How far do we take collateral estoppel?

Palisade Surgery Ctr. LLC v Allstate Prop. & Cas. Ins. Co., 2016 NY Slip Op 51824(U)(App. Term 1st Dept. 2016)

“The issue of medical necessity was not fully litigated or decided in the prior first-party no-fault action, and thus the doctrine of collateral estoppel does not bar defendant-insurer from raising the medical necessity defense in this action (see Kaufman v Eli Lilly & Co., 65 NY2d 449 [1985]; cf. Buechel v Bain, 97 NY2d 295, 303-304 [2001], cert denied 535 US 1096 [2002])”

I am left to believe that some provider prevailed somewhere.  Perhaps the issue of medical necessity was never reached?  I cannot make out what happened here, but I am curious what procedurally occurred to cause the provider to take an appeal on this one in a court where you are out at least $1500 for a reproduced record and brief.

Why are cariers filing DJ’s against the Anikeyev providers?

I am at a loss when I see  a DJ action against this group of medical providers.  In one published case, this particular medical provider was found after a full  briefing of papers to be ineligible to collect no-fault benefits.  See e.g. Nationwide v. Acuhealth Acupuncture, P.C.  (4874/15).  The case is going to the Appellate Division and I would be surprised if the Second Department offered this group of providers any relief.

In  State Farm Mut. Auto. Ins. Co. v. Anikeyeva, 130 AD3d 1007, 1007 (2d Dept. 2015), the merits were implicated due to the failure of defendant to respond to discovery after numerous orders.

Wouldn’t it follow that collateral estoppel would prevent the Anikeyeva facility from re-litigating the same issue it lost on the merits?  Parenthetically, I know Countrywide lost various arbitrations involving this issue – but arbitrators are not necessarily bound by collateral estoppel.

Now, unless my understanding of collateral estoppel is incorrect,

CPLR 3211(a)(5) motion converted to CPLR 3212 motion

Renelique v State-Wide Ins. Co., 2016 NY Slip Op 50095(U)(App. Term 2d Dept. 2015)

This is interesting for a myriad of reasons.  It is the first time I have seen this Appellate Term convert a post joinder motion to dismiss into a summary judgment motion; and the conversion was made without applicable notice to the other party.  Procedurally, what I find interesting here is that assuming the 3211(a)(5) motion was made more than 120-days after Notice of Trial was filed, this could turn into a motion for summary judgment that violates 3212(a).  It is quite nuanced.

Here is the case:

“At the outset, we note that although defendant’s motion was denominated as one to dismiss the complaint pursuant to CPLR 3211 (a) (5), it was made after issue was joined (see generally CPLR 3211 [e]). In these circumstances, the CPLR requires the court to give “adequate notice to the parties” that it will treat defendant’s motion to dismiss as one for summary judgment (CPLR 3211 [c]). Here, however, an exception to the notice requirement was applicable, since defendant’s motion exclusively involved “a purely legal question rather than any issues of fact” (Mihlovan v Grozavu, 72 NY2d 506, 508 [1988]; Four Seasons Hotels v Vinnik, 127 AD2d 310, 320 [1987]). Consequently, it was proper for the Civil Court to, in effect, treat defendant’s motion to dismiss as one for summary judgment “without first giving notice of its intention to do so” (Four Seasons Hotels, 127 AD2d at 320.)”

[res judicata prevails and case dismissed]

Unsettled order fails to dismiss Civil Court action

Promed Orthocare Supply, Inc. v AIG Advantage Ins. Co., 2015 NY Slip Op 51886(U)(App. Term 2d Dept. 2015)

“Upon a review of the record, we find that since the March 2010 Supreme Court order in the declaratory judgment action merely granted the entry of a declaratory judgment, but failed to make a statement declaring the rights of the parties involved (see Hirsch v Lindor Realty Corp., 63 NY2d 878, 881 [1984]; Suburban Bindery Equip. Corp. v Boston Old Colony Ins. Co., 150 AD2d 767 [1989]; Metro Health Prods., Inc. v Nationwide Ins., 48 Misc 3d 85 [App Term, 2d, 11th & 13th Jud Dists 2015]), the Supreme Court order cannot be considered a conclusive final determination and, thus, can have no preclusive effect in the instant no-fault action”

You know the order stated: motion granted, settled judgment.  Nothing else was decreed.  Defendant failed to settle a judgment and this is the result.

