New York Civil Law

New York Court of Appeals Determines No-Fault Priority of Payment Issue

How can you not love New York's no-fault regulations?  They raise such interesting issues.

Today, the New York Court of Appeals in Nyack Hosp. v. Gen. Motors Acceptance Corp. determined the following issue: whether an insurer that is waiting for information to verify a pending claim that causes aggregate claims to exceed $50,000 is prohibited by the priority-of-payment regulation (11 NYCRR 65-3.15) from paying already verified claims in the meantime.  The applicable regulation states:

[w]hen claims aggregate to more than $50,000, payments for basic economic loss shall be made to the applicant and/or an assignee in the order in which each service was rendered or each expense was incurred, provided claims therefor weremade to the insurer prior to the exhaustion of the $50,000. If the insurer pays the $50,000 before receiving claims for services rendered prior in time to those which were paid, the insurer will not be liable to pay such late claims.  If the insurer receives claims of a number of providers of services, at the same time, the payments shall be made in
the order of rendition of services.

The Court held that the regulation does not prohibit the insurer from paying already verified claims from other providers or applicants for reimbursement while the insurer awaits verification for an earlier submitted claim.

Because the procedure is so involved, I recommend analyzing the Decision.

March 26, 2007: I have added a trackback to It's No-Fault of New York's helpful discussion about this case.

 

New Treatise on No-Fault Law

Larry Rogak of Lawrence N. Rogak LLC has published a much needed treatise on New York's No-Fault Law (see publication here at Amazon.com).  I have not read the "Rogak's New York No-Fault Law & Practice" yet, but if it is anything like Larry's "The Rogak Report" it is sure to be incredibly informative and helpful to the New York No-Fault practitioner.

First Entry in No-Fault Song Parody Contest

The gauntlet has been thrown down.  New York Civil Law's first entry in the No-Fault parody contest (see post) is an extremely strong one.   Theo Mavromihalis submitted "Brighton Beach Avenue" to rave reviews.  This instant No-Fault classic is set to the tune of Eddy Grant's amazing song "Electric Avenue."  If you don't know the song, here is an .mp3 version of it and the video on YouTube.

Here are the lyrics: Download brighton_beach_avenue.doc

 

Questions have been asked about prizes.  Right now, bragging rights is on the table.  However, there have been rumblings about New York Civil Law paraphenalia or a VHS copy of the Redford-Winger classic "Legal Eagles" (Thanks Sarah).

Thanks to David of No-Fault Paradise and Damin at It's No-Fault of New York for their humor and, more importantly, presenting great posts on New York's No-Fault law (and making the topic interesting).

Keep the submissions coming.

The Hammer Comes Down -- Court Enforces Stipulation in No Fault Case

Justice Marber of the Nassau District Court got "old-school" on the defendant insurer in Vinings Spinal Diagnostic v. Travelers Prop. Cas. Ins. Co. Within the No-Fault context, the parties entered into a stipulation in which the defendant No-Fault carrier was to be precluded from producing any evidence that the plaintiff demanded at trial if the defendant failed to produce certain requested evidence within a certain time period.  The stipulation was not "so ordered" by the Court.

In enforcing the stipulation when the defendant failed to provide the requested discovery, Justice Marber relied upon the 1885 Court of Appeals' decision in In re Petition of New York L.& W.R.Co., 98 NY 447, 453 (1885).  That case states in pertinent part:

Parties by their stipulations may in many ways make the law for any legal proceeding to which they are parties, which not only binds them, but which the courts are bound to enforce. They may stipulate away statutory, and even constitutional rights. They may stipulate for shorter limitations of time for bringing actions for the breach of contracts than are prescribed by the statutes, such limitations being frequently found in insurance policies. They may stipulate that the decision of a court shall be final, and thus waive the right of appeal; and all such stipulations not unreasonable, not against good morals, or sound public policy, have been and will be enforced.

New Blawg on New York No-Fault Law

The blawgosphere has a new New York entry -- It's No-Fault of NY.  Erik Lutwin and frequent New York Civil Law comment writer, Damin Toell, from Bruno Gerbino & Soriano, LLP have started up this great-looking blawg about New York No-Fault law.  It's very exciting to have two attorneys who practice in this area give us updates on this important area of New York law.

I can already tell that this blawg is going to be a valuable resource  for a lot of New Yorkers.  Please help me welcome Erik and Damin to the blawgosphere.

Another Supreme Court Justice Weighs In on the Retroactivity of Mallela

As I have written in the past, the New York Court of Appeals in State Farm Mut. Auto. Ins. Co. v. Mallela, just last year, determined that No-Fault insurers can withhold payment for medical services provided by fraudulently incorporated enterprises to which patients have assigned claims.  Notably, the Court did not expressly state whether this holding was to apply prospectively or retroactively; the issue was before the Court from a certified question from the United States Court of Appeals for the Second Circuit (see prior post).

