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Breaking with a quarter century of lower court precedent and with all four New York Appellate Division departments, the New York Court of Appeals on Thursday held unanimously that only a total loss is compensable under the permanent-loss exception to no-fault insurance law in personal injury automobile cases. The decision is likely to narrow dramatically the pool of eligible plaintiffs under the no-fault law, according to tort lawyers. Oberly v. Bangs Ambulance, 72, stems from an appeal by Richard Oberly, an Ithaca, N.Y., dentist. In 1994, when Oberly went to a local hospital complaining of chest pains, a decision was made to transfer him via Bangs Ambulance Inc. to a hospital in Syracuse. While en route, the ambulance struck a curb, causing an IV pump to topple from a shelf above the stretcher and fall on Oberly’s arm. Oberly sought to recover under the no-fault insurance law, alleging that the resultant injury affected his ability to practice dentistry. A trial court held that Oberly could not sustain his claim, since the no-fault statute requires evidence of a “serious injury,” and defines that as “permanent loss of use,” which it said did not occur in this matter. The Appellate Division, 3rd Department, upheld the dismissal in a 3-2 decision focusing on whether the loss of use must be significant. At the Court of Appeals, the defendant argued that the loss must not only be significant, but permanent. Thursday, the court agreed in a decision that could instantly eliminate a large number of plaintiff automobile cases. “We conclude that only a total loss of use is compensable under the ‘permanent loss of use’ exception to the no-fault remedy,” Judge George Bundy Smith wrote for the court. The appeal centered on the no-fault law enacted by the Legislature in 1973 to provide for full and prompt compensation in the case of serious injury. In 1977, Section 5104 of the Insurance Law was amended to define a “serious injury” as one involving “permanent” physical loss or limitation. Thursday, for the first time and in contrast to myriad lower court rulings, the Court of Appeals held that “to qualify as a serious injury within the meaning of the statute, ‘permanent loss of use’ must be total.” Judge Smith said Thursday’s holding is mandated by the statutory text and the court’s conclusion that the Legislature intended, in amending the definition of “serious injury” in 1977, to limit claims to those involving a total loss of use. The court looked to the initial statute, which refers to loss of a body member, and the amended version, which refers to “permanent consequential limitation of use of a body organ or member” and “significant limitation of use of a body function or system.” The court said that had the Legislature “considered partial losses already covered under the ‘permanent loss of use’ there would have been no need to enact” the new provisions. “While the Appellate Division properly affirmed the dismissal of plaintiffs’ claim, it improperly engrafted the term ‘partial’ to the ‘loss of use’ standard,” Smith wrote. The appeal was argued by Theodore J. Mlynarski Jr. of Mlynarski & Cawley in Binghamton, N.Y., for Bangs Ambulance, and Albany Law School Professor Michael J. Hutter, of Thuillez Ford Gold & Johnson in Albany for Oberly. Mlynarski had contended that while he won at the 3rd Department, he won for the wrong reasons, and that the lower courts had essentially fashioned a rule never intended by the Legislature. “Plaintiff’s attorneys were jumping on the permanent loss of use standard to try to qualify trivial but permanent injuries which did not have a significant day-to-day impact … and avoid the limitation of use standard which requires significance,” Mlynarski said. “They were taking what was supposed to be a more stringent standard and using it to qualify lesser injuries.” Mlynarski said that under Thursday’s ruling, an injury must not only be significant but total to use the standard invoked by Oberly. Hutter said the decision will bar legitimate claimants from the courthouse. “I just don’t think this is what the Legislature intended, but obviously I’ve been told I’m wrong,” he said. FOSTER CHILD SUPPORT In another case decided Thursday, the court held that a parent’s support obligation for a child in foster or residential care is governed by the Child Support Standards Act rather than Section 415 of the Family Court Act. However, it also found room for judicial discretion, holding that courts can depart from the support guidelines where appropriate. Matter of Dutchess County Department of Social Services v. Day, 34, involves a girl who was placed in foster care for 25 weeks in 1997, and a county’s attempt to recover the costs from her parents. The county argued that the Child Support Standards Act (CSSA) should govern the amount of the reimbursement. It sought $8,600, based on the parents’ combined income of $110,000. Family Court, however, reasoned that Section 415, which is far more flexible than the support guidelines and which covers reimbursements for public assistance, should apply. It held that foster care is a form of public assistance, and ordered the parents to pay $4,375. In its ruling Thursday, the Court of Appeals said in an opinion by Judge Richard C. Wesley that the CSSA applies to all child support obligations, but that the guidelines are subject to judicial discretion. Wesley said Section 415 remains viable to establish liability where a spouse or stepchild receives public assistance. Dutchess County Senior Assistant County Attorney Richard A. Ott appeared for the appellant. There was no appearance on behalf of the respondent. Greater Upstate Law Project Inc. appeared as amicus curiae, urging the result reached by the court.

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