DJ victory

Best Touch PT, P.C. v American Tr. Ins. Co.,2015 NY Slip Op 51789(U)(App. Term 2d Dept. 2015)

(1) October 23, 2011 accident. By order dated May 22, 2013, the Supreme Court (Julia I. Rodriguez, J.) granted ATIC’s motion for entry of a declaratory judgment, on default, declaring that ATIC was not obligated to pay any claims for no-fault benefits submitted by the parties named as defendants in the declaratory judgment action.

(2) In August 2013, plaintiff herein moved for summary judgment. Defendant cross-moved for summary judgment dismissing the complaint, contending that this action was barred by virtue of the May 22, 2013 order of the Supreme Court. Plaintiff did not oppose defendant’s cross motion. By order entered April 29, 2014, the Civil Court granted plaintiff’s motion and denied defendant’s cross motion.

(3)Based upon the May 22, 2013 order of the Supreme Court, this action is barred under the doctrine of res judicata

I recall that Judge Feinman said that since this was a First Department DJ, she did not have to follow it.  So silly.

Concerns about the use of a first-party no-fault IME to support a third-party defendant's summary judgment motion

In the dissenting opinion of Rowe v Wahnow, 2009 NY Slip Op 29475 (App. Term 1st Dept. 2009), Justice McKeon discusses why he believes it is inappropriate for a defendant in a third-party lawsuit to solely rely on a no-fault IME of a plaintiff, to defeat said plaintiff’s serious injury claim (Ins Law 5102[d]).   He gives a few reasons why the use of a no-fault IME on its own in non-suiting a 5102(d) Plaintiff is inappropriate.

  • A no-fault IME is non-adversarial, whereas an IME in the context of a lawsuit is adversarial;
  • The IME in a first-party no-fault case is geared towards future medical treatment and compensability of wages, whereas an IME as a discovery device that is utilized during a lawsuit is solely to determine whether the Claimant breached sthe serious injury threshold;
  • The third-party defendant gets numerous bites at the apple since the insurance carrier in the first-party case can demand IME’s as often as the carrier may require.

While Justice McKeon’s opinion raises laudable goals, he fails to address the fact that the Appellate Divisions have already held that there are tremendous collateral estoppel consequences that emanate from a Claimant’s (or his or her assignee) unsuccessful pursuit to obtain contested first-party benefits.   As regular readers are aware, a finding of lack of causal relation in the no-fault context will spell the end of the Claimant’s third-party lawsuit  (Lobel v. Allstate, 269 AD2d at 502 [2d Dept. 2000]).   A finding that future services lack medical reasonableness will under many circumstances impair, if not knock out, the significant limitation and permanent consequential categories of the 5102(d) categories, leaving many times the 90/180 category as the only viable method to breach the serious injury threshold.  (c. f., Barnet v. Ives, 265 AD2d 865 [4th Dept. 1999]).

Writing on a clean slate, Justice McKeon’s argument has merit.  He raises many points that should not be taken lightly.  But, the law as it has developed renders his opinion nothing more than a good article for a law journal or law review.  I earnestly wonder, however, if the purposes of his dissent was to attempt to force the bar to contemplate the interrelation between no-fault actions and personal injury actions.

Dave Gottlieb over at NFP has a very interesting take on this issue.

Concerns about the use of a first-party no-fault IME to support a third-party defendant’s summary judgment motion

In the dissenting opinion of Rowe v Wahnow, 2009 NY Slip Op 29475 (App. Term 1st Dept. 2009), Justice McKeon discusses why he believes it is inappropriate for a defendant in a third-party lawsuit to solely rely on a no-fault IME of a plaintiff, to defeat said plaintiff’s serious injury claim (Ins Law 5102[d]).   He gives a few reasons why the use of a no-fault IME on its own in non-suiting a 5102(d) Plaintiff is inappropriate.

