stated that he thought he was current because he had made actually over payments in december and january and he had giving cash to william penn to pay the may a payment that was due we're involved here with the defense based upon the fraud provision in the policy and it states that this policy is  you and any other insurer if you or any other insured under this policy has intentionally concealed or misrepresented a material fact or circumstance relating to this insurance whether before or after the l plaintiff presented instruction number seven and what was labeled as his ten seven discussed what the owners were and mentioned  reliance two of the detriment of the insurance company and the instruction number ten am asked that the jury consider whether or not the insurance company could reasonably rely on those instructions were not to whether these facts were material you'd agree to that was a question for the jury when you yes and there's is there any basis to disturb their determination of material this fire was intentionally set that's not it is right we did not object in the subpoena to the issue on the to reality i think potentially any time you a sk questions about one's financial situation i think they can become relevant to the inquiry because of often the motive for setting a fire financial so we did not quibble with the materiality destruction that was given and made no objection to it but we did object to the fact that i guess what i'm getting at is what i don't  the same and i make the point that the subject clause here does not define misrepresentation it uses the word intent and uses the word material but it doesn't define as representational as can something be a misrepresentation that if it wasn't a relied upon or if it was it didn't affect the investigation on the words it was not so that's why go injury suffered justifiable reliance on the part of the carrier unfortunately the jury wasn't informed of that any statement made by thus it possibly could become a misrepresentation under no language of this clause for example he says my house was blue well the house wasn't bloom but is that something  again if someone concealed something like they had a dime in their pocket at the time of the fire i don't know that that would be necessarily something that and sure could reasonably rely upon to deny th it's her position here that we need the elements of reasonable our audience and injury here to protect against overreaching on this materiality issue and to prevent insurance companies from claiming that they were misled even though in no since but they have recently relied upon it and i cited the bill versus grilling case which in turn cited justice posner in the seventh circuit where he says the requirements of justifiable reliance backstops the jury's determination of actual lions is on this theory that a person who plays an ostrich may be held to acted deliberately you know and not to want to know so that is some protection against someone claiming that they were defrauded when fact they had no reason reasonably to rely upon that so for that reason we believe that there is no reason here as a matter of policy why the to and be taken advantage of by misstatements but rather i think the protection to the insured should be that any statement that he makes has to be reasonably relied upon and it has to in some sense fact the investigation the concept of prejudice or injury is the said otherwise the insurance company can seize upon anything of that the insured may have stated at wonderly time and this is particularly also true that in this particular case where he did not mention things at the initial recorded statement but then later after he found out the truth of the matter he on his own made corrections such as he furnished the credit report how can someone say they reasonably relied upon as the earlier statement that he didn't mention a certain credit card when you give someone the credit report that lists all the deaths and the amounts in fact i think this case presents a situation where the insurance company have used of this fraud procedure because having in front of it the credit report it does particular credit card under the examination of growth well they had the information can they say to have recently relied on the statement but looking right at the credit report thing knew but yet they didn't want to ask him they would rather would try to trap him to say well if he forgets to mention that also claiming that they relied to their detriment no worse somehow the investigation was harmed or in some way that they took some action of that they relied to their detriment we're not in raising fraud as a defense so we're not claiming that out of the insurance company has to actually pay a claim before we can raise the fraud defense or your government is predicated to clear not on their particular free phraseology in the policy vision about when the policies boiled but on that totality that comes under the consumer fraud provision that right well i'm not sure i understand your question justice but there is no provision says policies void i think if the pa is intentionally concealed or misrepresented any material fact or circumstance relating to this insurance whether intent and materiality it does not define the word misrepresented what is necessary presentational misrepresentation has to be an item that is false known to be false with the intent to induce and you have reason to rely on that statement reason reliance is always been a backstop to any claim that someone said that they something was concealed from them or something  misrepresented to them because of everyone has some duty to investigate particularly insurance companies and they cannot sit back and say someone made a misrepresentation to me and ye t they could not possibly have reasonably relied upon that in for the in for reasons that we stated here we believe that a homeowner has or should be given the opportunity to seasonably correct any misstatements a this homeowner in fact did we talked about the nisa card we talked about the american express card so i would define reason or lines in terms of that insurance company cannot rely upon