June 1976
Arbitration Journal;Jun76, Vol. 31 Issue 2, p139
Academic Journal
This article focuses on a court decision related to attorney fees. In vacating an award of attorney fees in amount of $1,050 the court held that an award of attorney fees under section 675(1) of the Insurance Law must be in proportion to the amount of the recovery. In this case, the respondent was awarded $502.60 (with statutory interest), a $200 fee for an expert witness, $25 administrative fee, and attorney fees of $1,060. In vacating the award of attorney fees, the court noted that ordinarily the question of the reasonableness of attorney fees is not subject to review on an application to vacate an award, but where the award of attorneys' fees is so out of proportion to the recovery, public policy is violated by the making of a grossly unreasonable award and one which is completely irrational. The motion to vacate was granted only on the issue of attorney fees, and the remainder of the award was confirmed. The issue of attorney fees was remanded to the same arbitrator for further proceedings.


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