that for a second i think that the briefing bifurcates this case and i thought it was more helpful to think of it in thirds there's a middle chunk of time there where the insurance company was relying on a spear court ruling and i found it helpful to take that out of there and look earlier and later and so i'm just telling you for purposes of your argument my notes look at the earlier period as before this supreme court ruling well let me explain and maybe this will change your mind about the divisions why bit lost in the details of this your client have counsel and that counsel was provided by a different insurance some are wrong about that is correct she was defended under one hundred thousand dollar policy from the auto club  i'm having difficulties seeing why there's any damage arising from this issue about the appointment of counsel conflict counsel any other kind of couse of her she had a lawyer well that's not a q miss counsel or public counsel per se it's the lack of knowledge that she needed coverage counsel whether she was entitled to that name was apparently what it all mean lack of knowledge that she was a potential insured have to tell her that but their response is you know is in discovery they disclose the existence of the policy so how are they in a venture in a position to know she doesn't know that she's a potential cover they did not disclose there were two things they did not disclose that she was an additional insured under that policy in fact they denied it that counsel they gave her in essence but they didn't give her the policy but second no they disclosed at her that was my question which you have not answered they disclose was insured under a national council my question yes i think you've got california law and i just want to in fairness give you a chance to respond but i think you've got california law that says if they have reason to know that they have an absurd or potential injury to give you that who doesn't know that she may be covered they have to tell her that but they gave they disclose the existence of that policy in discovery didn't they they was the existence of a policy which covered the marsh they did not say indicate that there was any additional coverage represented in this case they certainly did why took an adverse position to her from the outset of letting you she was represented they knew she was represented they took the position that she was not in the course and scope that was the very had they been advised there was a curve which issue they would have brought in some attorney or some attorney would have let you know it's just that there was a need to make a demand on national union they're going to help out and say that her lawyer had noticed that the policy and didn't get the policy and didn't so what is in fairness what is your response to that well my my my coverage is that she was she was represented by a lawyer who was hired to defend her against moratti not against national use and i have a different set of questions as i understand and i'm again please correct me if i'm wrong your client was ultimately reimbursed by this instrument to find an insurance company is that true reimbursed for out of pocket expenses and for the amount she put into the soeharto so she was made she had a lawyer from the get go from a different insurance company she was reimbursed for everything so her damages are worked why are here her damages were here for the emotional distress damages in the general damages from the disruption of her we were here for bad faith because she was subject to the threat of an enormous personal loss and because she was in fact required to put up her own money because national union decided to gamble with the insurance money rather than its own money right which is why they had to pay the economic damages and i fully appreciate that there was no doubt many sleepless nights this took many many months and she had to take out a mortgage i think a second mortgage and i understand that and don't want to minimize it but what about the findings the judge made at the bench trial regarding our i love that i'm glad you brought us to that he made essentially two kinds of findings and i don't disagree with the facts but the conclusions are quite different from the one he said that national union was focused on defending its client marsh national unit was focused on its own interest in defending the rate remaining maradi case national unit was not focused on bamberger true enough but that is sort of the definition of bad faith one of the definitions of bad faith is that the insured insurer does not take into account with the same weight the interest of it's now selected is definition i think the definition under california law in this country isn't deliberate act to frustrate bamberger's contractual rights yes i have trouble seeing why it wouldn't be good faith to take the position that she was on a frolic and detour verona when that's what the california superior thought and would have to say the judge was quite unreasonable for that not to be a position that could be taken in good faith one of my favorite cases cited in the reply brief is  if your existence kind of refutes that argument but the real issue what what really deals with that issue is the fact that there was existence not as a matter of not because there was some triable issue there was coverage as a matter of law now so i was probably just a matter of law based upon existing case law not a new case law when i what i want to know i am following up on your comment earlier about findings of fact after the bench  it's speculative because it's just as likely they had an incentive not to tell her that they'd thrown her under the bus because and not to alluded to the fact that they had breached their duty to her and not to make her angry so i don't think that follows from that's a different question the remaining findings are essentially that national union knew they knew about the decision they were so far into the thought they knew about the settlement they knew that bamberger had had to put in her own money  and there they knew all the facts that constituted you know a breach of duty and yet they did not connect with those let me let me and therefore did not recognize that they had breached a duty and therefore did nothing about it i had been hoping for an identification of a paragraph that was not supported by the evidence but i understand the more general point however i got a different question to ask you and it's important to me all the policies and pretty much all why billeted policies at least an automobile cases require a tender that she didn't tender now a failure to tender could be because of ignorance however she had counsel from the beginning of the case and even if she was personally ignorant counsel would always know of a possibility of other insurance coverage that would be why requested the national union policy at lack of a tender is often on purpose because when you do tender then the duty to defend applies and that it entails the power to control the defense and it would be a great nuisance and the risk to me amber if national union controlled her defense as opposed to a lawyer who owed no duty to anybody but her no this is a not uncommon situation in california law and the rule is that when the insured declares a conflict the insured takes over control of that case takes over control of