there's an interesting quote noting judge broomfield order about the sixty pounds of paper and the resultant effect on the force in the state of arizona that came about because of this case rereading the record and his order it strikes me that this case is not nearly as complex as perhaps all of council on both sides have made what we deal with here is a very good sized and small niche in arizona law simply what is the duty and responsibility of an insurance company you know a case in which it has not received a settlement offer from the victim's lawyer and a case in which the policy limits are known to be minimal a case in which the injuries are known to be catastrophic and the case in which the insured liability is set and is known to exist right at the beginning judge broomfield in his order get them to d publish meal that was denied so the supreme court is shown something towards me all but meal seems to be a different standard from clearwater and judge room field appears to be using each can you tell me where can you put together a clear water and meal for me only in this way to me a was a case in which the real issue and in fact the only issue decided was the question of whether or not you needed something more than facts come out depends a lot on the law you apply so help us out well i wish i could help you out more than just possible to help you out all i can tell you is that the one case that is precisely on this point is clearwater  in clearwater makes it very clear that there are two types of standards one applicable to first party cases and one applicable to third party cases the case before the bench here is a third party case and clearwater the revised jury instructions for whatever authority they may carry in this court and full time versus what for make it very clear that what the standard is in a third party case is that the insurance carrier must act reasonably to protect its insured from an excess judgement and you interpret then as the first part claims no it is it is not i can't interpret it because it's not it's pretty clear for me all that it's is a third party claim but it's some language  dropped into the opinion citing as a fact as a matter of fact trust joist which is another case which just happens to drop in in the opinion and these are opinions that are not on the issues they are on his than the opinion or isn't the question which is before this bench which is the duty in third party cases ok now if you're right on that then what you're telling us is that injecting mealand the case that was wrong reviewing the case don't we have to send it back to the district judge to write us another seventy five pages but leaving me well i trust we won't get another seventy five pages but the answer to your question is requirement is that the insurance carrier act reasonably to attempt to set to initiate settlement discussions and attempt to settle the case if your position it doesn't have to go back and your physician we don't have to be manage there is time if there is some real question about arizona law given that the confusing language in some of the cases it's always possible to certify that question to the arizona supreme court if that's what this court would wish to live you know i'm asking a more specific as counsel for one of the parties what you'd like to have and if i understand your position is that you're not taking a position that we need to remain and this case for reconsideration under some different standard of arizona law that what the district judge did here is sufficient that's clear that's correct yes let me mention two other things if it is remained  accordance with our position i do think that we need to take into consideration the trial judge's ruling on expert testimony judged broomfield quite clearly rejected consideration of the testimony of both experts that were presented by the plaintiff or by the defendants in this case by the victims and he did so saying that he knew as much law clear that juries cannot be expected to know what conforms to the usual and proper industry standards in the handling of claims and special specially in the handling of claims where there is a great danger of an  now there are in the depositions of these experts expressions of opinion as to what the law in arizona quite a bit of those expressions are based upon the fact that they were asked questions by the person taking the deposition about what they understood about arizona law but there are also very clear statements as to their view about what an insurance carrier in this factual situation ought to do in conformance with industry practice to and has been the mandate is issued so that's final that's part of the case in reaching this preclusion so to speak decision could preclude that testimony in his consideration of the case the trial judge i think and i submit went beyond the proper boundaries of consideration at this summary judgment standard it is true that the finder of fact whether a trial judge or jury trial could disregard expert testimony completely but it is also true that i believe and i submit that at summary judgment stage the only question before the trial judge is whether or not the witnesses are qualified whether the rule seven o two these witnesses were insurance defense counsel both of whom expressed woods and seems was and both of them expressed opinions that the insurance carrier here had simply done nothing to comply with the requirements to initiate settlement discussions and to attempt to settle the case and i think the facts are quite clear that that that support that from november of one nine hundred ninety four till october of one nine saying first we're investigating and second we're waiting for medical bills and the both of these witnesses say that that amounts to nothing nothing in the way of settling the case now they didn't come in with a tender they didn't write a letter saying we offered to is to the insurer and focal versus woodward requires them to initiate settlement talks and to attempt to settle the