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Article 75 attorneys fees are now limitedMay 31, 2016

Matter of GEICO Ins. Co. v AAAMG Leasing Corp., 2016 NY Slip Op 03879 (2d Dept. 2016)

“In a proceeding for judicial review of an award by a master arbitrator, an attorney’s fee shall be fixed by the court adjudicating the matter (see Insurance Department Regulations [11 NYCRR] § 65-4.10[j][4]; Matter of Hempstead Gen. Hosp. v National Grange Mut. Ins. Co. , 179 AD2d 645).”

“The limitations of an attorney’s fee recoverable in an appeal from a master arbitration award are set forth in Insurance Department Regulations (11 NYCRR) § 65-4.10(j). Insurance Department Regulations (11 NYCRR) § 65-4.10(j)(5) states: “No attorney shall demand, request or receive from the insurer any payment or fee in excess of the fees permitted by this subdivision for services rendered with respect to a no-fault master arbitration dispute.”

The Court has construed the above provision (4.10[j][5]) to refer to Article 75 proceedings and appeals from the proceedings.  While the case does not refer to de novo actions, 4.10[j][4] refers to both types of proceedings.

I think the Court has probably gotten this wrong.  As a carrier, it is great knowing that my liability for counsel fees is limited to $650 when I commence a trial de novo.  But to be dragged through a de-novo action with a PC, CC and other attendants of a Supreme Court action when  the provider chose to file an arbitration and to have an attorney fee limited to $650?  This is nonsense.

I really do not think DFS meant for this interpretation of the regulation.  I just do not read 4.10(j)(5) as a limitation on 4.10(j)(4).  It is creative, I will say that.

 

 

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