district court's ruling that the two clearwater reinsurance contract contain an unambiguous cap limiting the amount it would ever have to pay to utica regardless of what utica pays under the policies that are reassur this ruling was erroneous it was based on cases that construed and interpreted different language there is no cap or limit language in these reinsurance contracts the case the district court relied upon or bellefonte unit guardian access each of those cases is easily distinguished because it had specific language that the court wired upon to find a cap elephant was subject to the stated amount of liability we don't have that language unitard was subject to the limits we don't have that language excess was limits and an agreement by both sides that there were limits in the reinsurance contract we don't have that language what we have is a description on the front part of the certificate which is shorthand i think both sides agreed it's common ground that it's shorthand and it's jargon but it basically provides that this reinsure accept a piece of our umbrella policy and the rest of the certificate provides that it gets everything attributable to that piece both loss and loss expense that's exactly how the certificate operates i have auto insurance from farmers if you ask me what's the limit for liability coverage on their policy i would say five hundred thousand if i'm in an accident and injure someone and get sued farmers will pay up to five hundred thousand to settle the case or to satisfy a judgment in that case but it has an additional duty to defend me and that's outside and supplemental to the five hundred thousand  farmers were to get reinsurance for that five hundred thousand our policy say the top twenty percent of it the top one hundred thousand layer over four hundred thousand and clearwater where the reinsure assuming that piece cover loss expense yes it goes on to provide that they have a liability an obligation for loss expense and that's in paragraph three g of the contract the this court is had two of these ca from the northern district of new york remaindered for consideration of expense governance after which munich re settled gave me didn't settle abandon the defense the second case this court had was a year ago called global  century that the new york and asked them whether payment with the even with or without the language in it does does the limit of liability expose them only to pay payment for that sum right bellefonte issue and the access decision from the court of appeals but it doesn't necessarily govern our language we say the proper role here for the court the proper approach is to do what happened in munich to vacate because there is no cap expand its consideration and to issue a broader statement of new york law it's possible that it would have an impact here but not necessarily and we say the munich decision is what should be filed in this case new york  the judge decision on the fall of the fortunes follows settlements is correct and should be affirmed the case starts when the arguments start with whether there is a fall the fortunes obligation in the clearwater contracts well of course  liability clauses in there that's the clause that this court held north of us of you know yes and no frankly the parties conceded that there was a fall of the fortunes of legation they had done a five different language then judge  legation and they look to the the subtlest language in the policy and the opinion group to it as lee uses the follow liability i have to be honest you have a hard time understanding the liability argument  relationship because it is it in visions efficiency with regard to the reinsurance relationship that you accept that that's normative with regard to the industry but but i have a hard time seeing where the liability somehow trans reinsurance operating unless there's of follow the settlements follow the fortunes obligation sure by its very nature don't you think absolutely if it did want why even worry about the language why not just imputed well and some courts have and we maybe we should particular language and so that's a fall of the fortunes clause but more importantly wrong in the past yes they were my adversaries over the years and i made such arguments this is the last point i'll make on that is that work out sometimes you win  sometimes you lose the this certificate clearwater and it's brief page twenty three so this contract requires us to follow you because liability not a settlements and excited to some new york state courses the state court cases that said this contract doesn't mention settlements at all it certainly does it defines clearwater's viability for last  off course by citing north river where it was conceded that there was a separate follow the settlements provision and that all turned what this court in its explanations of the difference between following the forms and follow the settlements there is no follow the settlements provision in the clearwater certificates by contrast as we noted in our brief there was a fall of the settlements provision in the tepee f and c memorandum so that these contracts know how to make a difference if they want to and you cannot i don't believe consistent with long established reinsurance law read a liability clause say follow the form clause t o transform that into a follow the settlements clause in the cases there are well established in the new york appellate division the new hampshire case is the most recent explication of exactly this insurance story writing circuit in the eight hundred forty s noted that the long standing rule was that there reinsurer did not have to accept the settlement but was all free to writing at a time when the economy was limited to commute small communities we're talking about massive reinsurance arrangements for example in this instance reinsurance with regard to specify liability which blossomed into a monumental to associate in the defense provided you were given notice which they reinsurers here were not given and you have to right to contest what the underlying liability point is here you have a situation where coles principal argument was that there were no aggregate limits and if that position is correct the reinsurers are not going to face any it in the california tro they lost when the ghoul switch sides because it was to its benefit to then or a queue to get more money from the excess insurers not realize that they might bankrupt their carrier on the record to be decided that perhaps they'd like to have the expanded coverage that they purchase and of course clearwater wasn't a party to any of that judge was only it may well be that there are good arguments to change the background common law rule the parties here haven't briefed this and i would submit this is not the appropriate time or circumstance to do that was my next question reason that is correct and there is a certainly disputed issue of fact where you have three basically incontrovertibly facts here one is the goulds sought money from utica in exchange for stipulating i'm just trying to figure out if you're right on the law and what happens well at that point i would submit that we would depending on how you write the fact that we're correct on the law issue would depend on whether or not any evidence would be introduced we don't believe that's necessary because on the face of these contracts there is no federal follow the settlements provision and if that is