Collateral Estopptel | New York No Fault Paradise

State Farm Ins. Co. v Frias, 2009 NY Slip Op 07825 (App. Div., 2nd, 2009)

Of the 10 defendants named in this action, only 3, Luccme, Urena, and Pedro Fernandez, answered the complaint, and the Supreme Court granted State Farm’s motion for leave to enter a default judgment against the other defendants. State Farm was directed to submit a proposed judgment on notice. Luccme and Urena were served with the proposed judgment, and did not object to its terms or submit a proposed counter-judgment of their own. On October 25, 2006, the Supreme Court entered a judgment against the defaulting defendants. The judgment declared that State Farm was not required to provide insurance coverage to the defaulting defendants because the incident of January 24, 2002, resulted from an intentional act; that, by reason of no coverage and the failure of State Farm’s insured to cooperate, State Farm was not obligated to defend or indemnify Frias or Abreu in any current or future proceeding, including the underlying action; and that State Farm was not required to pay any damages, awards, or benefits to any of the other defaulting defendants in any current or future proceedings, including the underlying action.

State Farm subsequently moved for summary judgment against the three nondefaulting defendants, including Luccme and Urena, based on those parts of the default judgment which declared that the January 24, 2002, collision resulted from an intentional act, and that State Farm was not obligated to defend or indemnify its insureds or to provide any coverage. State Farm argued that, because the three nondefaulting defendants had not proposed a counter-judgment, had not opposed State Farm’s proposed judgment, had not moved for leave to renew or reargue, had not moved to vacate the judgment, and had not appealed from the judgment, they were estopped from challenging the declarations contained in it. Luccme and Urena opposed State Farm’s motion and, in an order entered April 10, 2008, the Supreme Court granted the motion based on the failure of the nondefaulting defendants to oppose the proposed judgment. Luccme and Urena appeal from the resulting judgment. We reverse.

Inasmuch as State Farm initially moved for leave to enter a default judgment against the defaulting defendants only, the resulting judgment binds only those defendants, and may not be given preclusive effect to deprive Luccme and Urena, who appeared in the action, of their right to litigate the issues pertaining to coverage (see American Motorists Ins. Co. v North Country Motors, 57 AD2d 158, 160). Accordingly, we reverse the order insofar as appealed from.

Defendant obtained a default on some of the parties, then tried to use that default as collateral estoppel against the appearing parties. Sneaky Sneaky.

Yes, this is what I do with my Saturday nights. I read cases and blog. I actually made coffee for this, because I was tired but wanted to blog.

Initially I said that Malcom Gladwell’s new book, What The Dog Saw, wasn’t that good; that it was far worse than his other books. I was wrong. It isn’t far worse. More like slightly less than mostly worse. It isn’t even really a book; it’s a collection of articles he’s written. One of my favorite articles was, The Art of Failure: Why Some People Choke and Others Panic. I hope that isn’t telling. I probably should have found an article on success stories. Anyway, his distinction between choking and panicking was interesting. After reading the article, I noticed things that I would have otherwise missed.

There are about 20 articles in the book. I liked about 8 of them. Wait for this to come out in paperback. Next up on the reading list is Superfreakonomics. If you haven’t read Freakonomics, you should. I’m almost done with that book on religious freedom. And I’m still reading everything I said I was reading before.

While you’re here…

Here are some things I’ve found around the interweb that you might find interesting. Money and Cognitive Bias, from Crime & Federalism. Monster Energy Drink’s Monstery Conduct, from New York Personal Injury Law Blog. 7 Must Read Productivity Steps to Finally Getting Things Done, from Dumb Little Man. Big ideas…, from Seth Godin’s Blog. The Best Decline Letter of All-Time, from The Blog of Author Tim Ferriss.

Finally, I’m still working on the look and feel of this blog. WordPress is more difficult to figure out that blogger and I don’t have as much time to work on it as I’d like. Eventually I may have to break down and hire someone to fix it up. So yeah, I’m working on it.

Complete Orthopedic Supplies, Inc. v State Farm Mut. Auto. Ins. Co., 2009 NY Slip Op 29014 (App. Term, 2nd)

The Civil Court held that defendant failed to establish that its denial of claim forms were timely mailed because the notary public’s jurat, on the affidavits of mailing executed by defendant’s claims support services supervisor and the president of the courier service utilized by defendant, did not indicate the year in which the affidavits were signed. However, this technical [*2]defect is of the type which a court should disregard since it does not prejudice a substantial right of a party, particularly, where as here, plaintiff raised no objection thereto (see CPLR 2001; Matter of Goffredo v City of New York, 33 AD3d 346 [2006]; Matter of Liberty Mut. Ins. Co. v Bohl, 262 AD2d 645 [1999]; Supreme Automotive Mfg. Corp. v Continental Cas. Co., 97 AD2d 700 [1983]). Accordingly, the affidavits submitted by defendant were sufficient to establish that its denial of claim forms, which denied plaintiff’s claims on the ground of lack of medical necessity, were timely mailed in accordance with defendant’s standard office practice and procedure designed to ensure that items are properly addressed and mailed (see Residential Holding Corp. v Scottsdale Ins. Co., 286 AD2d 679 [2001]; Delta Diagnostic Radiology, P.C. v Chubb Group of Ins., 17 Misc 3d 16 [App Term, 2d & 11th Jud Dists 2007]).

