this case turns on the holding of the kentucky supreme court in the case of jones or says bituminous coal i come to the court i look around there's lots of cases but i have in my hand the insurance policy in the jones case and i think that those are what decide this case in jones the kentucky supreme court reversed what had been the law of the land in one thousand nine hundred one the court held that if there is a late notice that it is no longer a forfeiture and what an insurer must then show if there is a late notice in an insurance policy is that there is prejudice this is the law of kentucky therefore the issue before this court is whether this jones case the carve out an exception for this  excess policy and in short the kentucky supreme court would not carve out such an exception are allow argues that yes they are allowed policy is somehow different or special and would be subject to an exception to jones's general rule and the answer is it is not special and is not subject to any type of exception to the notice prejudice rule set forth in jones jones who w current policy was yeah sure it was but i think we're talking about it claims claims as well were they answer is yes you are but we're talking about an excess policy and the issue before this court is to look and see whether the holding of jones would be any different in this policy when i know that does is try to categorize this is a claims made in reported policy but what we need to do is the court held in the i m g cases look at this policy and decide what does this policy say when you compared to jones does it make a difference whether it's just claims made or claims made and reported it does make a difference i want to say that once again what this court should do is look at the policy itself at the insuring cause and in this notice condition but it would make a difference is not the case here this is i excess policy and the reason that we call it a claims made policy is because the underlying policy which it follows was a darwin which was a claims made but that wasn't a coin's made a report of policy to its peculiar to me that  kentucky common law you say the weight of the authority which is jones would you say jealous depicts the general authority in kentucky that that ensures always from a show prejudice where there's been a lapse by the insured though what jones says is if there is a condition that has failed to be met it indeed goes by the general principles of contract law if you have a breach people breach contracts you know we do that and what used to be is an insur oh no we're going to forfeit their coverage but when joe says no no if there's a reach them we're going to look and see if it's material and if it's not material then what we're going to do is going to we're going to discount the policy language no your honor i think the discount is too strong what we're going to do is look to the policy language if there is a breach and in this case we we were late in the notice under the our our policy what is the effect of that and under jones the effect is the s will point to the cases in kentucky well first i want to know the court has read this but jones is so strong that that's where that's the reason i bring it up here it says in jones absent language in the contract clearly spelling out the meaning and cram terms for prompt notice and automatic forfeiture of consequences the reach in terms of the consequences or veg of the rule of the policy of ambiguity which is subject to applies to this contract and so talking about contract law part of the contract that has to do with sure and company of what risk those the company assume with the rights policy and the claims made by the insurance company assumes a wrist that ends on the date certain the end of the policy and an occurrence that's not the case so i can understand the prejudice rule if the claim doesn't have to occurred during the policy term but here you're really you want to rewrite a policy rewrite the risk paid its money and there was no question about that the darwin policy was acquired made for a specific period but your question judge i think really goes to what they're talking about a claims made and reported and so in this policy period you have two things that occur a made and it has to be reported that's not what happened in this case and in fact are allowed wants to talk about the darwin policy but what the court should focus on and is as said in the i m g case is what does the  and when you look at the our our policy you look to the insuring clause and under kentucky law the injury causes important site to the court to the st paul case which is a good tuckey supreme court that says that the insuring caused x rays are a lie in compass the darwin terms the darwin policy did in it did your honor and that's what's the darwin policy paid there is that there is no question that we weak understand that but we still are looking at the terms then of the our ally which happen to overlap with the terms of the darwin policy yes right yes your honor and so what you need to do what i suggest the court do is look at the jones case and then look at the excess cause and look for here because what you have to do under jones in order for for coverage that's what was happening here is we're going to forfeit coverage and if you're going to forfeit coverage then what you have to do is in unequivocally conspicuous plain and clear manifestation of the company's intent to exclude coverage only that will defeat that expectation and what you have to do is not only tell what the notice is thirty days but you also have to properly warn of a forfeiture and that's the problem in this so when you look at the insuring call as all the r l a policy says in the ensuring cause is that it will happen when it does during the policy period that was complied with and when the underline insurance has paid its full amount that didn't even happen for another year after this and then says subject to the terms except as otherwise provided and that's why i brought this chart here is when you look in agreement there is nothing that warrants the hospital or anyone in this insuring cause which is where during that period that's the difference or this is a claims made its during the policy period but the thing that that are a lot ignores is that there is no requirement that it be reported in that