1505 Division Street | Waite Park, Minnesota 56387


Copyright 2003 MAJ and T. Joseph Kane Crumley

No Fault Rule Changes

The Supreme Court has recently updated the No-Fault Arbitration Rules (available at www.courts.state.mn.us/cio/public_notices.htm). Here are the main changes:

  • Competition for AAA? The American Arbitration Association (AAA) is no longer listed as the exclusive arbitration provider. All references to the AAA were removed from the rules. A competing ADR provider had asked the court for this change.
  • Within the next twelve months, the chair of the standing committee, Retired Justice John Simonett, is to design a selection process for the arbitration provider. The process must involve “an independent screening committee with representative members of the Standing Committee, the Minnesota State Bar Association, the Trial Court Bench, and the public.”
  • Presumably, with their large local facility, 15-person staff and years of experience, the AAA still has a major competitive advantage over other potential bidders.
  • Arbitrator Qualifications. Rule 10 adds new qualifications for no-fault arbitrators:
    • One third of the arbitrator’s practice must be in auto insurance, motor vehicle or no-fault claims;
    • Arbitrators must complete a training program approved by the No-Fault Standing Committee prior to appointment;
    • Arbitrators need at least three CLE hours on no-fault issues within their reporting period.

There was a timing problem with the adoption of the Rules, which occurred by order dated August 5, 2003. Unfortunately, the draft of the rules took unusually long to be adopted, and specified that the new qualifications were effective August 1, 2003, four days earlier. The status of already-appointed arbitrators who no longer qualified was thrown into doubt? The Supreme Court again amended the rules September 10, 2003, changing the effective date for the Rule 10 changes to January 1, 2004.

Query: What was the status of arbitrators who no longer qualified between August 5 and September 10?

Not sure whether you have the necessary qualifications? MAJ has scheduled an excellent 3-credit seminar; “Wanna Stay a No-Fault Arbitrator?” November 7. Call Sandy at MAJ (612-375-1707, 1-800-898-6852) to register.

  • Claimants Pay for Last-Minute Withdrawals. Claimants that withdraw their claim must pay the arbitrator fee, unless otherwise agreed. If the withdrawal is in the 24 hours before the hearing, the fee is $300, just as in last-minute settlements.
  • Expenses Clarified. The changes to Rule 42 are interesting:

Rule 42. Expenses

Generally each side should pay its own expenses. An arbitrator does, however, have the discretion to direct a party or parties to pay expenses as part of an award.

Under the old rule, the appellate courts did not allow arbitrators to award expert witness fees, Kerber v. Allied Group Ins., 516 N.W.2d 568 (Minn. App. 1994). In Kerber, the court relied on the old language which specifically provided that parties pay for their own witnesses. Thus witness fees are again taxable at the arbitrator’s discretion.

List Serve Archives

The MAJ e-mail list servers get frequent mention in this column because of the wealth of ideas and information exchanged. MAJ has recently brought the list server in-house, at http://mntla.org/ (Note –no “www” –Check your old messages or call Derek for your password). Members can view every message posted on the lists since their inception in January 2000. The archives include legal advice, mediator and arbitrator recommendations, referral; attorney, jury instructions. You can do full text searches, and the messages can be sorted by name, subject, and chronologically.

Arbitrator Strike Lists.

uList serve members often exchange suggestions regarding arbitrators and strike lists, but MAJ member Matt Brenengen suggested another information source: www.google.com. Just typing in the arbitrator’s name and Minnesota will usually bring up lots of information about the candidate. He also suggested a Westlaw search would turn up any appeals the lawyer had handled, which would be helpful in analyzing their potential as an arbitrator.

Remember, MAJ keeps Report cards of arbitrators. Call MAJ to see if a fellow member has given a passing grade on your potential arbitrators.

Police Cars NOT Motor Vehicles

Q. When is a car not a motor vehicle? A. When it’s painted black and white! The Supreme Court has held that marked police cars are not motor vehicles. Strange as that may seem, it does follow the dictates of the statute. The No-Fault Act uses Motor vehicle licensing as the trigger for coverage. Since a marked police car does not need to be licensed, it is not considered a motor vehicle for purposes of the act.

The ramifications of Mutual Service Casualty Ins. Co. v. League of Minnesota Cities Ins. Trust, __ N.W.2d __ (Minn. Case No. CX-01-1929, filed April 24, 2003)are many, and not all negative.

  • 1.First, we know a pedestrian struck by a marked police officer cannot receive no-fault benefits from the police car’s insurance. That’s the simplest holding of the case.
  • 2. Probably, that pedestrian may be excluded from no-fault coverage from ANY policy. That’s because the holding is based on a marked police car being excluded from the definition of a motor vehicle. Under the No-Fault Act, a person has the right to claim basic economic loss benefits if he or she has been injured by the “maintenance or use of a motor vehicle.” If the policy was properly written, the private carrier could exclude coverage as well. Since many policies simply track the Act, most or all these policies may exclude the coverage. The court noted:
    • We recognize that the use of the plain meaning of “motor vehicle” will result in a class of accident victims being uncompensated under the Act, including pedestrians or passengers who happen to be injured by any of the vehicles that are not required to be registered under Chapter 168.
  • 3.There are no thresholdson liability actions that don’t arise out of the maintenance or use of a motor vehicle. Many minor injury third party claims will actually have much higher value.
  • 4. Don’t assume the involvement of a police car always excludes coverage. Just as a farmer on a tractor or an Amish person in a horse-drawn cart (not motor vehicles) gets no fault when hit by a car (a motor vehicle), so does the person in the police car hit by another ‘real’ motor vehicle.

