Personal Injury Arbitration in New York used to be a fair process and a good way to speed up a personal injury case and save the cost of trial expenses for both the plaintiff and defense.
For many years, we have done many arbitrations and always felt we had a fair decision with fair compensation awarded. However, things have changed.
Personal injury arbitration has become risky. With many judges refusing to arbitrate and after several recent very low arbitration awards from two different arbitration companies, we are no longer agreeing to arbitrate any personal injury cases. We are now taking every case to trial if we can’t settle for the entire insurance policy.
What Happened to Personal Injury Arbitration?
1) There are far fewer retired Supreme Court judges willing to arbitrate personal injury cases. There used to be a lot of retired Supreme Court judges willing to arbitrate but now, most of them will only agree to mediate cases (attempt to negotiate a settlement) and will no longer arbitrate (a binding decision after a hearing).
The judges we previously used who gave fair compensation to our clients are no longer agreeing to do arbitrations.
The alternative to using a retired Supreme Court judge is to use a lawyer as an arbitrator but we had a bad result with an arbitrator who is a lawyer because he wasn’t familiar with New York State law and didn’t read our arbitration brief which pointed out the law.
It was a motorcycle accident which was arbitrated by a lawyer, the arbitrator found the car driver was 100% at fault but awarded very little money and failed to award our client approximately $28,000 in hospital bills because he incorrectly thought it was covered by no-fault. The problem is that New York State law excludes motorcyclists from no-fault coverage and our client was entitled to be reimbursed for his medical costs. Our client was sued by Winthrop Hospital to recover their money.
2) We believe personal injury arbitration awards are much lower than they used to be and favor insurance companies. The arbitration award, below, by Judge Larry Schnachner defies belief.will
Unfortunately, a low arbitration award cannot be appealed but a low jury verdict can be appealed. Additionally, we never had a low jury verdict although we have had low arbitration awards.
Why Supreme Court Judges Don’t Want to Do Personal Injury Arbitration Anymore
There are two reasons I heard why there are fewer Supreme Court judges doing personal injury arbitrations.
A) Mediations require less time. Arbitrations require reading the papers and writing a decision. However, it doesn’t take that long to read the papers and arbitrators charge for any extra time involved. We have always been charged for additional time and we don’t care how much is charged if we get a fair decision.
B) I heard from the owner of an arbitration company and employees of two different arbitration companies that insurance companies have blackballed arbitrators who awarded too much money. What this means is that if the insurance company is not happy with the decisions of an arbitrator, they refuse to use that arbitrator in the future. We even hear this from insurance companies. We have selected numerous retired Supreme Court judges for arbitration only to be told the insurance company will not use them.
Review of Hon. Larry Schnachner Decision Shows Why We’re Done With Arbitration
This arbitration was at National Arbitration and Mediation (NAM) using arbitrator Hon. Larry Schnachner (formerly Justice Larry Schnachner of The Bronx Supreme Court).
Personal injury trial verdicts in the Bronx are typically higher than any other county in New York, so you wouldn’t expect a ridiculously low arbitration award from a Bronx Supreme Court judge.
We were extremely prepared for the arbitration. The defense attorney was not well prepared. In fact, arbitrator Larry Schnachner admonished the defense attorney when he objected to us introducing medical records because he had not reviewed them but we proved the medical records were sent to the defense.
After reading the arbitration decision, I was wondering if the arbitration award amount was a typo and the arbitrator accidentally left a 0 off the number. The arbitrator awarded $20,000 to the plaintiff. Unfortunately, NAM told me it wasn’t a typo. After legal fees and expenses including the cost of arbitration, the plaintiff will receive just over $10,000.
Is this enough to compensate the plaintiff? Take a look at all the facts below, be the arbitrator and decide for yourself.
The plaintiff was a woman age 74. She was in the red car going straight without a stop sign when she was struck by the silver SUV which ran a stop sign. The insurance policy was $250,000.
Following are the facts of the written arbitration decision:
Read the Personal Injury Arbitration Decision
- The defendant insurance company admitted 100% liability (fault for causing the accident), so the arbitration was “solely on the issue of damages” (not who’s at fault).
- The arbitrator found the plaintiff had no prior injuries.
- The arbitrator found the plaintiff did not have any medical treatment, prior to the car accident, to the injured body parts.
- The arbitrator wrote, “While there was evidence of degenerative changes in plaintiff’s spine and shoulder she was asymptomatic (no symptoms) prior to the accident, and living a normal life.”
- The arbitrator found that the symptoms caused by the accident were consistent.
