Matter of American Transit Insurance Company v YSC Trinity Acupuncture, P.C.
Attorneys and Parties
Brief Summary
New York no-fault insurance attorney's fees for court proceedings following master arbitration awards.
Confirmed the master arbitration award but, in the final judgment, in effect denied the provider’s request for attorney’s fees under 11 NYCRR 65-4.10(j)(4).
The denial of attorney’s fees; the appellate court granted entitlement to fees under 11 NYCRR 65-4.10(j)(4) and remitted to determine the amount.
Insurance Law § 5106(a) [entitles a claimant to a reasonable attorney's fee for services necessarily performed in securing payment of an overdue no-fault claim, subject to regulatory limits] and 11 NYCRR 65-4.10(j)(4) [attorney's fee for services rendered in a court appeal from a master arbitration award shall be fixed by the court adjudicating the matter] require a reasonable attorney’s fee to a prevailing claimant in a CPLR article 75 proceeding; the amount is fixed by the court and is not controlled by 11 NYCRR 65-4.6(d) [regulation asserted by the insurer to limit attorney’s fees].
Background
YSC Trinity Acupuncture, P.C. sought no-fault benefits from American Transit Insurance Company. The insurer denied the claim. An arbitrator awarded YSC the claimed amount (June 9, 2022). On master arbitration review, the award was confirmed (August 31, 2022). American Transit then commenced a CPLR article 75 proceeding to vacate the master arbitration award; YSC cross-petitioned to confirm and sought attorney’s fees for its court representation under 11 NYCRR 65-4.10(j)(4).
Lower Court Decision
In a June 4, 2024 decision, the Supreme Court, Kings County, denied the insurer’s petition, granted YSC’s cross-petition to confirm the master arbitration award, and held YSC was entitled to attorney’s fees under 11 NYCRR 65-4.10(j)(4), directing an affirmation of services. After YSC sought $5,020, the August 27, 2024 judgment denied the petition, confirmed the master arbitration award, but in effect denied the branch seeking attorney’s fees.
Appellate Division Reversal
Reversed insofar as appealed from. The court held that a prevailing claimant is entitled to a reasonable attorney’s fee for services rendered in a CPLR article 75 court proceeding that constitutes a “court appeal from a master arbitration award,” pursuant to Insurance Law § 5106(a) and 11 NYCRR 65-4.10(j)(4). It rejected the insurer’s argument that 11 NYCRR 65-4.6(d) limits the amount. The matter was remitted to the Supreme Court, Kings County, to fix the amount of a reasonable attorney’s fee and to state the evidentiary basis for the award, with costs to YSC.
Legal Significance
Clarifies that, in New York no-fault disputes, a CPLR article 75 proceeding to vacate or confirm a master arbitration award qualifies as a “court appeal from a master arbitration award,” entitling the prevailing claimant to a reasonable attorney’s fee fixed by the court under 11 NYCRR 65-4.10(j)(4). The decision confirms that fee amounts in this context are not capped by 11 NYCRR 65-4.6(d).
A prevailing no-fault claimant in a CPLR article 75 proceeding following a master arbitration award is entitled to a reasonable attorney’s fee fixed by the court under 11 NYCRR 65-4.10(j)(4), and 11 NYCRR 65-4.6(d) does not control the amount.