Key Takeaway
New York appellate court ruling reveals ongoing jurisdictional split over MVAIC exhaustion requirements in no-fault insurance coverage disputes.
The Motor Vehicle Accident Indemnification Corporation (MVAIC) serves as New York’s safety net for no-fault insurance coverage when traditional insurance isn’t available. However, MVAIC cases often involve complex procedural requirements that can trap unwary practitioners. A recent Appellate Term decision highlights ongoing confusion around the “exhaustion of remedies” requirement — a procedural hurdle that has created a split between different judicial departments.
This jurisdictional divide has significant practical implications for attorneys handling New York No-Fault Insurance Law cases. Understanding which department’s precedent applies can mean the difference between a successful claim and a dismissed case based on procedural grounds.
Jason Tenenbaum’s Analysis:
JJ & R Chiropractic PC v MVAIC, 2019 NY Slip Op 51559(U)(App. Term 1st Dept. 2019)
” efendant MVAIC failed in its burden to establish, prima facie, that plaintiff’s assignor was not a “qualified person” entitled to no-fault coverage (see Socrates Med. Health, P.C. v MVAIC, 29 Misc 3d 129, 2010 NY Slip Op 51780 ). Nor has defendant established that plaintiff was required to “exhaust its remedies” against the vehicle’s owner prior to commencing this action”
For some reason, I do not find MVAIC issues blog worthy. Perhaps it is because I do not deal with them frequently. But the exhaustion of remedies has caused a department split in the Appellate Terms. I take MVAIC will leave this alone since the majority of their cases take place in the Second Department, which has historically been more receptive to MVAIC’s “coverage” issue analysis.
Key Takeaway
The First Department rejected MVAIC’s exhaustion of remedies defense, creating a split with the Second Department’s approach. This jurisdictional divide means attorneys must carefully consider venue selection in MVAIC cases, as different departments apply varying standards to procedural requirements and coverage defenses.