  • A no-fault IME is non-adversarial, whereas an IME in the context of a lawsuit is adversarial;
  • The IME in a first-party no-fault case is geared towards future medical treatment and compensability of wages, whereas an IME as a discovery device that is utilized during a lawsuit is solely to determine whether the Claimant breached sthe serious injury threshold;
  • The third-party defendant gets numerous bites at the apple since the insurance carrier in the first-party case can demand IME’s as often as the carrier may require.

While Justice McKeon’s opinion raises laudable goals, he fails to address the fact that the Appellate Divisions have already held that there are tremendous collateral estoppel consequences that emanate from a Claimant’s (or his or her assignee) unsuccessful pursuit to obtain contested first-party benefits.   As regular readers are aware, a finding of lack of causal relation in the no-fault context will spell the end of the Claimant’s third-party lawsuit  (Lobel v. Allstate, 269 AD2d at 502 [2d Dept. 2000]).   A finding that future services lack medical reasonableness will under many circumstances impair, if not knock out, the significant limitation and permanent consequential categories of the 5102(d) categories, leaving many times the 90/180 category as the only viable method to breach the serious injury threshold.  (c. f., Barnet v. Ives, 265 AD2d 865 [4th Dept. 1999]).

Writing on a clean slate, Justice McKeon’s argument has merit.  He raises many points that should not be taken lightly.  But, the law as it has developed renders his opinion nothing more than a good article for a law journal or law review.  I earnestly wonder, however, if the purposes of his dissent was to attempt to force the bar to contemplate the interrelation between no-fault actions and personal injury actions.

Dave Gottlieb over at NFP has a very interesting take on this issue.

Collateral Estoppel may not apply in no-fault arbitrations – so says the Fourth Department

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In a very interesting case, the Appellate Division, Fourth Department held that principles of collateral estoppel do not apply in arbitration.

Matter of Falzone v New York Cent. Mut. Fire Ins. Co. 2009 NY Slip Op 05423 (4th Dept. 2009)

In this case, a Claimant initially arbitrated a no-fault claim between himself and his insurance carrier. The issue that was arbitrated involved whether Claimant’s injuries were causally related to the motor vehicle accident. A no-fault arbitrator found the injuries to be causally related to the motor vehicle accident and awarded benefits.

The Claimant after obtaining an award for no fault benefits then sought to obtain SUM benefits arising from the same loss. Accordingly, Claimant commenced a second arbitration between himself and the same carrier upon which he was awarded no-fault benefits. The insurance carrier’s defense to payment in this SUM arbitration, similar to that in the no-fault arbitration, was that there was a lack of a causal nexus between the motor vehicle accident and the alleged injuries.

Since the parties and issues to be resolved in this SUM matter were the same as that in the no-fault matter, i.e., whether the injuries were causally related to the motor vehicle accident, you would think that principles of collateral estoppel would come into play and bind the SUM arbitrator to the same decision as that of the no-fault arbitrator. As we saw in a previous post involving the matter of Lobel v. Allstate, a no-fault arbitrator’s decision on causation will collaterally estopp a party from re-litigating a previously arbitrated issue in Court. Yet, the SUM arbitrator, aware that the prior arbitrator found a causal nexus existed between the motor vehicle accident and the injuries, nonetheless ruled that there was no causal connection between the injuries and the motor vehicle accident.

An Article 75 challenge was lodged in the Supreme Court. The Supreme Court granted the petition, reversed the SUM arbitrator’s decision and properly found that the results of the no-fault arbitration collaterally estopped the parties from contesting the causal relationship between the motor vehicle accident and the injuries at the SUM arbitration. Thus, the SUM arbitratror, as a matter of law, had to find that there was a causal relationship between the motor vehicle accident and the loss. The carrier appealed and the Fourth Department surprisingly reversed the order and judgment of the Supreme Court as set forth herein:

