March 13th, 2007

Must Someone Be Negligent In Head-On Collision?

When cars collide head-on in New York, does at least one of them have to be negligent? A jury said no, and the trial court agreed. The case was brought by an injured passenger in one of the cars.

In a ruling last week, the Appellate Division Second Department reversed with this principle of law:

It has repeatedly been held that a driver who crosses over a double yellow line into opposing traffic, unless justified by an emergency not of the driver’s own making, violates the Vehicle and Traffic Law and is guilty of negligence as a matter of law.

Here, the evidence presented at trial demonstrated that the statute was violated by either [car one or car two]. Neither party presented a non-negligent explanation for the accident. Rather, each defendant claimed that although it had been raining and/or sleeting for some time, she did not lose control of her vehicle. In any event, the adverse weather conditions were foreseeable and would not have provided a non-negligent excuse for the collision.

The case was sent back for a new trial. The decision in Sena v Negron is here.


March 12th, 2007

New York Personal Injury Claimants Can Protect Some Medical Records

New York personal injury lawsuits have very liberal discovery rules when it comes to furnishing medical records. Almost any medical record, it seems, is fair game under the civil practice rule for discovery of all “material and necessary” documents.

But the First Department of the Appellate Division wrote a few days back that a tougher standard exists for more sensitive medical data, particularly with respect to HIV status and substance abuse materials. Applying the standard of the Health Law or Mental Hygiene Law instead of the Civil Practice Law and Rules, the court noted that a court should grant an order for disclosure of confidential HIV related information upon an application showing a “compelling need” for disclosure of the information for the adjudication of a criminal or civil proceeding.

Since the motion court had made its determination using “material and necessary” standard and not the “compelling need” standard, the lower court decision was reversed and remanded for consideration under the higher standard to see if such records exist and determine their discoverability (if any).

The decision in this malpractice case is here.


January 23rd, 2007

How New York Caps Personal Injury Damages

A favorite topic of tort “reformers” is to place arbitrary caps on personal injury damage awards for pain and suffering. In doing so, they simply ignore the fact that caps already exist, but without the low ball one-size-fits-all numbers they argue for. In fact, we’ve been capping damages now in New York for almost 200 years without using an arbitrary number.

Here’s how it works: On occasion a jury will give an outrageous number…sometimes way too high, and sometimes way too low. (Newspapers only cover the high ones.) While jury awards are given great deference by the courts, that deference is not absolute, and the judge has the power to modify the award. Not directly, since the court won’t simply substitute its own judgment for the jury, but by tossing out the award and ordering a new trial unless the aggrieved party stipulates to the new amount chosen by the court. This happens at both the trial court level and the appellate level.

The earliest opinion I’ve seen where the court says it will not accept any award from a jury in New York is from 1812:

“It is not enough to say, that in the opinion of the court, the damages are too high and that we would have given much less. It is the judgment of the jury, and not the judgment of the court, which is to assess the damages in actions for personal torts and injuries….The damages, therefore, must be so excessive as to strike mankind, at first blush, as being beyond all measure, unreasonable and outrageous, and such as manifestly show the jury to have been actuated by passion, partiality, prejudice, or corruption. In short, the damages must be flagrantly outrageous and extravagant, or the court cannot undertake to draw the line; for they have no standard by which to ascertain the excess.” – Chief Judge James Kent, Coleman v. Southwick, 9 Johns. 45, 1812)

Chief Judge Kent’s standard of being “flagrantly outrageous and extravagant” to toss out a civil award is now read in two similar ways: The appellate court language is that the damages “deviate materially from what would be reasonable compensation”; and the trial courts say they will order a new trial when the verdict “shocks the conscience of this court.”

This methodology of ordering a new trial if the party did not stipulate to reduced damages came up in a famous 1913 case, involving future Supreme Court Justice Benjamin N. Cardozo and Bat Masterson, a legendary figure of the Old West, when a jury returned a defamation verdict in favor of Masterson for $3,500. The reason? Cardozo’s client had said that that Masterson had “made his reputation by shooting drunken Mexicans and Indians in the back.” (Hat tip to Randy Barnett at The Volokh Conspiracy.) New York’s appellate court tossed the verdict and awarded a new trial unless Masterson stipulated to a reduction of the verdict to $1,000.

And in one of my own trials, I took a $610K verdict in a Brooklyn medical malpractice case resulting from a misplaced injection that injured the sciatic nerve. The court reduced my client to $450K using the same stipulation mechanism. To see how often the New York courts continue to do that, just pop the phrase “deviate materially from what would be reasonable compensation” into the search box at the court’s appellate website here.

In other words, to persevere in an action for pain and suffering, one must first win with a jury’s review, then have that verdict pass muster before the judge that heard the case, and then have the verdict reviewed a third time in front of an appellate panel.

So why put arbitrary caps in place if common sense ones already exist? Because the movement to do so has nothing to do with finding justice, but rather, is run by big business and its front groups such as the U.S. Chamber of Commerce to give negligent conduct various forms of immunities and protections when folks are injured. The idea is to remove the concept of personal responsibility for one’s actions.

