Chapter Twenty-Four

JurisdictionNew York

Chapter Twenty-four

Exceeding the No-Fault Threshold: Serious Injury

Michael F. Chelus, Esq. Michael M. Chelus, Esq.*

* The authors acknowledge the contribution of Louis B. Cristo, Esq., who participated in the preparation of the chapter in the first edition of Insurance Law Practice.


A. Purposes

The Comprehensive Motor Vehicle Insurance Reparations Act2984 is widely known as New York’s no-fault law. The no-fault law serves the state’s goal of providing automobile accident victims with a rapid means of recovery for their resulting economic losses.2985 By requiring automobile liability insurance carriers to compensate accident victims for most of their economic loss regardless of fault, it was believed that this would create an expedient system of compensation and the public would benefit. Additionally, the congestion in the court dockets would be alleviated by the elimination of “minor” automobile accident cases. While court dockets now appear no less congested than before no-fault, and some no-fault claimants might argue that the no-fault system is anything but expedient, the no-fault law has effectively shifted disputes from the courtroom to the administrative hearing room.

The Court of Appeals, in its pivotal analysis of the then-new no-fault legislation, pointed to four essential bases for enactment of the law:2986

1. The belief that the risk of tort liability does not cause drivers to operate their vehicles any more prudently. Therefore, no hidden benefits were being realized by the common-law fault system, which would be eliminated by the enactment of the no-fault law.
2. The belief that the common-law tort system was “excessively and needlessly expensive and inefficient.” 2987
3. The distribution of compensation to accident victims through the tort system was inequitable and haphazard.
4. The state’s court system was becoming increasingly overburdened by litigation of automobile accident cases.

The Court of Appeals also praised the legislature’s study and investigation of the no-fault legislation, saying it had “an uncommonly sturdy legislative basis.”2988

New York chose to enact a “hybrid” no-fault system that supplements rather than supplants the common law. In contrast to no-fault schemes that completely abrogate a person’s common law civil remedy in favor of an administrative-based system, New York preserved the right to a tort cause of action in instances where serious injury is sustained. In such cases, recovery may be had for noneconomic loss or, as it is more commonly known, pain and suffering.2989

Since enactment of the no-fault law, the issue of whether an automobile accident victim has sustained “serious injury” has proven fertile ground for litigation. The categories of serious injury defined by the Insurance Law2990 are constantly being refined and, sometimes, contorted to contend with new theories of recovery and new diagnoses of injury.

B. History

The no-fault law, which began its existence as the Comprehensive Automobile Insurance Reparations Act, was codified originally as article 18 of the Insurance Law.2991 It is now contained in Insurance Law article 51, having been recodified in 1984. The no-fault law’s basic structure has not been altered substantively since its inception; the recodification project tinkered with the positioning and wording of the statutes but without significant consequence. There exist a few notable exceptions, however, which are examined below. When the no-fault law was originally enacted, serious injury was defined and established as follows:

(a) [injury] which results in death; dismemberment; significant disfigurement; a compound or comminuted fracture; or permanent loss of use of a body organ, member, function, or system; or
(b) if the reasonable and customary charges for medical, hospital, surgical, nursing, dental, ambulance, x-ray, prescription drug and prosthetic services necessarily performed as a result of the injury would exceed five hundred dollars. 2992

In 1977, the legislature eliminated the second means of establishing serious injury—proof of the expenditure of $500 for medical and related services.2993 It was believed that this standard was too lenient, encouraging inflated claims of medical expenses and eviscerating the purpose of the legislation, and it was stricken in favor of the present language.2994 Inserted in its place are what have become the two most litigated categories of serious injury: (1) a “significant limitation of use of a body function or system” and (2) an “injury or impairment of a non-permanent nature which prevents the injured person from performing substantially all of the material acts which constitute such person’s usual and customary daily activities for not less than [90] days during the [180] days immediately following the occurrence of the injury or impairment.”2995 Also eliminated in 1977 was the requirement that a fracture be compound or comminuted to qualify as a serious injury. A simple fracture now constitutes a serious injury. Other technical changes were made in the interests of better “systematization.”2996

Practitioners should be aware of two bills (see A4787/2011 and S3790/2011) that would significantly change motion practice and the burden of proof with respect to the serious injury threshold. Further, the proposals also include a significant change in the definition of “serious injury” as found in Insurance Law § 5102(d). The proposed changes would greatly increase the scope of qualifying injuries. Since there have been no statutory changes at this time, any speculation would go beyond the scope of this update. However, the practitioner must recognize the ongoing discussion as it relates to their practice.

