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The six year statute of limitations period commences 30-days from receipt of the claim form



New Millenium Med. Supply v Clarendon Natl. Ins. Co., 2010 NY Slip Op 51820(U)(2d Dept. 2010)

“no-fault [action]…pursuant to a policy of insurance was not interposed within the applicable six-year statute of limitations  since the cause of action accrued on the date the claim became overdue — here, 30 days after defendant’s receipt of the claim — not the date of defendant’s untimely denial of the claim.”

It is nice to see the SOL rule clearly articulated, as the Appellate Term, First Department did in this case.  What I found interesting is the case Plaintiff argued in support of maintaining his tardy cause of action: Taggart v State Farm Mut. Auto. Ins. Co. (272 AD2d 222 [2000]).  Admittedly, I was not intricately familiar with Taggart.  I probably came across it at one point, but not recently.  Here is the pertinent part of Taggart: “[d]efendant, pursuant to 11 NYCRR 65.15 (g) (2) (ii), sent plaintiff a denial of claim form, dated July 13, 1990, notifying her that her no-fault medical benefits were to be discontinued in light of medical examinations indicating that she was no longer disabled. From the date of the denial of claim, plaintiff had six years to challenge the denial as a breach of defendant’s agreement to pay her no-fault benefits and may not have the applicable statutory period extended until her commencement of this action in 1998 simply because she continued to submit bills for payment subsequent to her receipt of the July 13, 1990 denial notice.”

Taggart actually protects the insurance carrier who sends a global denial to the injured person, in that that the SOL commences upon receipt of the global denial, provided subsequent bills are not submitted (see below).  It also appears that the regulations as the courts have construed them strongly suggest that a carrier issue this type of denial based upon a physical examination terminating further benefits.

But Taggart probably is not good law because of the work of some attorney who prevailed in A&S Medical v. Allstate.  Simply put, the Appellate Division held in A&S that a claimant who continues to send bills to the insurance carrier following a negative physical examination has the statutory right (Ins. Law 5106[a]) to have that bill paid or denied within 30-days of the insurance carrier’s receipt of that bill, notwithstanding the prior denial terminating all subsequent benefits due to a physical examination.

Thus, the statute of limitations would actually commence upon the latter of 30-days following receipt of the bill or the date of the global denial, should subsequent bills not be submitted following the global denial.

Taggart might still be good law in the lost wage scenario.

For the record, I think the plaintiffs should either have “Domotor” or “A&S”.  They should not have it both ways.  To the extent I keep seeing the words “contract of insurance” next to the words “no-fault” in these court cases, I have to believe that A&S was improperly decided.