Court of Appeals Reverses LMK Psychological -- Attorneys' Fees Limited to Aggregate of a Provider's Bills Per Insured & Interest Tolled Regardless of Timeliness of Denial

NO-FAULT – ATTORNEYS' FEES – TOLLING OF INTEREST
LMK Psychological Servs., P.C. v. State Farm Mut. Auto. Ins. Co.
(Ct. Apps., decided 4/2/2009)

In a unanimous opinion authored by Judge Piggott, the New York Court of Appeals today REVERSED the Third Department's 2007 decision in this case and ruled:

• Attorneys' fees on awarded no-fault benefits are to be calculated consistent with the New York State Insurance Department's Office of General Counsel Opinion of October 8, 2003, based on the aggregate of all bills for each insured disputed in a single action or arbitration, and not based on a "per bill" basis.

• If a claimant does not request arbitration or institute a lawsuit within 30 days after receipt of a denial of claim form or payment of benefits, the interest tolling provision of 11 NYCRR 65-3.9 (c) applies regardless of whether the no-fault insurer has issued a proper and timely denial.

As the old Dodge RAM truck commercials used to say, this changes everything. Don't issue those checks today, and start drafting your motions to reargue.

Mura & Storm hosted a 60-minute webinar to review and discuss this decision on Thursday, April 9, 2009 @ noon. A recap of that program is here.