Collateral Estoppel?

Rojas v Romanoff, 2020 NY Slip Op 04237 (1st Dept. 2020)

Collateral estoppel in the First Department to non-suit

(1) “In the declaratory judgment action, Nationwide claimed, among other things, that the injuries sustained by plaintiff did not come from the use or operation of a Nationwide insured vehicle and that plaintiff’s injuries were caused while he was operating a motorcycle, which is not covered by no-fault law [FN2]. Those issues were never litigated, because the declaratory judgment was granted on default.”

(2) “We hold that neither claim preclusion nor issue preclusion applies to bar this personal injury action. First, the default nature of the judgment rendered in the prior declaratory judgment action prevents application of issue preclusion. Second, claim preclusion also does not apply because both actions did not involve the same parties or their parties in privity. As fully explained below, “same parties” means the same adversarial parties, and plaintiff and defendants were not adversaries in the prior litigation. As to claim preclusion, the only adversaries in the prior action were plaintiff (as a defendant) and defendants’ (driver’s/owner’s) insurer, Nationwide (as the plaintiff) with whom defendants (driver/owner) were not in privity in the no-fault benefits dispute.”

(3) “Additionally, under the particular circumstances here, giving preclusive effect to a prior default determination on no-fault benefits, in a subsequent personal injury action would contravene the concept of fairness underlying the doctrine of res judicata. The primary purposes of res judicata are grounded in public policy and are to ensure finality, prevent vexatious litigation and promote judicial economy (see Matter of Hodes v Axelrod, 70 NY2d 364, 372 [1987]; Reilly v Reid, 45 NY2d at 28). However, unfairness may result if the doctrine is applied too harshly; thus “[i]n properly seeking to deny a litigant two days in court’, courts must be careful not to deprive [the litigant] of one” (Reilly v Reilly, 45 NY2d 24, 28 [1978]). Important here is that the preclusive effect of the declaratory judgment in favor of Nationwide should be evaluated in the context that the causation issue —- whether an automobile accident caused plaintiff’s injuries — was never decided because the prior action was determined on default, to which issue preclusion does not apply. Applying “issue” preclusion in this manner encourages litigants not to over-litigate seemingly minor issues — if a party defaults on what appears to be a minor issue that turns out to be important in a later suit, she has the opportunity to litigate that issue in the later suit. Yet, by applying claim preclusion to this case, we would in effect be saying that plaintiff is precluded from raising an issue that should have been litigated in the prior no-fault benefits action decided on default.”

(4) “Finally, we recognize that the Second Department has ruled otherwise (see Albanez v [*7]Charles (134 AD3d 657 [2d Dept 2015]). We are not bound by the decision of the Second Department (see Mountain View Coach Lines v Storms, 102 AD2d 663, 665 [2d Dept 1984]). Of course, because stare decisis serves the important interests of stability in the law and predictability of decisions, we ordinarily follow the decisions of other departments unless we have good reason to disagree (see McKinney’s Cons Laws of NY, Book 1, Statutes § 72[b]; see e.g. Church of St. Paul and St. Andrew v Barwick, 67 NY2d 510, 519 [1986]). In this case, departure from Albanez v Charles is indeed justified, because that court failed to apply “the same parties” requirement of claim preclusion articulated in Welsbach Electric Corp. (9 NY3d at 127) and Parker v Blauvelt Volunteer Fire Co., (93 NY2d at 347)”

…Affirmed…

When collateral estoppel is given

Pain Mgt. Ctr. of N.J., P.C. v Travelers Prop. & Cas. Ins. Co., 2019 NY Slip Op 50607(U)(App. Term 2d Dept. 2019)

“With respect to the branch of defendant’s motion seeking summary judgment based on the doctrine of collateral estoppel, plaintiff’s argument on appeal as to why the doctrine of collateral estoppel does not apply in the case at bar is, essentially, that it cannot be determined if the issues to be litigated were substantially similar because defendant failed to include in its motion the evidence and documents submitted by the parties at the arbitration. In view of the fact that plaintiff does not point to any ambiguity in the arbitrator’s decision, or any distinction between the facts of this case and those underlying the arbitration, or any other meritorious argument, plaintiff has presented no basis to disturb so much of the order of the Civil Court as, upon amendment of the answer, granted the branch of defendant’s motion seeking summary judgment dismissing the complaint. “

The burden is on the movant to set forth the “distinction between the facts of this case and this underlying the arbitration” in order to apply collateral estoppel,

Failure to cooperate

Country-Wide Ins. Co. v Gotham Med., P.C., 2017 NY Slip Op 07538 (1st Dept. 2017)

(1) “The refusal by defendant’s principal, Dr. Alexandre Scheer, to answer questions at an examination under oath (EUO) about his compliance with a consent agreement and order he had entered into with the Office of Professional Medical Conduct (OPMC) constituted a failure to comply with the request for an EUO, a condition precedent to coverage under the insurance policy (see Hertz Corp. v Active Care Med. Supply Corp., 124 AD3d 411 [1st Dept 2015]).”

This is the second time the Appellate Division opined on the issue of not answering questions at the EUO.  The intentional refusal to comply “voided” coverage.

(2) “Defendant also argues that plaintiffs had no independent right to determine whether Scheer was in compliance with the consent agreement and order and that any determination by them of noncompliance would not render him “unlicensed” to practice medicine. This argument is unavailing. The consent agreement and order provides that any medical practice in violation of the term permitting Scheer to practice only when monitored “shall constitute the unauthorized practice of medicine.” An unlicensed health care provider is ineligible to receive no-fault reimbursement (11 NYCRR 65-3.16[a][12]), and an insurer may make a good faith determination that a medical provider assignee seeking no-fault benefits is ineligible to receive such benefits (State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313, 322 [2005]).”

The facts on this one were highly advantageous to the insurance carrier.  You had a wounded warrior, tried to put the dagger into him and he refused to allow that to occur.

(3) “Defendant waived the defenses of res judicata and award and arbitration (CPLR 3211[e]; see Mayers v D’Agostino, 58 NY2d 696 [1982]). While the arbitral awards in its favor were not issued until after it had filed its answer in this action, there is no indication on the record before us that defendant ever moved to amend its answer to assert either of those defenses.”

I think this is the most important point to take from this case.  It is the danger of being forced to allow these matters to proceed to arbitration.

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.