Long Is. Multi-Medicine Group, P.c. v Travelers Ins. Co., 2009 NY Slip Op 50030(U) (App. Term, 2nd)

The affidavit of defendant’s claims representative submitted in opposition to plaintiff’s motion, and the denial of claim forms annexed thereto, demonstrate that defendant denied a number of plaintiff’s claims on the ground that they were not timely submitted (see generally Insurance Department Regulations [11 NYCRR] § 65.12). However, since none of the denial of claim forms correspond to the claim forms upon which plaintiff seeks summary judgment, defendant failed to establish that it timely denied the subject claims. As a result, defendant failed to raise a triable issue of fact with respect to the claims at issue (see Zuckerman v City of New York, 49 NY2d 557 [1980]). Accordingly, the judgment is affirmed, albeit on other grounds.

M.N.M. Med. Health Care, P.C. v MVAIC, 2009 NY Slip Op 50041(U) (App. Term, 2nd)

“The filing of a timely affidavit providing the MVAIC with notice of intention to file a claim is a condition precedent to the right to apply for payment from [MVAIC]” (A.B. Med. Servs. PLLC v Motor Veh. Acc. Indem. Corp., 10 Misc 3d 145[A], 2006 NY Slip Op 50139[U] [App Term, 2d & 11th Jud Dists 2006] [citations and internal quotation marks omitted]; see Insurance Law § 5208 [a]; Bell Air Med. Supply, LLC v MVAIC, 16 Misc 3d 135[A], 2007 NY Slip Op 51607[U] [App Term, 2d & 11th Jud Dists 2007]). Compliance with the statutory requirement of timely filing a notice of claim must be established in order to demonstrate that the claimant is a “covered person” who is entitled to recover no-fault benefits from MVAIC (see Insurance Law § 5221 [b] [2]; Bell Air Med. Supply, LLC, 16 Misc 3d 135[A], 2007 NY Slip Op 51607[U]; A.B. Med. Servs. PLLC, 10 Misc 3d 145[A], 2006 NY Slip Op 50139[U]; Ocean Diagnostic Imaging v Motor Veh. Acc. Indem. Corp., 8 Misc 3d 137[A], 2005 NY Slip Op 51271[U] [App Term, 2d & 11th Jud Dists 2005]). [*2]

MVAIC’s submissions in support of its motion for summary judgment made a prima facie showing that plaintiff’s assignor failed to timely file a notice of claim (see Insurance Law § 5208 [a]). By defaulting on the motion, plaintiff did not demonstrate that its assignor timely filed a notice of claim or sought leave to file a late notice of claim (see Insurance Law § 5208 [b], [c]). As a result, the order denying MVAIC’s unopposed motion for summary judgment dismissing the complaint is reversed and defendant’s motion is granted (see Bell Air Med. Supply, LLC, 16 Misc 3d 135[A], 2007 NY Slip Op 51607[U]; A.B. Med. Servs. PLLC, 10 Misc 3d 145[A], 2006 NY Slip Op 50139[U]; Ocean Diagnostic Imaging, 8 Misc 3d 137[A], 2005 NY Slip Op 51271[U]).

All Mental Care Medicine, P.C. v State Farm Mut. Ins. Co., 2009 NY Slip Op 50042(U) (App. Term, 2nd)

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff offered a notice to admit and an affirmation made by defendant’s attorney in order to prove its prima facie case at trial. Plaintiff then rested without calling any witnesses. The court found that plaintiff, having failed to produce a witness, failed to make its prima facie case, and dismissed the complaint. For the reasons set forth in Bajaj v General Assur. (18 Misc 3d 25 [App Term, 2d & 11th Jud Dists 2007]), we affirm the judgment.

Uptodate Med. Serv., P.C. v State Farm Mut. Auto. Ins. Co., 2009 NY Slip Op 50046(U) (App. Term, 2nd)

Defendant sought leave to interpose the affirmative defenses of res judicata and collateral estoppel because there was a prior arbitration proceeding between the parties in which plaintiff had sought to recover assigned first-party no-fault benefits for services rendered from August 2003 through January 14, 2004, in which proceeding the arbitrator had determined that plaintiff was ineligible to receive reimbursement of no-fault benefits because it was a fraudulently incorporated professional service corporation (see State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313, 322 [2005]). Inasmuch as plaintiff failed to demonstrate prejudice or surprise as a result of the proposed amendment to defendant’s answer (see McCaskey, Davies & Assocs. v New York City Health & Hosps. Corp., 59 NY2d 755 [1983]), and the proposed affirmative defense was neither devoid of merit nor palpably insufficient as a matter of law (see Ingrami, 45 AD3d at 808; Hill, 42 AD3d at 433), defendant should have been granted leave to amend its answer.