any statement made before the owner is given some opportunity through seasonably correct and in fact in this case at the examination under oath which was the final stage sworn statement that's when the homeowner said you know i gave you my credit report and he says as to the thank america card visa i was wrong when i told you that before i've now found out that card was overdrawn because somebody took thirty two hundred dollars worth of cash advances so i submit that the reason or elias element must be present and i would argue that is included within of the phrase misrepresent tai because it's not otherwise defined i think i've covered those issues involving this issue of fraud i will also mention that there was an i p o instruction that  that it is i think i said earlier insurance policies should be construed against insurers to avoid forfeiture so i think you have that rule of construction that forfeiture should not  granted unless it's absolutely clear and this is the language of the policy that was provided i also didn't make such some arguments about recusal i only have a few minutes we're not making any claim it was in the actual prejudiced this is a case in which the law is settled the question under consideration is one of fact the jury was properly instructed and the evidence was sufficient  believe that that would be an accurate statement of what our position here is this policy provision and that's what we're dealing with we're dealing with a policy provision and not with the common law fraud concept this policy provision is designed to protect the process it is separate and apart from arson it is separate and apart from common law fraud and going back at least as far but it goes beyond that to the supreme u s supreme court case of cla in the late eighteenth hundreds and they talk about this notion that in the course of investigation the obligation of the unit sure pursuant to this clause is to be truthful in all the harm is that the yes that the process was violated that the insured was not truthful and misrepresented and in fact concealed some things in the course of the investigation and the law here and it's one of the great things about the privileged work that i get to do is to learn new areas of the all the time is that the law is very specific here is that materiality is the test and not reliance and not damage but rather materiality and materiality is based upon the concept of potential prejudice as judge easterbrook wrote sitting as a trial court judge which we materiality at the time that it was made and that it is very clear under this long standard law all around the country that materiality is not to be determined after the fact to look at  stand here and say ok at the end of the day was there was the reliance was there damage etc you look at the process and you determine whether at the time that the misrepresentation were concealment occurred whether it was the target at that time whether it was relevant to the inquiry and all of these things clearly were in the courts also say that when you have a fire of suspicious circumstances and this is far beyond suspicious there's no doubt that this fire was set and that the plaintiff was acting suspiciously even at the fire scene that in those situations the insurer is particularly intitled to pursue a broad defense so the plaintiff can win in this case only by asking this court and having to score change the law to say for the first time that an insurer relying upon the section must prove both actual reliance  absolutely absolutely there is a difference and i think because this is a policy defense based upon the wording of the policy and it is not common law fraud and the stratum i said something that very important very useful to us he said it in his brief and he said it here that the concept of materiality really is a substitute for his missing elements of what he says are the missing elements of reliance and damage a is not at variance with the so and it's very important in a in a and i'm sort of out of track here but i'm like to address your question opinion and am in any way there was the jury was told almost nothing by way of instructions it merely said that the policy there was a policy provision that the plaintiff couldn't recover if there was a fraudulent misrepresentation misrepresentation wasn't defined in any way nor was the jury told that it had to find the statements were material and of course that jury was not instructed on the meaning of materiality so the instructions in a in a were absolutely and completely efficient and there's no question that that case had to be set back for a new trial based upon proper instructions the comparison between instructions in service what it was my recollection of how the word reliance resides in the a in a opinion is this is that the proposed instruction that was given by the plaintiff in that case would have included reliance and damage but the but the trial judge did not get it and he and the opinion in a in a says that this case has to be sent back into the jury has to be instructed on materiality and in dicta and i and there's really no doubt my mind that it was simply one sentence in passing the court said that for instance or for example one of those two w that if the plaintiffs proposed instruction had been given then the concept of reliance would have been given to the jury at that point but they never mandated that russia would be given agreement absolutely they did not and this is this is a case  made it's quite clear even of this is very much in passing which is part of the latin definition of one type of dict as justice freeman has written at length about that it was very much in passing and then just said well if that instruction be given there would been something about reliance but in a day when the opinion that is carefully read a day is all about materiality and it is not about the missing elements which he claims here this jury had to find a lot against the  plaintiff in order to recover going to the instructions and this we put by the way the verdict form in the pending swear brief it was a special verdict form and so the jury had to go through and check off question by question