We agree with respondent that Supreme Court erred in granting claimant’s motion. The fact that a prior arbitration award is inconsistent with a subsequent award is not an enumerated ground in either subdivision (b) or (c) of CPLR 7511 for vacating or modifying the subsequent award (see Matter of City School Dist. of City of Tonawanda v Tonawanda Educ. Assn., 63 NY2d 846, 848). As the court properly recognized, “[i]t was within the [SUM] arbitrator’s authority to determine the preclusive effect of the prior arbitration on the instant arbitration” (Matter of Progressive N. Ins. Co. v Sentry Ins. A Mut. Co., 51 AD3d 800, 801). The court erred in noting, however, that it was unable to determine whether the SUM arbitrator even considered claimant’s contention with respect to collateral estoppel. Arbitrators are not required to provide reasons for their decisions (see Matter of Solow Bldg. Co. v Morgan Guar. Trust Co. of N.Y., 6 AD3d 356, 356-357, lv denied 3 NY3d 605, cert denied 543 US 1148; Matter of Guetta [Raxon Fabrics Corp.], 123 AD2d 40, 41), and thus the SUM arbitrator was not required to state that he had considered that contention. “

Two points need to be considered. First, the Fourth Department cites a 2007 Second Department case entitled Matter of Progressive N. Ins. Co. v Sentry Ins. A Mut. Co. for its rule of law. Yet, the Progressive case actually held that collateral estoppel should be given effect to prior arbitration awards involving the same parties and the same issue. Second, there was a two Justice dissent, which as a matter of right brings this case to the Court of Appeals.

For the sake of commonsense, this case should be reversed. Otherwise, there will be too many instances where inconsistent decisions will arise in post-ime cases, other policy violation cases and coverage cases, among others. It would be a fair assessment to say that no-fault and other first-party practitioners will not benefit from the uncertainty and some could say absurdity that this case could rein upon the arbitral process.

To be Lobelled

I have always said that to understand no-fault, you need to understand bodily injury law. This is typified through instances where the result of an assigned no-fault case can fatally destroy the personal injury case for the assignor.

This issue I think rears its ugly head most often times in the so-called “causation” scenarios, where the defense to the no-fault claim is that the injuries are not causally related to the underlying motor vehicle accident. The question that arises is what happens to the corresponding personal injury claim of the assignor if the insurance carrier succeeds in proving this defense?

This is when one must understand the term: “to be lobelled”. Here is the case:

Lobel v. Allstate Ins. Co. 269 A.D.2d 502 (2d Dept. 2002).

“The defendant moved to dismiss the cause of action to recover no-fault benefits on the ground that it was barred by a prior arbitration proceeding between the plaintiff’s assignee and the defendant, which resulted in a determination that there was no casual connection between the plaintiff’s lower back condition and the subject automobile accident. The defendant demonstrated that the issue in the **489 arbitration proceeding was identical to and decisive of this cause of action. The plaintiff failed to establish the absence of a full and fair opportunity to litigate the issue in the prior matter”.

I think the bolded words speak for themselves.

Oh yes, what about the IME cut-off that is upheld? How does this impact the assignor’s personal injury case? Barnett v. Ives 265 A.D.2d 865 (4th Dept.1994).

In Barnett, the Appellate Division held that an arbitration award which found that an injured person was not longer injured as a result of the accident, whether phrased as a causation or medical necessity determination, is collateral estoppel to the injured person in a personal injury case. As observed from the facts should you pull the case up, it is potentially catosrophic in terms of proving the two most potent 5102(d) categories: (a) Significant Limitation; and (b) Permanent Consequential. Furthermore, even if you can prove Significant Limitation or 90/180, an adervse arbitration ruling would knock out future damages, which many times is the crux of the BI case. It may also call into question the degree of actual injury, which may limit damages for past pain and suffering and past economic injury.

Some newer cases

It has been a real quiet few months in our world of law. Nothing too substantial has come out recently. There have been some procedural cases, which have an effect on all areas of law. Here are some of the cases I have found which have interesting overtones to them:

Stipulation of discontinuance with prejudice = presumption of res judicata

Support Billing & Mgt. Co. v State Farm Mut. Ins. Co.
2008 NYSlipOp 52226(U)(App. Term 2d Dept. 2008)

“A stipulation of discontinuance which specifies that it is “with prejudice” raises a presumption that the stipulation is to be given res judicata effect in future litigation on the same cause of action”

Discovery on a precluded defense requires proof of a timely denial – timely denial means more than it being facially timely…

Corona Hgts. Med., P.C. v State Farm Mut. Auto. Ins. Co.
2008 NYSlipOp 52185(U)(App. Term 2d Dept. 2008)

“Where a discovery demand concerns matters relating to a defense which a defendant is precluded from raising, it is palpably improper, notwithstanding the fact that the plaintiff did not specifically object thereto (see A.B. Med. Servs. PLLC, 11 Misc 3d 71). As defendant did not establish that it timely denied plaintiff’s claims, to the extent defendant seeks discovery in support of its defense of lack of medical necessity, discovery of such precluded matter is palpably improper”

Court sanctions more than one discovery device being demanded simulataneously

First Aid Occupational Therapy, PLLC v State Farm Mut. Auto. Ins. Co.

