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Previously Settled Accident Case Heads to Arbitration

Tuesday, July, 21, 2015

Arbitration is frequently used in vehicle accident cases when mediation is not an option. Arbitration provides a third-party ruling without the expense and time-consuming nature of a traditional trial. In most cases, the ruling in arbitration is binding and both parties must abide by it.


One unusual case in Philadelphia is using arbitration to settle a vehicle accident claim, but unlike other cases, it is doing so after a settlement was already reached between those involved in the accident and the plaintiff had already received her desired funds.


The accident involved Philadelphia residents Deborah Johnson and Donalyn Craig. Craig’s insurance provider, Eric Insurance of Media, was mandated to pay Johnson $15,000 within a month. Approximately a month after that deadline passed, Johnson was forced to file a motion to enforce collection, as well as accumulated interest at 4.25%, as well as nearly $500 in court fees and attorney’s fees of $495 per hour.


Erie Insurance responded that they could not disburse the funds without final approval from Medicare. The defendants were also unaware that Johnson’s Medicare coverage was not confirmed and that the Social Security number on file had been incorrect.


The motion to enforce collection was denied in December and a motion to reconsider was denied in January. Johnson eventually received her settlement in March, but according to court records, her attorneys filed a motion for sanctions in May, requesting other fees be collected that were not paid within the original time frame. She is requesting $225.30 in interest, various court costs totaling approximately $630, and nearly $2000 in attorney’s fees. An arbitration hearing regarding these payments is set for August.