so then we have an opportunity to argue that there were no aggregate limits and that that issue would be litigated in the district court based on the fact that there has never been a proper joining of that issue where they are completely disinterested parties to argue that the goulds policies that already issued here do not you don't have to know what i'm saying is that that would be the issue for the district court room and and to our way of thinking that's obviously a crucial issue for a substantial amount of money and that is one that should be properly litigated in light of what is a very extensive factual record that the utica people that including the general counsel in the c e o and the board were aware that what was going to happen was that they needed to trade this money in order to have aggregates artificially inserted into the policy limits so in error if you remain as completely appropriate the summary judgment standard had not been properly done in the district court did not follow the correct standard with respect to the primary appeal bella five not unique art and access do in answer the question about the limits that principle is well established the  form that is provided in unicorn is exactly the same as it is here and so the answer to the question of whether or not this contract has limits is one that has already been decided should the court decide that it wants to await the new york subject to limitations subject to the liability limits the word limit the lie a word a liability as defined by the hague treatise which is i believe on page sixty two in a footnote of our brief explains that under reinsurance law that word is understood to mean a limitation of liability thank you umbrella policies the whole structure of google's insurance program was that the primaries had low limits aggregate limits for products and then who purchased a mountain of umbrella excess coverage five hundred million dollars which would have been worse less if everything stayed in the primary policy the seventy eight to eighty two policies were good races in aggregate issues had scrivener's error they had a floating number at some point and a blanket other points policies have errors or mistakes what's that supposed to do it basically negotiates an agreement that the policies were applying as intended and we're told that's unreasonable because what's there evidence is there any evidence anywhere after a million pages dykeman production dozens of depositions thousands of pages of transcripts that ghouls ever intended to and sought to buy on aggregated primary coverage with products products cover gould had no evidence the broker had no evidence is there any evidence you could ever agreed to sell such an unusual policy no you had no evidence gould had no evidence none of the other insurers had any evidence the only thing clearwater ever cites is the blanks on the policies that's that's it that's the sum total and then a bunch of arguments that you get had to get the last of the umbrellas because that's where the reinsurance was the standard is strange reading it would be a strange reading of the agreement i could briefly because that's what governs the question to clear waters council is what happens if we agree there is no fall in the fortunes obligation at first there was an agreement that the issue below be reasonable to us but that's not how it ended clearwater's position is that it gets if there's no follow the fortunes are followed settlements obligation inherent implied or express that they get to really get everything that they can we come back and they get to challenge whether our policies are the aggregate limits or not and we have to somehow act as if there are goals and where are you to go and litigate a last policies case that's what you around it can't possibly be a proper policy in a situation like this to go real it again everything because the reinsure wants to second guess the settlement we made the growing reinsurers we're challenging whether there's any difference oh to a seating company's allocation decisions in this court found in north river and in trailers that there was that was still an open issue under new york law and the new york court of appeals considered the issue and said yes there is deference so there's definitely a difference between between trying to choose between claims  putting on putting all the emphasis or placing all the some of them on claims that are covered both as versus claims or not and you know that's environmental cases but but you say this is different because here is there benefit cases but what the issues you know i take it in your views it's not so much whether there was or wasn't coverage whether you were susman of the of your chance of losing on the aggregate issue and the only issue is that we have a plausible basis for settling on the terms we did of course we did the california courts absolutely affirmed what we did not only as a reasonable or a possible they found their aggregate limits in these were to succeed fully on your claims here what what is the disposition that this court would announce we would ask the court to issue an order vacating the district court's decision on the ne your your honor we had expert testimony that we offered to the court which it refused to consider would that be a bench trial of some kind or is that a jury trial what is that what would happen in the district there'd be there'd be discovery perhaps on how clearwater has operated over the years under this language that's what led and this would be submitted to a trier of yes and i'm i'm sorry that as i sit here i can't recall but i do believe there's a jury demand below  there would be i'm just trying to figure out having had the benefit of your argument what it is that you would accomplish here you would have us accomplish for you vacate the cap it cost us about four million dollars set us back to litigate whether there really is a cap because there is no we say the contract is at least ambiguous as far as the courts follow the settlement following the fortunes ruling affirmed that the court properly found individual or individuals is that that's that's correct so it would be it would be completely irrational to conduct insurance in that way let me go down to the allocation in the reasonable miss question we agree that us f and g is the governing standard and i'm quite surprised that my colleague here has embraced that decision so clearly because that case is almost directly on point there with the new york court of appeals held was that there was a triable issue of fact summary judgment was not appropriate where one hundred percent of the allocated settlement had gone to the reinsured claims in zero percent to the bad faith claims if you substitute the idea for bad faith claims to primary insurance where the an arguable issue we think a quite substantial one about there not being aggregate limits you have exactly the same situation so clearly there is an issue of fact that the district court erred in deciding on a summary judgment standard that ought to be sent back i would note that in the fireman's fund case the northern district of new york is now set for trial of this very issue because the district court had tonight summary judgment for the the seaton's claim so this issue is in fact going to go to trial in a separate case arising out of the exact same set of rules policies unless the court has any further questions will submit thank you