The big verdicts make big headlines. The subsequent reductions (or additions when a plaintiff is badly shortchanged) rarely appear. But simply because you don’t see it in the papers doesn’t mean it doesn’t exist.

Addendum, 3/12/07 — For more on the disparity of coverage between verdicts and subsequent reductions, see Media Bias at TortDeform.


January 12th, 2007

Are Emotional Injury Recoveries Tax Exempt? An Appeals Court Dumps Its Own Opinion…

It’s odd to see an appeals court vacate its own decision, without anyone having asked, but that is what happened here. It’s all about the power of the government to tax personal injury awards.

Congress has the power to tax income, but not recoveries for personal injury. Its power comes from the Sixteenth Amendment, which gives it the “power to lay and collect taxes on incomes, from whatever source derived…”

Since a personal injury award, either by settlement or verdict/judgment, is compensation for that which was lost, it is not income. The injured person is simply made whole.

But what of psychological injury or loss to reputation? It was just a few days ago I posted on emotional injuries for witnessing the death of a sibling while in the “zone of danger.” In Murphy v. IRS, a three judge panel of the U.S. Court of Appeals for the District of Columbia held last year that compensation for emotional injuries was not income, and therefore not taxable. Therefore the provision of the Internal Revenue Code that tried to tax the money was held to be unconstitutional as it contravened the Sixteenth Amendment. Much was written on the subject, which I will not repeat, some of which can be found at this link to the TaxProf Blog.

The news? The Court of Appeals reversed itself a few weeks back by tossing out the decision, and asked for new briefs and oral argument. We can thus expect a new decision where the same three judges reverses their prior holding, or perhaps strengthens that prior opinion with the knowledge that, one way or another, this may well be headed for the U.S. Supreme Court. Interestingly, the court’s request for a re-hearing was done on its own motion. The losing side, the government, had not asked for that, but rather, an en banc hearing (with all the judges for the circuit court).

Since almost all personal injury cases have an element of psychological damage (the “suffering” in “pain and suffering”), the outcome is more than a little bit important. Will the court try to distinguish the emotional damage one has with a lost limb from that of the suffering in a non-physical injury defamation case? If a person has any physical injury to go with the emotional damage, does that mean all of the emotional damages are tax exempt? Will juries now be asked to separate out the two components?

The government argument is that all compensation from a personal injury suit may be taxed, notwithstanding the Sixteenth Amendment. This next appellate argument is unlikely to be the last…stay tuned…

And a tip of the hat to John D. Darer at StructuredSettlements4Real, where I caught up with that information.


November 28th, 2006

How much are the legal fees in a personal injury case?

In part one of this FAQ, I discussed 1) the need to find a lawyer in your area, and; 2) concerns one should have if they are solicited by an attorney. Now we turn to legal fees:

3. How much are the legal fees in a negligence case?

Most New York personal injury law firms operate the same way:

First, there is no legal fee for an initial consultation. If the case is taken it is usually done on a contingency basis, which means that the lawyer gets paid only if the client gets paid. This is an incentive for the lawyer to only take good cases with serious injuries, and it relieves a burden from clients who would not otherwise be able to afford a good attorney.

Legal fees are governed by the Judiciary Law, which establishes a limit of 1/3 of any recovery as the fee, with the exception of medical and dental malpractice cases where the fee is lower (see below).

Over the course of the representation, there will be expenses that most attorneys will generally advance on behalf of the client, such as for medical records, experts, stenographers, and certain court filings. There may be exceptions to this, and a good attorney will candidly discuss them with you. (For example, if a settlement offer is made that the attorney recommends accepting, and the client refuses, the client might be asked to front any additional expenses.)

At the time of recovery, the firm will first reimburse themselves for the cash outlay for expenses and then do an apportionment of the remaining recovery. For example, if a case settles for $100 and there was $10 in expenses paid by the attorneys on behalf of the client, then the $10 would be paid back to the attorney and the remaining $90 would be used to determine the legal fee.

4. What are the fees in New York medical malpractice and hospital malpractice cases?

Medical, dental and hospital malpractice cases are also governed by the Judiciary Law, which sets forth a legal fee “sliding scale” structure that looks like this:

30% of the first $250,000 of the sum recovered;
25% of the next $250,000 of the sum recovered;
20% of the next $500,000 of the sum recovered;
15% of the next $250,000 of the sum recovered;
10% of any amount over 1,250,000 of the sum recovered.

Thus, while malpractice cases are significantly more difficult to bring, and cost a great deal more (due to the necessity of hiring additional experts), the fees are lower than in other New York personal injury matters. In fact, they are some of the lowest in the nation. Because of this, many New York firms have a much higher threshold barrier in taking malpractice cases. Essentially, the lower fees, greater expense and significant technical difficulty of bringing such suits has given virtual immunity to the medical profession for smaller claims. Samples of some of the New York medical malpractice cases my firm has handled can be viewed at this link, and they demonstrate the complexity of many matters.

In future FAQs, I hope to cover the need for speed in certain things, the issues around how to “value” a potential case, and other subjects.