Appellate Division hold that Civil Court lacks subject matter over DJ actionsMarch 2, 2019

State Farm Fire & Cas. Co. v Jewsbury, 2019 NY Slip Op 01247 (2d Dept. 2019)

This involves the unsuccessful argument that Civil Court actions block Supreme Court declaratory judgment actions. The Appellate Divisions have never ruled in favor of the providers under a CPLR 3211(a)(4) dismissal theory. If that was the holding, I would not really care much about this.

But – we finally have clarity regarding the ability of an insurance carrier to seek declaratory judgment relief in Civil Court. The answer was what we all knew it was after Fresh Acupuncture, but later confused due to Countrywide. A well reasoned decision.

“After State Farm received and failed to pay first-party beneficiary claims submitted by Parisien, Parisien commenced two actions in the Civil Court of the City of New York for payment (see Insurance Law § 5106). While those actions were pending, State Farm commenced this action in the Supreme Court, Kings County. State Farm seeks a judgment declaring that it is not required to pay any claims related to the accident on the policy it issued.”

” The Supreme Court improvidently exercised its discretion in granting that branch of Parisien’s motion which was pursuant to CPLR 3211(a)(4) to dismiss the complaint insofar as asserted against him. A declaratory judgment resolving the issue of State Farm’s obligation to pay any claims on the policy with respect to the accident, and naming all providers who may seek reimbursement under the policy, would further the interest of judicial economy. Indeed, the Civil Court may not issue the declaratory relief State Farm seeks in this action (see Fresh Acupuncture, P.C. v Interboro Ins. Co., 56 Misc 3d 98, 100 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists]; cf. CPLR 3001; Insurance Law § 3420[a][6]; Mazzei v Kyriacou, 139 AD3d 823, 824), and the other providers who may seek no-fault reimbursements relating to that collision are not parties to the two actions pending in the Civil Court. “

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