policy period not in the darwin because it was  if this court decides that this is a claims made in reported policy i have to be frank i don't know how you find that from the language of the darwin policy which pay i mean they and and then when you look at the the  policy or allow what they say is except as otherwise provided and then you come to this section ten which is or notice this is their notice they have put it in there remember under kentucky law if there's any ambiguity or any can spew shit about which notice provision should be that i think was abandoned in this but it essentially the certainly the district court said that somehow the hospital had to comply with not only the darwin notice and give our allies notice of the darwin policy but also under the are allowed policy and judge bunning got that wrong the only notice requirement that is required is the one that oral law set forth but if there is a confusion i think judge bunning was confused on it it has to be that is has to be construed in favor of the hospital and it is a very the insured in favor of coverage in favor is typically yes yes your honor and so when you come down to it this is the reason i brought this chart is because you look this is what they hang your hat on this is when you cut thro when you read it it doesn't really talk about notice of a claim is that if this is as they argue the essential part of this policy how come no place in the our our policy does it ever say that you have to give notice of a claim it doesn't it just says notice of anything what if it was a change of address what are argue you didn't give us notice of a change of address or we added a trustee of course not and if if to emphasize this point the very next year for the same follow form drunk because that's the first thing is that the ensuring call as of the our law says except as otherwise provided here is as otherwise provided this is what the court should look to and this is just a condition but to go to that's the reason why our last try to go back to the darwin policy in the trying to somehow pigeon hole this in in to say it is a claims made and reported but even if you look at the darwin policy it is not a claims made reported it just says it fo claims that are made within this finite period and then just like i'm arguing the jones there is a separate section it's an endorsement that amended a condition that said just like this that you have to give notice within sixty days of the into the policy so the darwin policy is simply a claims made policy not a claim is made a report and it's important to our odd to try to pigeonhole it there because they have to run away from the express language of their endorsement because this indorsement right here if you look at it if we go cranium under their theory if we got a ten dollar refund back from darwin and failed to report that ten dollar refund back then their position is we lose this this they try to pigeonhole and most of the coin under item b but that has no greater dignity under this caller's than a ten dollar refund of premium that's why the jones is so important and it says that in order to cause a forfeiture you have to show that there was substantial prejudice and there was no substantial prejudice as shown by the very next year this policy completely did away with this notice requirement same policy saying crean thank you thank you thank you thank you made place the core my name's michael pro i represent our ally insurance company and i respond to mr bentley's points shortly my opening comment is our timely it would help us to think about that little point there are about ten dollar refund any number of things well that could trigger under those terms what would seem an absurd forfeiture of cover all right  and i think we have a couple things to say there first has one of judge clay's early questions raised this policy is a follow form excess policy there's nothing exotic or unusual about that it adopts the terms and conditions of the primary policy except to the extent that terms are further restricted or amended in the access provisions that follow and therefore the claim notice provisions of the darwin policy are adopted into the i x us policy there's nothing unusual about that they represented by marsh they know the way insurance works we took the deposition of their corporate designee they understand how follow form policies work so i wouldn't w requirements the claim notice is set forth in the terms and conditions of the primary policy that's followed this provision have to do with notifying the access carrier when something affecting the primary coverage happens  returns in a hypothetical that's fine a return premium could reflect something that affects the risk the excess carry has underwritten for example in an excess policy where you follow form a return premium may reflect a change in the coverage that occurred on the primary policy and therefore the excess carrier is potentially affected now it may or may not be you would want the notice you want the notice of the idea of ten dollars is one that's too it's it doesn't suggest a change in the risk it's in that it's never going to happen it's a scenario that ever duction to the absurd because you're not if you say that if there's a ten dollar premium do i have to notify the excess carrier that's what you're arguing your response is a change and if there were a refund it suggests there also is worse circumstances that would be meaningful but there could reflect a change the mary coverage is material to the excess carrier it is fair for an excess carrier to say tell me if one of these four things happens tell me if there's been an alteration or cancellation of the underlying insurance because i follow form to this because you may not be fair to say tell us right but the but the point that after the hospital corp has to make a report of this claim the report of the claim is set forth in the primary darwin policy and in fact they gave notice to darwin on the last possible day so they knew full well the reporting obligation of the darwin policy and they knew our policy followed form to it yet they did not provide us a report of the claim so that's that's point one on that point two on this is think that was just oversight we never got nesting there something purposeful we never got an explanation so all we are left is t this