II. Early Judicial Construction—LICARI V. ELLIOTT

Licari v. Elliott2997 defines the scope of judicial inquiry into the serious injury issue by focusing on the summary judgment motion as the testing ground for meeting the threshold. “If it can be said, as a matter of law, that plaintiff suffered no serious injury . . . then plaintiff has no claim to assert and there is nothing for the jury to decide.”2998 As a result, the summary judgment motion is the vehicle of choice for presentation of the serious injury threshold issue. The court is obliged in the first instance to decide whether a prima facie case of serious injury has been established. It has been stated, now with universal approval, that once the serious injury threshold is met, the plaintiff may recover for all injuries whether or not other incidental injuries sustained would qualify as serious injuries in their own right.2999

Licari also addressed the quantum of proof necessary to prevail on the issue of serious injury. The court stated that, with regard to a plaintiff’s claim of significant limitation of use of a body function or system, “significant” means precisely that—significant, not “minor, mild or slight.”3000 Courts have struggled in complying with the stringent tenor set by Licari. At cross-purposes with the no-fault law’s statutory mandate has been a judicial reluctance to summarily dispose of personal injury cases.3001

Court of Appeals and appellate division decisions serve to remind the bar that there is no such thing as giving the plaintiff the benefit of the doubt where the serious injury threshold is concerned. Strict application of the statute has been deemed necessary to protect and preserve its benefits.

III. Categories of Serious Injury

Insurance Law § 5102(d) defines serious injury as a “personal injury which results in”

1. death;
2. dismemberment;
3. significant disfigurement;
4. a fracture;
5. loss of a fetus;
6. permanent loss of use of a body organ, member, function or system;
7. permanent consequential limitation of use of a body organ or member;
8. significant limitation of use of a body function or system; or
9. a medically determined injury or impairment of a non-permanent nature which prevents the injured person from performing substantially all of the material acts which constitute such person’s usual and customary daily activities for not less than ninety days during the one hundred eighty days immediately following the occurrence of the injury or impairment. 3002

There were two significant advancements in the serious-injury threshold/body of the threshold as it applies to cases: One was evolutionary, which is that line of cases tackling disc disruptions. The second was revolutionary, that is, the Court of Appeals’ opinion regarding permanent loss of use of a body organ, member, function or system in Oberly v. Bangs Ambulance, Inc.3003 Both will be discussed in the sections that follow.

IV. Categories Defined

While some categories of serious injury have received scant judicial scrutiny, others have been tagged with caselaw interpretation so widely accepted, it has developed into a body of quasi-definitional phrases. For obvious reasons, the three most significant categories of serious injury—death, dismemberment and loss of a fetus—have not generated a great deal of discussion. The categories of significant disfigurement; significant limitation of use of a body function or system; permanent loss of use of a body organ, member, function or system; permanent consequential limitation of use of a body organ or member; and 90/180 day material acts and their interpretation are addressed below.

A. Significant Disfigurement

1. Facial Scars

“[I]f a reasonable person viewing the plaintiff’s body in its altered state would regard the condition as unattractive, objectionable, or as the object of pity or scorn,” it constitutes significant disfigurement.3004 In Waldron v. Wild, the plaintiff sustained a scar on the bridge of his nose of circular pigmentation about one-half centimeter in diameter, accompanied by a slight bony prominence. The Fourth Department held that the seriousness of the scar presented a question of fact for the jury.3005


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