by John Darer CLU ChFC CSSC
The recent DealFlow Media post "Appelate Court Reduces Award in Structured Settlement Case" on The Structured Settlements Wire, highlights the confusion of the "wannabe structured settlement media".
The post deals with a recent New York Third Department Appellate Division Memorandum and Order in a case captioned" Mary Ann Nolan Appellant v Union College Trust of Schenectady, New York (Index 50854). DealFlow Media Headline states erroneously refers to this as a "structured settlement case". This IS NOT a structured settlement case. The origin of the case stemmed from an occurrence on January 26, 2003 when "at approximately 1:00 A.M., plaintiff was injured while walking across the campus at Union College in Schenectady County (New York), where she was a student, when she stepped into an uncovered manhole with her right leg".
New York's Periodic Payment of Judgment statutes, Article 50A and Article 50B of the Civil Practice Law Rules (CPLR) deal with periodic payment of damages and have been on the books now for over 20 years. Article 50A entltled "PERIODIC PAYMENT OF JUDGMENTS IN MEDICAL AND DENTAL MALPRACTICE ACTIONS" deals with periodic payment of damages on medical, dental and podiatric malpractice cases. Article 50B of the CPLR deals with periodic payment of damages on personal injury, injury to property and wrongful death actions. Article 50A has been effective since July 1, 1985 (amended effective July 2003) and Article 50B since August 1, 1986.
Let's work through some logic here:
According to Nolo.com, in a lawsuit, damages are defined as money awarded to one party based on injury or loss caused by the other.
An award is the decision made by a panel of arbitrators or commissioners, a jury, or other authorized individuals in a controversy that has been presented for resolution. Similarly a judgment is adecision by a court or other tribunal that resolves a controversy and determines the rights and obligations of the parties.
A settlement is an agreement reached between the parties in a pending lawsuit that resolves the dispute to their mutual satisfaction and occurs without judicial intervention, supervision, or approval (i.e. a compromise or "meeting of the minds")
A structured settlement is a form of compromise
- A structured judgment is a form of award.
- CPLR Article 50A makes the distinction between judgments (under the statute) and settlements, where at CPLR 5037 it states " Settlements. Nothing in this article shall be construed to limit the right of a plaintiff, defendant or defendants and any insurer to settle dental, medical or podiatric malpractice claims as they consider appropriate and in their complete discretion.
- A structured settlement is fully customizable.
- A New York structured judgment is completely inflexible.
- A New York structured judgment is likely to contain significant mandated life contingent elements (e.g. future medicals, pain & suffering) which evaporate upon the death of the structured judgment payee.
Thus you cannot be awarded a structured settlement in the State of New York. You can however, be awarded a structured judgment for your future damages, provided a minimum future damages threshold is met.
Perhaps Deal Flow Media's confusion stems from page 2 of the decision which states "Following a hearing pursuant to CPLR 4545, Supreme Court denied defendant's request for a collateral source offset and ruled that the structured settlement should be adjusted by reducing the award for future medical expenses by $50,000"
BUT, on page 3, the correct terminology of "structured judgment" appears. It states "Plaintiff and defendant ultimately agreed to the structured judgment computation made by plaintiff's economist pursuant to CPLR article 50-B. Supreme Court entered a judgment in accordance therewith. Defendant appeals from the judgment as well."
Clearly the appearance of the words "structured settlement" on page 2 is simply an clerical error in the published decision.
Click here for a copy of the Third Department's Memorandum and Order in Mary Ann Nolan Appellant v Union College Trust of Schenectady, New York (Index 50854).