Justic Moskowitz recently held in Allstate Ins. Co. v. Belt Parkway Imaging, P.C. that Mallela can be applied retroactively to cover those claims that matured prior to April 4, 2002 (the when the Superintendent of Insurance excluded from the meaning of "basic economic loss" payments made to unlicensed or fraudulently licensed providers).   Justice  Moskowitz cited three reasons for the retroactive application: (1) that Mallela involved claims that matured prior to the regulation's effective date and, therefore, the Court of Appeals' decision incorporated claims that matured priot to the effective date of the regulation; (2) the regulation at issue merely clarified the law rather than expressing a sharp change in the law; and (3) the holding comports with the Court of Appeals' policy choce that it made in Mallela of protecting insurer from fraud.

Thank  you to Damin Toell of Bruno Gerbino & Soriano LLP for bringing my attention to this case.

Recent Decision Explains Standard and Burdens of Production Regarding Where No-Fault Claim is Not Covered

As anyone who practices in the No-Fault arena knows, there is not a lot of case law exists addressing the numerous issues surrounding trials.   Justice Bluth wrote this extremely enlightening decision in S. Med. Servs. P.C. v. Allstate Ins. Co. [Civ. Ct., Kings County], concerning what is an insurer's burden in the context of a first-party No-Fault claim where the insurer claims the accident was intentional.  Justice Bluth discusses the misnomer that these cases all encompass a showing of fraud, explaining that the insurer must proffer evidentiary proof that the accident was not unintentional [going along with one of the main principles of insurance].  Justice Bluth also explained the burden of production of both the insured and insurer.

In this case, Justice Bluth determined that the insurer supported its claim that the insured's accident claim was not an accident, and the insured failed to rebut that showing.  The insurer's proof was mostly circumstantial, which Justice Bluth noted was frequently the case on these types of claims.

This case is a great overview of the issue most Courts have deemed as "fraud."  Thank  you to Damin Toell of Bruno Gerbino & Soriano LLP for bringing my attention to this case.

Should Court Apply the Court of Appeals' Decision in State Farm v. Mallela Retroactive? Judge Markey Doesn't Think So.

As most of you probably know, the New York Court of Appeals in State Farm Mut. Auto. Ins. Co. v. Mallela, earlier this year, determined that No-Fault insurers can withhold payment for medical services provided by fraudulently incorporated enterprises to which patients have assigned claims.  Notably, the Court did not expressly state whether this holding was to apply prospectively or retroactively; the issue was before the Court from a certified question from the United States Court of Appeals for the Second Circuit.

Judge Markey in Multiquest, P.L.L.C. v. Allstate Ins. Co. determined that the Court of Appeals did not intend for the Mallela decision to have retroactive effect.  He reasoned that the Court of Appeals likely knew the administrative difficulties it would create if the holding applied retroactively.  He also noted that applying the holding retroactively would raise property right issues.  The decision provides an excellent analysis of both sides of the issue.

Insurers Beware - Recent No-Fault Decision Demonstrates the Importance of a Correct Denial of Claim Form

The District Court, Nassau County's recent decision in West Tremont Med. Diagnostics, P.C. demonstrates that No-Fault carriers need to be complete with their denial of claims forms.  The court entered judgment in favor of the plaintiff for reimbursement under the No-Fault regulations given that the defendant left out crucial information -- i.e., the name of the medical provider, the date of bill, and the date of the amount in dispute.  The court held that the defendant's omissions were fatal, rejecting the defendant's argument that the motion was premature because the plaintiff sent the defendant incomplete information in response to its demand for additional information.

Appellate Division, Fourth Department Addresses Application of Set-Off In No-Fault Context

At first blush, the Appellate Division, Fourth Department's holding in Huther v. Sickler appears unfair and a windfall to the defendant.  Although the reasoning is counter-intuitive, the Court's holding is absolutely correct.

The plaintiff in this matter recovered approximately $4,500 from her No-Fault carrier, although she claimed that her lost wages and medical expenses were much more.  The plaintiff then commenced an action against the tortfeasor and, ultimately, was awarded a jury verdict of approximately $76,000.  The defendant argued that the jury award should be reduced by $50,000, the amount of basic economic loss  she could have received under the Insurance Law and applicable No-Fault regulations.  The plaintiff claimed that the set-off should be reduced only by $4,500.

The Court agreed with the defendant, concluding that the prohibition of recovering basic economic loss against the tortfeasor is absolute.

The case makes for an interesting result that, no doubt, will have some crying an inequity has befallen upon the plaintiff.