Getting a Recovery for Your Attorney’s Fee in Accident Cases and Insurance Lawsuits

April 19, 2012

Clients ask  whether they can separately recover their legal fees on top of the recovery for their injury or damage?  Unfortunately, the answer is “no.”

This question makes sense in that if the defendant did not injure the client, the client would not be put to the expense of hiring an attorney to get a recovery.  After all, the client is not profiting from the lawsuit.  He is merely being made “whole” after a loss.   

Under the so-called “American rule”, which is recognized in New York, each party of the lawsuit is responsible for his own legal costs.  In comparison, under the “English rule”, the winner can recover his legal costs against the losing side.

A disadvantage of the American rule is that the injured party is not made “whole”.  He must pay a portion of his recovery for his legal fees.  On the other hand, an advantage is that a losing plaintiff will not burdened with defendant’s legal costs if defendant wins.

 An exception to the rule is where either statute or a contract provides for the award of legal fees.  But, as a general rule legal fees cannot be recovered in personal injury, property damage, and breach of insurance cases.

Mark E. Seitelman, 4/19/12, www.seitelman.com.


Getting a Recovery for Your Injuries; the ERISA Healthcare Lien

March 21, 2012

The injured client’s attorney has two jobs.

First, he must obtain the best monetary recovery possible based on the facts and the law.

Second, he has to get as much as possible of the settlement into the client’s hands.  He has to either fight or negotiate liens.  Such liens include Medicare, Medicaid, Public Assistance, workers’ compensation, and private health insurance.

Once an injured client gets a settlement, governments and insurance companies swarm around the money like a flock of buzzards over a dead animal.  These liens pick away at the settlement.  Sometimes, the lien holders seek to leave nothing to the client.

The unfairness of liens, particularly healthcare insurer liens under the ERISA law, is discussed in Professor Roger M. Baron’s excellent law review article, “The Revictimization of Personal Injury Victims by ERISA Subrogation Liens,” 45 Creighton Law Review 325 (2012).

Professor Baron is correct.  The injured client is “revictimized” by the healthcare insurer’s lien.  The health insurer has done nothing to get the recovery, but it stands ready to take money out of the client’s hands.  Sometimes it wants the entire settlement. 

There is hope.  Public Justice, the public interest law firm, took-up the injured clients’ cause in the recent case of US Airways, Inc. v. McCutchen,  663 F.3d 671 (3d Cir. 2011).  In this case the injured client’s health insurer sought the entire net settlement to pay-back its alleged lien.  The client, who was very seriously injured, would have received nothing!  The court ruled that this is inequitable, and the trial court must hold a hearing as to whether the health insurer is entitled to any share of the net settlement.

We see the McCutchen case as a first victory on the war on liens.

Mark E. Seitelman, 3/21/12, www.seitelman.com.


Being Prepared for an Automobile Accident; Getting Non-Owned Auto Insurance

March 14, 2012

If you do not own a car you should consider buying non-owned automobile insurance.

This insurance will protect you in the event of an automobile accident with either a vehicle which is uninsured or unknown (the “hit and run”) or a vehicle which carries less insurance than your coverage.

We recommend this insurance in order to provide the best insurance protection to you and your family.  If you can afford this coverage we recommend it so that you are provided an extra measure of protection in the event of a very serious auto accident.

For example,

Assume that you did not own a car, therefore, you had no auto insurance.

Further assume that as a pedestrian you are injured by a hit and run vehicle.  You sustain a herniated lumbar disc, and you undergo back surgery.  You cannot return to work.

Under the minimal, required coverage of Motor Vehicle Indemnification Corp. (MVAIC), the most that you could recover is $25,000 from MVAIC.

However, let us assume that you purchased a non-owned auto policy with uninsured motorist coverage of $500,000.  You could recover the full $500,000 from your own insurance carrier.

The non-owned policy also protects you when you rent a vehicle or borrow someone else’s car. 

I recently purchased a non-owned automobile policy for my wife and me with $500,000 Supplementary Uninsured/Underinsured Motorist coverage as well as $500,000 bodily injury coverage.   The price?  A mere $99.

If you are able to afford non-owned automobile insurance, it is very wise purchase.

Mark E. Seitelman, March 14, 2012, www.seitelman.com.


Bedbugs May Not Be Covered by Your Insurance; Check Your Policy!

October 12, 2010

When a person’s home is invaded by bedbugs, his insurance may not cover the exterminators.  

Most insurance policies provide an exclusion for damage caused by insects, vermin, and animals.  This exclusion usually comes into play where the homeowner has termites and seeks coverage for the repairs.

People with bedbugs in their home may spend much money to eliminate the problem, such as special exterminators with bedbug sniffing dogs.  Some have all of the possessions of their apartment inspected and cured and have moved out temporarily to a hotel during the process.  

Unfortunately, such expenses may not be covered under insurance.  To determine whether bedbugs are excluded there must be a careful reading of the policy.

Although typical homeowners’ policies exclude insects, we secured a recovery for our client’s extensive termite damage.  In that case the insurance company did not use the standard language promulgated by the Insurance Service Office, and the insurance company’s poorly written policy allowed coverage.  That case will be discussed in a future post.

Mark E. Seitelman, 10/12/10, www.seitelman.com.