Under the doctrine of collateral estoppel, a party is precluded from relitigating an issue which has been previously decided against it in a prior proceeding where it had a full and fair opportunity to litigate the issue (see D’Arata v New York Cent. Mut. Fire Ins. Co., 76 NY2d 659 [1990]). “The two elements that must be satisfied to invoke the doctrine of estoppel are that (1) the identical issue was decided in the prior action and is decisive in the present action, and (2) the party to be precluded from relitigating the issue had a full and fair opportunity to contest the prior issue (see Kaufman v Lilly Co. [65 NY2d 449, 455 (1985)])” (Luscher v Arrua, 21 AD3d 1005, 1007 [2005]). “The burden is on the party attempting to defeat the application of collateral estoppel to establish the absence of a full and fair opportunity to litigate” (D’Arata, 76 NY2d at 664; see also Kaufman, 65 NY2d at 456).

Collateral estoppel effect can, under appropriate circumstances, be given to arbitration awards (see Matter of American Ins. Co. [Messinger Aetna Cas. & Sur. Co.], 43 NY2d 184 [1977]). Where a plaintiff has freely elected to proceed to arbitration with the assistance of counsel despite the availability of an alternate judicial forum and has had the opportunity to employ procedures substantially similar to those utilized in a court of law, it may be found that the plaintiff has had a full and fair opportunity to litigate the issue determined in the arbitration proceeding (Clemens v Apple, 65 NY2d 746 [1985]).

In the instant matter, defendant established that the issue of whether plaintiff was ineligible to receive reimbursement of no-fault benefits because it was a fraudulently incorporated professional service corporation (see State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d at 322) was identical to the issue previously decided by the arbitrator. In opposition to defendant’s cross motion, plaintiff failed to address the branch of the cross motion which sought summary judgment dismissing the complaint on the ground of collateral estoppel. Therefore, plaintiff failed to establish that it did not receive a full and fair opportunity to litigate in the arbitration proceeding. Thus, the branch of defendant’s cross motion seeking summary judgment should have been granted.

Vista Surgical Supplies, Inc. v State Farm Mut. Ins. Co., 2009 NY Slip Op 50047(U) (App. Term, 2nd)

An admission that defendant received plaintiff’s claim form is not a concession of the facts set forth in said claim form (Bajaj v General Assur. Co., 18 Misc 3d 25, 28 [App Term, 2d & 11th Jud Dists 2007]; Midborough Acupuncture, P.C. v New York Cent. Mut. Fire Ins. Co., 13 Misc 3d 132[A], 2006 NY Slip Op 51879[U] [App Term, 2d & 11th Jud Dists 2006]). While defendant acknowledged that it received plaintiff’s claim form and that a true copy was annexed to plaintiff’s notice to admit, it remained plaintiff’s burden to lay a sufficient foundation to establish that the claim form is admissible pursuant to the business records exception to the hearsay rule to prove the truth of the matters asserted therein (see Art of Healing Medicine, P.C. v Travelers Home & Mar. Ins. Co., 55 AD3d 644 [2008], affg 15 Misc 3d 144[A], 2007 NY Slip Op 51161[U] [App Term, 2d & 11th Jud Dists 2007]). Since plaintiff failed to proffer such [*2]proof, the court properly held that plaintiff failed to make a prima facie showing (see id.; Dan Med. P.C. v New York Cent. Mut. Fire Ins. Co., 14 Misc 3d 44 [App Term, 2d & 11th Jud Dists 2006]). Accordingly, the judgment is affirmed (see Parochial Bus Sys. v Board of Educ. of City of N.Y., 60 NY2d 539 [1983]).

V.S. Med. Servs., P.C. v Travelers Ins. Co., 2009 NY Slip Op 50048(U) (App. Term, 2nd)

While plaintiff produced a witness to testify regarding the claim forms plaintiff sought to have admitted into evidence, because said witness did not testify at all as to the generation of such claim forms, they were not admissible as business records (see CPLR 4518). Accordingly, plaintiff failed to establish a prima facie case (see Bajaj v General Assur., 18 Misc 3d 25 [App Term, 2d & 11th Jud Dists 2007]). Consequently, the judgment is affirmed.

Category Archives: Collateral Estopptel

Putting collateral estoppel to use, but without success

NEW DECISIONS