issue between the two insurance companies in this case can be accurately described in the following we have to viability insurance companies both of which have duties to defend their common insured and number three underlying actions cuckoo development company i work for them k d c as we did in the briefs both those two policies have relevant indemnity coverage there can't be any dispute about that one of those two policies has primary other insurance wording and one of those policies has excess other insurance wording that's the indian harbor policy so under the terms of the contracts put aside all the fights that the party has had the primary just reading those two phrases you can see that the primary should bear all defense an indemnity and the excess you don't have to pay anything until the decades that the policy with the excess clause has no defense or indemnity obligations on the set of facts and that's consistent with the most recent pronouncements of the second circuit case and the very recent pronouncement of the new york court of appeals  i would see that the difference between the two states i would say there's no difference when it comes to the issue of when there's overlapping and then the coverage or relevant overlapping and then the coverage but based on the most recent nautilus decision that was issued after the underlying action was brief would say that while law doesn't view the mere existence of two policies having defense coverage as being sufficient to be the same risk that the same risk has to be based on identity coverage but it's very clear under new york law that overlapping it's just a jacket and it says several times when i say what happens between them i guess that's correct your honor i guess i was focusing on the part of the third certify question that said that you had to the both parties had a duty to defend in the first instance right and it is correct it says in the end you always do look up to the other insurance causes and apply them i guess i just say i don't know what the answer to that question is under high law because i don't believe there's any precedent for us to determine whether an overlapping defense obligation alone which isn't the case we have before us but it was only an overlapping defense obligation like we had in one of the cases in the briefs the i think the fireman's fund versus federal case out in new york where there are only overlap was defense and they said that was good enough here we have a because for the render the standing of renter the properties of the pro surprise parties the redder it is the cause of virtually all the damages in this action and we've offered evidence that's in the record to show that both parties gemini and in the harbor pollution so it was the same risk and that's an over and then she later realized that was an overstatement so i couldn't quite tell which was the ruling that was governing on the defense issue well i have to admit i was confused and i expected the judge to reconsider her ruling which is why we brought the issue up so many times we're not we're there just to annoy the underlying judge but when she initially made her decision she characterized the two policies i think in a published decision as mirror images saying one covered pollution and one doesn't and that just wasn't correct and so when that came out to be correct and she came to understood that to be correct the response that kept on coming back in the orders was well there's not a basis for reconsideration at this point in time so we knew that whatever happen we would have to end up before this court on that issue and so that's why we use devised the part of utilize the procedure they did stipulate to judgment preserving just two issues for appeal and going back to something that your honor just said with respect whether they did our position will be there's an order from the court that says a new york law applies and have an obligation under slaven obligation to appeal it because it wouldn't have to be across appeal so they have no appeal obligation with regard to that but we would submit that it's different than the standards  was a consent or an ira settlement as such it seemed to be an agreement that the orders the decisions that had already been made be incorporated in a final judgment rather than any agreement to the substance of anything i'd say that there are parts of us that stipulation in order that are clear that they are the parties both vigorously oppose the finding by the district court that they had done the applications mr gallagher and i argued those issues very strongly we agreed  need the flipside of what your honor just said in that we agree to a number of things that we have a number of claims out there we agreed that we all those claims have been ruled against us everything else was adjudicated with prejudice against us of the what was explicitly  that we could appeal any of those issues except for them preserved for appeal without getting into that they didn't appeal on it and have to appeal in order to raise the question of which office not a question of whether they appealed it it's a question of whether they're bound by the order so  consent to an order and under slaven if your consent to an order and under the law that relies on you're bound by that and if i we don't need that let me ask you this counsel is very thing in the record that tells us how much what's spent on the gemini policy versus the union harbor policy how much was paid for of in terms of premiums yes i believe that is in the record i think the front pages of the policies say that i off the top my head and i remember it from the action because i was so such a big issue in our minds that the general policy had was a two million dollar policy and i believe they paid one point eight million for it so it was a paper that was a policy that was known to be had at high risk in this kind of construction project i don't remember offhand  look at the premium differential there's often a very much higher policy approach a primary c d o policy knows it is the front line risk and us liability insurance sellers to it it's the front line risk because lots of other policies like specialty policies we might call them you know policies you know policies professional policies pollution policies that are known to be a secondary level of their primary coverage if they don't pay out there they almost always carry these excess other insurance clauses so that's known they're go contractor operations so when a contractor goes to a site and spreads native materials out there contaminated or not that's not within the scope of their pollution exclusion and the record has strong support that jim and i knew that from the beginning we have at brought onto the property that created the pollution damage no there's no evidence of things brought in on brought onto the property causing actual damages there is some allegations that were made that some of the judgment motions gemini didn't respond and say this might be ninety five percent red dirt but five percent diesel it actually didn't offer any evidence of that type so that issue that some of the should have been allocated to diesel wasn't preserved for appeal there wasn't the evidence to make that argument least that's that was a settlement here as i understand but every one of those three actions was settled and we don't know whether the you know what what part of what's in there is the covered pollution and what's covered pollution each of you are that you have coverage from each of them that's not i mean that's not what the motion it was before it was to say that we had coverage for the entirety of the settlement if the full settlement amount and that was the ruling she said we have coverage here is and her sam and i look for issue before us on appeal we both said that that was the way we're going to go into this we were going to go into an appeal just looking at the other insurance issues so most of the questions right now i'd like to  were access to that we had access to them as to indemnity because we both had full coverage for that shredder settlement we stipulates that we've got another insurance costs so our excess other insurance costs it makes us excess under either hawaii or new york law in that situation we clearly are entitled to reimbursement of the two sixty two five hundred we pa right thank you to get straight to the point that is not what the court ordered