case and they never did that until eleven months past from the day to the when they talked to each other that  meant what the plaintiff's lawyer meant and what the insurance company understood that the plaintiff's lawyer meant is don't use up any part of the first fifteen thousand dollars on the other five claims for the people who weren't hurt badly that way that's not what the letter said but that's what the testimony that's what the testimony of both mr guerrero who wrote the letter who's assistant wrote the letter and of the recipient of  on what was said you could enter plead the funds and they didn't do that either so they were aware from the very beginning on our demand actually occurs on october twenty three but ninety five and ninety five but it's a conditional it strikes me that that's a pretty fair response what is there in the record to show that they should have done something different under these circumstances at that point at that point nothing but now we are now  post post chance to settle this case and what they did is they ran the risk and i'm using up time i'd like to say for rebuttal but they ran the risk of just something happening just like what happened eventually of the the plaintiff finally finding any product liability action in being afraid to settle with the with the adverse driver because of arizona's empty chair problems with you know comparative fault state ok thank you my name is joan can i am counsel for the apple e safely insurance company there is a great deal of arizona law on the subject of bad faith case to spend valving insurance companies that refused to  applying arizona law has ever done which is to hold that an insurance company may be liable for bad faith the all you're just settle in circumstances where the insurance company actually put a concrete proposal to settle for your implication that the complaint corel's reasonable time period yes your honor the significance of that is that there was nothing to alert safeway and indeed there was no question even his mind that there was liability so you had a liability case with three hundred thousand medicals and a fifteen thousand dollar limit and at that time the insurance company was put on the table under those circumstances certainly back in february when when the insurance company knew the extent of the loves what's your response to that my response first starts your honor with what the law is in arizona on their acquirements forbad say there are two elements that first element is that the insurer the insurance company act on reasonably towards its insured as letting your voice drop and i must say party i'm sorry there are two elements to bad faith the first is that the insurance company act done reasonably towards its insured and the second is that the insurance company knows that its conduct was unreasonable or act with reckless disregard and your your honor asked questions about that standard focusing on the clearwater case well even after clearwater we had meal and even after meal we had the twenty city cases the court of appeals clearwater supreme court we acted a little more deference it's an ok i understand yes your honor and the twin city decision which we cited in our rule twenty eight j letter is also a supreme court case decided in two thousand and three which quote said to prove the bad faith claim based on the feel you're to settle a plaintiff much demonstrates that the insurer acted on reasonably and either knew or was the process of the fact that its conduct was unreasonable and i think i could he was the third party it was the case grows out of a third party claim brought by an excess insurance company i guess the primary insurance company that had refused to settle a claim brought against the insure worst kind of loss the worst kind of loss that your honor it arose in an unusual context it had to do with questions about whether the attorney client privilege had been waived and the court said well it hadn't been waived with respect to communications received by the ex carrier and its attorneys but it but it contracted that situation with when a primary insurance carriers involved in that situation the court said communication carriers intent is that issue as it is under the meal test there the relevance of attorney client communication allows for those kinds of communications to be ordered to be produce think from what you're telling me that if i look at clearwater i'm not getting enough to know what the earth is on the lawyers today that there have been modifications in the approach by subsequent cases i don't even think it's modification your honor if you take a look at clearwater clearwater it's actually a very narrow jury should be instructed on fair debate ability in a person party case when a claim is fairly debatable that is a defense for the for the insured not to cover the claim in a third party case the court in clearwater says welfare and it's fair to bait ability may be a factor to consider but it's not a get out of jail free card for an insurance company there may be circumstances where the claim is fairly debatable where the insurer giving due consideration to the court said you don't give the jury in that context a fair debate ability instruction but that's all it held it didn't reverse other aspects of the court of appeals decision in that case and if you look at the court of appeal you should not settle any claims arising from this accident any claims and i'm not aware of any testimony by anyone from safeway that interpreted that language to mean other than what it said in fact the letter went on to say that rather than settle any claims what safeway should do is enter a plea in its insurance policy that limits well that so you take issue with opposing counsel's representation that represent represent the claimant was eckstein in november i'm not november fourteenth to enter plead it's an insurance policy limits that would have been the worst of all worlds for the insured it would have gotten safeway off the hook but it would have kept the