Medical Records Revisited

Many medical providers and their copying services attempt to charge a retrieval fee when no medical records are found. Lawyers receive numerous bills for $13.58 ($14.46 with tax) from providers who insist they have the right to charge that under Minn Stat. §144.335. However, the statutory language clearly requires that the charges don’t kick in until copies of medical records are actually made:

(b) When a provider or its representative makes copies of patient records upon a patient's request under this section, the provider or its representative may charge the patient or the patient's representative . . . Minn. Stat. §144.335 Subd. 5(b), (2002)(emphasis added).

"Review of Current Care” Exception.We all know that:

  • When a patient requests a copy of the patient's record for purposes of reviewing current medical care, the provider must not charge a fee. Minn. Stat. §144.335 Subd. 5(a), (2002).

Some lawyers argue that an injured plaintiff is always requesting their records for that purpose, and should not be charged. Medical providers take the position that the plaintiff must make the request in person (although there is no such language in the statute) and that puts practical obstacles in the way of lawyers attempting to save their clients the charges.

Social Security Exception. However, few lawyers are aware that the provider must specifically provide the lawyer free copies (plus two free updates) when appealing a denial of Social Security Disability Benefits. Minn. Stat. §144.335 Subd. 5(d), (2002).

Massage Therapy, Lapses, and Burden for Affirmative Defenses

VanLangen v. Western National Ins. Group, (Minn Ct. App. unpub’d No. C9-02-149 filed 7-23-02). Last year, in what should have been a published case, MAJ member Dr. David Ketroser won an important no-fault decision covering burden of proof, lapse, and massage therapy.

VanLangen stopped seeing her neurologist, but continue to have symptoms from the accident. She secured massage therapy for the following three years without a referral or supervision by a doctor. She then found out the treatment might be compensable under the no-fault act, and secured a referral slip after the fact . Western argued that this amounted to a lapse in treatment. The arbitrator awarded the benefits, the district court reversed the award, and the Court of Appeals reinstated the arbitrator’s award. Some points to cite:

  • 1. An insurer needs to show lapse of both treatment and disability.
  • 2. The defense has the burden of proving affirmative defenses , such as lapse. When the arbitrator did not make any finding on disability, it was Western’s problem, not the claimant.

In addition, the case implicitly approves massage therapy.

No-Fault Mileage/Transportation Costs

Occasionally, no-fault insurers assert a low mileage rate for reimbursement of transportation expenses. MAJ member Matthew Thornton complained of one insurer asserting an alleged IRS rate of 12 cents per mile for medical mileage reimbursement.

MAJ past president Duane Lillehaug noted that the rate quoted was for charitable deductions where mileage isn't reimbursed by the charity. Current MAJ president Peter W. Riley suggested asking the insurer two simple questions: At what rate do they reimburse the adjusters and the executives of the company, and would they rather the client take a cab?

Keep in mind that the statute provides for “reasonable transportation costs.” Minn. Stat. § 65B.44, subd. 2 (2002). The IRS medical and charitable rate is not intended in any way to resemble the actual or reasonable costs… they are reduced rates to provide some minimal deductibility, similar to the medical deduction itself, where your first huge chunk of medicals (7.5% of your Adjusted Gross Income)are not deductible.

Type “mileage reimbursement rate” into Google and you’ll get a huge list of 36-cent-per-mile websites…


and mail the insurer a sheaf of authority….

Don’t forget that if you’ve got other “reasonable expenses,” they are compensable and should be submitted to the insurer. For certain clients, the cost of a taxi or a bus cards is the most reasonable expense.

MAJ Membership.

Are you and all the members of your firm MAJ members? If you’re not, you should be. Any lawyer handling litigation, primarily for plaintiffs, should have their own membership. The basic MAJ membership provides you with access to a wide range of professional support services designed to assist and advance your skills as a trial lawyer.

Only MAJ members (and not their office-mates) are able to participate in:

  • List Servers
  • Case Evaluations
  • Mock Trials/Focus Groups
  • Information Banks.

Why wait for a stale magazine with a 3-month old routing slip from your MAJ Member partner or superior? For only $25 per month (if you’ve been a lawyer more than five years), MAJ members can participate fully and receive the bi-monthly and quarterly Membership Communications: MAJ News - Minnesota Case Reports - Minnesota Trial Lawyer Magazine - MAJ Update.

Upgraded Membership. If you’re already an MAJ regular member, Good for You! You should consider the benefits of an upgraded membership.

For only $150 more, a SILVER membership provides:

  • 6 free credits of Continuing Legal Education
  • Selection of one MAJ Publication
  • 100 pages from the Information Bank
  • 300 Client Counseling Brochures
  • 8 hours use of the Boardroom/Conference Center

A GOLD member gets ten Free CLE Credits, two free MAJ Publications, 200 pages from the Information Bank and 500 Client Counseling Brochures.

For less than $100 per month, a PLATINUM member receives:

  • 15 free CLE (all you need!)
  • 2 MAJ Publications
  • 250 pages from the information Bank
  • Up to 700 Client Counseling Brochures
  • 1 free case evaluation
  • 16 hours use of the Boardroom/Conference Center

Upgrade your MAJ membership today. You may actually save money!

Our Articles READ MORE »
E - News Letters READ MORE »
Advice for LawyersREAD MORE »
Web Resources READ MORE »
Firm OverviewREAD MORE »
Attorneys and StaffREAD MORE »
Our Awards and AffiliationsREAD MORE »
Our VideosREAD MORE »
Roundup LawsuitREAD MORE »
Hernia Mesh LawsuitREAD MORE »
Personal Injury Information CenterREAD MORE »
Visit Our Personal Injury BlogREAD MORE »