Quick Health Pharm. Corp. v American Tr. Ins. Co. (2025 NY Slip Op 25038)

PROCEDURAL SUMMARY

Appeal from a judgment of the District Court of Suffolk County, Sixth District (James F. Matthews, J.), entered September 29, 2023. The judgment, insofar as appealed from, upon awarding petitioner assigned first-party no-fault benefits in the principal sum of $1,454.70, awarded petitioner $1,360 in attorney's fees.

HEADNOTES

Arbitration - Award - Attorney's Fees

In a proceeding pursuant to CPLR article 75 in which petitioner successfully sought to vacate a master arbitrator's award, Civil Court mistakenly applied the $1,360 fee cap imposed by 11 NYCRR 65-4.6 (d) to the attorney's fees to be awarded pursuant to 11 NYCRR 65-4.10 (j) (4). Pursuant to 11 NYCRR 65-4.6 (d), attorney's fees for the arbitration and master arbitration, in which petitioner ultimately prevailed, were not discretionary, as they are established by the no-fault regulations. Such fees are limited to 20% of the total amount of first-party benefits awarded, plus interest, subject to a maximum fee of $1,360. Having successfully prevailed in the article 75 proceeding, petitioner was also entitled to an additional award of reasonable attorney's fees therefor pursuant to 11 NYCRR 65-4.10 (j) (4), which amount was to be fixed by the court. The court, in effect, awarded $933.27 in attorney's fees for the article 75 proceeding, notwithstanding the fact that petitioner submitted a claim seeking $3,900 as reasonable attorney's fees for that proceeding. Under the circumstances, the matter was remitted to District Court for a determination of the amount of reasonable attorney's fees to which petitioner was entitled as a result of the court proceeding, without any regulatory cap thereon.

APPEARANCES OF COUNSEL

Roman Kravchenko and Jason Tenenbaum for appellant.

Short & Billy, P.C. (Seok Ho [Richard] Kang of counsel) for respondent.

Ordered that the judgment, insofar as appealed from, is reversed, without costs, and the matter is remitted to the District Court for the entry of a new judgment following a determination of the amount of attorney's fees to which petitioner is entitled, in accordance with this decision and order.

Petitioner commenced this proceeding pursuant to CPLR article 75 to vacate a master arbitrator's award dated March 27, 2023, which upheld the award of an arbitrator dated January 27, 2023, rendered pursuant to Insurance Law § 5106 (b), denying petitioner's claim which had sought assigned first-party no-fault benefits in the amount of $1,454.70. The District Court (James F. Matthews, J.) granted the petition and, among other things, awarded petitioner "its reasonable counsel fees in bringing this Petition." The court directed petitioner to submit a judgment for $1,454.70 plus interest, and attorney's fees pursuant to 11 NYCRR 65-4.6 (d) and [*2]11 NYCRR 65-4.10 (j) (4). Along with a proposed judgment, petitioner submitted an attorney's affirmation seeking $3,900 as petitioner's legal fees for the article 75 proceeding (see 11 NYCRR 65-4.10 [j] [4]). A judgment, entered on September 29, 2023, awarded petitioner the{**86 Misc 3d at 9} principal sum of $1,454.70, plus $678.86 in interest, $230 in costs and fees, and $1,360 in attorney's fees. Petitioner appeals, arguing that the award of $1,360 for attorney's fees was inadequate.

The appropriate attorney's fees due for the arbitration pursuant to 11 NYCRR 65-4.6 (d), calculated at 20% of $1,454.70 plus $678.86, is $426.71. In awarding a total sum of $1,360 in attorney's fees for both the arbitration and the CPLR article 75 proceeding, we assume that the Civil Court mistakenly applied the $1,360 cap imposed by 11 NYCRR 65-4.6 (d) to the attorney's fees to be awarded for the article 75 proceeding pursuant to 11 NYCRR 65-4.10 (j) (4), and therefore, in effect, awarded $933.27 in attorney's fees for the article 75 proceeding, notwithstanding the fact that petitioner submitted a claim seeking $3,900 as reasonable attorney's fees for that proceeding. Under the circumstances, the matter must be remitted to the District Court for a determination of the amount of reasonable attorney's fees to which petitioner is entitled as a result of the court proceeding, without any regulatory cap thereon (see 11 NYCRR 65-4.10 [j] [4]), in addition to the $426.71 regulatorily mandated attorney's fees for the arbitration (see 11 NYCRR 65-4.6 [d]). The court shall state the evidentiary basis for its determination (see Matter of GEICO Ins. Co. v AAAMG Leasing Corp., 148 AD3d 703 [2d Dept 2017]). We note that petitioner is also entitled to reasonable attorney's fees for this appeal (see 11 NYCRR 65-4.10 [j] [4]; Acuhealth Acupuncture, P.C., 170 AD3d 1168).{**86 Misc 3d at 10}

Accordingly, the judgment, insofar as appealed from, is reversed and the matter is remitted to the District Court for the entry of a new judgment following a determination of the total amount of attorney's fees to which petitioner is entitled pursuant to both 11 NYCRR 65-4.6 (d) and 11 NYCRR 65-4.10 (j) (4).