- The arbitrator wrote, “…plaintiffs injuries are causally connected to the subject accident.” Thus, he found that all of the plaintiff’s injuries were caused by the accident (see list of the injuries below).
- The arbitrator noted that the defense submitted reports from their neurologist and orthopedic surgeon who examined the plaintiff for the defense but the arbitrator did not note any findings from the defense medical exam reports in his decision. Apparently, the arbitrator found the defendant’s medical examinations were not believable.
- The arbitrator appeared to have found the impact to be substantial when he stated: “Due to the impact…”
- The arbitrator found that the plaintiff suffered a “Serious injury under the Insurance Law”.
- The arbitrator found that the plaintiff was not able to work the same number of hours as she did before the accident.
- The arbitrator found that the plaintiff suffered restrictions in daily living after the accident.
- The arbitrator noted that the plaintiff submitted in evidence “copies of verdicts and settlements of cases with similar injuries to plaintiff” which ranged from $325,000-$650,000.
- NAM arbitrator Larry Schnachner (formerly Justice Larry Schnachner) gave only $20,000 for almost 2 1/2 years past pain-and-suffering and future pain-and-suffering!
- The arbitrator did NOT give any reasons for awarding only $20,000 compensation.
- The arbitrator charged for an additional 1 hour to review the documents and write the short decision.
We did a great job. Judge Larry Schnachner ruled in our favor on every point we argued. We couldn’t ask for a better decision! The only problem is that he forgot to fairly compensate our client.
Injuries Submitted Which Arbitrator Larry Schnachner Found Was Caused by the Accident — Was $20,000 an Appropriate Award?
- CLOSED HEAD INJURY
- CONCUSSION WITH LOSS OF CONSCIOUSNESS
- POST CONCUSSION HEADACHE SYNDROME/TRAUMATIC BRAIN INJURY WITH PROLONGED SYMPTOMS
- EPISODIC DIZZINESS
- MEMORY LOSS
- LOSS OF COORDINATION
- BRAIN FOG
- SLURRED SPEECH
- FUMBLING WORDS
- TEAR OF THE LEFT PROXIMAL LONG HEAD BICEPS TENDON WITH SUBACROMIAL-SUBDELTOID BURSITIS IN THE LEFT SHOULDER
- CERVICAL RADICULOPATHY REQUIRING A SERIES OF FOUR TRIGGER POINT INJECTIONS
- LEFT ARM PAIN AND WEAKNESS
- LEFT SHOULDER DERANGEMENT WITH DIMINISHED RANGE OF MOTION REQUIRING A LARGE JOINT INJECTION UNDER ANESTHESIA
- MILD LEFT SUPRASPINATUS TENDINOSIS WITH A PARTIAL WIDTH FULL THICKNESS TEAR OF THE ANTERIOR INSERTIONAL FIBERS
- MILD INFRASPINATUS AND MODERATE SUBSCAPULARIS TENDINOSIS WITH LOW-GRADE PARTIAL TEARING
- MILD GLENOHUMERAL AND MILD-MODERATE ACROMIOCLAVICULAR JOINT DEGENERATIVE CHANGE WITH SMALL JOINT EFFUSIONS
- RIGHT UPPER EXTREMITY PAIN THAT RADIATES INTO RIGHT ARM/HAND
- LOW BACK PAIN REQUIRING A TRIGGER POINT INJECTION
So, why did arbitrator Larry Schnachner award so little money?
After we asked NAM to inquire if there was a typo, Hon. Larry Schnachner wrote: “This was a damages only arbitration. Plaintiff was a sweet old lady but she had degeneration in her spine and shoulder. She did have injections and reduced working hours. I think I called it as I saw it, but given her age, and the degenerative changes, I think the award was fair and can not be changed.
Hon. Larry Schachner”
The problems with this argument:
First, he wrote in his decision, “While there was evidence of degenerative changes in plaintiff’s spine and shoulder she was asymptomatic prior to the accident, and living a normal life.”
Second, a bicep tear is not degenerative. A bicep tear is caused by trauma although underlying degeneration may make it more likely to tear. While there may have been underlying degeneration, the bicep was not torn before the accident and Judge Schachner said so in his decision.
Third, everyone begins degenerating by the age of 18. Degeneration should not reduce the compensation awarded to the plaintiff. The injury is far worse when someone has pre-existing degeneration.
I think we got screwed. What do you think?
We were so upset with Judge Larry Schachner’s decision that we waived our legal fee.
Read the Personal Injury Arbitration Decision