2008 NY Slip Op 51963(U)(App. Term 2d Dept, 2008).

In addition, defendant is entitled to conduct an EBT of plaintiff notwithstanding the fact that defendant also served a demand for discovery and inspection of documents (see Woods v Alexander, 267 AD2d 1060, 1061 [1999]; Iseman v Delmar Med.-Dental Bldg., 113 AD2d 276 [1985]; JMJ Contract Mgt. v Ingersoll-Rand Co., 100 AD2d 291, 293 [1984]).

CCA 1201 – give us a reason for allowing an extraterritorial subpoena

Bronxborough Med., P.C. v Travelers Ins. Co.
21 Misc.3d 21 (App. Term 2d Dept. 2008)

Inasmuch as plaintiff’s moving papers failed to establish that the interests of justice would be served by permitting plaintiff to serve, outside the City of New York and the adjoining counties, a subpoena which would require defendant’s employee to appear at trial, and, in addition, did not set forth the location at which plaintiff sought to serve the subpoena, plaintiff’s motion was properly denied.

Don’t send the peer or IME upon demand – the courts will forgive you, but the DOI probably will not.

Careplus Med. Supply, Inc. v New York Cent. Mut. Fire Ins. Co.

21 Misc.3d 18 (App. Term 2d Dept. 2008)

In response to a provider seeking to preclude an insurance carrier from raising a defense of lack of medical necessity based upon the pre-suit failure to turn over the peer or IME report in accordance with the regulations, the Appellate Term said no so fast…

“The Insurance Department Regulations provide no sanction for an insurer’s failure to provide a peer review report upon the written{**21 Misc 3d at 20}{**21 Misc 3d at 20} request for one by a provider (see e.g. A.B. Med. Servs. PLLC v Clarendon Natl. Ins. Co., 12 Misc 3d 143[A], 2006 NY Slip Op 51415[U] [App Term, 2d & 11th Jud Dists 2006]). While plaintiff urges the court to impose the sanction of preclusion here, we decline to do so because “[h]ad it been the intent of the Department of Insurance” to impose such a sanction, “it would have so provided”

Do not file a notice of trial without obtaining a final order of preclusion or dismissal, etc.

Iscowitz v. County of Suffolk
54 A.D.3d 725 (2d Dept. 2008)

“The plaintiffs waived any objection to the adequacy and timeliness of the disclosure by filing a note of issue and certificate of readiness prior to moving pursuant to CPLR 3126 for the imposition of a discovery sanction

Preclusion – The Appellate Division spells out why we should not sign preclusion stipulations.

Allen v Calleja
2008 NY Slip Op 08685 (2d Dept. 2008)

To warrant preclusion, “the Supreme Court must determine that the offending party’s lack of cooperation with disclosure was willful, deliberate, and contumacious” (Assael v Metropolitan Tr. Auth., 4 AD3d 443, 443; see CPLR 3126[2]; Moog v City of New York, 30 AD3d 490). Such conduct may be found where, for example, a party repeatedly fails to comply with court orders directing it to produce certain discovery without adequate excuses therefor

And when it comes to the inability to invoke “preclusion” based upon a single failure to comply with a conditional order of preclusion (when this was the first discovery order in the case), the Appellate Term, First Department said the following:

Pelham Parkway Neuro & Diagnostic, P.C. v. Liberty Mut. Ins. Co.

16 Misc.3d 130(A)(App. Term 1st Dept. 2007)

In this action to recover assigned first party no-fault benefits, the drastic sanction of precluding defendant from asserting its defense of exhaustion of policy limits was unwarranted in the absence of a showing that defendant’s single failure to comply with the parties’ discovery stipulation was willful and contumacious