by question did you find this did you find that it said or done so by clear and convincing evidence not just beyond by preponderance they found a point to conceal or misrepresented facts but those facts were material but the misrepresentations were made to stay farm you know that they were made knowingly willfully and with intent to deceive and that's true also was given a recognised definition of material by instruction or defense instruction number nine which is also on  that well i think that i would be very comfortable with you in a opinion in the end with the a in a court and just give me short just briefly what ok the basis for the difference between the bas difference is this then we are we start with the premise that we come before the court not because we have asserted common law fraud but because we rely upon a particular policy provision this is a contract case this is not a  a contract case and the language misrepresentation doesn't apply well the the policy language says that if you misrepresent the word concealed that you do not have the right to recover under the policy now it's important we're not inventing this area of the law for the first time here today fire policies are somewhat unique although there's a difference because justice thomas pointed out between the a and a policy in this in some particulars in a talk specifically about to defraud but nonetheless fire policies are standard and in fact fire policies have to be approved in standard form by the state and the new york fire policy historically has been the source of all the policies in the war on the server and so when you go back you know i know that you're asking me to tell you why you should believe me that there is a difference between the policy and common law fraud and the answer is it has always been thus and it is quite clearly the law across the country and the reason is that we are dealing with policy language and not with common law thought now there is an additional reason why it you cannot force this process into a common law fraud situation and that is because how else would you get  harmed except to say that well the there is only harm there's only reliance if the fire ensure pays the policy now mr adam i said at the end he said well we're not saying that but he has to be saying that because where else would he come up with harm or reliance which would be sufficient to satisfy these elements which he wants to support for the first time and there has been no opinion which he's offered to you which  but it's my responsibility you know every word of this record which i did and when when we wrote the brief that i mean there is not the slightest suggestion anywhere in the record that the alternative instructions were  offered and in fact with respect to the materiality instruction which is our number nine in which is really the key i mean i think the fact because materiality was instructed  objection to a small part of it which had really nothing has has nothing to do with the issues before the case now what happened after that is that mr adam i filed a motion with the trial judge which was heard two years after the trial saying look judge you know that i offered these instructions in the trial judge said no and they yes they were offered and so the record has been supplemented to now include those tendered structures robbery and a waiver they would be here's the situation with the precedent from the court from this court and it's clear from the appe court is that the transcript of the instructions conference whatever that means moving the of usually or a series of instructions conferences has to affirmatively demonstrate that the instruction the standard that the competing instruction was show that specific objections were made in this case to the entire jaldi but yes i absolutely you know concede the record shows that those two tendered instructions were were made so it's really a matter  of housekeeping for this court to determine what the outcome want to be and i didn't intend to further argue that point this morning mr reagan just to make sure you're not making  paragraphs in length and it says things like this it says the statement is an action of the plaintiff is material or whether whether to reality exists or not depends on whether a reasonable insurer would attach importance to it at time it was made so that what you see is the instruction begins to talk about an objective standard as opposed to well did this particular insurer think it to be important secondly that a reasonable insurer would attach importance to any fact that would affect insurers action or attitude regarding the claim that free standing is a very important thing materiality is is it the type of thing which would affect what a reasonable insurer would think or what is attitude would be in looking at the claim and this representation is material with which is calculated to mislead or deflect investigation in any area that could be relevant at the time of the investigation and mr adam i and discussion with the court talked about the financial status of the insured as being very important and then lastly the jury was instructed that a finding of materiality quote does not depend on whether the misrepresentation relates to a matter that ultimately proves to be s in the insurer's final disposition of the claim now there was no challenge clearly in response to your question there was actually no challenge to any aspect of listen struction other than the general statement that mr adam i didn't think apparently so i mean that the bystanders report says that there was an objection to the giving of instruction on materiality but there is even in the bystanders report no challenge to language of the statute or of this instruction and working from what we've cited in the brief is a federal trial court opinion would sound national bank from the northern district of illinois again only a trial court opinion but there the judge said look we've put sources in those opinions and so that is the is the definition of materiality and it's so that the concept is is it the sort of thing that would've affected insurer's attitude at the time the statement is made not not