subpoena comes in that's a big problem in july of two thousand and eleven they are looking at renewal at the end of september early october of two thousand and eleven they'd if they rock the boat on renewal and jeopardize the renewal there may well have determined they would have difficulty placing alternative coverage because they would have to disclose their claim and so they set it aside this company has a routine practice that they testify to every med mal claim that comes in every premises claim that comes in they immediately tender they immediately tender it's a sound business practice their corporate asic in the said to tender claims immediately this company yes actually hospital corporation even though they have a million dollar s t r in their meds policy they tender every claim because they know it's a sound business practice this gigantic problematic claim comes in and they don't tender they don't tender it they don't even ask marsh to tender it or ask marsh do we have any coverage so one possible explanation would be you don't want to rock the boat at renewal you want to get your policies renewed for some reason that has taken the claim off the track it isn't getting immediately tendered however they send it to outside council in november of two thousand and eleven when there's still plenty of time to tender it to whatever material it's an outside counsel that could just as outside counsel writes a letter  absolutely the last day to satisfy the reporting requirement of the darwin policy they hand the liver on day ninety after expiration of the policy period handle live or a letter to darwin giving their first notice of the claim even then outside counsel ashlan nobody sends it to our ally is there an explanation i haven't gotten one i've had witnesses underoath i've asked them questions every way i could think of and i don't have an explanation i know that you have a case law addressing as soon as looks to whether there is some excuse or some reason some justifiable reason why they can't comply with the contract here for all i can tell this is a sophisticated policy holder represented by marsh they know the terms of their contracts for all i can  is a conscious decision because here they are with outside counsel representing them giving notice on the last possible day darwin we follow form to darwin and they don't give notice to us are they thinking they can argue this jones jones's is a categorical general rule and it's kentucky law and it doesn't matter and then i heard an answer to a later question that whether this is claims made or claims are made and reported matters and i suppose those two arguments may actually be somewhat contradictory if if joan states a general categorical rule it states a general rule but the fact is it doesn't and this court itself circuit is recognized in one beacon versus gilo so that joan states an exception to the general rule that the general rule is conditions precedent and reporting requirements are enforced and jones itself marches through a series of factors that are particular as as the jones court says to the present case including that it's a mine owners policy statutorily mandated with an injured worker that has jones been criticized i realized from your brief that both briefs that that seems like the weight of authority in kentucky uphold contractual conditions conditions president but is jones a one off has it been criticized what's the i wouldn't say it's been criticized i think within its scope within its realm jones is consistent with cases that have come down all over the country there's nothing unusual about jones or about kentucky law courts around the country and i think one of the cases cited a two thousand and fifteen connecticut case tried to collect authority maybe thirty eight or forty depending on how you interpret cases of states have a case like jones in an occurrence or accident based policy where you have a just a general provision i mean what jones talked about was a c g l policy commercial general liability where after the loss there's a coverage and it was not warned that there is a consequence of no coverage or for or of not having coverage if you fail to do so there are several differences here first of all we do specify and as did darwin exactly what timing is required for the reporting so this isn't just notify promptly you know do your best the darren policy says you know in no way even later than ninety days after expiration of the policy our policy says in the event later than thirty days after notifying the primary and so we do specifically spell out exactly what is meant by timely reporting and part of that goes to the risk assumed and claims made or claims made a reported policy which is that you know about the claim within a short period of time after the closure of the policy period so that you don't have these long tail claims that environmental and construction defect in toxic tort cases we've seen where we're still that a gating over stuff that happened in the one nine hundred sixty s and one nine hundred seventy s that was the whole reason for the claims made policies you're setting time limits on the reporting and so that's one big distinction from jones second is in both the reporting requirement of the darwin policy and here it does say and here's here's the current policy as a condition precedent to any right to payment in respect of any claim the insurance must give the insurer a written notice as soon as practicable and no even later than ninety days so there is an express warning and express notice this is a condition precedent to any right to payment in respect of any claim it is telling them the consequence of noncompliance you have no right to payment it's right there in the any insurer and any lay person reading that language would would read it that way and to say that actual hospital corporation which is a big company that forces contracts every day of its existence can ignore a clause like that and set on a claim and not report it as required is that is to nullify contract law and the our life policy likewise says the insured shall as a condition precedent to exercising their rights under this policy again you are being told upfront if you don't meet this you may not exercise your rights under this policy that's not jones jones just says if you have a claim you must notify us promptly and