nor what that stipulated to with respect to the entirety of all the indemnity nor would that have even met the facts of the allegations even if it has a duty to indemnify k d c there are claims that are involved pesticides and fumes clearly primary coverage under the pollution policy there were claims for broken water mains clearly primary coverage under the sea g l policy the red dirt was at issue and i could see the court found that the red dirt having not been brought onto the premises was not a pollution issue but at the time of settlement the court's orders lent to the very real or potential possibility of a verdict at the close of the evidence for example that would hold maybe one hundred thousand dollars for the pesticide maybe twenty five thousand dollars for the fumes maybe another hundred thousand dollars for the red dirt and another twenty five thousand dollars for the broken water mains but so what we have we don't have a same risk you are primary and their access as to the defense no your honor one because there is no same risk here there's no necessarily finding a lot in risk or even overlapping because there's a possibility potential that there is not an overlapping risk the feels to encase but the new york case seems to clearly say that where each of you would have had a duty to defend because it was a possibility that there would be coverage then you then look at the cost of defense is the risk and the primary one goes first to approach it in that fashion  possibly have coverage and then to say that we're going to disregard that and then create a primary excess after one has analyzed whether each has a duty to defend under a possibility when you were stipulation for final judgment on prior rulings you adopted that february twenty ninth twenty twelve rolling where the court said your size and you didn't reserve a right to agree to a final judgment so that the issues can the issues are really the nub of this thing can be appealed and then come back later and say oh but we didn't really mean to agree to the order and it's in there that we agreed to  honor to it in the big picture the conflict of laws issues really became more acute when the nautilus decision came out which of course was after all of money for the defense and said several different times we're not saying as between them what happens after the fact just doesn't deal with this i agree or honor and so what happened and no one was also some kind of speaks to it a little bit what no is also says is that the claims that someone has access that one party has access to other insurance and this is from the novice case often cannot be determined until after the conclusion or sometimes at all in the event the case settles which is what happened here exactly or are there fault aren't don't you jump in the same place well to assert also tell you end up in the same place for a different reason which is this whole predecessor question about  they would have in force the choice of law provision of last application of the law of the chosen state it would be contrary to a fundamental policy of us state which has materially greater interest in the chosen here and this what we have on this is policies consistent with the whole oil law where they stay where they sell them to is to hawaii in shorts or to mr shredder who was the claimant here so there's a strong public policy towards applying their own law with regard to insurance policy interpretations the court overlooked that we believe in its decision you hear your question assuming you say it doesn't matter which for i think again because there had not been yet any kind of decision on how one parcels out the damages here the under the indemnity the settlement was made without that decision certainly as to the nautilus case without some sort of decision or framework to do an allocation between insurers  enforcing the of the provisions of some form of allocation by way of saying primary access they can't do in fact the stipulation also in our situation had agreed that the that there was no basis that based on the facts or differences in the scope of coverage there's no basis to reallocate the settlement and the shredder action that was part of the stipulation as part of what jim and i stipulated to was that they there was no basis to reallocate what they're doing is skipping the reallocation basis then it has to be taken that the risks covered by both polic as to as to pollution claims they still do because they are primary as to pollution claims that are not covered under the gemini policy right then for that  complaint right yes ok well if you look at the end of line complaint i don't see it seems that every and every single basis for injury had to do with this red shirt pollution then when you was going to end up causing all this damage anyway there were also allegations of of toxic fumes there are allegations of fumes due to diesel fuel there are allegations of pesticides both the pesticides and the fumes would be covered primarily under the indian harbor pollution policy and excluded under the gemini policy can we circle back to the fact that the stipulation does say indian think also your honor if one looks back to the underlying orders from which that came those orders clearly say each over duty to indemnify a but that's not what the situation since your honor i read that and understood that at the time the stipulation to mean that k t c was entirely indemnified not that collectively excuse me that collectively they were entirely indemnified not that each of us owed a separate doesn't say they together had duties to them to find them and said they both said judy honor all i can tell you is that came from two orders that are not don't read it that way and i did not read it that way at the time i signed it i think too i mean we're talking about sandbagging or whatever but to say that this now becomes the way the court had ruled or you know we take it your way certainly and you still have a non divisible settlement as to which one can't tell at least at least one you're not primary with regard to that selling it when there's no way to know to exclude the part of the pollution coverage that you are risk for well that's my and not reserve that actually issue and then you would even be in front of us if actual issue i think what happened your honor procedurally was we settled that factual issue with the settlement of the contribution from my client contribution from indian harbor contribution from underwriters so those factual issues were all settled the legal issue that that that indeed her wanted to raise was that they should become access over all of this my point is is that under the nautilus lexington decision that talks about sometimes the operation of an other insurance clause may never be resolved at all in the event the case settles at that point what and say at that point think that that that that nobody's primary nobody's access they haven't established that they are excess to any part of the settlement that was paid it without any contribution from indian harbor would exceed the limits that's not true there's nothing in the record that says that was a two million dollar policy that had contributions from a third insurer was the one it's not in the record and it's not correct from my understanding of the numbers after all the only amount that's being soft money in harbor is two hundred forty one thousand and two hundred sixty two thousand indian harbor seeking from it there's no evidence that this five hundred thousand dollars swing that we're asking the court to make would exceed the limits of the policy i don't think that's right and it's definitely not in the record it can't be brought at this time secondly with respect to the ngos case the argument that i want to point that is i don't think that out of the case because of the fundamental policy issue the judge persona raised  exception really in the context of case arising out of california as opposed to why as far as i could tell in one night getting the case yesterday if the court would like i can identify a number of cases where the court has this court has said that that fundamental policy exception is a very high threshold that has to be satisfied by a state regulatory pronouncement either the constitution or statute or by unconscious ability of contract and so i have this case and it's missed them i don't know if it makes sense to put them in the record now