Mark E. Seitelman Is in Super Lawyers

October 1, 2010

    I am pleased to announce that I am in the 2010 edition of Super Lawyers and that I am featured in a profile in a special advertising supplement to The New York Times Magazine (Sunday, October 3rd). 

The same profile will appear in the free-standing Super Lawyers magazine which is being mailed to all the lawyers in Metro New York.  

The New York Times     Only 5% of New Y0rk attorneys are elected into Super Lawyers.  They are nominated by fellow lawyers, and attorneys enter Super Lawyers based on their credentials, experience, and reputation for excellence and integrity.

I have been named a Super Lawyer in the following fields:

  1. plaintiffs’ personal injury (general);
  2. medical malpractice; and
  3. insurance coverage.

I am honored to be selected again into the ranks of Super Lawyers.  This has been my 4th year.  I thank my clients and colleagues for allowing me to be of service to them.

Mark E. Seitelman, 10/1/10, www.seitelman.com.


Getting a Personal Injury Recovery and the Medicare Lien; What a Mess!

August 30, 2010

Medicare has made recoveries in personal injury lawsuits messier and more prolonged.  

Medicare has a lien for its medical payments to the injured person for medical bills arising from the accident.  Medicare’s lien gets adjusted for the amount of the recovery and the cost of getting the recovery, such as the lawsuit expenses and the lawyer’s fee. 

Medicare’s recently enacted rules require that defendant or its insurer make sure that Medicare is involved in the settlement before defendant pays any settlement money.  Defendants and their insurance companies can get fined if they do not comply, therefore, the insurance industry has become very tough in enforcing these rules.

The net result is that defendant’s insurer cannot pay until Medicare gets involved.  Once it is notified, Medicare is taking 3 to 9 months to provide its lien figures and to arrive at a settlement.  Therefore, settlements are being delayed due to Medicare’s inefficiency.

This delay is onerous on older clients who may have waited years for a settlement and must now wait many months more.  For some clients time is very precious, and they do not have time for more delays.  We have one client who just settled her case and is 95 years of age.  

The American Association of Justice (www.justice.org)  is proposing rule changes that would greatly speed-up the process. 

Something must be done.

Mark E. Seitelman, 8/30/10, www.seitelman.com.


See an Attorney Early; Do Not Let Time Deadlines Pass

August 16, 2010

Every once in a while a client comes to us when it is too late.  

I discussed the prudence of seeing an attorney early in a prior post.

Last week a client asked our help on the following case:

Mrs. Mary Moore sustained a substantial loss of  her personal property due to a flooded basement.  The flood was caused by construction next door.  The contractor struck a water main.

There appears to be no question that the contractor was negligent.  His insurance company paid other people damaged by the flood.

Mrs. Moore sustained about $1,000,000 in personal property damage, such as damaged artwork, antique furniture, collectibles, and a vast designer clothing collection which included many unworn garments with their tags.

First, Mrs. Moore sought recovery from her own homeowner’s insurer, Allstate.  About 2 years after the flood, Allstate paid its full limits of $350,000.  She then sought to collect $650,000 from the contractor’s insurance company, Old State Dominion Insurance Company.

Mrs. Moore engaged in much negotiation with Old State’s representative.  Documentation was exchanged, and there were inspections of the property.

According to Mrs. Moore Old State’s adjustor told Mrs. Moore a number of times that a “claim must be filed no later than July 8th”, which was 3 years from the flood.  Mrs. Moore took it to mean that she must send-in all of her claims documentation.  There was also a conversation where Old State’s adjustor’s asked whether Mrs. Moore hired an attorney.  Mrs. Moore answered “no”.  “Good” was the adjustor’s response because “we can settle faster without an attorney.”

Mrs. Moore sent extensive and very organized paperwork supporting her claim to Old State before the 3 year deadline.  On July 16th, a week after  the 3 year anniversary, Mrs. Moore and the adjustor had an all day meeting to review the claim submission.  After this session another meeting was planned for August 2nd in which numbers would be discussed.

However, that August 2nd meeting was cancelled.  Old State sent a denial letter to Mrs. Moore on July 28th.  The claim was denied since suit was not filed within the 3 year statute of limitations.

We could not help Mrs. Moore.  She failed to file suit before the statute of limitations expired.  If suit had been filed, negotiations could have continued and may have led to an eventual settlement.

The law has a strong policy in upholding statutes of limitations.  The law favors  an end to claims and lawsuits.  In order to claim that the statute of limitations would not apply, we would have to show fraud by the insurance company.  Negotiation before or after the deadline will not be deemed a waiver of the statute of limitations.  Furthermore, there was no fraud in the adjustor’s statement that it was good that an attorney was not hired.  This was not tantamount to lulling the client into not hiring an attorney.   Furthermore, there was no offer made which could cause the client to think that the case was settled.  In sum, we could not show any of the extraordinary circumstances which would allow the case to proceed.

The lesson for clients is to consult with an attorney as soon as possible after a loss or an injury.  An injured client should be aware that there are strict time limits in which to pursue a claim or lawsuit.  Defendant will take every advantage of the statute of limitations which is a “slam dunk” defense.  

Mark E. Seitelman, 8/16/10, www.seitelman.com.


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