the supreme court of kentucky said well in light of that language it's vague as to what promptly means and it's vague as to whether there's any consequence if you don't do so and i think that's one big distinction in jones to this case there are other distinctions involving the nature of the relative risks of an occurrence policy and a claims made or claims made and reported policy  again the timing of the claimant of the reporting to the carrier being an essential term it's interesting on the the notice to the primary care issue that is even if you set aside the whole claims made in claims made a reported question of following form for the darwin policy which i think it's plainly does and we're within the a vast sea of authority supporting us on that just looking at the notice to the primary carrier requirement that you need to tell the excess carrier within thirty days of notice the primary carrier this case is controlled by union planners bank a decision by this court two thousand and seven in a slightly different policy context but it interpreted a very similar provision that said when you give notice to a primary carrier you must immediately notify the excess carrier and in that case the court held that whatever immediately means that does not mean twenty five days there was a twenty five day delay in that case between notifying the primary and notifying the excess and three twenty five million dollar policies fell on that because the this court said notify immediately does not mean wait twenty five days and did not require the prejudice to be shown sudden claims reporting in claims made by policies prejudice is not required and in that case union planners make everything happen within the policy period so there is no question of first year of coverage second year of coverage straddling the claim comes in and when you're if you put in none of that this is all within the policy period and they forced a primary carrier notice clause much like this if anything less certain because it said immediately in did not set forth a date requirement it just immediately and and enforced it so we again i think you even that this is governed by the claims made a clean straight main reported case law that we've discussed jones's distinguishable for several reasons we have discussed the notify promptly language versus the precise language here and i think in addition even setting that issue aside the primary notice clause tracks the holding of this court and union planners make and essentially indistinguishable obviously there's distinctions in every case of different language and different policies and so on but as far as the purpose of putting the excess carriers on notice when you notify a primary carrier that's exactly the interest that's protected by by this clause too so that we don't have what happened here which is you know this  largest claim in the history of the company comes in they put our men on notice on the last day and they leave us in the dark for six months before we get a two sentence letter tells us nothing and that's that's actually hospital flouting its contractual obligation follow it through for a moment yes i'm sorry i was just wondering had you had notice what what options do you claim you would have had and on that issue because of the terms on which this was brief the question of what what prejudice could you establish if you had to establish it had not been developed in fact the discovery had been out on that there'd been some delay in discovery due to some motions and that was something that was teed up and was going to go forward on the thing i want to point out and make sure the court is clear about is that the darwin policy the notice requirement was separate from the insuring clause and therefore under the darwin policy there is a notice prejudice rule i think the court was and what you're saying there you notice requirement is separate from the policy that is separate from the in showing you i thank you ron i are certainly misspoke on that it's separate from the ensuring cause when you look at the ensuring agreement under the darwin policy which is where the rubber hits the road this is the essential term when you look at that ensuring agreement what it says is it is for a claim made during this period then there is a separate condition in the darwin policy that says you have to give notice to darwin and that's the thing that's so perplexing about how judge bunning found it we gave notice to darwin as was required in darwin paid the money when you read the darwin requirement of notice it applies only to darwin it doesn't apply to our ally they say what's a fa  explicitly about the conditions of the darwin well if it goes back to my statement in kentucky if there's any ambiguity in the policy and if you look at the part of what i just say it doesn't  roger the point where it talks about the pay to talk about it right there just as if the claims made policy it's later in the boilerplate where they say this is a coin you've made a report of but when you look at the words the actual insuring cla what it says is is just for claims made during the policy and then there is a separate section condition just like in the jones case that says you have to give notice but and darwin pay there's no question about that and when  you're point is give notice to whom it and right you give notice to darwin which we did it was handled which was handled and there's no question about it darwin now tries to piggyback that and even though the policy quarterly says the notice must be given to darwin they say well you should give it is the issue before the court is what happens if you don't you have a legend and the issue before the court is what would the kentucky supreme court do and the answer is it would say show us prejudice and if you can't show as prejudice and it's in the same thing as the ten dollar refund it's in the thing place and if they wanted to clearly and explicitly say you're going to recover they should have done that they did not that's what he says we told you clearly thirty days ten days but when you read jones it says what you have to say clearly is a forfeiture and the only case that i'm going to stop the only case in kentucky that is ever deviated from jones was a his cock case and that is the case where judge bunny said look at the things about waiting for you to fi