No Fault Defender – A Defense Attorney's Perspective on New York No-Fault Law

Archive for the ‘Attorney fee’ Category

Cornell Med., P.C. v Mercury Cas. Co.
2009 NY Slip Op 29228 (App. Term 2d Dept. 2009)

This case is extremely complicated. There are two points of law that came from this case. The first point of law that came from this case, and it is significant, is that a prima facie demonstration of failure to bill in accordance with the fee schedule raises an inference that a plaintiff attorney is not entitled to an attorney fee. The plaintiff attorney must then prove the two exceptions that are set forth in 65-4.6(i). Secondly, a counterclaim for monies paid in excess of the fee schedule is untenable.

LMK Psychological Servs., P.C. v State Farm Mut. Auto. Ins. Co.
2009 NY Slip Op 02481 (2009)
http://www.courts.state.ny.us/reporter/3dseries/2009/2009_02481.htm

Everybody now knows the LMK decision. Many people have posted and blogged about it. I could discuss it here at length, but it would be fruitless. I will share a few observations. First, the decision was poorly written. When I say poorly written, I mean this in the sense that modern no-fault jurisprudence is nuanced. Does anybody remember the entire line of cases which construed interest tolling based upon a definition of the word “Applicant”?

The Court of Appeals, in a cavalier fashion, used the words: “insured”, “claimant”, and “cause of action” all throughout their opinion. These phrases have created hundreds of court decisions from the lower courts up through the Appeals Courts. I will highlight the examples of the internally inconsistent language that the Court of Appeals used in this decision:

1) “the Superintendent stated

“[that provision] makes it clear that the amount of attorneys’ fees awarded will be based upon 20% of the total amount of first party benefits awarded. That total amount is derived from the total amount of individual bills disputed in either a court action or arbitration, regardless of whether one bill or multiple bills are presented as part of a total claim for benefits, based upon the health services rendered by a provider to the same eligible insured.”

2) “For purposes of calculating attorneys’ fees, the Superintendent has interpreted a claim to be the total medical expenses claimed in a cause of action pertaining to a single insured, and not — as the courts below held — each separate medical bill submitted by the provider.”

3) “Thus, this Court accepts the Insurance Department’s interpretation of its own regulation and, upon remittitur, directs Supreme Court to calculate attorneys’ fees based on the aggregate of all bills for each insured”

So now, we have different interpretations of this rule. Does the LMK rule involve each “cause of action” no matter how pleaded? Does this rule involve the “aggregate of all bills” for the insured? Or, does LMK stands for what it means: “Because this interpretation is neither irrational, unreasonable, nor runs counter to the clear wording of the statute, it is entitled to deference.”

I will take option #3. The Appellate Terms will inevitably clean this mess up, and hold that option #3 is the most logical path to follow. But LMK at all levels just goes to show how careful things need to be expressed, or else unintended consequences will be abound.