the strategy and tactics in that case in order to prevent the but this case is not really about she had no risk of being on the hook to her lawyer that her insurance company was paying or more well yes that's true she had a defense and this case is not about failure to defend this case position would declaring a conflict what would have they wouldn't have maybe they would have had to provide a defense maybe or maybe not they would have had to provide q must counsel but at least at that point in time the bamberger bamberger's attorney would have known to make a demand on to settle the case because this was a clear clearly in excess of coverage in excess of one hundred thousand dollars underlying policy in excess of work in excess of her of her excess policy they would have been in the position to say you know you've got to settle this because california law says you're supposed to gamble with your own money even if even if there's a dispute over coverage they didn't and that's to judge papers point so when this came to light they wrote a check personal liability and secondly she was in fact made personally liable as a result of her settlement and this is the first phrase your first point is she suffered noneconomic damages and your second is that she suffered economic damages that they paid the economic that well actually they didn't fully paid the economic damages because she had to hire us she had to hire attorneys to get it so that goes to the brand i don't see why she wasn't in a position to demand contribution to a potential settlement even before the national union received the tender from her she had a lawyer or a lawyer knew from the get go mar liability insurance since marsh is a corporation and can act by itself only through its employees and agents so her lawyer would know that employees and agents would be covered and would be in a position to make a demand for contribution even before he saw the policy a whole point of the course and scope issue in the course and scope was defense was that marsh had no responsibility to do any of sure but her lawyer didn't have to accept that her lawyer could write the ordinary letter that says we think you're on the hook because we think she was in the course and scope and we think we can defend this your attention to a case ramirez was a sturtevant and which kind of addressed so that in which they say you know we're not going to let you off the hook because the because the attorney for the council just didn't quite do everything that time comes you can have a minute for a bo and i think initially i was going to start with the third one and sort of work backwards but i'm going to start with the first one because i think that was the one that you were you were most interested in and i think it's important to keep in mind that when  the plaintiffs in the underlying action named marsh as a defendant and national union found out about this lawsuit for the first time a bamberger had already been in the action for several months and during that time as you know the auto club had provided her with defense counsel and she had also obtained her asset protection lawyer and under spent i think yes yes i understand for which i believe she's been reimbursed but the the as a result and under california law her automobile insurer was principally response  there is california the law that talks about needing to treat insureds equally and she was a potential injured and she's a potential injured not in any kind of remote sense she was obviously a potential injured and wasn't notified of that what is your response is that the failure to notify her of this is quite extraordinary well i don't believe that it's california law at least i'm not aware of any california case which has said that they insure has a duty to unilaterally reach out to someone who may be covered and may at some point tender a claim well there is california law that talks about the duty to inform and insured of benefits  doesn't know about those benefits that i understand your honor yes probably would not like she's a member of some kind of a difficult to identify class and it is a car automobile accident she's right in the smack dab middle of it and she was marshes employee or not right at the time of the accident so you know i'm troubled by what that they didn't notify her and i just want to put that out there and let you respond ok i don't believe there's any case where the california courts have recognized a duty to communicate or inform an insured when there has been no andor or an attempt to tender once the tender is made then it is understandable that the insure has grant you that i grant you that absolutely but it is he's asking us to make new law i believe but it's not a terrible stretch because in this case it was pretty clear that she was a potential and stored right and if you about the existence of the policy it's pretty tough to tender are you relying on the fact that the policy was just closed in discovery or what is your well i think that's an important factor it was disclosed in discovery early on i believe and i can you tell me how far in it was disclosed i think actually mean i haven't time the the the disclosure is the response didn't draw the tories are in the record they it obviously would have been after marsh was brought into the case and presumably before the trial judges summary judgment order ok yes now your honor i i guess i think you're on a put the put your finger on it i think the other side is asking this court to make new new law for the state of california and i think hope i'm not presuming but i think it's this court's responsibility to understand or interpret the law we're supposed to do what we of a plane is not a pointless formality in the in the insurance business it is the important first step in the process by which to you but i don't know what follows from had in terms of this lady well your honor let me let me also go back to the question of of the erger was liable to maradi whether she was in the course and scope of employment or not ok obviously naturally she wanted to have some deep pocket standing next to her and when marsh disclosed that it had a fifty million dollar insurance policy bamberger knew that if she was in the course and scope of employment and she was negligent marsh was going to be that deep pocket she also knew that mar yes your honor she that marsh would be the carries lee live all for her negligence if she was in the course and scope of employment and that in the course and scope of her employment marsh was going to have to indemnify or so course and scope of employment was very important to bamberger as to the labor code twenty eight zero two issue and it was also very important to her with respect to the fake areas liability that marsh would have no question it didn't it didn't really make any difference whether she knew she might also potentially be an insured under national union policy to the way she handled the house because she was already separately represented i'm sorry what was that it sounds like you're saying because you lucked out because of your client because she was already separately represented well i wouldn't say that we have very different case if she had been represented i don't think we owe you well enough that it would be it would be very different but i don't think it's a question of locking out your honor because there was nothing