after the fact because if you look after the fact if we have to come here now and say ok when it's all said and done you know here's the harm then that this flies in the face of what the law is in syria which is that economic interest it is only de minimus is not an economic interest then the disqualification rules says you have to disqualify yourself if you have an economic interest while we have a judicial declaration that it is not an economic interest so all that they can argue is th whether the judge also has to refuse herself in a situation where the impartiality could be reasonably challenged and so when the rule itself says that this is not balance clarify i notice you didn't mention just at the end you talked about the recusal or you are you persisting in that argument or you yes all we are not claiming that there was any actual prejudice rule sixty three c says that it has shall disqualify himself in any perceiving in which the judges impersonality might be reasonably question including but not limited to instances where they go on to describe  interests were not proceeding on any economic interest theory at all the fact that it was a mutual policy has nothing to do with this the point here is that if you do business with someone can the li know about that and can the appearance of possible impropriety actually harm the system and that's what we're concerned about here is that we have someone doing business with one of the litigants industry and in this particular case of course with this actual insurance company so whether it be as i made a point of barber accountant lawyer or whatever should a judge sit on a case where he's doing business with that person again be it insurance company barber or whatever and i think it advances the a quality of the that this disclosure should have been made up front so that my client could have filed a motion for substitution at that point without cause i won't discuss won't discuss that any further but i did want to discuss this item you know since have we ever conceded that materiality takes over from reason reliance what we have here however is that there is no distinct line between jury all the gorilla reasonable reliance and intent of they often bloor because one can talk about whether a statement was made to intend to defraud somebody whether the statement was material that they were sufficiently material that the party could rely upon it and the question of was it reasonable reliance and again we make the point that of the insurance company should not be able to claim that they were lied on the statement if in fact the little get in this case my client was given the opportunity to and didn't fact correct in his statements because at the examination under oath he explained the express card by having given the credit report he explained the bank america visa because he explained i was wrong i didn't have this bill before so how can they claim that they reasonably relied reason reliance is a backstop against someone claiming that they relied when in fact they had no right to rely because it is a test of reason elias especially where here the insurance company had a duty to investigate now when we read the any opinion differently we read that opinion is saying that the jury should have been instructed on reasonable reliance and there is a  quote in the the opinion that the jury should have been instructed upon reasonable reliance i don't think that can be simply dismissed as dicta there is a state in the pinion the jury should have been instructed upon reasonable loss insurance company has it reasonable to rely upon it it's material and if you submit approval last insurance company it seems to me that they're prejudiced because they have to assume that this is what they're proceeding on likewise an examination under oath we soon that and we cite the grand case of indiana it was also cited by later fence that at examination under oath once that's given the insured has had an opportunity to correct in the statements and after that point the insurance company has every reason to rely upon it and can reasonably rely upon it and thus act upon it and and suffer prejudice so corrects that statement so can the insurance company sit back and say i was defrauded here when the insurer seasonally corrected the statement and that is then the definition in these insurance cases of raise more liason firms of years as a basis for avoiding the policy and defendant second affirmative defense was not based on a claim that plaintiff attempted to defraud defendant thus no proof of fraud or dutch or mild drug for mental reliance was required instead defend had to show point of misrepresented were concealed a material fact avoid the policy instructions given by the truck were adequately inform the jury of the law on the issue that was decided given the evidence presented we find no abuse discretion so that's what i was asking what they do distinguish they talked about the sero then they talked about a m a and they said this case their policy language did not involve fraud as it did in and in a well  fraud or concealment so it doesn't involve fraud and thus all the elements of fraud need be proven and there is no reason to exclude no possible public policy reason whatsoever to exclude reason elias from an element that the insurance company a must prove in fact there's an even stronger reason seems to mean insurance cases to require reasonable lines because of the spirit economic power of the insurance company they can say well you said this we're go live on that i'm sorry we're not going pay the claim and they are in the insurance as well you know i want to correct that statement and it makes all those corrections on it before the examination in a row so how can the insurance company rely upon some statement however trivial or mistaken or the insurance company knows this is not really right as in this particular case they knew what the exact status was of the mortgage because they were dealing with a mortgage company how can they stand back and say well we recently relied upon this rodney jay birth versus three firm for you carefully company has taken under advisement as agenda number nine