New York State Seal
STATE OF NEW YORK
INSURANCE DEPARTMENT
25 BEAVER STREET
NEW YORK, NEW YORK 10004

George E. Pataki
Governor

Gregory V. Serio
Superintendent

The Office of General Counsel issued the following opinion on January 6, 2003, representing the position of the New York State Insurance Department.

Re: "Splitting" a cause of action under no-fault laws

Questions Presented:

1. Does the Insurance Law or regulations promulgated thereunder forbid the use of "splitting" a cause of action involving the same parties and same facts for the purpose of obtaining two separate legal fees payable under the New York no-fault laws?

2. Does the Insurance Law or regulations promulgated thereunder address whether a plaintiff’s law firm is entitled to reimbursement for the $35 filing fee payable to the Civil or District Courts plus the $20 service of process fee payable to the Superintendent of Insurance?

Conclusions:

1. No. Neither the Insurance Law nor regulations promulgated thereunder address the issue of "splitting" a cause of action since this issue is not under the jurisdiction of the Insurance Department but is governed under the New York judicial system.

2. No. Neither the Insurance Law nor regulations promulgated thereunder address this issue. This question is subject to the provisions of the New York Civil Practice Law and Rules in the context of judicial litigation costs.

Facts:

No additional facts were given.

Analysis:

Under N.Y. Ins. Law § 5106 (McKinney 2000), a plaintiff with a no-fault claim has the right to optional arbitration, in lieu of litigating the claim in court. Here, the plaintiff brought his claims as court proceedings. Neither the Insurance Law nor regulations promulgated thereunder address the issue of "splitting" a cause of action involving the same parties and same facts for the purpose of obtaining two separate legal fees payable under the no-fault laws, since this issue is not under the jurisdiction of the Insurance Department but of the judicial system.

However, a "consolidation" rule does exist in arbitration that addresses this issue. N.Y. Comp. Codes R. & Regs. tit. 11, § 65-4.5(c) (2002) (Regulation 68-D) states that: "The designated organization shall, except where impracticable, consolidate disputes for which a request for arbitration has been received, if the claims involved arose out of the same accident and involve common issues of fact."

Since this issue deals with court proceedings and not arbitration, a motion to consolidate before the court may be brought.

In addition, neither the Insurance Law nor regulations promulgated thereunder governs the issue of whether a plaintiff’s law firm is entitled to reimbursement for the $35 filing fee payable to the Civil or District Courts plus the $20 service of process fee payable to the Superintendent of Insurance. These questions are subject to the provisions of the New York Civil Practice Law and Rules in the context of judicial litigation costs. The no-fault regulation provisions concerning fee reimbursement are limited to the filing fee for requesting no-fault arbitration and assessment of the administrative costs of no-fault arbitration.

For further information, you may contact Senior Attorney Meredith S. Kaufer at the New York City Office.