No fault injury victim cannot collect attorneys fees from Farmers Insurance

The Guardian of Denise Nail sued her insurance carrier, Farmers Insurance Exchange, after Farmers terminated Nail's PIP medical benefits.  Nail suffered a closed head injury when she was struck from behind by a vehicle traveling over 55 miles per hour.  After paying benefits for several months, Farmers sent Nail to an "independent" medical examiner, Dr. Thomas Gola, who concluded that Nail suffered "no neurological deficits that would be consistent with traumatic brain injury."  Farmers then terminated benefits.

At trial, Nail was awarded $60,000.00 in overdue benefits and immediately sought attorneys' fees as well.  In the context of PIP benefits, fees may be awarded to the injury victim if the insurer's decision to deny benefits was not reasonable.  After reviewing the record, the trial court concluded that although the jury ultimately concluded that Dr. Gola was mistaken, Farmers was not "unreasonable" in its denial of benefits based on his report. Since "Dr. Gola's report gave rise to a legitimate question of factual uncertainty" the appellate judges ruled that the trial court's decision was not "clear error" and affirmed it. 

The appellate court did conclude that the lower court judge had erred in considering Gola's subsequent report, one year later, in deciding whether the insurer's actions were reasonable, however, it did not overturn the decision on this basis.