What is a Lien in a Personal Injury Case?  

Someone who sustains a serious injury in a New York motor vehicle crash may be entitled to compensation for pain and suffering.  

Pain and suffering is a form of “noneconomic” loss. Under New York’s no-fault law, which we have discussed in these pages, claims for pain and suffering are generally precluded unless the injured person can demonstrate a “serious injury” under the Insurance Law.  

The determination of whether someone’s injuries qualify as a “serious injury” or not is factually sensitive, particularly in “soft tissue” cases involving the spine. Such injuries may not be immediately apparent through an X-ray at the emergency department, but can be immensely debilitating, sometimes leading to permanent injuries and even surgery.   

At first blush, this may not make a whole lot of sense. If someone drove dangerously, resulting in the crash and your injuries, shouldn’t they pay for all damage caused? Why should it matter how many days you missed from work, or whether my treating doctor found range of motion losses that courts have described as “insignificant.”  

In passing the state’s no-fault law, lawmakers made a tradeoff. The no-fault law does not require a claimant to show the absence of fault. Because there is no need to prove that the other driver was at fault, the logic is that receiving such benefits is relatively easy, with no need to prove anything in court. Lawmakers determined that, because the process of recouping basic economic loss should be relatively easy, those entitled to receive payment for non-economic losses, including pain and suffering and emotional anguish, must show more than a minor or slight injury, but instead a “serious injury.” 

It has been this way for over four decades. The system certainly has its pros and cons.  

One positive is that, while in some jurisdictions those injured in a crash must go to court to recover for medical expenses, in New York certain limited medical expenses are paid by the no-fault insurance company regardless of fault and without any need to go to court.  

One negative is that separating a qualifying “serious injury” from one that is not is not always clear. Everyone is unique with different medical histories and daily activities, and what might be a trivial difficulty for one person could be devastating for another. Some serious injury categories focus on range-of-motion loss, which does not always capture the entire disability picture.  

Pros and cons go back and forth, but a major benefit of New York’s no-fault insurance system is that certain medical expenses and lost wages cannot be the subject of a “lien,” and thus cannot generally serve to decrease or diminish the amount of recovery for pain and suffering when a “serious injury” is shown.  

The term “lien” is defined by Merriam-Webster to include “a charge upon real or personal property for the satisfaction of some debt or duty ordinarily arising by operation of law.”  

What is a lien in a personal injury case? In the context of a personal injury lawsuit, a lien is often seen when a medical provider or insurance company provides certain injury-related treatment without immediate payment on condition that payment for treatment will be received from the proceeds of any settlement or verdict.  

For example, some medical providers will ask patients to sign a letter of protection, which is a legal agreement to pay back medical costs upon receiving compensation in an injury case. A letter of protection can allow a patient to receive medical treatment, while at the same time reducing the recovery from the at-fault motorist. Liens can be asserted by a private insurance company, medical provider, government agency, or other potential lienholders. 

As you might expect, someone looking to maximize their recovery after a New York motor vehicle crash will generally seek to avoid liens and, when they exist, reduce their amounts.   

If you sustained a “serious injury” in a New York car crash, please do not hesitate to contact William Mattar, P.C. Our attorneys have extensive experience helping injured motorists obtain maximum compensation under the circumstances. 

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