for us to do we didn't have any duties to defend we didn't have to appoint  counsel because you only have to appoint him as counsel if you do have a duty to defend there were no settlement discussions that are in the record so there was nothing to and there was no attempt which is your other and there was no tender is that why you have no duty to defend no no the do it we had well yes that's that's point one point two is that she her primary insurer was the auto club and under california law it was the auto she probably had lots of sleepless nights but it wasn't because she didn't know about the national union policies additional insured provision it was because she didn't know whether she was in the course and scope of employment when the accident occurred nobody could have told her that and in fact the state court judge ruled that she was not which is obviously meant that she was argument would be so much stronger and would worry me so much less if you were taking the position that you just close the policy because what she knows about the policy has she had the ability to attend but instead you seem to be saying even if i had to do it all over again they wouldn't tell their potential entry that she was a potential  looking back in hindsight you can always do things different as indeed the company did as soon as she filed her complaint how is it possible that after the california supreme court ruled it took months for the insurance company to say well we forgot about bamberger what happened well it had she was out of the case at that point she had settled so she was out of no no no question she was insured at that point right as a matter of law i mean i don't think it is that right you're not well she was in the course and scope of her nash i mean marcia should say marsh's attorney was reaching out to clancy her per her asset protection lawyer about having her testify for deposition so there was evidence that she was going to participate in this that now had to take place because right i'm curious about she she's had different kinds of lawyers i think asset protection means how to shield your assets from bankruptcy but she had a record an ordinary personal injury defense lawyer provided by her primary insured during really a geisha for it and i imagine an asset protection lawyer might not be familiar with sitting insurance companies  access and all that sort of thing but her primary insure ordinarily would be different with primary insurer contact national union or marsh about contributing to the settlement i'm not a i'm not aware of any evidence to that effect in the record and if you're talking about contributing to the settlement at the time the settlement occurred your honor my response would be at that point national union was certainly entitled to take the position there was no cover it was relying on the superior court rule absolutely and that was an objective lee reasonable position to take so if even if even evidence that that happened at that then trial to explain that was introduced at the fence top to explain how it is that her insurance company forgot about her well there was testimony from the national union representative who explained how when when the california appellate courts ruled that she was in course in scope as a matter of law that by that point she was out of she was out of the case i don't read it but i guess what i should have asked more specifically is what's your take on it when i read it's kind of hard to imagine they just forgot about her but she's oh in the middle of a case where your honor that's comes back to what i was saying earlier about do things in that internally you know in house and this is our rule i believe in the industry well i understand that but she's what about all your insurer lay people who are out there how do you reconcile that with california law that says if you  have reason to know that the insurer doesn't know you have to do something and that's my comment to you just close the policy and if it weren't for that i just really feel like you'd be in deep kimchi here when you're on i think that if if there is such a duty it would be a very  disruptive duty to say to an inch to the insurance companies insurance companies that you have to take it upon yourself basically to assume the role of coverage council for people that have never come to you never asked you for anything well marcia's asked you them to pain premiums for you to cover themselves and their employees well yes but the but marcia was the one who tendered the claim she never tendered the coin now you know had things been done differently certainly her auto club lawyer should have should have contacted should should have asked for the policy and read it and seen the additional insured language but apparently so far as the record shows that never happened i would think you would even have to kind of language is always on your honor i you know i i hesitated to say that but i think you're right in these kinds of pollock because i suspect every other why ability be liable to indemnify the employee if the employee is acting in the course and scope of employment anyway so it makes perfect sense in these policies to have additional insured clauses of this type when the employee is in fact in the course it's hard to believe that a lawyer the lawyer appointed by the auto club who is you know obviously involved in personal injury cases all the time on the side of the defense wasn't aware and the only thing i can keep i keep coming back to your honor is that it really wouldn't have made any difference because of the state of the of the letter at that time yes because if there were they everybody knew marsh h bamberger went to marsh she told him about the suit they didn't do anything about it marsh tendered the case and in their tender they say this happened by a suit this happened when it was an employee who was on their way home so they had everything they knew needed to know in terms of a tender the duty to investigate and to know the facts also your client had to discover his pontificating that she denying that she was acting as an agent that is true but the facts were the facts that she was depose prior and as she and her deposition she described in detail the circumstances in which she was required to bring her car to work and those were the facts of the were operative in this case and marsh had duty to look at the facts and they were asked to look at the facts in the tender itself that was sent to national unions so they can't claim ignorance more importantly you know this isn't a case of just nonfeasance just failure to defend or failure to failure to pay benefits a case of actual malfeasance in the sense that they came into the case actively intervened and took a position that was adverse to something here the cases that you cited for the duty to tell the insured of her rights are first party insurance with laypeople this is third party liability insurance cases should be extended to to a situation so different they are in fact aware of the need for advice as to coverage is more severe probably in liability cases under first appeal it's an old case where the court of appeal basically says gee you didn't even tell your insured that you were settling that you were handling this case in which he was named as a defendant you were hanging him out to dry not a good idea thank you counsel you've exceeded your