Dumlao v. State Farm Ins. Co.

• Decision Date: 13 May 1991
• Citation: 173 A.D.2d 517,570 N.Y.S.2d 119
• Parties: Keiko DUMLAO, Respondent, v. STATE FARM INSURANCE COMPANY, Appellant.
• Court: New York Supreme Court — Appellate Division

Page 119

570 N.Y.S.2d 119

173 A.D.2d 517

Keiko DUMLAO, Respondent, v. STATE FARM INSURANCE COMPANY, Appellant.

Supreme Court, Appellate Division,

Second Department.

May 13, 1991.

Robert R. Serpe, Huntington, for appellant.

Before KOOPER, J.P., and SULLIVAN, HARWOOD and ROSENBLATT, JJ.

MEMORANDUM BY THE COURT.

In an action, inter alia, to recover first-party no-fault insurance benefits pursuant to a contract of insurance issued by the defendant, the defendant appeals from so much of a judgment of the Supreme Court, Nassau County (Roberto, J.), entered August 9, 1989, as awarded counsel fees pursuant to 11 NYCRR 65.17(b)(6)(vi) in the amount of $5,000 to the plaintiff's attorneys.

ORDERED that the judgment is modified, on the law and the facts, by deleting the provision thereof awarding the plaintiff's attorneys $5,000 in counsel fees and substituting therefor a provision awarding them $850 in counsel fees; as so modified, the judgment is affirmed insofar as appealed from, without costs or disbursements.

The record reveals that the plaintiff commenced this action to recover first-party benefits after she allegedly sustained disabling injuries in an automobile accident while insured by the defendant. The only dispute which arose during the ensuing trial concerned the factual issue of whether the plaintiff's injury was caused by the automobile accident or by a preexisting arthritic condition. The plaintiff's attorneys elicited the testimony of the plaintiff and a medical expert in support of the former position, while the defendant presented its own medical expert in an attempt to prove the latter. Moreover, while the parties agreed that, under the regulations of the Superintendent of Insurance, any award of counsel fees in a case such as this ordinarily would be limited by 11 NYCRR 65.17(b)(6)(v), the plaintiff maintained that an excess fee award would be warranted in this case pursuant to 11 NYCRR 65.17(b)(6)(vi). Those regulatory provisions state:

"(v) * * * the attorney's fee shall be limited as follows: 20 percent of the amount of first-party benefits, plus interest thereon, awarded by the arbitrator or court, subject to a maximum fee of $850".

"(vi) Notwithstanding the limitations listed in this paragraph, if the arbitrator or a court determines that the issues in dispute were of such a novel or unique nature as to require extraordinary skills or services, the arbitrator or court may award an attorney's fee in excess of the limitations set forth [in these rules]. An excess fee award [must] describe in detail the specific novel or unique nature of the dispute which justifies the award" (11 NYCRR 65.17[b][6][v], [vi].

The Supreme Court rendered an award in favor of the plaintiff, and also awarded counsel fees of $5,000 to the plaintiff's attorneys, reasoning as follows:

"[t]his Court finds that the issue of whether or not the injury was causally related [to the accident] is of such a unique nature as to require the extraordinary skills and services of an attorney. [The plaintiff] is therefore entitled to...