guerrero is clearly announcing at that point that the settlement ball is now in his court and that's where things stood until october twenty three one thousand nine hundred ninety five when guerrero finally sent the bills he had agreed to provide and with those bills he said in his words the time is right to present our demand for settlement and then he went along and provided his settlement offer so that's the the lawyer undertook to provide but that's not that faith on the issue or even on the first issue the question of was steak ways conduct unreasonable the question is did safeway have reason to know that by waiting for the claimants lawyer to provide the bills that he agreed to provide he was putting his insured's interests in jeopardy that's the very question that the arizona court of appeals opposed in the  summary judgment for an insurer because there was nothing to show that the tell the insurance company that its insurance interests were in jeopardy and that the claimants were about to pull the plug on style meant safeway that it's insurance interests were in jeopardy by waiting and in fact they weren't in jeopardy we know that on october twenty third the claimant actually said here's an offer to settle the case the time is now ri for settlement and she didn't sue until eight months later so and those facts your honor i would submit there is no evidence of unreasonable conduct let alone the kind of knowing conduct that arizona law requires the fulton case doesn't change this analysis at all does recognize that in certain circumstances and insurer may have a duty to initiate settlement because it's insured it's facing a strong policy busting case but there is no case saying that holmes duty to an issue settlement is breached when either the claimant or the insurance company safeway wrote back to hymes saying ok great we're going to put a package settlement offer together that will resolve all the claims against our insured and soon after on december eighteenth followed up with a fines on the other hand initially responded to safeway saying well wait a minute i think we want to sort of claim for loss of consortium she then changes her mind instead as her lawyer says go ahead and proceed with the settlement then comes february in this case causation is an independent ground that requires judgment for safeway why is that so heinz admits that she couldn't settle this case until she got a waiver of the government's medical lien the government had a and not to heinz and heinz concedes that you know who we are so that followed between the time she got the waiver and the time that she pulled the plug on settlement there wasn't anything that's what he did  caused the plug to be pulled on settlement in fact in their summary judgment papers what hines can see is that the reason they pulled the plug on startlement was they didn't want to face an empty chair defense in the lawsuit against general motors which is the manufacturer of the vehicle in which the injured party was injured and the lawyers also stated that they didn't want to get out of the picture the insured out of the picture because it might create diversity jurisdiction in a suit that it was going to the is the very narrow limits of the expert to judge broomfield ruling on expert testimony he did not rule that expert testimony would be inadmissible at trial where he didn't hold was that the specific expert opinions that were presented to him were in the summary judgment papers were not evidence they were merely legal conclusions the judge just finding on that regard is unassailable the reports are pure a court please i apologize for not remembering offhand this try taking two record to the record on your question as to as to what the i do not settle letter meant and it's covered on page two and three of our reply brief and as to what mr up guerrero meant and what safeway was aware of than understood and set forth the tab one point three zero zero zero zero five six eight it is also the only thing that it could mean because there's no sense at all in telling an insurer which has a fifteen thousand dollars limit not to offer the fifteen thousand dollar limit because once they offer it they are off the hook the insured is off the hook as much as the insurer could be let me go back to clearwater  clearwater is still one arizona case which is right on this point in which the court had to consider the difference between first party in third party claims we've set it out in our brief summarized in the revised arizona jury instructions the there's a difference between the two standards the standard applicable to this case and set forth in clearwater and in fulton simply this that the insurance carrier must act reasonably in order to protect its insured in the question before the fact finder is always whether the insurance carrier given the facts of a particular claim case didn't act reasonably in this case a lot of what mr consensus could well be argued but a lot of what we say could well be offer of settlement for fifteen thousand dollars even though they knew everything as judge group feel thin on everything they needed to know to trigger so to speak the fulton requirement  that to you but i believe that that was in one of the deposition there are sixty pounds of paper here but anyhow it's all it could mean it's all it could mean we get to the experts the experts are quite clear as to what the duty of the insurance carrier was here and finally i'd like to end up with one thing as to this offer of settlement in december of one nine hundred ninety five which is a year and several months later as the arizona court of appeals summarized and i can't put it in better words than this mr cecil when he wrote that letter did not have authority he did not make a fifteen thousand dollar offer even then a year in five six months after the accident what he said is we propose the following this company never wants you know all the time even at the from the year it took to get the offer of a settlement from mr guerrero to the