## United States Court of Appeals FOR THE EIGHTH CIRCUIT

___________ No. 96-2456

___________ Kevin Graeme Smith, * Individually and as the * Representative of All * Underwriters at Lloyd's, * * Plaintiff - Appellee, * * v. * Appeal from the United States * District Court for the Shirley F. Henslin, dba * Western District of Arkansas. CAR Transportation Company, * * [UNPUBLISHED] Defendant - Appellant, * * Golden Eagle Insurance Company, * * Defendant - Appellee. *

___________ Submitted: January 16, 1997 Filed: February 25, 1997

___________ Before LOKEN, JOHN R. GIBSON, and MORRIS SHEPPARD ARNOLD, Circuit Judges.

___________
PER CURIAM.

Fr omAugust 10, 1990, until September 10, 1992, insuranc e broker Steven M. Kennedy obtained errors and omissions insuranc e coverage from Golden Eagle Ins urance Company ("Golden Eagle") on a claims made basis. From September 10, 1992, until February 2 , 1993, Kennedy obtained similar coverage from the Underwriters a t Lloyd's of London ("Lloyd's"). During these periods, Kenned y received large premium payments from his customer, Shirley H enslin, to pay for liability and cargo insurance for her interstate motor carrier business, CAR Transportation Company. In April 1995 , afterThe HONORABLE H. FRANKLIN WATERS, Chief Judge of the Unite d

States District Court for the Western District of Arkansas. -2- the insurers procured by Kennedy denied coverage for numerou s liability and cargo claims asserted against CAR, Henslin sued the insurers, Kennedy, Golden Eagl e, and Lloyd's, seeking to hold some financially responsible party liable to provide the insuranc e Henslin thought she had purchased.
Henslin's lawsuit, ultimately dismissed by the district court for la ck of federal jurisdiction, caused Lloyd's (represented by pl aintiff Kevin Graeme Smith) to commence this lawsuit agains t Kennedy, Henslin, and Golden E agle, seeking a declaratory judgment th at Lloyd's need not indemnify nor defend Kennedy agains t Hensli n's claims of broker malpractice. Kennedy, who is no w inca rcerated, defaulted. Henslin defended, opposing the relie f
re quested by Lloyd's. Golden Eagle defended and cross-claime d aga inst Henslin, asserting that it, too, has no obligation t o indemnify or defend Kennedy against Henslin's claims.
Henslin now appeals the entry of judgment in favor of Lloyd's
an dGolden Eagle. As to Lloyd's, the district court conclude d 1 that there is no coverage under the policy it issued to Kenned y bec ause Henslin made no errors and omissions claims, and Kenned y gave Lloyd's no notice of any unasserted claims, during the policy period. As to Golden Eagle, the court first entered a defau lt when Henslin failed to plead in res ponse to Golden Eagle's cross claim. It then denied Henslin's motion to set aside the default becaus e "there has been absolutely no attempt to show any cause, much less good cause, for the failure to timely respond." However, th e court delayed entering judgment of default until after it granted summary judgment in favor of Lloyd's on the merits of its claim.

On app eal, Henslin first argues that the court erred i n granting summary judgment in favor of Lloyd's because an insurer-3-

"ma ynot disclaim liability based upon inactions of the insured " (Kennedy), and because the court in any event should not hav e rel iedupon Lloyd's affidavit stating that it had received n o timely n otice of claims. With a claims made policy, the insure r need no t show it was prejudiced by the lack of timely notic e because notice within the poli cy period "defines the limits of the insurer's obligation." Lexington Ins. Co. v. St. Louis Univ. , 88 F.3d 632, 634 (8th Cir. 1996). Therefore, after careful review of the record, we affirm the grant of summary judgment for the reasons sta tedin the district court's May 16, 1996, Memorandum Opinion
. See 8th Cir. Rule 47B.

Henslinnext contends that the district court abused it s discretion in entering default judgment in favor of Golden Eagle. Hen slinargues that Golden Eagle was not prejudiced by Henslin' s inadvertent failure to reply t o Golden Eagle's cross claim, and it is therefore unjust to deprive Henslin of this substantial c laim by default. However, Henslin ignores the fact that the distric t court delayed entering default judgment until it ruled on the merits of Llo yd's claim. Like Lloyd's, Golden Eagle issued claims mad e policies to Kennedy, and Hensl in admitted to the district court -- albeit somewhat ambiguously -- that she could not recover fro m Golden Eagle if Lloyd's prevai led on the merits of the claims-made policy issue. In these circumstances, the district court did not abu se its discretion in entering default judgment in favor o f Golden Eagle.
The judgment of the district court is affirmed.
A true copy.

Attest:
CLERK, U. S. COURT OF APPEALS, EIGHTH CIRCUIT.