it your honor your honor so i think the issue in this case is what key is the purpose of the employee benefit liability insurance coverage is it meant to cover the nature of the employee benefit or is it meant to cover the consequences of the get the insured in ministering those employee benefit plans the underlying  opinion and hartford argues that it is the nature of the obligation that controls the determination of whether there is a duty to defend in this case we argue that it is the consequences of the employer's act in administer in those employee benefit plans and the error in the reasoning that it's the nature of the obligation that determines where their coverage i think is demonstrated if you look at the example in the baylor case that the court suggested might be a circumstance in which there would be coverage but you don't why you don't have coverage for breach of contract but that isn't that what's involved here breach of contract but any employee benefit is the result arises out of the contractual obligation negligence arises out of the act of the employer in administrative bad contractual obligation that you have to look at otherwise there would never be an insurance in this case and the risk to courts address is the intentional that what that you don't want to say that every piece of contract is the result of negligence zennie that every breach of contract becomes insured which you can't have that right correct but the insurance company has to look at the the actions that cause the breach because the risk the moral risk in the case law talks about what happens if there's an intentional breach backs what the reasoning in those cases is asserting that they're protecting against but that could arise with any insurance so i have my homeowners insurance you burn my  cover what is the negligence and negligent act here it's the failure of our clients to maintain the records and necessary to defend themselves against the claim of the point differ in the underlying caught conduct so what big fee example in baylor doesn't sound right sounds fishy you're saying but the company says we're going to have to worry about details pain people anything of that matter insurance pays for now no insurance company is going to write insurance you know slobs but the example in the bail it's really you go to you go to insurance including the one in the baylor case which is the failure to to enroll a person in a pension plan or the example in the marketing materials for these types of insurance is the failure to and enroll someone in a health insurance plan is not materially different than your example and if that's covered then my client's failure to maintain those records should be covered as well because you look at the consequences  as well that referred to by by hartford again the way the explorer schoolish mary language reads we think creates an ambiguity because it says to form any obligation or fill any guarantee with respect to the payment of benefits so anything in the administration of the employee benefit plan would fall within that that definition or at least that definition could be used to dye any type of of covers therefore we don't think that is the exclusion can be the basis for denying the insurance compan virtually identical issue to the case presented in baylor this is a case in which an insured seeking insurance benefits for a claim made against them for wages under a written employee benefit contract that's what ronald fleischer says case was about against them when they settled it the hell gay sions of suppose that negligence really are irrelevant as concerns the duty to defend because as counsel for the putative insurance has admitted it is a negligence that they were going to try to  use as a defense essential e to ronald's claim essentially what they're arguing is his we didn't keep any records about whether or not we paid this guy and there that was negligent on our behalf and so therefore hartford you have to pay this man the wages that we told him we were going to pay him i mean that is really an outrageous situation and would require this court i think excuse me you can gets to the point that if you're if your honour's are going to rule in favor of the policy holders here you really have to reverse the baylor case because baylor says specifically that an agreement pay something under a written agreement can never provide a duty or provide a duty that can sustain a negligence cause of action it's not possible here i'm sorry can i talk to you about harford's response to the inquiry sure my notes indicate they contacted hard for it on september twenty fifth night of twenty thirteen didn't take any action until settlement was him and now you know the jury's code speaks to this kind of conduct you want to you want to respond to that well i don't think i think that paired during his delay should all fall in well to hartford's expense yes if if in fact there is a duty to defend and that is kind of the point so what what the policy holders have argued here is that we should be a stop from contesting an obligation to defend based upon the fact that we filed the lawsuit you know a few days before they actually went into mediation of the underlying case now my understanding of the underlying case at that point two was that they had filed a motion to dismiss which is in the record here concerning whether or not they had joined all the necessary allegation and so and i think the law is pretty clear that even if you accept the timeline here it's six or seven months between the time of the tender and the time of the filing of the lawsuit and that time period is entirely reasonable based on multiple precedents so i don't think that a stopper has any applicability here with respect to whether or not we have an obligate or we can deny a defense obligation and set forth those matters within the you can't create that obligation and then moreover even if it could which it doesn't we filed within a sufficient period of time and the fact that they settled the underlying case really rather swiftly since to you learned about the mediation no i think we did respond before that time i think there was a response prior to that time i guess i guess my notes i'm sorry i meant i believe that of late i had my my reading wasn't you turned to the issue and when you found out about the mediation oh there was a discussion there were discussions actually between myself and counsel for the insureds prior to that time with them wanting to us to contribute toward a settlement that they may be negotiating in the mediation and in point of fact you know we had offered us a very small amount of money that went toward that to avoid this litigation this double when would you say you first made contact well but as i said even if you take in the the time period between the time of the tender and the time of the filing of the lawsuit there's nothing to indicate that that time period is on reasonable and that's the standard there are multiple cases which  periods to be reasonable and so you know given that those facts and if there was an obligation to defend certainly we would have been required to reimburse the defense costs incurred from the date of tender and i don't think there's any dispute about that however there's no duty to defend in the first instance because this case is nothing more then somebody coming in and saying hey i've got this bill to pay and i agreed to pay in writing and i've refused to pay it but i want you to pay it for me and that's not a negligent act there are oral mission in the administration of an employee benefit plan b taken to its bill logical conclusion every commercial dispute in which one and insured decides he doesn't want to hear she doesn't want to pay somebody a sum that they've agreed to pay becomes an insurer bill of vent because i decide not to it's not an outside vendor supplying id equipment it's an employee it's a little closer to the benefits it would you say then then just not paying the rent well it is an employee but it is a contract and  isn't an amount that they agreed upon and this really is a wage dispute you know it they've agreed to pay a wage to this man because for vacation and it's sixth time over a period of years fact really seeking coverage for something that is almost you know an immoral hazard in effect so we believe that the district court was entirely correct in following baylor i think what we're asking the court to do is really reconcile two cases the baylor case and the krueger case the pervert case uses the analysis we used and talks about sort of the broad s but people can't buy insurance against a breach of contract because because it would be if it was it was made it would it would encourage careless people to relax all their controls all their care on a contract on the theory that need carelessness and it minister in a contract is insur i see the implications of your position but i do but the insurance covers the employee benefit which is the contractual benefit whether it's pension benefits health insurance benefits or the vacation benefits which we're talking about in this